Episode 165: Krisstina Wise, a money expert, coach, and the CEO and founder of Wealthy Wellthy, dedicates herself and works hard to obtain riches and success.
The Profit First REI Podcast
March 21, 2023
David Richter
Summary:
Our guest for this episode is Krisstina Wise, a money expert, coach, and the CEO and founder of Wealthy Wellthy. She dedicates herself to helping other entrepreneurs achieve wealth without the cost of their relationships and health—something she herself has gone through.
Krisstina’s mission is fuelled by her personal struggles. In 2013, she nearly lost her life due to a lifestyle dedicated to the pursuit of success and money. She realized that she achieved professional success at the expense of her health and happiness in other facets of life. From there, she went on a journey to understand money.
Krisstina now teaches how to have a healthy relationship with money, using her expert insights to help people reach financial satisfaction, including how to apply Profit First into your life. Tune in to hear all of it straight from an expert!
Key Takeaways:
[00:58] Introducing Krisstina Wise and Her Background
[04:41] Experiencing Money Struggles and Other Challenges
[08:58] How Krisstina Began to Dig Herself Out of Her Situation
[11:29] What Contributed to Her Going Through Financial Struggles and the First Category of Money Mindset Problems
[13:29] The Second Category of Money Mindset Problems: Parkinson’s Law
[16:22] The Third Category of Money Mindset Problems: The Fear of Spending
[17:01] The Three Money Mindsets
[20:53] On the Tendency for Entrepreneurs to Live Deal to Deal
[31:42] The Most Important Money Question: How Much Money is Enough?
[37:11] Connect with Krisstina and Check Out Her Book
Quotes:
[06:24] “Over 75%—close to 80%—of Westerners are paycheck-to-paycheck, regardless of income. So those statistics alone tell us that we really don’t understand this thing called money.”
[21:55] “The number one money myth, the biggest money lie…[or] false belief there is out there is this belief that the answer to all of my money problems system make more money.”
[31:53] “The most important money question that we can ask ourselves…is “how much money is enough?” And it’s an equally philosophical question as it is practical…It’’s a really important question because what we need to get to is a place of what’s called satisfaction.”
Connect with Krisstina:
Facebook: https://www.facebook.com/WealthyWellthy/
Instagram: https://www.instagram.com/krisstinawise/?hl=en
Financial IQ Quiz: www.wisemoneymethod.com/quiz
Falling for Money: How to Have a Lifetime Love Affair with your Finances: https://www.amazon.com/Falling-Money-Lifetime-Affair-Finances/dp/0692560904
Wealthy Wellthy Podcast: https://podcasts.apple.com/us/podcast/wealthy-wellthy-podcast/id1087965675
Tired of living deal to deal?
If you are a real estate investor or business owner who is tired of living deal to deal, and want to double your profits, head over here to book your no-obligation discovery call with me. Either myself or someone from my team will hop on a short call with you to get clear on your business goals, remove any obstacles holding you back, and map out a game plan to help you finally start keeping more of the money you work so hard to make. – David
Transcription:
Krisstina Wise:
So I just made a decision at that moment that I’m gonna learn money. This is a game. Some people have mastered it. I’ve looked at the statistics in over 75. Close to 80% of Westerners are paycheck to paycheck regardless of income. So those statistics alone tell us that we really don’t understand this thing called money. We know how to make it and we are pretty good at spending it. And you know, some people try to budget whatever that means, but nobody I ever talk to loves to budget.
Outro:
If you’re a real estate investor who’s sick and tired of living, deal to deal, then welcome home. Hear from everyday real estate investors just like you, and discover how they’ve completely transformed their business by taking a profit First approach. This is the profit first for REI podcast, where we believe revenue is vanity. Profit is sanity. It’s time to start making profit a habit in your business. So here’s your host, David Richter.
David Richter:
I interview Christina Wise in this episode and she is a money expert. We are cut from the same cloth. If you enjoy the prophet first message, you are going to enjoy Christina. She tells her emotional backstory too, going from rags to riches, then rags to riches again, and how she got out of the hole for the good and for what she had to breakthrough in order to get to where she is now. And this is, she gives step by step practical advice of if you’re gonna have profit first in your business, how do we have profit first in our household as well too? This is an insanely valuable episode. And get ready, buckle up because you’ll get some life-changing information in this episode. Thank you so much for listening. Hey everyone, it’s David Richter here again and I have Christina Wise in this studio. Super excited about this one because a lot of people come on either as real estate investors or different people in their niches and all that, but Christina knows money. Like she talks money all the time. She has her own podcast, the Wealthy Wealthy Podcast. And then I wanna make sure that everyone gets around what she does, cuz she also works with people on the personal finance side as well too, which a lot of people don’t get that. Any of that help. So Christina, I’m really excited for you to be on here today and to bring a lot of value to the listeners. So thanks for being here.
Krisstina Wise:
My pleasure. I’m looking forward to the conversation.
David Richter:
Well then before we get into it, some people might not know your background, where you’re coming from. You want to give just a quick overview of like what you’ve done and where you are and what you’re doing now. Cuz I love what you’re absolutely love what you’re doing now to help a lot of people.
Krisstina Wise:
Well, the funny thing about the story is that, you know, if I had a crystal ball about five or six years ago with then the crystal ball had a hundred percent accuracy and said, Hey Christina, five years from now you’re gonna be, um, teaching money. You’re gonna have a money school, you’re gonna be a money coach, you’re gonna be helping people learn how to convert their income into wealth, blah, blah, blah. I’d have said, there is no way that seems like the silliest thing ever, like whoever had idea. So I’m almost as surprised as anybody else’s that I’m here on one way, but on the other hand, I know that this is exactly what I’m meant to do. So, awesome. You know, the universe had had more knowledge than I did, which isn’t any surprise. But what got me here ultimately is most of my career wasn’t real estate. So I started in real estate sales, did very well in sales, made, you know, as a top salesperson, made a good amount of income and then went on to build a real estate brokerage, a title company, a mortgage company, just all the stuff. So that was my background is 25 years of real estate. And the real estate was, you know, mostly on the business side of things. But personally, and I had a lot of claim to fame. Like I was very well known citywide, nationally in the industry. So publicly I had this public identity of being this, you know, real estate business leader. And, uh, but personally what I know what happened personally, what got me into the money game as opposed to just let’s say real estate and even real estate investing for that matter, is that early in my career I sold a lot of real estate. I just kind of found my niche and I’d, you know, I was the kid that started in a trailer home and had nothing like one of those stories. So when I started making a lot of money in real estate, I thought, holy shit, this is a lot of money. You know, and felt like I won the lottery and I just didn’t even know what to do with it other
David Richter:
yeah
Krisstina Wise:
Than spend it and enjoy it. But I found myself, you know, <laugh> about a handful of years later, divorced single mom. And in this financial state where I had, you know, similar story, many have had just hundreds of thousand dollars of debt. My income went away cause it’s a hundred percent commission now I’m a single mom, I’d been fighting in my divorce. So I wasn’t paying attention to making money cause I thought I had plenty of money.
David Richter:
Yeah.
Krisstina Wise:
And ended up, wait, I mean, wound up where I had not only no money, but I could not afford a place to live. I couldn’t afford utilities, I couldn’t turn on, I didn’t have enough money to turn on the utilities. And I had these two babies under five. So it was just this big wake up call. Like, and the only thing that got me through and my kids through is I had colleagues at work who’d pitched in and got us, paid our rent for six months and got us paid the electricity and dropped off some old furniture and blankets and sheets. And so on one hand we were so lucky because I don’t know what I would’ve done had I not had, you know, these kind of just peers and colleagues that helped out. On the other hand, I was just filled with so much shame and embarrassment. And here I was a leader in my industry and in the city, and I had to take charity and handouts just, I mean, literally just to turn the electricity on. And so it was just, it that was a tough time. But
David Richter:
Yes,
Krisstina Wise:
Once I got over my pity party, I woke, I just finally, two thoughts occurred to me, well, nobody can pull me outta this jam, but me and that too, there must be more to the money equation than meet C. Like, how the hell did I make all that money? And I’m in this horrific financial situation and I it like, I didn’t have an answer for it. Like it made no sense. Like, I just didn’t understand. So I just made a decision at that moment that I’m gonna learn money. This is a game. Some people have mastered it. I’ve looked at the statistics in over 75, close to 80% of Westerners are paycheck to paycheck regardless of income. So those statistics alone tell us that we really don’t understand this thing called money. We know how to make it and we are pretty good at spending it. And you know, some people try to budget whatever that means, but nobody I ever talk to loves to budget. So that’s, and then we’re supposed to do this investing thing and oh yeah, we’re supposed to save. And it’s just kind of confusing. And at the day we’re just kind, we have this belief that the answer to all my money problems is to make more money. So then we’re in the grind and churning it out and just trying to make more money to figure out how to pay all the bills. And that becomes what we call the treadmill. So I was in that discovery and in that just desire to learn and get good at this, that I’d ended up, I learned how to just start building wealth as opposed to just making money. So privately I was building wealth while, you know, publicly I was building a business and the identity and, you know, getting all these entrepreneurial awards and you know, could get the t-shirt for that. So that’s what got me on this journey. And then I had a health crisis about a handful of years ago that woke me up to, there’s more to life than just working and even building wealth for that matter. But my wealth is what saved my life because when I got sick, my business deteriorated. I when I deteriorated. And it just made me realize like, oh, it’s not just about having wealth and it’s not just about having money. It’s why do we build wealth?
David Richter:
Yeah.
Krisstina Wise:
And why do we have money and understanding that it’s life that we need to care about and all these categories of life and money, what money is what underwrites the cost of living a good life. And there’s working income and passive income. And over time we want to, we wanna use our working income to create passive income to one day when our passive income can replace our working income. And that’s the money game. And you know, then it’s just learning how to play it. So after that I just thought, you know, I’ve kind of figured this money thing out of all this personal, you know, research and desire and trial and error and kind of decoded it to what’s in ended up to, you know, become my financially free place today. And now I just have a passion for teaching what I’ve learned and what I know and what I’ve done.
David Richter:
So let’s back up just a little bit. So you were basically, you needed that help, which I think it’s, I know it was embarrassing and you even said, you know, the word shame. I’m glad you did reach out to help. I’m glad there were people there to help you in that situation. So then you said you got off your party and then like started down this road, but like, what did you get into, what was the next step? Was it like, okay, I’ve hit rock bottom, so like now let me research about money and wealth and then I’m gonna go out there and teach, you know, as right away or like, what was that next step, you know, like from going to that oil or did you build a business in between there? Or like, did you go back to real estate at all? Because like there’s, there’s a lot of things that you have that you’ve done. And I
Krisstina Wise:
Yeah, like of course once I came outta that place, like I just start person, you know, I didn’t have any money. So I first went to the library and started getting books on money, you know, and there’s so many books out there and even, you know, even timeless books, like simple books like, um, the Millionaire Next Door
David Richter:
Right.
Krisstina Wise:
You know, of course we’ve all heard of Think and Grow Rich and, um, the Greatest Salesman in the World. Like, they’re just, I just realized that man, they’re all these books about like the fundamentals of foundation, foundational understanding of how money operates and, it’s been around for centuries. Like this isn’t a new thing.
David Richter:
Yeah.
Krisstina Wise:
The money game’s rigged the way it’s kind of spoken and taught and all the money people out there, there’s just one kind of big rig system. If we don’t understand it, we’re just part of the rig. So, you know, but once you start reading these and understanding this, like now I can see what I was doing, which was sabotaging,
David Richter:
hmm
Krisstina Wise:
Everything that I was working so hard for.
David Richter:
Yeah.
Krisstina Wise:
And, you know, combined with some ego and be attached to, you know, making a lot of money means I get to show off a lot of money and those things. But when you learn these principles and wake up, it’s like, oh, now I see why and I wanna do something different. But what I learned through the discovery, and then I took workshops and then I had mentors and then, you know, it just, but each, the thing is it snowballed, but I started with little bitty investments and then, you know, the time and money I’ve invested in learning money is pretty substantial. You know, there’s lots of zeros to that, but there’s lots of zeros have turned into lot more zeros at the thing. But, I think the only difference about me is that I realized that, there was something to learn. There’s something I didn’t know that I didn’t know.
David Richter:
Yeah.
Krisstina Wise:
Cause I was good at making money and it was more than that. And then really making the investment to learn it and to do it. So, and it’s paid off over time.
David Richter:
Yeah. It sounds like <laugh>, it was a rags to riches to rags to riches story from, you know, for, uh, because you briefly mentioned childhood as well too, like living in trailer parks and stuff. So I guess, do you wanna break down why once you had the money, was it just because you didn’t have any of that training growing up and then just were never exposed to anything then you did on the second cycle of rags to riches again? So do you think that’s a lot of that contributed to that downfall and then just basically like you said, 75% of Westerners paycheck to paycheck. It’s just our culture. So I mean, how much of it, you know, the growing up and then, you know, just everything that were fed versus then you actually make the money, you know, and then it’s all gone.
Krisstina Wise:
Yeah. You know, I love that question. It was a combination for sure. I mean, based on my background that coming from a place where there was no money, I mean, it was impoverished in that situation and just, you know, alcoholism and,
David Richter:
hmm
Krisstina Wise:
Um, absent parents and, you know, not having money. And there is a lot of shame attached to that as a kid, you know, and being judged and almost being bullied, you know, not having money and not having the right clothes and not be, you don’t fit in,
David Richter:
yeah
Krisstina Wise:
You know, and you feel separate. So from a young age, the good that came out of that was I was very motivated to make money.
David Richter:
Mm.Right
Krisstina Wise:
You know, from a kid, like I work, I, if I wanted the Jordash jeans, I was gonna work and figure out how to do it. And so like, making money’s never been an issue with me. And what I found with money is people kind of fit in these different categories of like money problems.
David Richter:
Yeah.
Krisstina Wise:
One is, there’s a mindset there that they can’t ever quite make enough money. You know, that’s just, they think money making money’s hard. They have narratives or beliefs about that. And so that’s one problem. I never had that problem because I was always so motivated to make it and I was willing to work my ass off to do it. And I was very creative. And so, but that motivation came from that. So the good that came outta that experience was the desire and ability to make you know, high income relative.
David Richter:
Yeah.
Krisstina Wise:
Relatively speaks. Um, now another category that I find people fall into is maybe they’re great at making money, but they suck at keeping it
David Richter:
hmm
Krisstina Wise:
For one reason or another.
David Richter:
Mm-hmm. <affirmative>. Yeah.
Krisstina Wise:
And, you know, so that’s where the second piece came into because from a young age, I made money to fit in. I made money to be judged positively. I made money.
David Richter:
Okay.
Krisstina Wise:
No, like learning through experience that oh, if I have money and I can buy the right things, people went from not including me to including me from being not cool to cool. So that was like the, I guess maybe it worked as a kid, but as an adult it didn’t work so much because then the more money I made, the bigger the clubs I got to be in, the more I was even respected and I was looked at. So I was feeding that childhood, um, story of I need to prove myself and I need to show others how amazing I am by virtue of my house and my car and the boats and the private schools and all the things. I didn’t know that’s what was driving me, but it was that childhood story that was driving me. So ultimately the more money I made, the more money I spent. And, you know, Parkinson’s law, meaning expenses always rise to, um, match income.
David Richter:
Right.
Krisstina Wise:
And so that just, that becomes a paycheck to paycheck. And in my case, so as commissioned to commission along with this belief that if money’s tight, I’ll just go sell another house. Like I can sell another house. I can always sell another house. So that became the pattern. But that’s where most people are located. One way or another is that, uh, with Parkinson’s law expenses will always rise to match expenses. And where, you know, what was once a luxury becomes a necessity, you know, most of us fit in there. And then there’s a cultural piece too where there’s a biological piece where we all wanna fit in and we wanna be part of the BMW club or
David Richter:
yeah
Krisstina Wise:
The Porsche Club or whatever. The more money you make, we’re just, we wanna fit in and show. I’ve got that icon too. I have the financial ability to buy that icon also. And that’s just very natural thing. So we don’t understand money, we don’t understand we need margins, then we’re just always working to keep our identity.
David Richter:
Right.
Krisstina Wise:
Ultimately is what that is. And that ego and, we all easily fall prey to that unless we’re paying attention to it. And understand that we’re probably in that game of making money to spend money for our identity one way or another until the day we decide not to and understand how to get out of that cultural narrative.
David Richter:
Okay.
Krisstina Wise:
And that biological urge to fit in. So that’s the second category that most of us, regardless of how much money we make, our, you know, it’s expense creep always creeps up to match it.
David Richter:
Yeah.
Krisstina Wise:
With that, someday when there’s more money, I’ll invest one day, you know, one day I’ll retire whatever retirement means these days. And so again, that’s kind of this subconscious belief that and, um, behavior that we’re in. And that’s the cultural, the third category that I find people in that they’re actually decent at making money and decent at saving money, but they’ll never spend it.
David Richter:
Hmm.
Krisstina Wise:
So then they hoard it. And so they, their kind of mindset is like, is still outta this fear of loss, a fear of not having. So they have to hoard, hoard, hoard, save, save, save. And never experience the joy of spending it, understanding that money’s meant to be spent, it’s meant to circulate, but within the rules of money of, you know, not overspend. You know, spend the right amount and enjoy it. And if it’s given it all away and that brings joy, then do that. But it’s, you know, these money mindsets is like, oh, um, I mindset there’s some limitation. I can’t ever quite make enough. And I’m always in some type of financial despair, like due to earning too, pretty good at making money. But I just, it’s a lot of it that comes from this unworthiness of like, it’s, I’m not worth holding onto it or keeping it. I need to get rid of it as fast as possible.
David Richter:
Yeah.
Krisstina Wise:
So there’s some mindset, usually stuff in there that for people that just overspend, you know, shopaholic, there’s something like this urge or this compulsion to just need to spend. So when that’s the case and to really be measure up, you know, that external reward or that, you know, for that external, you know, people including us or whatever.
David Richter:
Yeah.
Krisstina Wise:
So there’s that mindset or just self worthiness that kind of fits into that too. And then the third piece, like I said, is just kind of fear of loss or I’m not good enough to spend my money on. So you can see like underneath all of these kind of three places where people end up not in, where money is just a sore subject one way or another, even if you have a lot of it. But it creates chaos. There’s usually some un underlying combination of money beliefs, because we all form all of our beliefs. By the time we’re seven to 10, we grow up and, you know, we learn to speak English if that’s what we’re taught. We don’t, we didn’t speak Spanish, we learned to speak English. So everything that was fed to us that was imprinted
David Richter:
Yeah.
Krisstina Wise:
Including money. So most of us are adults that are still holding on to our seven to 10 year old money imprints from our parents. And unless we look at that and change that combined with, you know, not feeling worthy and not feeling good enough and some of these other things that are kind of embedded as well, money fits really well into those, you know, unexamined belief systems.
David Richter:
Yeah.
Krisstina Wise:
So when we start to, you know, unravel that and peel back those layers, we can see like, oh, okay. But the great thing about money, as opposed to other parts of life that can be more difficult to kind of unravel and fix, if you will, money is math money’s black and white money has very specific rules and laws and metrics that if you follow them, you can be rich. It’s just, we’re not, we haven’t worked on, you know, those layers of, you know, personal things that wreak havoc, financial havoc on our lives. And then two, we don’t understand how money operates. And when you combine those two together, that gives us our statistics. I mean, I talk to people every single day and you know, it sounds like this, I had a call yesterday and it was a woman, she does medical sales and she’s a, you know, medical sales. She makes about 185 plus bonus, so close to $200,000 a year. And she said, when I write down, when I had to write to you how much money I made, I thought, holy shit, that’s a lot of money. And she said, but every single month we’re struggling. Like, I don’t understand. It doesn’t feel like a lot of money.
David Richter:
Hmm.
Krisstina Wise:
I just can’t get my arms around it. So, you know, that’s just a good example of the story that like most of people are feeling.
David Richter:
Yeah.
Krisstina Wise:
And it’s because we’re not abiding by money’s laws, and we don’t understand simple math and we’ve not thrown anything into a compounding calculator. We’re not managing our money and we’re not paying attention and money, money will evaporate money. Money will easily leave our pockets into somebody else’s if we’re not paying.
David Richter:
True.
Krisstina Wise:
It loves to move. That’s right. So it was just moving into the wrong pockets is ultimately what we’re allowing it to do.
David Richter:
Yeah. No, I love that. This is great stuff. I love the three different areas before the money problems, never make it enough, make it, but can’t keep it or you never spend it. And that fear of loss, I love what you said too. Money is math. You know, it’s like there’s rules to, if you can learn it, then you’ll, you can become rich and then don’t understand how money actually operates. But outta those three money problems, where do you see in your sphere most people fit into, like, is there, is it split 33%, you know, between the three areas? Or is it like, there’s one that most people struggle with because I’d have an answer for that. Like, just from what I see, but I, I’m just in my slice of the world, but I’d like to know what’s your, you know, the money problems? Which one do you see the most?
Krisstina Wise:
Well, you know, I just based from, you know, from my anecdotal experience, I don’t really work with too many that can’t figure out how to make enough money. So I really don’t know what that is. That’s, that’s a money problem that I, that’s not my expertise to solve.
David Richter:
Yeah.
Krisstina Wise:
Um, but what, so in my world, it’s really, it doesn’t matter if you’re making $50,000 a year, a hundred thousand dollars a year, $500,000 a year, or a million dollars a year, what happens is we spend every dollar we make.
David Richter:
Mm-hmm.
Krisstina Wise:
And we have no margins.
David Richter:
Yeah.
Krisstina Wise:
And what happens is that we, this, what I’ve found to what I believe is like the number one money myth, the biggest money lie, kind of false belief there is out there
David Richter:
Yeah.
Krisstina Wise:
Is this belief that the answer to all of my money problems is to make more money <laugh>. Because man, there’s not enough left at the end of the month. So we’ll take the example of the woman I talked to yesterday who’s making between 180 5 and 200 years, that’s a lot of money.
David Richter:
Yeah.
Krisstina Wise:
That’s a good income. So with, you know, with her, she, her question to me is, I need more income streams, Christina. Like, I’m not making enough money. Like, what do I do to make more? Because I wanna save and invest and do these things I think I’m supposed to do, but there’s not enough money. So that’s there. Most people are in some version of that thinking, when I have more money, then I’ll save and invest. Or, so we’re pushing, you’re kicking that count can out there versus understanding like no the day today, we need to understand and organize our money in the, in a way that no matter how much money we’re making, we know we’re every dollar needs a job. Every dollar needs to be accounted for.
David Richter:
Yeah.
Krisstina Wise:
Every dollar needs to move intentionally, but if we’re not moving intentionally, it’s moving. Like I said, it’s moving out of our pocket somewhere else.
David Richter:
Yeah.
Krisstina Wise:
In most cases, what I found, it’s mostly those in bucket two, meaning
David Richter:
Oh yeah.
Krisstina Wise:
We dunno how to spend our money. And what I found, you know, if we can replace this belief, the truth, the answer to all my money problems is to make more money and my business or get a raise or get a second side hustle, which is what everybody’s kind of telling us to do. Man, I need to scale my business bigger, make more money. Oh I need to climb the corporate ladder, make more money. Oh, I need to get a side hustle, make more money. So everything that’s kind of taught is over in what I call that e category, the earning. It’s like that’s where we are.
David Richter:
Yeah.
Krisstina Wise:
Versus understanding that no matter where the money comes from in working income, that’s just a source of income. So if that’s the income game and Yeah. We wanna play the income game well cuz ultimately over time we wanna make more money
David Richter:
Yeah.
Krisstina Wise:
For, you know, if we can without, but every time we make more money, working income usually comes at a trade off more risk, more time, more effort.
David Richter:
Yeah.
Krisstina Wise:
More stress. Something. So it comes at a cost. And that’s kinda that balancing act too, is if I wanna make a lot more money and I wanna do a side hustle, well I’m gonna trade more time to do the side hustle, which means I’m not gonna spend as much time at the gym.
David Richter:
Right
Krisstina Wise:
I’m not gonna spend as much time with the family. I’m not gonna spend as much time meditating. I’m not gonna spend as much time skiing, whatever that time block is because time is currency.
David Richter:
Yeah.
Krisstina Wise:
But we don’t, understanding that currency time is the currency we’re after. It’s not the dollar bill ultimately.
David Richter:
That’s really good.
Krisstina Wise:
So anyway, it’s just understanding that when every time we say we make wanna make more money, there’s a cost or a trade off associated with it. This is on working income and there’s only so many hours in the day. So, you know, you can, when you match your match hours with trade off, sometimes the answer isn’t to make more money. But even again, that’s just the income part of the game.
David Richter:
Right.
Krisstina Wise:
There’s a wealth part of the game and a time part of the game, which is different. But the, what happens is that we spend all this time working one way or another to make money thinking that that’s how I get wealthy. No. That’s just how you make income. How we get wealthy is through our household. And that’s why I teach people how to run their household like a financial powerhouse.
David Richter:
Hmm.
Krisstina Wise:
Because we build wealth in the household, not through your business, not through your corporate job, not through your side hustle. Because you can make a million dollars in your business and spend a million dollars by your lifestyle in your household, and you will never build wealth.
David Richter:
Yeah.
Krisstina Wise:
There’s no margin. You just, and what happens there also is that the more money we make, we start to feel rich. And when you feel rich, feeling rich means you’re living a rich life like lifestyle. You’re buying all the things you’re doing all. And there’s nothing wrong with that, just, you know, fundamentally, but it tricks us that we’re spent, when we feel rich and live this rich lifestyle and kind of spend all of our money, two things happen. One, it really, um, it, we use our working like our really great younger working years. We have all this energy and momentum and excitement. We’re, um, living this lifestyle during these best wealth building years.
David Richter:
Right.
Krisstina Wise:
It’s our best income making years. We want those to also be our best wealth building years. But we’re not building wealth, we’re just living a really fancy lifestyle because we feel rich. So I teach the difference between kind of being a rich mindset versus a wealthy mindset. Two totally different mindsets there for strategies.
David Richter:
Yeah.
Krisstina Wise:
So that’s one thing we feel rich and we tend to spend on a very expensive lifestyle. That’s, and then, but what happens is then we get locked into this really expensive lifestyle and now we’re really measured up based on the country club and based on the cars we drive and based on where we send our skids to school and based on where we go vacation. Again, nothing wrong with it, but we’re doing that. But what happens is when we do that, we have to, then there’s no, there’s no relief button. You have to go next month to cover last month’s bills and then you have to do it again and over and over. And there becomes a time where it’s like making a million dollars a year and me having to do all this work and at this cost and trade off, I’m just kind of tired. But you have to go hit the button again and do it again again. So we get trapped in what I call this earn spend, earn spend, earn spend, earn spend with no wealth in the equation.
David Richter:
Yeah.
Krisstina Wise:
Which means no freedom, no time freedom. So again, that’s where I find are people in what I call this earn spend trap or the merry-go-round and then like what you’re teaching with no profit. So since you’re profit first I’ll just talk about how profit, so we think profit, I mean I know you’re teaching differently too. So in business that’s the name of the game profit. And following a profit first system, we’re kind of paying ourselves first. We’re taking the profit off the top and then you learn to spend everything else
David Richter:
Correct
Krisstina Wise:
In the business. And Mike came up with that because he found himself in that cycle where he’s, you know, making more money, raising more money, taking more risk, all the things.
David Richter:
Yeah.
Krisstina Wise:
And at the end of the day, he’s like, man, I raised $2 million and had 2 million of revenue and I didn’t pay myself one dime. Like what gives, and same thing, the, it’s all mechanics. It’s how business operates and kind of how our psychology works. So it’s like, oh, if we make a million dollars on our business, but we spend a million in $1 in expenses to make the million.
David Richter:
Right.
Krisstina Wise:
There’s no profit. So at the end of the day, even though it’s like, Hey, I’ve had bragging rights, I have a seven figure business, I didn’t make any money. Everybody else got paid, but I didn’t.
David Richter:
Right.
Krisstina Wise:
So then it’s like, oh, maybe I should pay myself first and then just let the business expenses can only, the biscuits can only spend what’s left over.
David Richter:
Yeah.
Krisstina Wise:
And it’s, you know, and you have buckets and do these different things to make sure you have the cash and the resources. Well that’s great, but we wanna do that all the way down the line. We want profit in our household
David Richter:
mm-hmm. <affirmative>
Krisstina Wise:
Because then we want profit first. We wanna take that profit. Like if you have a 20% profit margin in your business. So if you have, um, you know, a million dollar business with a 20% profit margin, you have a $200,000 profit.
David Richter:
Yep.
Krisstina Wise:
Now we pay ourselves at $200,000 in our household, move it outta the business to the household. And now we wanna take that same 20% margin off the top and that will go to fund our future self investing bucket.
David Richter:
Yeah.
Krisstina Wise:
So that’s, but we want to pay ourselves first, pay ourselves first in the business and pay ourselves first in the household and then live off the, you know, our household expenses. We can only spend that based on what’s left over. So it’s a very easy concept. Just, you’re always looking for the margins. You need a margin in your business because no profit means no pay and you need a margin in your household because no profit means no wealth. And then we move that wealth, you know, that margin, that 20% and if we’re, you know, saving that to buy some real estate, since we love real estate is investing, then the more money we make, as long as we keep that 20% margin at a minimum going into that, we can buy a lot more real estate.
David Richter:
Yeah.
Krisstina Wise:
And then we just get, we just keep our burn rates in both our business and our household really tight and we have some extra buckets of income and some different things. And now we can really enjoy spending all of our money because every dollar is accounted for. We have money going to our wealth bucket. We have money going to rainy day bucket, we have money going to our dreams bucket and we’ve, you know, and covering the cost of our life every single month. So now we’ve got surplus, we’ve got cash and we’ve got investments and we need liquidity and we need investments to make us feel safe, secure. I call it the F words, the S words, safe, secure, that comes from surplus.
David Richter:
Mm-hmm <affirmative>
Krisstina Wise:
That comes from, you know, having money that is saved and set aside. And that’s, so instead of this, I need to go work hard and make more money that’s gonna make me feel secure. It’s like, no, we really need to manage our money in a way that’s profit first that we know every dollar is accounted for. We’re creating these, you know, what we call buckets of money between, you know, money we can’t touch for, which is really investing for the future, uh, through any sort of investments and then our liquid cash. And when we have these buffers of investments in cash and all of our bills are paid, now we have space, now we feel lighter, now we see monies working for us now we see it’s growing while we’re working hard. And this is the wealth game. It’s a very different game. And I’ll just sum that up. But it starts with asking this, what I think is the most important money question that we can ask ourselves. And again, very few people I think do this work cuz we don’t even know where we should do this work.
David Richter:
Right, exactly.
Krisstina Wise:
But the question is how much money’s enough? And it’s an equally philosophical question. Is it practical. So how much money’s enough? It’s like, okay, yeah, great question, but where do I start to answer that? You know, it can be like this big question, but it’s a really important question because what we need to get to is a place of what’s called satisfaction.
David Richter:
Yeah.
Krisstina Wise:
Of, man, if I hit these, if I had this amount of money, not a dollar more, not a dollar less, if I may, if I had more, great, but if I had not a dollar more, not a dollar less, I’d be completely satisfied. This is enough money for me to live a good life, to be out of the struggle, to be out of the survival, to be out of the fear, to be out of the anxiety. I could just live a really good life and have the money to spend on my quality of lifestyle. So that’s what we wanna do is say how much money is enough? So that one, there’s a place of satisfaction, but more importantly, so we have a goal, we have a destination, we know what we’re building.
David Richter:
Yeah.
Krisstina Wise:
You can’t get anywhere if you don’t have a destination yet. People are like, oh, let me go invest in real estate without even backing into some of these numbers. Or knowing if real estate then might be the best, you know, vehicle to hit some of those targets. So what we wanna do in that case is we wanna look out to our future self, which is what the wealth game is 10 year older or 20 year older, you know, based on how old we are and say, Hey, I wanna have a certain amount of net worth of, net worth that throws off a certain amount of passive or, you know, passive income or cash flow. So how do we write, how do we wind up in that number? Is it mil $1 million, $5 million, $10 million, 50 million? Like most people just write a number down like, oh my said 10 million, that sounds like a good number. I wanna, I wanna have a 10 million by the time I’m, you know, 55 or something. So the, maybe that’s the right number. But again, we wanna calculate these, we want these to be our numbers and we want to know, this is my number this that’s connected to my meaningful life. I’ve already quantified this. I know I’ve already sketched out or architected, like this is where I am today and this is, you know, financially where I wanna grow into. And you know, this is kind of this destination and it’s not all about the destination, but it’s about having that satisfactory mark.
David Richter:
Yeah.
Krisstina Wise:
So when we do that, so then how do we quantify that? Well, it’s pretty simple. What you look at is where we start with, it’s how much does it cost to live my good life? So we need to look at life in all categories is okay, my good life would cost, is it a hundred thousand dollars a year, two 50 a year, three 50 a year, a million a year. But it needs to be quantified. And how you do that is you really write it down like visualize like, man, this is my good life. Do I have to have yachts and do I have to have the Lamborghini and do I have to have, you know, private plane? Some people may say yes, other people may say, I don’t need all that to be satisfied and happy. I could, as long as, you know, I’d like a to live in this, you know, this location of the country and have this type of house and I’d like it to be paid for. And I, you know, I wanna be healthy, so I wanna be able to eat organic food and afford, you know, a personal trainer. And I love to travel. So I’d like to take, you know, three trips a year that, you know, are kind of in this, you know, this cost per trip and, and you know, I’d like to, I’d like having cars, but I can pay those off and do that. So really just, you just quantify this. I wanna put my kids in certain schools and I wanna pay for their college. And so we can quantify this on an annual basis and say, for all these things to happen, it’s going to take me $150,000 a year. I’m gonna stay outta credit card debt, all these things. So now we can multiply that by 20 and now we can get a number of $3 million is my net worth number.
David Richter:
Hmm.
Krisstina Wise:
So now if I wanna do that in 10 years, I need to have a plan or strategy relative to how I spend relative to my income and how much money I need to put away on an annual basis in some form of how to invest to be able to hit that number. And I love real estate, so I’ve hit my numbers through mostly real estate, but this is the process and the work, and this is all the stuff that I’ve learned over these years and kind of just simplified it into a few steps, but money’s not that complicated. But it just, it feels complicated when we’re in the hustle all the time.
David Richter:
Yeah, wow. That was awesome. Well, I think we’re definitely cut from the same cloth. If you’ve been listening to this show for any length of time, Christina, this has been incredible. You went from your background and your emotional backstory of like, you know, living the rags to riches, rags to riches, you know, I feel like that was just, and then you overcame that. Now you’re helping a ton of people with this mindset. I mean, if you just listened to the last like 10, 15 minutes, she basically gave you steps that you can follow of like, here’s how I can calculate these numbers. Here’s how I make the money. Math what you even talked about before, like making it math and making it more simple. I think a lot of people just put a, like a big mystical shroud around it and then use that as an excuse not to go down this road, but it’s like, here, here you are, Christina’s demystifying it right here for you. It’s like very simple. I love this and I love that you’ve made it very simple too. That’s why I wanted you on here and like, okay, now you’ve provided a ton of value here. I loved exactly what you say. Like what are the money problems? How do we get over some of these? What were the, I love the number one money myth to make more money. Could park there like for the rest of the day. But this is where just a lot of good stuff she even gave you how to get to those numbers too. So Christina, you do a lot of education, a lot of you do have your own podcast, you have your book following for money and number one Amazon, number one best seller, you know, sold a lot of copies there. How do people get ahold of you? How do they take the next steps? You’ve got a personal finance course that leads into a business finance course as well too. Like just, I want people to be able to find you and be able to get ahold of this because yes, profit first is very important for the business, but I mean, she even told you here, wealth is built at home. You can have all the profit in the business in the world, but if you don’t translate that into the actual money in the household, then we have failed you on this podcast. We have failed this city. So like, please, Christina, tell people how they could get ahold of you, how they can reach out, how they can, you know, go down this road with you.
Krisstina Wise:
Yeah. One thing I’d love everyone to do if you’re listening is I have a financial IQ quiz.
David Richter:
Oh, cool.
Krisstina Wise:
So it’s kind of 10 questions and it will just give you your score and it’s really eye-opening. Just the questions themselves are pretty thought pro, thought provoking and it causes most people realize like, oh, I don’t really know how to answer this.
David Richter:
Hmm.
Krisstina Wise:
And, you know, so that can just, and then again, just put in some the best numbers you can, but it’s a really nice easy quiz. Takes 10 minutes max to give you your score. So, and that’s at wisemoneymethod.com/quiz. Why is moneymethod.com/quiz? So that’s a great place to start. And, um, so fun. It’s a fun quiz, but also what you get from that is it will, um, my automated system from that will send you like this little guide, the step-by-step guide that will go through all the kind of the simple math that I talked about to help you arrive at your own good enough number.
David Richter:
Awesome.
Krisstina Wise:
And it’s just, it’s step by step and you just fill in the blanks and it’s very thorough. So I used to just give that to, it’s like part, it’s kind of the, one of the central parts of my program. So it’s <laugh> it’s a very valuable part of what I teach and you know, um, I’m giving that away for free for anybody that takes the quiz. So that’s a great place to start. Take the quiz for fun, but do the workbook. That’s a really great action item to do something as opposed to just listening and, you know, making all this great information academic, like put it to good use. So that’s the first thing. And then, you know, from that you can, I mean my Wealthy Wealthy podcast, but, um, I’m easy to find. I do a class, so I’m an educator but I teach, I have a money school and it’s 12 weeks where I teach you how to become rich and wealthy and how to manage your money through your households or a profit first system. That’s very much paint by numbers, but it’s everything we should have learned in school about money, but the school didn’t teach this really important life skill as well as really looking at where, what are the, which money trap are we in?
David Richter:
Yeah.
Krisstina Wise:
And giving us a really, you know, um, clear guide for how to get out of it and getting very clear with our numbers. So, um, anybody interested in that? Then, um, the, from the quiz, you’ll have my email address and just send me an email back and we answer all the emails and reply to everyone and um, we can talk more about it.
David Richter:
Yeah, their customer service is top-notch. I’ve gone through their system and it’s incredible. So please follow her on like, you know, Instagram, Facebook, all that stuff too. But then get on her podcast, listen to that, make sure you take that quiz, which is awesome cuz she does have her core concept of what she teaches from the, you know, from her courses and she’s giving it to you there. So that was wisemoneymethod.com/quiz. Make sure we’ll put that in the show notes too. Christina, this has been incredible and if you’ve been listening to this podcast and you’re like, oh my gosh, she is like touched on my soul because I feel like I’m making money but I can’t keep it or I can’t, I have no idea where to start. You can also head over to simplecfo.com for your business. We help implement Profit First and get that part of it. Cuz if you’re like drowning in your business and have nothing left over to bring home for that wealth, we can help knock that domino down and then get you started on the path to, well it’s there. So it simplecfo.com I wanna make sure you make profit a habit in your business. And then Christina wants to make sure you’re actually a wealthy individual and not taking all that profit and blowing it on just whatever it is, the other bad habits that got you in there at the first place. So Christina, thank you so much again and thank you for sharing your wisdom here today.
Krisstina Wise:
My pleasure. Thank you so much.
Outro:
This episode of The Profit First for REI podcast is over, but there are plenty more where that came from. Are you ready to learn how David and his team can help implement the Profit First system in your business? Schedule a discovery call at simplecfo.com right now. We’ll see you next time on the Profit First for REI podcast with David Richter.
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