Finding Financial Freedom and Building Generational Wealth with M.C. Laubscher – EP 96

Interview with M.C. Laubscher

Finding Financial Freedom and Building Generational Wealth with M.C. Laubscher

In times of adversity and economic downturn, we need to learn how to position our energy, time, and resources to prepare ourselves and our families for worst-case scenarios.

If we play our cards right, not only will we survive crisis scenarios, we’ll bounce back much stronger than before.

It’s what today’s guest, M.C. Laubscher, has learned during his journey of escaping the rat race to build a passive income portfolio through cashflow investing. He came to the US from South Africa, dreaming of being a professional athlete. What he found was a perfect opportunity to showcase his entrepreneurial talents. After starting in maintenance, he quickly learned the ins and outs of wealth management and all the moving parts of real estate.

Today, M.C. empowers people to generate their own income and manage, grow and protect their own wealth in any economy. M.C. is the creator and host of the top-rated business and investing podcast, Cashflow Ninja, downloaded millions of times in over 180 countries and featured as one of the top 48 podcasts for entrepreneurs by Entrepreneur Magazine.

In this episode, we go over his strategies for building wealth, the importance of investing in yourself and your relationships, and how to position your business to capitalize on economic downturns.

Featured on This Episode: M.C. Laubscher

✅ What he does: M.C. Laubscher is a wealth strategist, educator, and financial freedom fighter. He is the creator and host of the top-rated business and investing podcast Cashflow Ninja and his brand new podcast, Cashflow Investing Secrets. M.C. is also the President of Producers Wealth, a wealth creation firm helping clients in 50 states implement holistic wealth creation strategies. His mission is to help producers and creators create, protect, and multiply their wealth in any economy and market and help them achieve financial freedom to create a lifestyle on their terms. M.C. constantly challenges existing societal belief systems and misinformation around concepts such as money, saving, investing, wealth and retirement.

💬 Words of wisdom: “I don’t take anything for face value. I always try to see all the different angles of what’s presented by anyone and anything, and especially any authority.” – M.C. Laubscher

🔎 Where to find M.C. Laubscher: Twitter | Instagram | LinkedIn

Key Takeaways with M.C. Laubscher

• What brought M.C. from South Africa to the U.S. and the mindset that helped him find success.
• The book that changed his thinking and led him to buy his first investment property.
• Even when he started in real estate maintenance, M.C. gave 100% to perfecting his craft. Whatever you do, show up at your best.
• The mindset that sets immigrants apart when they enter the US market.
• How high net-worth individuals use collateralization of assets to build massive capital.
• The compounding effect and how it can help you think differently about wealth building.
• How to position yourself to capitalize on an economic crisis.
• Crypto-cash flow strategies that don’t require you to buy crypto.

M.C. Laubscher Tweetables

Resources

• Cashflow Ninja
• C. Laubscher on Twitter | Instagram | LinkedIn
• Producers Wealth
• Producers Capital Partners
• The 21 Best Cashflow Niches™: Creating Wealth In The Best Alternative Cashflow Investments by M.C. Laubscher
• Elon Musk
• Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! By Robert Kiyosaki
• Becoming Your Own Banker: Unlock the Infinite Banking Concept by Nelson Nash
• What Would the Rockefellers Do?: How the Wealthy Get and Stay That Way, and How You Can Too by Garrett Gunderson
• Episode 088: Building Wealth and Keeping More of It with Garrett Gunderson
• Episode 022: Your Passport to Freedom, Opportunity, and Prosperity with James Hickman
• Tamar Hermes

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Read the Full Transcript with Grant Baldwin

Justin Donald: All right. What’s up, M.C.? So glad to have you on the show.

M.C. Laubscher: Thank you so much for having me. I’m really excited to have this conversation. I’ve been looking forward to it.

Justin Donald: Well, I feel like this is the one-two punch. You so kindly had me on your show, and I felt like there were hours more that we could spend together. And so, selfishly, I’m excited to have you on the show. I know that my audience is going to love it and is going to get a ton out of it. But selfishly, I’m just excited to dig in more. There’s so much that we’re in alignment on, the way that we look at the world, the way that we invest, the strategy we use, this whole idea of cash flow and utilizing insurance similar to like infinite banking. Just so many things. So, welcome.

M.C. Laubscher: No. I’m excited. I love the brand, Lifestyle Investor. It’s all about building an amazing life. So, yeah, we’re definitely in alignment right away and appreciate spending some time with you.

Justin Donald: Yeah. This is going to be fun. So, to really kind of continue on, I feel like you were able to gather so much about where I started and kind of how I created the Lifestyle Investor brand and really the purpose and the vision and how it scaled so quickly. But you have a brand that the same thing has happened and there are so many similar parallels. And I’d love to hear kind of the early stories of you, M.C., because you’re not from the U.S. You live here now. You’re from South Africa. I’d love to hear what it was like growing up there, why you moved here, what it was that maybe was enticing about the U.S., and why you got into investing and business and entrepreneurship.

M.C. Laubscher: Absolutely. And as you mentioned, I grew up in South Africa and I grew up during a very interesting time in the country’s history. I mean, I was in high school when Nelson Mandela was released from prison, essentially. So, it was very interesting and it created an environment there of uncertainty, unpredictability. There was a lot of change, obviously, happening. There was a lot of disruption. And there was a lot of very interesting things happening. So, being a young man during that time, obviously, learned a lot changed, who I am and how I view the world. You know, one of the things is I’m very comfortable being uncomfortable because of living through all of that. So, when I am faced with adversity and uncertainty and times of disruption and so forth, I embrace it. I love it. It’s actually my safe place to be in the unknown. So, I mean, it also really contributed to why. As far as my worldview, my paradigm, where I question everything critically, I don’t take anything for face value. I always try to see all the different angles of what’s presented by anyone and anything, and especially any authority. So, I always try to figure out, all right, what’s the other side of the information being presented? Is there different sides to it and how it can relate, which has assisted me as an entrepreneur and an investor? But I came to the United States in 2001. It’s almost kind of crazy. It’s a crazy feeling. Let me rephrase that. I’ve always lived here as long as I lived in South Africa.

Justin Donald: Wow.

M.C. Laubscher: Yeah. So, that’ll be next year, which is it’s kind of weird, but I came here and I traveled quite a bit after university and then landed in the United States. And I have to say, when you come to the U.S. as a foreigner, I was just amazed and blown away about the incredible opportunity that exists in this place. I don’t think people that are born here recognize that because they’re born here and I always joked and said, “If you’re born here, you literally won a lottery ticket.” It’s an incredible place. The first thing that really struck me was the opportunity for upward mobility. And I’ve had conversations with many immigrants. Same thing where they all said the same thing like, “Man, that’s why there are so many rags-to-riches stories in this country because essentially there’s no one holding you back but yourself.” And the opportunity to just basically determine your own faith is incredible. You know, on that note, I was just forwarded an article. Somebody forwarded me an article a couple of weeks ago, a Forbes magazine article. And the title of the article was Immigrant Billionaires in the U.S.

So, of course, Elon Musk is right there at the top but that doesn’t surprise me at all because it’s a different mindset when you come here and you see the opportunity that’s available to you here as opposed to maybe the country that you came from. I mean, there’s absolutely nothing holding you back to pursue whatever you want. And I played in a sports league up until 2007, sort of a National Rugby League, and we traveled quite a bit. And people get into these different hobbies when they do. And I got into reading. Some guys got into video games on the planes because we were traveling quite a bit, either on a bus and a plane. And my university background, so I majored in history and economics and also have an MBA in finance, but I love history. I love economics. I love learning. And my mom actually gave me the book, Rich Dad Poor Dad from Robert Kiyosaki. And I just completely like it just blew my mind and that changed the trajectory of everything else that I studied and read and started to realize that there’s a completely different way to play this game of wealth than what has been presented to me in my entire life at that stage.

So, I changed my paradigm. I took action right away, bought my first investment property in 2001, and I put some tenants and renters into the property. I collected rent and wanted at the end of the month when I paid all the expenses, there was money left over and that was my first light bulb moment when I said, “Cash flow, this is incredible,” and went to, “How many times can I do this? This is quite incredible.” And of course, then school starts, right? The hard school of knocks as an investor and the next big, I would say, thing that I would share that has shaped a lot of how I view things and how I approach things as an investor is I started to learn all about real estate and cash flow. But then also I had a friend which came from a very wealthy family that started to share certain things with me, what his family was doing. And again, this is not information available to the general public, and most of the time it’s the complete opposite of what everyone else is doing. So, one of the things that I did start to realize is that they think sort of their family wealth, which was they sort of had a family office style model and set up and a family office for folks that they are not familiar with. It’s just a basically private wealth management firm that manages the money of a very wealthy family.

Usually, when you’re looking at about $100 million in net worth, they start looking at family office kind of styles and setups. But I started to realize how they view and look at the family wealth and that they’re essentially creating this banking system and the model, the behaviors of banks. And I looked at that and I said, “This is incredible. Cash flow is great, but what would amplify the cash flow?” I’d just put some rocket fuel onto what I was doing at that point was creating my own banking system like these families do. You know, you don’t have to be a Rockefeller to do what the Rockefellers do. You could do it on a smaller scale and it’ll make big movements for you. So, that was a really big another light bulb moment. And then I actually started to work for that friend of mine in multifamily. He was in multifamily real estate, a very wealthy family, but eventually, put a lot of capital in multifamily real estate. And I was playing still rugby at that time, which, I mean, try and hold a job down at that stage when you’re traveling all the time, you’re out of town all the time, traveling in the U.S. and internationally.

So, I started working for him, and I started right at the bottom. I always said I started basically doing maintenance on a multi-family property. That’s where I started. And I ran construction crews and eventually did leasing that some property management eventually manage over 1,000 units for them, became part of the acquisitions team that he had. And I remember there was one investor in that area that had a nice decent-sized portfolio of multifamily. And I was trying to get a meeting with this particular investor. And I’ll never forget it. After pursuing him for about six months or so, eventually, that same investor walked out of the head broker’s office with my friend and so forth when I came into the office early one morning, 7:30. They have already done the deal. So, I looked at the situation. I said, “There’s got to be a lesson here. This is a learning moment.” And I started to realize that these folks are Cashflow Ninjas. They are the players in multifamily on the north side of the City of Chicago. And if somebody was even thinking of either selling or buying real estate, that they would contact them. They would sit down with those folks. And I sat back for a second there, and I go, “It’s tough to compete with Cashflow Ninjas.”

So, the second question becomes, “Well, if I can’t compete with them because it’s almost going to be impossible because they basically have this market locked up, how do I partner with them? How do I become a partner in the deals that they’re doing?” So, instead of just trying to go and compete with them, now I get to invest with the Cashflow Ninja, the dominant player in their markets, and get access to the best deals. So, that was kind of the background as an investor. And then as an entrepreneur, I started many businesses, failed for most of them. I had a couple that worked out really well but things really started to change around, I would say, 2015, 2016 when I started my podcast to share some of the things that I was doing and then interview incredible folks. And I chose the brand Cashflow Ninja because cash flow was a central theme in a lot of things that I was involved with and the importance, I mean, sure, it was very important that cash flow played a central theme in the brand that I was going to create.

The ninja actually comes from my dad. My dad is a very well-known martial artist that travels the world. And before 2020, I mean, he taught in about 8 to 10 countries a year. So, it’s a ninth dan black belt, one of the highest-graded folks in his organization around the world. And one of the things that I learned from my dad, and this is children learned by observation, I just saw my dad pursue excellence in his craft daily. You know, he’s 72 right now. He could still beat me up on the way, but he still gets up and he tries to get better every day. And he has a mindset that is pursuing excellence in his craft of karate. And he’ll never get to, I mean, he is always pursuing the next step and the next step and getting better every single day. And I looked at that philosophy and I said, “That’s quite incredible. I want to apply that to business. I want to apply that same philosophy to investing. I just want to get and pursue excellence in that craft as an entrepreneur and as an investor every single day. And I just want to get better and I want to continue to learn from folks and increase my skill set in those two areas.”

But I started that in 2016, been absolutely blessed, started as a podcast. We’ve been downloaded millions of times across the world in over 180 countries. It’s turned into an education company to where we’re rolling out programs and books. And then I also have two other companies, Producers Wealth, which we help folks implement and execute a cash flow management strategy in all 50 states in the US, and then Producers Capital Partners where we have a lot of fun doing a lot of deals in a lot of different areas and a lot of different niches.

Justin Donald: That’s awesome. M.C., you have such a cool story, such a unique story, and I love your perspective of immigrant founders and immigrants moving to the U.S. and recognizing that it is within their control here to move up. And one of the things that you had said really resonated with me and I invested in a fund that a friend is running that only invests in companies with immigrant founders. You know, under the thesis that, number one, we want to give immigrant founders a great opportunity and a leg up. But number two, that there is a work ethic that exists that may not exist with someone that was born in the U.S. as you referenced because you take for granted some of the things that you don’t even recognize that could be the greatest blessing in the world or winning the lottery, as you said. And so, just the grit, the toughness, the work ethic of these immigrant founders that we invest in is incredible. And we have just a great track record or the fund, I should say, has such a great track record. The person who put it together is brilliant and it’s just a neat story. So, I appreciate your sharing that.

And in fact, at some point today, we should probably talk about another immigrant founder in Elon Musk, because off-camera we were talking about his newest deal in buying Twitter and how that was structured. In fact, let’s just get into it now where the strategy he used. He didn’t buy it with cash. He didn’t put what would end up being 46 billion, whatever the number was, he didn’t do that in cash. He did that with a collateralized loan. I’d love to hear your perspective, number one, on just another South-African entrepreneur and businessman and, number two, this strategy of actually acquiring Twitter and how unique that is and how he’s using leverage to his advantage.

M.C. Laubscher: Yeah. The thing about immigrant entrepreneurs too is, I mean, they relish every single opportunity that’s given to them and they’re not afraid to get their hands dirty. You know, somebody said to me one time because he had a similar experience with even hiring in a sales organization immigrants that came over here, and there was the saying that and I would say there’s a lot of grandparents maybe and parents that have shared this with folks and said, “Flipping hamburgers back in my day was an opportunity,” and no one was beneath that. And it’s the same kind of mentality that they’ll bring. It’s just like we’ll do whatever we need to do and start wherever we need to start to make it work over here. The other thing, too, is I would say that the first thing is that you start most of them relish the opportunity but there’s always that immigrant mentality, too, is they will work and do whatever is necessary to make this work. And I would say sometimes, especially in the beginning, I would say fear plays into it a little bit. And then because you’re building from there, right, you’re not building toward something, you’re building from a place. So, there’s fear still involved there.

And then you get to a place where you massively gain confidence because of the results that you’re starting to get and now you’re building toward something. And if I have to look at the mindset of Elon Musk, he is building toward something. You know, the fear is out the window. The confidence is definitely there. If you look at his career, even having a massive success at PayPal and a great payday there, he just found the next projects and rolled it right in there and said, “Let’s go. Let’s do this again,” where most folks at that stage could have just cashed out and sat somewhere on a beach somewhere. So, he’s definitely building towards something and he’s obviously an incredible vision of essentially trying to address huge problems and trying to make big moves in markets. You know, electrical cars is a big one, space exploration and so forth. But the strategies that Elon implements and executes from a financial side and I’ve been following obviously what he’s been doing for a while.

There was actually a court case that he had to file for discovery of certain financial documents. He’s involved in some sort of a lawsuit back in 2019. And that actually was the first hint that I got of the game that he was playing. And essentially what he did back then was he would place his Tesla shares as collateral and then he would get an asset-backed line or asset-based loan, ABL, from those shares. And then he would utilize that to fund other projects that he’s involved in or invest in other areas. It was very, very interesting to see that. So, when this deal was announced that he was going to buy Twitter, I was very interested to see how the media was going to report how this deal’s going down because I already had a little bit of an idea of what he would do. And, yes, he placed his Tesla shares as collateral again to get a loan to then finance the purchase of Twitter. Now, it does many different things for you there. So, the first thing that it does, obviously, there’s no taxable event. So, he just had to sell his Tesla shares then that would be a taxable event right there, which obviously is the game that you don’t want to play in. You want to minimize your taxes as much as possible.

But because of that, he was able to then get the loan, get the financing, and buy Twitter. So, he essentially used one asset to acquire another asset, which is what you see the wealthiest families do and individuals as that’s the game that they’re playing in. One pool of capital is always positioned in a certain manner that it could do many different things for you simultaneously. You know, most business owners, if you’re listening to this, you’re probably familiar with business lines of credit and business loans. We had someone in our network, a business owner. He placed the assets of the business as collateral, and he bought the real estate from which the business was operating. So, he used his business to acquire real estate, and now he has both assets. Most real estate investors know of a cash-out refi and HELOC, right, home equity line of credit. And then also some folks might even be familiar with gold, silver, and art. There’s custodians that will allow you to borrow against your gold, silver, and art up to 50%.

Also, a great strategy because there’s a lot of folks that want to hold gold and silver for very good reasons, in the same reasons I do too, very uncertain times, financial reset times. But there might be an opportunity that comes along. So, how do you capitalize on that? Well, you can have that metal strategy in place and also get a loan against it to then acquire, let’s just say, cash flow asset maybe, maybe another hard asset. And then also in crypto, there’s been a lot of developments, as you know there too, with decentralized finance where the same kind of strategy can be played out, where you can place your Bitcoin or your Ethereums as collateral for a loan to then go and buy a hard asset. So, it’s a powerful strategy and, of course, you’ve shared the life insurance strategy, too, which I love, and I’ve done that over a decade myself. And we’ve established a family bank in our family too, which is our primary mechanism for financing. But that’s a, I mean, the life insurance too, if you have to compare that with the other strategies I just listed too, you can borrow up to more of the value of the cash value in your life insurance.

And there’s also a solid foundation where the principle in your life insurance policy is guaranteed. There’s growth, it’s guaranteed. You’re earning dividends. It’s not subject to stock market fluctuations. So, there are no margin calls, right? And there was the short pullback in the markets and even on Tesla. I’m sure Elon is smart enough and have a team of advisors advising him to manage collateral properly and manage margin calls and so forth. You don’t have that with the life insurance. So, that’s one thing that you can count on that’s pretty solid. And with the other assets that I mentioned, you have moving pieces. So, it’s important and no one understand that. But I think the big lesson here, too, for your audience is think about capital positioning. You know, most folks are focused just on creating capital, which entrepreneurs and business owners do. And if you’re a high paying professional, you’re focused on that too, whether sales, in the legal field, medical field. But capital position is the next step. Where do you position this capital? And then if you position it efficiently and effectively, then it becomes, “Alright. Now, how do I deploy into more cash flow assets, growth assets?” And then obviously you have to protect everything through tax strategy, through proper asset protection, and estate planning.

Justin Donald: Yeah. You know, you touched on a lot of stuff there that I think, well, overall, the whole package of what you just shared is brilliant. It’s top-level. I want to dissect it a little bit because the thing that I think most people think is you’ve got these entrepreneurs like an Elon Musk and people are like, “Oh, man, that guy’s got all the money in the world. He can do whatever he wants.” But the reality for a lot of entrepreneurs like that is that they’re often really like asset rich, cash poor. So, their value, their net worth is tied up in stock, is tied up in a company. So, this is one way to access some of that capital. And it’s a very brilliant way because you’re taking on debt which isn’t taxed. So, you could sell your stock and then you have a taxable event so it costs you a lot more to buy the company. So, I said before that it was 46 billion. I think the actual purchase price was 44 billion but I think he borrowed 46.5 billion to get some extra cash out and/or maybe that’s what’s making the payments. You know, it’d be interesting to see like what’s really happening behind the scenes.

But at the end of the day, this is a brilliant guy who has been very successful in the entrepreneurial space, but then he’s using very unique investment strategies to be able to grow his influence, his net worth, and really just put his money to use and to work. So, now he’s got money working in two different places at the same time, which is just like the infinite banking concept. And I love that concept in general. I think that there are some minor flaws to it working the way that Nelson Nash has laid out in his book, The Infinite Banking Concept. But the book is brilliant. The strategy is brilliant. I think with a few little tweaks that that overall strategy can be enhanced and actually perfected, and it doesn’t take much to do it. You know, it’s just the right type of policy, the right person that knows how to do it. And for people that don’t understand this or think that they wonder maybe like, “Should I be doing this?” this is what the wealthiest people in the world, the wealthiest families do. I mean, if you haven’t read Garrett Gunderson’s book, What Would the Rockefellers Do, which has been retitled What Would Billionaires Do, which I just interviewed him.

You know, you could check out his show, which was released not too long ago. The whole framework of the Rockefellers is based on dividend-paying whole life or kind of like the banking through life insurance concept, where everything inside the trust is taken as a loan that you pay back. And as someone dies later on, hopefully later on in life, it replenishes. And so, you’re building a bigger nest egg, whereas you’ve got a lot of other wealthy families like the Carnegie’s, like many others, that their wealth, their legacy ended financially. Like they don’t have the reserves that the Rockefellers and many of these other large family offices have. And so, it’s interesting to see how can I replicate what the wealthiest, most successful people financially do? And this is just one strategy, one of many, but I would say it’s a foundational strategy. Would you agree?

M.C. Laubscher: Absolutely. And the big takeaways there if you look at Elon as an entrepreneur, too, where did Elon invest his money? In his own business. You know, so if you’re an entrepreneur or a business owner, where can you position your capital to invest in your own business? You’ll notice that Elon didn’t invest in Apple stock or in a diversified portfolio of stocks, bonds, and mutual funds. Tesla shares, his own company, his own business. And so, that’s a big takeaway. And the other thing is with the efficiency and effectiveness that he implements and executes that strategy, I just wanted to just add on one point that you brought up, which is so, so important. If he had sold those shares to buy that, I mean, you would have to figure out the tax bill, how much more this would have cost him. And again, what did he do with the proceeds? Well, he acquired another asset, another company that he now will own. And he’s taking it private, by the way, too. Great diversification strategy. Great, great diversification. So, he was probably looking at, “Well, I can own a platform which is great for messaging and continuing to troll everyone as long as I want to,” by the way, one of the best news jackers of all time. It’s a skill set.

You know, you have to hand it to someone that can grab attention in an attention economy that has been flooded with now two years with pandemic and now World War III and everybody’s talking about him? That’s incredible. But to your point, back to the Rockefellers, if you just do the math and this is all about the philosophy of how the ultra-wealthy think, they plant trees that they will never sit to enjoy or underneath that tree and enjoy it. They think multi-generational, two, three, or four generations from now. And when you think about compound interest and compounding anything, efforts, actions, mindsets, money, that compounding effect if you just had three generations. One of my team members just did quick math the other day. It’s like if you have three generations and let’s just say their children at age 30, every single one of them, you’re looking at like over three generations of almost 140 years of compounding interest in a family bank. So, that’s why these strategies are so powerful. As part of an overall holistic strategy, bringing everything together, what you do, I mean, it’s so important. We always focus sometimes just in on one particular to say asset class or niche. But you bring all these things together and look at what they’re doing, it’s pretty powerful stuff.

Justin Donald: No kidding. And you know, we’re in this crazy time this season that is so fascinating because you have so many different things converging all at once. And I’m so curious to know what you think is going to happen with the economy. Are we going to stay strong? I just talked to some experts that are like, “Hey, we’re in the strongest place we’ve ever been as a nation.” I’ve talked to other experts that say, “By the end of the year, we’re going to be in a full-blown recession.” It’s so crazy how incredibly smart people can be on either side of the aisle at either extreme. And I think that we have to prepare for both. I mean, part of what you and I both do is we have this mindset, this philosophy, the strategy of multiple streams of income, well-diversified. Just in case something goes wrong, you are hedging against your investments, not performing that you’ve got something at least that performs and creates cash flow if the economy is strong or if the economy tanks. And I’d love to get your thoughts, number one, on what you think might happen and, number two, how you’re protecting against whatever it is that you think could come.

M.C. Laubscher: That’s a great question. You know, the crystal ball game is the toughest game to play in. Very tough business. So, with that being said, if you look at it, there’s essentially two outcomes which you’ve summarized but there’s a very strong case that the inflation continues and it’s pretty bad. I think most people that anyone that’s been to the store lately have seen the effects of inflation, this increase in currency supply which has been done all over the world. You pick your country and your central bank. It’s all over the place. And to throw just some fuel on the fire, most of the time, you have the same amount of goods or at least the goods and services increase in economy. This time, there’s actually fewer goods and services circulating in the economy with more currency units chasing it. So, we’ve really seen the effects. I mean, the numbers that have been thrown out is 8% to 9%. And then you look at John Williams shadow stats, it’s more like 16 to 17. And then we saw Congress gave their staffers and lawyers and so forth in DC a 21% pay increase. So, you’re figuring it’s probably closer to 20% than to the 8% or to the 9%.

So, with regards to inflation, to keep this economy going, which is essentially now completely debt-driven after we’ve basically shut it off in 2020, the first position that I would take is you’re probably going to continue to see inflation and it’s going to get much worse. So, you’re going to continue to see asset inflation, which is the increase of the values of all asset classes, which we’ve seen significantly. I mean, real estate that we love has been a huge benefactor. Obviously, the stock market and a lot of capital is flowing there because a lot of money has been borrowed to buy back shares, too, which is a completely different conversation. And then we’ve also seen cryptocurrencies benefit from that with a huge spike since 2020. So, that would be my first way of looking at it, but we are living during incredible times. I mean, I’m pretty excited for the times that we live in. Like I said, uncertainty and chaos and disruptions is my happy place. I would not be surprised if there is a wildcard event which could come in many shapes and sizes.

You know, for example, one of the markets that is pretty interesting to watch is the bond market, the biggest market on the planet. It just dwarfs all the other markets. So, the bond market pops. That bubble goes, everything else goes with that, the stock market, real estate market, essentially everything in this debt money-based system which we have. So, how do you protect for it? You know, you look at what the billionaires are doing again. You know, they are always looking and thinking what they don’t know. Like, what’s my blind spot? What am I not aware of? I need to position myself for anything and everything at this point. So, I’ve taken the approach of just essentially looking at four buckets, keeping things very, very simple. I’ve learned that when things get chaotic outside in the environment, you want to keep things inside of your businesses and your own wealth strategy very simple so that it doesn’t get confusing. But essentially cash is one bucket. And where would we keep cash? There’s a counterparty risk to where you’re keeping your cash. And cash itself is a counterparty risk because it’s fiat currency but essentially, where do you keep it?

So, I wouldn’t sleep well at night if I have large sums of money in banks right now. So, just what I do is I love the insurance vehicle for my cash because these companies have been around since the mid-1800s. So, from a counterparty risk management perspective, the probability is probably very high that they’re going to behave how they behaved since the mid-1800s. They’ve seen civil wars in the U.S., two world wars. They’ve seen all these economic booms and bust cycles and the Great Depression. So, that’s the one part of it. The second part of it which is also still very defensive is metals, having some metals exposures. In a currency reset and especially global financial resets, which I believe we’re in right now, it’s good to have things that have been money for centuries and that have held their value for centuries. So, metals play a big part in the portfolio. And then the third bucket is the cash flow, just the cash flow portfolio positioning. And of course, you and I are very much aligned in diversifying income streams within the cash flow portfolio. So important right now.

I think unfortunately people have found out the hard way that if one income stream gets taken away and for most people that were dependent on one, whether it’s employment or just an asset class, and that goes away, now you don’t have any income. So, you want to be diversified. There are uncertain and certain different income streams. And then the fourth part is the growth bucket where I like some cryptocurrencies in that growth bucket and some other place, Bitcoin obviously being one of them. So, if there is an inflationary environment, you still have cash that can be used to buy other things. Metals will hold steady. Your cash flow portfolio will benefit in your growth bucket. If there’s a deflationary event, then obviously your metals will go down a little bit, your growth bucket will get clobbered a little bit, especially if it’s crypto and your cash flow portfolio will just keep on trucking, but you’ll have cash to buy assets at a discount. So, I’m always thinking of what is the blind spot? Where could there be a danger? But that’s kind of my best thinking and insights at this point, just to try and put something together that’s ready for anything and everything that’s going to be thrown at us.

Justin Donald: Well, that’s fantastic that you have it broken down so simplified into these four buckets. But I have to imagine some things led up to this. I know that there was a time in your life where you didn’t have all the answers and basically life was beating you up. And I’d love to have you share that because I feel like that’s a critical part of your journey to the insight and expertise and knowledge that you have today, and also part of what helped you write your book, which I want to talk about thereafter.

M.C. Laubscher: Yeah. So, the biggest lesson that I learned and cash is in there and most folks would say, “M.C., but cash is trash. It’s losing its value.” You know, we’ve all heard all the cliches and I’ve probably said a lot of that myself, too, on my podcast. But in the end, cash is something that’s going to stabilize everything. So, one of the toughest lessons that I learned is starting out as a real estate investor. I was told all of those things and that’s when I was still doing the single-family game. And I would as soon as I wrap up the one property, I would try and get another property because cash is trash, right? It’s losing its value. Well, what happens if you’re trying to scale? All of a sudden you have a tenant that doesn’t pay rent. Shocker. That happens in real estate. You have a tenant that beats up your property and especially when you’re getting started. I felt like there was a time, there was a period in my journey where I would take like two steps forward and like three or four steps back because I didn’t have any cash on hand and then all of a sudden now it’s credit cards again or hard money or something like that.

Until I discovered obviously the life insurance strategy, which changed things around, big time for me, where I said, “Alright, I got to do something here. I need a financing vehicle with some reserves that if something happens.” And since I put that cash in my overall strategy, that’s where I felt like I didn’t take two steps forward and like three or four steps back anymore, but we now just started taking steps forward. I’ll share another interesting tidbit. Cash actually helped me save some crypto and folks are like, “How is that possible? How does cash save you cryptocurrencies or Bitcoin?” So, I had a collateralized loan on Bitcoin and then all of a sudden there was a sharp market pullback. Now, if I didn’t have that reserve bucket and that cash set up in a separate bucket, now, what would have happened to my coins? I would have done margin calls. I would have been able to handle those margin calls, and then I would have had to sell off my collateral, which would have resulted in me losing my coins at that point. But because I had the cash, I could buy more coins, fix my loan and my collateral, and it was all good again until I paid off the loan. So, you need that volatility buffer in there when things happen in your overall strategy.

So, that’s like I would say, the biggest lesson because we hear all the time, cash is trash, cash is trash. We’re learning that it’s losing value. Yes, it is. It is. But you still need some liquidity in case of a worst-case scenario.

Justin Donald: Yeah, there’s no doubt. I mean, I have such a love-hate relationship with cash. I love it for all the things that it can provide and I hate it for the fact that when I sit on it, I feel like my money is just evaporating in thin air. And so, what I’ve done is I’ve adopted this mindset that is a little different. I don’t want to be stuck in this scarce mindset around money. And so, for me, what I’ve been able to kind of take solace in is the fact that I do need to have a portion of my portfolio in cash. That cash needs to be outside the bank. Some can be inside of it but most needs to be outside of it. And by the way, I don’t think there ever needs to be a time where there’s more than $250,000 in any single bank because if something happens, it is not insured, it is not protected. And there is a case for having multiple banks. So, for me, I’ve got 30, somewhere between 30 and 35 banks, I think at 34 different banks that I use. And that to me is a good strategy, is just in case, especially with some local banks. But what most people don’t realize is these bank runs that happen when people try to take all their cash out like that’s real. This happens across the globe.

And just because it hasn’t happened to you yet or in your country, it doesn’t mean that it won’t happen in a tough economic crisis. And keep in mind, most people don’t even realize the solvency ratio of most of the banks, including U.S. banks. U.S. banks are the biggest culprit of this. It’s astronomically low like these are not safe havens like most people think. I did an episode with James Hickman a.k.a. Simon Black from Sovereign Man, where we got all into this but I spent a lot of time researching banks and really the best place to keep money. So, I think it makes sense to keep cash outside. But where I take solace is the fact that maybe I lose money today when I don’t know where to purpose it. So, maybe I’m losing 20% every single year. But the moment I find an asset sold at a discount, I make much more than the 20% that I lose every year. So, as long as the greater strategy is to buy assets, to buy discounted assets, I think people really win. So, that’s kind of the way I look at cash. I think it’s necessary. I think it’s needed. It’s not going away for a period of time. But I do think it’s very smart to have that growth bucket, as you said, where you have others.

Well, first of all, you’ve got your metals. You got your gold, your silver, you got your platinum, whatever else you want to include in that bucket but then also you have Bitcoin, you have other cryptocurrencies, you have Ethereum. So, I think that’s great. I’d love for you to share a little bit on your book. Tell us why we should get your book. And by the way, I know your book is incredible because your podcast is incredible. And I just loved the guests you’ve had. I love your insight. I mean, this is how I learned about you and from a mutual friend. Tamar Hermes actually connected us, which is cool. But tell me and tell us about your awesome book.

M.C. Laubscher: Absolutely. And just wanted to share again, your banking take is 100% correct. For folks that haven’t researched this, go and do your own research right now of what has happened in the past 12 months in Lebanon, Sri Lanka, Peru. There’s a reason it’s not in the news. So, a lot of bank runs have already started around the globe. It just isn’t in your country yet in the United States.

Justin Donald: And there is a scare in Canada. A lot of people don’t even know that there is a bank run in Canada that just happened and it all worked itself out but that doesn’t mean it’s always going to work itself out.

M.C. Laubscher: Yeah, exactly. And the book is called The 21 Best Cash Flow Niches: Creating Wealth and the Best Alternative Cash Flow Investments. And essentially, after interviewing over 800 of the best minds in business and investing over the past six years, the number one question I get is, “M.C., what are some of the best opportunities that have been shared on your show?” So, I put it together in a book, and also I’m very passionate about sharing how important it is to diversify income streams right now, as we’ve spoken about earlier. Especially in an economy, nobody has a crystal ball. No one. And there’s a lot of folks that there’s a time and a place to really focus and go in on a particular asset class. And then there’s a time and a place to maybe just diversify a little bit out so that everything isn’t determined on just one particular niche or asset class. So, in the book, I share 21 and I throw in five bonus ones there. I always want to over-deliver and 21 markets is better than 26, right? But, yeah, I just share many different niches, which has just been very interesting. My show’s very, very wide. So, business, businesses, commodities, real estate, blockchain, and cryptocurrencies, and then also paper assets. So, there’s a whole bunch of different assets and especially cash flow niches that folks might not even be aware of. So, my goal was to share this with folks, to share ideas of just the endless opportunities that exist in this alternate space, which is obviously the alternative asset classes that we love.

Justin Donald: Well, I love alts. And when I say alts, I’m not talking specifically about crypto alts. I’m talking about overall private equity, real estate, just alternative investments, debt, you name it. And it’s such a fascinating space where I, like deep down, I am optimistic that things are going to work out, even if we have a tough season, a tough spell, that it’s going to get better on the other side. I pray that we have a longer, strong, good season than not, but I want to prepare as if it’s not. So, man, I hope we can get to 2030 without some sort of a financial crisis. I think the odds are not good. No one has a crystal ball. Maybe it’s five years more that we get. Maybe it’s three years. Maybe it’s something at the end of the year I just think we should plan is we should plan for the recession that is due to come. You just can’t print money this way without that happening. Like it’s just a matter of time but if you continue to print money, then you can delay that timeline. So, it’ll be interesting to see what happens. So, we should prepare for the inevitable and hopefully we just get a bunch more years of things booming here in the U.S. and globally.

So, M.C., this has been such an awesome time getting to know you. You’re such a wealth of knowledge. I would love for you to share with our audience here how people can learn more about you and reach you.

M.C. Laubscher: CashflowNinja.com. So, CashflowNinja.com is where folks can learn everything that I’m up to. And for your listeners, if they’re interested in the book, it’s available at CashflowNinja.com or on Amazon.com. And when they grab a copy of the book, please screenshot a proof of your purchase and send it to my team at info@cashflowninja.com and we’ll give you access to a digital version of the book if you want to read it on Kindle, an audio version of the book if you want to listen to it like most people do books these days, including myself, a curated library of the Cashflow Ninja’s talking about, the niches, and more bonus goodies.

Justin Donald: Well, M.C., thanks so much. We’ll get all this in the show notes. And I just want to wrap up today’s interview and time together, the way I do every week, and that’s this. What’s the one step that you can take today to move towards financial freedom in living a life that’s truly on your terms, one that you truly desire, not a life by default, but a life by design? Thanks, and we’ll catch you next week.