November 6, 2025 • 36 mins
Do you think the stock market is the only path to wealth? Think again. We broke down how to build true, lasting wealth outside of Wall Street — from real estate to private lending, business ownership, and even alternative investments the wealthy quietly use every day. If you’re ready to diversify your financial freedom, this show’s for you.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:03):
Good Wednesday afternoon to you. Welcome to the John Sanchez
Show on News Talk seven eighty k WH. It's a
pleasure to be with you. I am flying solo this afternoon.
Mister Ganta has a busy pack schedule, so I'm going
to run this ship for you. Thank you so much
for joining me. I do appreciate it. I am really
excited to talk to you about a very important topic
in my heart. So as many of you know that
(00:25):
if you're you know, clients of our firm, or you've
met with us in the past, or you've been a
longtime listener of this show, many of you have questioned
me over the years in regards to my I've had
(00:56):
it many times where we've recommended to a client like, hey,
you know what, we're really not the best choice for
the sum of money that you have. We think it
would be better for you to, I don't know, go
start a small business or put it into real estate,
right I mean, And people are like, well, wait a
minute here, you don't make any money off of that. No,
we don't. That's more than fine, right. We're not in
(01:18):
this to make money. We're in this to help our
clients and future clients, so we're kind of unique when
it comes to that standpoint. We believe that whatever is
the most appropriate way for you to build wealth, that's
what we're going to advise you on. Whether it's the
stock market and a combination of real estate, small business,
whatever the conditions are, and whatever the different mix is,
(01:40):
that's all we care about. Right, whatever is right for
you as our client, that's what we're going to recommend
to you. Nothing to benefit us, all to benefit our client.
So with that said, I thought, you know what, it's
a great time this afternoon to revisit something that we
haven't discussed in quite some time. And I want to
start you to be thinking about this for a second
(02:01):
before I get to the stock market side. Do you
think the stock market is the only path to build wealth? Well,
if you said yes, and I want you to think again,
because that is absolutely not the case. Today I'm the program.
What I'm going to be doing for you is I'm
going to be breaking down how to build true sustainable
(02:24):
wealth outside the scope of Wall Street, from things like
real estate to private lending, business ownership, and even alternative
investments that the wealthy people of this country quietly use
to build their wealth each and every day. So it's
going to be a very very wonderful show as far
(02:45):
as the things I'm going to teach you as we
go through this, because again, true wealth is not built
in one dimension. It's not built just with the stock market,
or not built just with real estate, can it be sure?
But for most people the answer is no, it's a
combination of things. And so again you're going to learn
how you can build your wealth through a combination of things. Again,
(03:08):
real estate, small business, private equity, different things along those lines.
So again, going to be a great way for you
to learn about something outside the scope of what we
normally talk about on this show each and every day,
which of course is Wall Street. All right, So I'll
be getting to that in just a moment. Let's recap
the what the heck happened today volatile session. First of all,
(03:31):
we had weakness, we had strength, We had weakness, We
had strength throughout the entire session. But again, as I
always say it, all that matters is where. We closed
that at one o'clock and it was a nice game
across the board, but it was a lot of wide
swings going on. We finished with a game of two
twenty six on the Dow. That was a point four
to eight percent rise, closing at forty seven three eleven.
(03:52):
Now is that game one fifty one point sixty five percent,
SMP at twenty five points or point three seven percent.
But again, we have some underlying issues that are continuing
to dominate the market, well, the first one being market.
One of the reasons it was so volatile today. Of course,
today is when the Supreme Court began hearing the case
(04:13):
on whether President Trump's tariffs are legal or not, and
the takeaway was they may not be. There are some
things going on in this court case. At least what
happened on the first day, and I don't know how
many more days they have left. It doesn't sound like
many that many are saying, well, wait a minute here,
(04:34):
we don't know if what the president did, what the
Supreme Court said, We don't know what the president did
if it was legal. Now, the only thing we need
to really discuss right now, because we're not going to
speculate if the Supreme Court rules against the Trump administration
or in favor of because again there's a million different scenarios.
(04:57):
But the most important thing to remember is if the
administration loses the lawsuit. Remember the gist behind what's behind
this whole thing, is they, meaning the government or the
Treasury specifically, will have to refund hundreds of billions of
dollars to businesses that were charged the tariffs. And that's
(05:19):
what has everybody concerned. Is well, wait a minute, here,
what happens if indeed the Trump administration loses. So the headlines,
if you kind of follow it, say that the Supreme
Court justices appeared deeply skeptical about the legality of the
tariffs imposed. Conservative and liberal justices sharply questioned, excuse me,
(05:41):
questioned the Solicitor General d John Sawyer about the justifications
of the tariffs, which critics say infringe upon the power
of Congress to tex Now, remember the lower courts a
few months ago said the president lacked authority under the
International Emergency Economic Powers Act. Remember that's what he claimed
that it was an economic emergency the reason that he
(06:02):
started the tariffs. But the lower courts, like I said
a few months ago, indicated that he lacked the authority
to impose these reciprocal and fentanyl tariffs on imports from Canada, China,
Mexico and other trade partners. Jersey Secretary Scott Bessent attended
the arguments. No comments from him. So the gist from
(06:22):
what I've heard so far today is it didn't go
well for the Trump administration on this, and again some
of these judges, which remember we've got a little bit
of a mixture on Scotis a little bit of a
mixture there. It's kind of a toss up right now,
is what many of the legal authorities are saying. So
once again we'll see how much longer this has. Again,
(06:44):
the indications going into it was they're under pressure, meaning
Scotis is under pressure to get this a decision made
as quickly as possible because again the government is continuing
to collect the tariffs, and if they are ruled illegal,
then once again the Treasury is going to be writing
in a big check. I, however, think that if the
(07:04):
ruling goes against the Trump administration, which I tell you
it's a fifty to fifty shot. I mean, I've seen
the Supreme Court rule in favor of Trump and things
that I would never think that they would, So we
know the bit of a bias that's going on there.
So you know, if I was a betman right now,
I'd say, I think Scotus is going to rule in
favor of the Trump administration, maybe not give him everything
(07:25):
he wants, but I'd say the vast majority. But let's
say I'm wrong. Let's say that they do rule against him.
There's a few other backup plans, which again I could
do an entire show on the backup plans that he'll
go to. Besides, of course, you know, I don't know
if they can appeal once it's at this level, but
they've already said there's a few other little loopholes in
the law that they can do. So again, as the
(07:46):
news headlines came out of the out of the hearing, again,
that was the we'd see the market kind of go
up or down. And to be honest with you, the
market almost got excited. It actually moved up when the
headline started to come out that things weren't going for
the Trump administration during the hearing. And so you kind
of sit there and go, well, okay, if that's the case,
(08:07):
then maybe it would be positive obviously for the market.
And it makes a lot of common sense, right if
there's you know, no tariffs or dramatically reduced tariffs, guess
what corporate America should have more money towards the bottom line,
and you and I as a consumer should have more
money to go out and spend because we're not paying
an extra whatever ten twenty thirty percent on tariffs. So
that could be ruled again in the favor of the
(08:30):
markets and you know, as us as individuals. So as
of last week, the federal government collected one hundred and
fifty one billion dollars from custom duties in the second
half of fiscal year twenty twenty five. That is nearly
a three hundred percent increase over the same period in
fiscal year twenty twenty four. So there's a lot of
money at stake here, a lot of money. But again,
(08:52):
that was one of the big volatile issues going on
in the market today. Where were a few other things
still the AI valuation theme started. We had Advanced micro
Devices report at numbers this morning, pretty good numbers, but
still again some concerns about valuation in the semiconductor slash
AI space. Some of the other big winners. I'm just
(09:13):
kind of looking through my list right here. We had
Meta today had a pretty good day, up eight dollars
and sixty three cents one point three eight percent. Six
thirty five ninety five. Tesla was another star performance, even
though German sales were down fifty percent. Heck, the stock
rallies right, it seems to be what happens bad news
and the stock goes up seventeen dollars ninety cent gain
on a Tesla to four sixty two to twenty three.
(09:34):
That was a four point zero five percent rise. McDonald's
was the star of the dowt to day after reporting
a third quarter miss and a revenue that was in
line with expectations, but basically the street focusing on stronger
than expected same store sales momentum both in the US
and international markets. McDonald's finished up six dollars and forty
six cents two point one six percent to three zero
(09:55):
five ninety seven. Apple kind of flap ten cent gain
to seventy four. Microsoft lost a bit, down seven dollars
and seventeen cents, same with Navidia lower by three dollars
and fifty cents about one point seven to six percent. Pellingtai,
which again got beat up yesterday on the valuation scenario,
lost about two dollars and eighty four cents today to
win eighty seven to ninety and Micron was a big
(10:16):
standout with a gain of eight dollars and or excuse me,
eight point ninety three percent of nineteen dollars and forty
seven cents to two thirty seven to fifty. So, like
I said, a lot of movement underneath the surface, but
it was all said and done, turned out to be
a pretty decent day. Today. We're actually up over three
hundred at our best level on the dow back down,
almost went negative a couple times early in the morning,
and then like I said, finished in the nice solid
(10:38):
gain of two twenty six. On the commodity side, we
lost ninety eight cents on oil to a price now
broke the sixty dollars mark fifty nine sixty a barrel
golled up thirty two dollars and ten cents three seventy
nine three thousand and seven ninety three fifty an ounce
three thousand, seven ninety three fifty and a big increase
in bond deals across the board. Tenure up seven basis points,
and that was, like I said, a not only in
(11:01):
the tenure did we see a bump up in yields,
but it was right across the board. The tenure by
the way finished at four sixteen, but two year was
up five basis points, five years up six basis points,
thirty year was up seven basis points. So it was
one of those days where it went strong across the board.
We did actually get one report today that was in
regards to the labor side. ADP did report, for those
(11:23):
of you that believe the ADP numbers, that the economy
in the month of October gained a whopping forty two
thousand jobs in the month of October. Estimates were only
twenty two thousand. And then we had the October Institute
of Supply Management, what we call the ISM service number
that came in at fifty two point four. Prior reading
with fifty, you want to read in above fifty to
show expansion. So pretty good numbers there, and they gave
(11:44):
us a bit of a boost when those numbers came
out early this morning. All right, you're up to date
on the market. Now, when we come back, let's get
down to a great topic beyond Wall Street, the other
paths to twelth Let's turn it over to Christen snow
right now Traffic Center. Hello, Kristin, Welcome back to the
John Sanchez Show on Newstalk seven eighty kah. Pleasure to
be with you this afternoon. Again, Jason, that tied up
(12:05):
in some office activities, I'm fine, solo. Ready to get
to our topic, how to build wealth outside of Wall Street.
I know sounds strange coming from a guy that mixes
living on Wall Street, but you know what, there are
other ways to do it, or let's just say a
combination thereof. But first, once again, good session today at
two twenty six gain on the DOUBT one fifty one
on the Nasdaq and a twenty five point increase on
(12:27):
the S and P five hundred. Well, once again, as
I said earlier, if you think wealth can only be
built on Wall Street, you're absolutely incorrect. It can be
built in a lot of ways. And again, the purpose
of today's show is really simple. Let me help you diversify.
I let our firm help you diversify your wealth into
areas outside the scope of Wall Street. It should be
a portion of it, but it doesn't have to be everything.
(12:47):
For some people, that's all they do. It's what they
feel comfortable with, no problem. But for those that want
to diversify, and you know, something interesting we're seeing is
in the younger generation. This is exactly what they want
to do. They wanted to fine and build their wealth. Well,
it's a portion of it, but it's not everything like
some of the older generations are. So this is kind
of interesting. So if you have any kids or grandkids,
(13:11):
you know what, pick up the podcast. Tell them pick
up the podcast. This may be right down their rally.
All right, So let's get into I don't know what
do I have here. I've got about I guess about
seven different systems and ideas for you. Okay, so here
we go. How do we build wealth outside the stock market?
First one, many of you do it already, real estate investing.
(13:31):
How do we build wealth there? Well, I've got four
points for you. Number one, rental income and appreciation, right,
long term cash flow, hopefully some equity growth ability as
we discussed yesterday with the boys' ability to borrow against
some of it. If you need to to use it
either to pay off lower interest debt or to buy
more real estate or to buy more investments. It gives
(13:52):
you a lot of advantages. And as I always say
when I recommend real estate to a client, one thing
that the stock that real estate can do that the
stock market can in most cases, it can give you
some terrific tax advantages. This great thing called depreciation a
phantom expense. Right, It's a way to lower your taxable
income without really doing much. Right, That's what depreciation is
(14:12):
all about. Cash flow. We love adding real estate to
our client's portfolio when they're in or near retirement. Why
because it's another income source. Let's go to point number
two under real estate ten thirty one. Tax deferred exchanges.
Just got finished doing one, or helping a client with
one a few days ago last week. Phenomenal tax strategy. Right.
(14:35):
This is where you sell an appreciated piece of investment
real estate and you exchange it for another investment real
estate or business of equal or greater value. You buy
a rental house, let's say, for five hundred thousand. A
few years later it's worth seven hundred thousand. You go, oh, man,
I want to sell it, but I don't want to
pay capital gains tax that two hundred thousand dollars profit.
(14:56):
Guess what do a tax deferred exchange ten thirty one?
Move that over you find another property seven hundred thousand
dollars or more. You do that. You follow all the rules,
and again we did a couple of shows a few
months or a few weeks ago about ten thirty one's
follow all the rules and you will be deferring your taxes. Okay.
(15:17):
Now you may be saying, okay, great, I get to defer.
But remember this is what many of the wealthy will
do with real estate. They do tax deferred exchanges, one
after the other. Right, They've got them going for years
upon years, and then what happens to all of us
at some point we die. When we die, our beneficiaries
that inherit that property received a stepped up basis. So
let's say we started in twenty twenty five buying a
(15:39):
five hundred thousand dollars property. A couple of years later,
it's worth seven hundred thousand. We want to sell it,
and we go out, we do a ten thirty one
tax deferred exchange, buy another investment property of equal or
greater value. So we buy one for seven hundred and
fifty thousand, and we hold that until it hits a million,
and then we do it again, and maybe we decide
to sell that million dollar property for one point five million,
and we continue to do that under ten thirty one
(16:01):
TAXI for exchanges and by the time we die. Let's
say it's all worth three hundred thousand. You started with
five hundred. Now you're in properties that are worth three
or three million. You haven't paid a dime of capital
gains tax on it, and then you die. Well, if
you are my children, guess what. If you are my beneficiary,
my children or whomever I've named, guess what you get
(16:22):
to inherit that real estate that's worth one and a
half or three million dollars. That's your new cost basis,
not my five hundred thousand. You see the major difference there,
really really powerful strategy, especially for those of you listening
in California or other parts of the country where you
have a big high capital gains tax, because not only
do you have to pay federal, but you have to
pay state. In some states no matter, we don't obviously,
(16:45):
but California you do. It could be as high as
thirteen point three percent. So make sure if you have
an investment property you want to sell, make sure you
consider the ten thirty one TAXI for exchange. Great way
to build wealth, and eventually you know, you die and
like I said, your kids receive the stepped up basis.
Another great way short term rentals and accessory dwelling units
(17:06):
eight US. We discussed this a few days ago on
the show again the city of Renos passing some new
rules making it more favorable for you to be able
to build an ADU in some circumstances. These are little
dwellings that you put if you have a big enough
property your zone correctly, you follow all the rules that
you can put in the backyard. Maybe you got a
couple of acres and you can put one in the
backyard rent it out right. That's a great way to
(17:28):
build wealth. Maybe that thing will appreciate in value. But
you're going to get some cash flow that Hopefully you
take that cash flow and invest it into something else
and multiply that cash flow so you're getting a thousand
dollars a month rent from that ADU beautiful instead of
spending one thousand. Take it and put it in the
stock market or in some other investment that we'll talk about.
And then finally, commercial and mixed use real estate offer
(17:50):
often higher cap rates, lease stability. Again, when you start
getting into commercial real estate, it has a whole set
of risk and rewards that residential real estate doesn't. And
you know, especially when we're talking single family rents, right,
How nice would it be to get into a big
commercial building, a warehouse space or something if it fits
your parameters? And again, nice stable long term leases and
(18:13):
great depreciation schedules on some of those. If you do
the what's called segregation depreciation, where you're breaking down all
the elements of that commercial building and assigning a lower
depreciation schedule versus the entire structure. It's called cost segregation.
Very very powerful tax strategy and a great way to
(18:33):
build wealth. So real estate, let your imagination wonder. You know,
we of course can get into what we call package products.
When it comes to real estate, you always those to consider,
and again we've been more happy to sit down and
share those with you. Let me squeeze in business ownership
before I go to break. So what can you do
on the business ownership to build wealth outside of Wall Street?
Of course, you can start or buy an existing business.
(18:55):
You have direct control, you have scalable income. That's how
I built my net worth through businesses. There's no better
way in my opinion. No stock market, no real estate,
no nothing can build wealth faster, more sustainable, and in
greater amount than a business can that's my opinion. Some
don't agree with that, But I tell you what, you
(19:16):
build a solid business, you have unlimited income potential, you
get some tax deductions, you hopefully get to do what
you want to do. You don't dread getting out a bit.
I don't dread getting out a bit. I can't wait
every morning when my alarm goes off a four to
hit the ground running. I love it. Am I tired
by Friday afternoon, absolutely, but it's a great feeling because
I've worked hard all week. Build a business. Folks, especially
(19:37):
those of you that are young, no better way in
the world to build your net worth in my opinion,
and that you talk about investing out of Wall Street.
Those of you that don't want to start from the
ground floor, consider buying a franchise. Pluses and minuses to franchises.
But you know, there's a lot of people that have
been become extremely wealthy. Look at some of your McDonald's
franchisees right, just as an example, there are some very
(19:58):
very wealthy franchise he's out there. Because you're coming into
a turnkey system, you have to give a little bit
back to the parent, absolutely, but in return, hopefully you
have a proven business model, and you're not having to
go through a lot of the trials and tribulations many
of us do when we start a new business. And
don't forget about silent partnerships. Right, nothing says you have
to have day to day involvement into the business. You
(20:20):
can be kind of the bank right, invest the capital
without the day to day management, lend the money to
the up and rising entrepreneur or the existing entrepreneur, and
get some pretty nice interest rates these days for doing that.
I just run across that situation the other day where
I had a friend that is in a cash bind
and he needed to borrow some money. And it's like, well,
it's gonna cost you a lot of money to do that,
(20:43):
but you know what I offered him wasn't fair. I said,
you know, here's the number to my banker. Go contact
him and get yourself a line of credit real quick.
Get past your little hiccum. Wish I could have helped him,
but just didn't make economic sense for either one of us.
But again, you can be involved. I've shared stories over
the years. I've had clients that just made a living
literally going in by an existing business and improving it,
(21:06):
making it very very profitable, and then they turn around
and sell it, and then they go on and do
the next one and the next one, or they invest
in again, maybe a friend, family or whomever, someone that
has a good operating business, but maybe they want to
double or triple the revenues. They need capital to do it.
Good luck getting capital from the bank these days. It's
very very difficult, especially if you're a young business. But
(21:26):
you know, if you know these people and you can
collateralize what you're going to lend to that entrepreneur, maybe
an idea for you to consider wealth building outside of
Wall Street. We'll come back and talk about my third idea,
which is private lending and notes, similar to what I
told you a moment ago, but we'll go into more detail.
S turned over to Jack Saban News traffic and whether
it's what he has. Hey, Jack, Welcome back to the
John Sanchez Show on Newstalk seven eighty KO. Wait once again,
(21:48):
we finished with a nice set result on the market
to twenty sixteen on the dalm a Zac grows one
to fifty one s somep hire by twenty five. All right,
we're going through different ways to build wealth outside of
Wall Street. All right, I've covered real estate investing again
under that rental income and Appreciation ten thirty one taxi
fort exchanges, short term rentals in ADUs and commercial or
(22:08):
mixed real estate. Then we got into my second idea
business ownership started by an existing business. Look at a franchise.
If you want to don't want to start from ground zero,
or if you don't want to be involved but you
have the capital to do it, consider being a silent
partner in another business. All right, here's my third point,
private lending and notes. How do you like this term?
(22:29):
Be the bank earn a fixed rate of return by
lending money to real estate investors or small business owners. Again,
make sure you have your CPA, your attorney involved, write
up everything correctly, make sure you've got good collateral. Once again,
there are some somewhat stringent rules in Nevada when it
comes to lending in real estate. There a certain amount
that you can do without being considered a quote mortgage lender.
(22:53):
So again, your attorneyshould able to direct you in that area.
But I've seen clients over the years. For the most part,
I don't recall any of them that had a loan
go bad on them, But boy, they made some pretty
good money. You know, you charge a few points or
maybe more three or four points upfront higher than expected
rates because again, these people need the money quickly, you know,
(23:15):
ten to fifteen percent I've seen over the years, and
like I said, numerous points up front can be pretty lucrative.
Usually they do it for about a year and they
collateralize the real estate that the that the person needs
the money for. So not a bad way to go. Again,
make sure your whole team's involved with that great way
to build wealth outside of Wall Street. Now under my
private lending, I also have collateralized notes again protect the
(23:38):
downside with real assets. A collateralized note can go for
anything someone that you know, again, a business owner for example,
that needs to buy a new piece of equipment and
the bank will give them the money or they need
the money now. And the bank of course takes forever
to give a loan these days. So you can look
at doing the collateralized loan, same type of thing, figure
out what you want to charge as far as points
(23:58):
and the interest rate, and then similar to what I
mentioned about the silent partnership on the real estate side,
or excuse me, on the business ownership side. You can
also do, of course, what we call peer to peer
lending platforms. There's all kinds of them out there. I
use one personally, just a full disclosure. I can't tell
you the name of it, but I send in a
little bit of money every single week, and they structure
(24:21):
it among a number of notes. Right, they turn around
and lend money out. I don't have to do anything,
and collecting a pretty nice interest rate on it, et
CETERA great way to go. But there's all kinds of
those companies that are out there that do the peer
to pure lending. I don't say it's going to be rich,
but not a bad cash flow. You just have to
understand it and what the fees are and so on
(24:41):
and so forth. All right, let's move on to number four,
the alternatives. Folks, if you haven't already heard, you're going
to be hearing more and more and more in the
press about alts or alternative investments. And the reason I
say that is because the Trump administration Department of Labor
are in the midst it looks like they've quasi approved
it and seeing anything where it's one hundred percent finalized,
(25:02):
where alternative investments are going to be offered in four
to one case for the first time ever in history. Now,
what's an all, Well, pretty much anything that's not involved
in Wall Street. It can be real estate, precious metals,
private equity, so and so forth. Again, there's a lot
of pluses and minuses to them. You have to really
understand what you're doing or have an advisor that does.
But let's just go down the list. So, one great
(25:24):
alternative investment you can do on your own precious metals, right, well,
remember where gold was just a few weeks ago, much
lower than where or much higher than where it is
right now. But again, many if you like to own gold,
that's an alternative investment to your stock market portfolio. It's
a great hedge against inflation, market volatility, so on and
so forth. And again you can use any precious metal
in that example. We just got going, got done going
(25:46):
through that big run up in the rare earth metals.
Right those stocks were just on fire for a while,
but they've created ever since. Second alternative investment, private equity
and venture capital, early stage or growth phased companies. You
ever see some of these guys in thousand CNBC that
are worth billions and billions of dollars and they read
I watched one the other day. They didn't read the
(26:07):
companies that this gentleman had been a venture capital or
a private equity investor in, but they instead showed the
logos of all the companies. And these are guys. You
know again, I'm talking on the big scale that got
in early days of you know, Meta and some of
the great companies. There's so many of them now that
are getting involved in you know, upstart AI type of companies.
(26:29):
But you don't have to go to that biggest scale, right.
There's remember of years ago I was involved in a
in a local venture capital group and it was a
great opportunity. Right. People come in business owners come in
new or experience, and they pitched their idea to you,
and you do your due diligence and it may you know, fit,
and then you go, okay, you know, I'm going to
(26:51):
give you or lend you X amount of dollars in
return for X amount ownership of the company. That's how
the big boys do it. You can do it on
a small scale. Maybe you have a good friend or
relative of a neighbor or whatever the case is. It
has a great business idea, but they lacked the capital
that's private equity and venture capital. So once again make
sure you're turning your CPA or involved. But boy, all
it takes is one big one to hit and it
(27:12):
can be very lucrative. Second is collectibles and tangibles. Boy,
this is an area that's getting a lot of attention.
Not because of art wine, classic cars those have been around.
Farmland has always continue to be a very, very wonderful
alternative investment. You can read up on the stats of it,
but believe it or not, farmland for in most cases
(27:33):
has outperformed the stock market. You know, if you're working
the land yourself or you're just buying farmland and leasing
it out, a lot of great tax advantages and income
potential and hopefully appreciation as well. Rogers said, they ain't
making no more land. But here's one part under the
collectibles and tangibles that's really starting to get a lot
of attention. Sports teams. Have you read any of those
(27:55):
stories about how private equity and venture capital firms are
now coming in and taking a minority stake and NFL
teams for example, WNBA, NBA teams, etc. This is now
becoming basically an asset class just like a stock bond
mutual fund these sports teams. Many funds are being created
now that are going out and actively seeking ownership percentages
(28:18):
of some of these professional teams. I think this is
just the beginning. I think this is going to be
an area that is going to grow dramatically. I would
not be surprised if I don't know, I'll pick a
time period, say ten years from now, long ways out
that they don't have some type of a private equity
or venture capital opportunity for people to invest in college
(28:39):
football teams. Right, very very lucrative for most colleges. But
most colleges, of course they need capital because they're paying
out a lot of money under these nil deals right
where they're paying the college athletes to perform, and many
of them need capital. Well, I'll tell you if a
venture capital fund came a call in with multi billions
for some state of that football team, I bet they'd consider.
(29:02):
And I've heard there's actually some rumblings going on right
now that that may be, you know, well before the
ten years that I just predicted. So sports teams of
all sorts, right, we've seen pickleball teams now and bad
I mean, you name it. There's soccer is another huge one.
Private equity is really involved in professional soccer teams like
on the MLS side and overseas, et cetera. So again,
(29:25):
depending upon what you want to look at, there see
if you can get involved in a fund, or maybe
again you can get in and get involved on a
smaller scale for a younger up and coming team, maybe
a sport that's not real popular yet. I know in
the world of rodeo that I followed very closely a
few years ago, so I got really smart and they said,
look at, these bulls are worth you know, in some
cases millions and millions of dollars. If this bull is
(29:47):
very successful and bucks off, you know, majority of the
cowboys on it, and these bulls would be worth millions
and millions of dollars. Their semen is worth millions and
millions of dollars in a lot of cases. And so
one guy got really smarter. I think a company that
excuse me, and they look at we're gonna sell off
portions of this bowl. You know, for X amount of
dollars you can own ten percent or five or twenty
or fifty or whatever. Took off like Gangbusters. I haven't
(30:08):
seen the last couple of years if that's still around.
But let your imagination wonder when it comes to anything
sports related. And then finally under my alts, structured notes
and annuities. Again, structured notes are somewhere to what I
mentioned earlier. We know about annuities, great income solutions. Just
again understand the pluses and the minuses of all of those.
Let's see, I'm going to say five and six for
(30:29):
when we come back from the break, because these are
really good ones. I want to kind of wrap up with.
Let's turn it over to Jack say excuse me to
Kristin snow right now, traffic center kerr Risten, Welcome back
to the John Sanchez Show on News Talk seven eighty
ko H, all right, we're going to continue on our
discussion how to build wealth outside of Wall Street. So
we're working on well, we just wrapped up the alternative investments.
(30:49):
Now I want to move into a really really great
area self directed retirement accounts. Oh yes, self directed iras.
Keep in mind, folks you may or may not know this.
Stay tuned. You'll be hearing much more from us on
this U than the next month or so. An IRA
can be invested into anything outside the scope of collectibles
meaning stamps and rugs and life insurance. Yes, you heard
(31:13):
me correctly. An IRA can be invested into anything other
than collectibles, stamps and rugs and life insurance. Want to
buy real estate inside your IRA? You can? Want to
go buy account inside your IRA? You can, And like
I said, in a short period of time, we're going
to make some major announcements and show you how it.
Sanche's got capital management. We're gonna be able to help
you do this. But that is a great way to
(31:36):
build wealth if you obviously choose the right investments. But
I want to take you back for a second to
the entrepreneurship side of things. There's another tremendous way. I
love setting these up for clients. They're called solo four
to one case. They're a four to one case the
name says, but solo is the key. They're designed for
a one person business or a husband and wife business
(31:57):
if you have employees. Forget what I'm going to tell
you now. What are they? So? They're a very simple
retirement plan that you can set up when you are
self employed. But the contribution limits far surpass a normal
four to one K And I'll tell you how I
use them for our clients. Here's your numbers. If you
are age zero to forty nine, let's kind of go
(32:22):
with that. Twenty three thousand, five hundred dollars is your
twenty twenty five limit right now. If we are age
fifty to fifty nine, we get to play catchup. We
get to add another seventy five hundred dollars, bringing our
total to thirty one thousand dollars. Okay, Now, if you
are age sixty to sixty three, remember we have this
(32:43):
extra large contribution catchup for the next couple of years.
For those of us that are sixty to sixty three,
it's not the seventy five hundred dollars catchup. It's eleven
two hundred and fifty dollars ketchup. So you take your
twenty three five, you add the eleven thousand, two fifty.
That's thirty four thousan seven hundred and fifty dollars pre
tax you get to put into the solo for one K.
(33:05):
But here's a little trick. Your business can also contribute,
and that business contribution can be up to twenty five
percent of your compensation in most situations, bringing the maximum
that you can contribute pre tax in a solo for
one K to seventy thousand dollars. Pretty good chunk of money, right, Okay, Now,
(33:31):
why is this a wealth building strategy outside of Wall Street? Well,
first of all, you've obviously reduced your taxes for your
business and yourself personally, depend upon your business structure. But
where I use this? A lot for real estate agents
or real estate investors that are a business, a true business.
And how do I use it? Well, guess what? You
build these up to a large enough value. One great
(33:51):
thing about a solo four one K. It's like the
Big Boy four oh one K you get through an employer.
You can borrow against fifty percent or up to fifty
percent or up to fifty thousand dollars of your value.
So if you had one hundred thousand dollars sitting in
your solo for one kit, you can turn around and
take a loan of your own money for fifty thousand dollars,
pay back schedule up to five years. Great tool to
get your hands on capital very quick, maybe a real
(34:13):
estate deal comes up or whatever the case is, tremendous
way to go. So another way to build wealth outside
of Wall Street backdoor wroth irays, boy I wish I
had about another hour to talk to you about those.
That again is where for those of you that make
too much money to be able to qualify to go
into a roth ira. But this is where you fund
a traditional ira. You don't get the tax deduction, but
(34:36):
you immediately converted into a roth ira. And the idea
is you have to try to do it with zero tax.
So you put in your seventy five hundred dollars IRA
contribution and the next day you convert it into a
wroth and guess what. Now you have eight thousand dollars
or seventy five hundred dollars in a tax free, tax
deferred investment, meaning the roth ira that you can turn
(34:58):
around and do a lot of things with. So the
bottom line is this, folks. And then my final point
was different insurance products like index universal life annuities and things,
but we don't have time for that. So the bottom
line is this, here's your goal to build wealth outside
of Wall Street, build multiple strings of income, use cash flow,
not to go home, blow on stuff, but to buy
more assets and focus on time freedom not just net worth. That,
(35:22):
my fans, is true financial freedom. Hope you enjoyed it.
Want more info, call the office or send us say
an email. God bless, have a great afternoon see tomorrow
on the John Sanchi Show. John Sanchez is a registered
investment advisor, and the opinions expressed by Sanchez Gone Capital Management,
LLC on this show or their own and do not
reflect the opinions of News Talks seven eighty or its
(35:44):
pairing company, Cumulus Media. All statements and opinions expressed are
based upon information considered reliable, although it should not be
relied upon. As such, Any statements or opinions are subject
to change without notice. Information presented is for educational purposes
on the end, does not intend to make an offer
or solicitation for the sale or purchase of any specific securities, investments,
(36:05):
or investment strategies. Investments involve risk, and, unless otherwise stated
or are not guaranteed, information expressed does not take into
account your specific situation or objectives, and is not intended
as recommendations appropriate for any individual. Listeners are encouraged to
seek advice from a qualified tax, legal, or investment advisor
to determine whether any information presented may be suitable for
(36:28):
their specific situation. Past performance is not indicative of future performance.
Good Wednesday afternoon to you. Welcome to the John Sanchez
Show on News Talk seven eighty k WH. It's a
pleasure to be with you. I am flying solo this afternoon.
Mister Ganta has a busy pack schedule, so I'm going
to run this ship for you. Thank you so much
for joining me. I do appreciate it. I am really
excited to talk to you about a very important topic
in my heart. So as many of you know that
(00:25):
if you're you know, clients of our firm, or you've
met with us in the past, or you've been a
longtime listener of this show, many of you have questioned
me over the years in regards to my I've had
(00:56):
it many times where we've recommended to a client like, hey,
you know what, we're really not the best choice for
the sum of money that you have. We think it
would be better for you to, I don't know, go
start a small business or put it into real estate,
right I mean, And people are like, well, wait a
minute here, you don't make any money off of that. No,
we don't. That's more than fine, right. We're not in
(01:18):
this to make money. We're in this to help our
clients and future clients, so we're kind of unique when
it comes to that standpoint. We believe that whatever is
the most appropriate way for you to build wealth, that's
what we're going to advise you on. Whether it's the
stock market and a combination of real estate, small business,
whatever the conditions are, and whatever the different mix is,
(01:40):
that's all we care about. Right, whatever is right for
you as our client, that's what we're going to recommend
to you. Nothing to benefit us, all to benefit our client.
So with that said, I thought, you know what, it's
a great time this afternoon to revisit something that we
haven't discussed in quite some time. And I want to
start you to be thinking about this for a second
(02:01):
before I get to the stock market side. Do you
think the stock market is the only path to build wealth? Well,
if you said yes, and I want you to think again,
because that is absolutely not the case. Today I'm the program.
What I'm going to be doing for you is I'm
going to be breaking down how to build true sustainable
(02:24):
wealth outside the scope of Wall Street, from things like
real estate to private lending, business ownership, and even alternative
investments that the wealthy people of this country quietly use
to build their wealth each and every day. So it's
going to be a very very wonderful show as far
(02:45):
as the things I'm going to teach you as we
go through this, because again, true wealth is not built
in one dimension. It's not built just with the stock market,
or not built just with real estate, can it be sure?
But for most people the answer is no, it's a
combination of things. And so again you're going to learn
how you can build your wealth through a combination of things. Again,
(03:08):
real estate, small business, private equity, different things along those lines.
So again, going to be a great way for you
to learn about something outside the scope of what we
normally talk about on this show each and every day,
which of course is Wall Street. All right, So I'll
be getting to that in just a moment. Let's recap
the what the heck happened today volatile session. First of all,
(03:31):
we had weakness, we had strength, We had weakness, We
had strength throughout the entire session. But again, as I
always say it, all that matters is where. We closed
that at one o'clock and it was a nice game
across the board, but it was a lot of wide
swings going on. We finished with a game of two
twenty six on the Dow. That was a point four
to eight percent rise, closing at forty seven three eleven.
(03:52):
Now is that game one fifty one point sixty five percent,
SMP at twenty five points or point three seven percent.
But again, we have some underlying issues that are continuing
to dominate the market, well, the first one being market.
One of the reasons it was so volatile today. Of course,
today is when the Supreme Court began hearing the case
(04:13):
on whether President Trump's tariffs are legal or not, and
the takeaway was they may not be. There are some
things going on in this court case. At least what
happened on the first day, and I don't know how
many more days they have left. It doesn't sound like
many that many are saying, well, wait a minute here,
(04:34):
we don't know if what the president did, what the
Supreme Court said, We don't know what the president did
if it was legal. Now, the only thing we need
to really discuss right now, because we're not going to
speculate if the Supreme Court rules against the Trump administration
or in favor of because again there's a million different scenarios.
(04:57):
But the most important thing to remember is if the
administration loses the lawsuit. Remember the gist behind what's behind
this whole thing, is they, meaning the government or the
Treasury specifically, will have to refund hundreds of billions of
dollars to businesses that were charged the tariffs. And that's
(05:19):
what has everybody concerned. Is well, wait a minute, here,
what happens if indeed the Trump administration loses. So the headlines,
if you kind of follow it, say that the Supreme
Court justices appeared deeply skeptical about the legality of the
tariffs imposed. Conservative and liberal justices sharply questioned, excuse me,
(05:41):
questioned the Solicitor General d John Sawyer about the justifications
of the tariffs, which critics say infringe upon the power
of Congress to tex Now, remember the lower courts a
few months ago said the president lacked authority under the
International Emergency Economic Powers Act. Remember that's what he claimed
that it was an economic emergency the reason that he
(06:02):
started the tariffs. But the lower courts, like I said
a few months ago, indicated that he lacked the authority
to impose these reciprocal and fentanyl tariffs on imports from Canada, China,
Mexico and other trade partners. Jersey Secretary Scott Bessent attended
the arguments. No comments from him. So the gist from
(06:22):
what I've heard so far today is it didn't go
well for the Trump administration on this, and again some
of these judges, which remember we've got a little bit
of a mixture on Scotis a little bit of a
mixture there. It's kind of a toss up right now,
is what many of the legal authorities are saying. So
once again we'll see how much longer this has. Again,
(06:44):
the indications going into it was they're under pressure, meaning
Scotis is under pressure to get this a decision made
as quickly as possible because again the government is continuing
to collect the tariffs, and if they are ruled illegal,
then once again the Treasury is going to be writing
in a big check. I, however, think that if the
(07:04):
ruling goes against the Trump administration, which I tell you
it's a fifty to fifty shot. I mean, I've seen
the Supreme Court rule in favor of Trump and things
that I would never think that they would, So we
know the bit of a bias that's going on there.
So you know, if I was a betman right now,
I'd say, I think Scotus is going to rule in
favor of the Trump administration, maybe not give him everything
(07:25):
he wants, but I'd say the vast majority. But let's
say I'm wrong. Let's say that they do rule against him.
There's a few other backup plans, which again I could
do an entire show on the backup plans that he'll
go to. Besides, of course, you know, I don't know
if they can appeal once it's at this level, but
they've already said there's a few other little loopholes in
the law that they can do. So again, as the
(07:46):
news headlines came out of the out of the hearing, again,
that was the we'd see the market kind of go
up or down. And to be honest with you, the
market almost got excited. It actually moved up when the
headline started to come out that things weren't going for
the Trump administration during the hearing. And so you kind
of sit there and go, well, okay, if that's the case,
(08:07):
then maybe it would be positive obviously for the market.
And it makes a lot of common sense, right if
there's you know, no tariffs or dramatically reduced tariffs, guess
what corporate America should have more money towards the bottom line,
and you and I as a consumer should have more
money to go out and spend because we're not paying
an extra whatever ten twenty thirty percent on tariffs. So
that could be ruled again in the favor of the
(08:30):
markets and you know, as us as individuals. So as
of last week, the federal government collected one hundred and
fifty one billion dollars from custom duties in the second
half of fiscal year twenty twenty five. That is nearly
a three hundred percent increase over the same period in
fiscal year twenty twenty four. So there's a lot of
money at stake here, a lot of money. But again,
(08:52):
that was one of the big volatile issues going on
in the market today. Where were a few other things
still the AI valuation theme started. We had Advanced micro
Devices report at numbers this morning, pretty good numbers, but
still again some concerns about valuation in the semiconductor slash
AI space. Some of the other big winners. I'm just
(09:13):
kind of looking through my list right here. We had
Meta today had a pretty good day, up eight dollars
and sixty three cents one point three eight percent. Six
thirty five ninety five. Tesla was another star performance, even
though German sales were down fifty percent. Heck, the stock
rallies right, it seems to be what happens bad news
and the stock goes up seventeen dollars ninety cent gain
on a Tesla to four sixty two to twenty three.
(09:34):
That was a four point zero five percent rise. McDonald's
was the star of the dowt to day after reporting
a third quarter miss and a revenue that was in
line with expectations, but basically the street focusing on stronger
than expected same store sales momentum both in the US
and international markets. McDonald's finished up six dollars and forty
six cents two point one six percent to three zero
(09:55):
five ninety seven. Apple kind of flap ten cent gain
to seventy four. Microsoft lost a bit, down seven dollars
and seventeen cents, same with Navidia lower by three dollars
and fifty cents about one point seven to six percent. Pellingtai,
which again got beat up yesterday on the valuation scenario,
lost about two dollars and eighty four cents today to
win eighty seven to ninety and Micron was a big
(10:16):
standout with a gain of eight dollars and or excuse me,
eight point ninety three percent of nineteen dollars and forty
seven cents to two thirty seven to fifty. So, like
I said, a lot of movement underneath the surface, but
it was all said and done, turned out to be
a pretty decent day. Today. We're actually up over three
hundred at our best level on the dow back down,
almost went negative a couple times early in the morning,
and then like I said, finished in the nice solid
(10:38):
gain of two twenty six. On the commodity side, we
lost ninety eight cents on oil to a price now
broke the sixty dollars mark fifty nine sixty a barrel
golled up thirty two dollars and ten cents three seventy
nine three thousand and seven ninety three fifty an ounce
three thousand, seven ninety three fifty and a big increase
in bond deals across the board. Tenure up seven basis points,
and that was, like I said, a not only in
(11:01):
the tenure did we see a bump up in yields,
but it was right across the board. The tenure by
the way finished at four sixteen, but two year was
up five basis points, five years up six basis points,
thirty year was up seven basis points. So it was
one of those days where it went strong across the board.
We did actually get one report today that was in
regards to the labor side. ADP did report, for those
(11:23):
of you that believe the ADP numbers, that the economy
in the month of October gained a whopping forty two
thousand jobs in the month of October. Estimates were only
twenty two thousand. And then we had the October Institute
of Supply Management, what we call the ISM service number
that came in at fifty two point four. Prior reading
with fifty, you want to read in above fifty to
show expansion. So pretty good numbers there, and they gave
(11:44):
us a bit of a boost when those numbers came
out early this morning. All right, you're up to date
on the market. Now, when we come back, let's get
down to a great topic beyond Wall Street, the other
paths to twelth Let's turn it over to Christen snow
right now Traffic Center. Hello, Kristin, Welcome back to the
John Sanchez Show on Newstalk seven eighty kah. Pleasure to
be with you this afternoon. Again, Jason, that tied up
(12:05):
in some office activities, I'm fine, solo. Ready to get
to our topic, how to build wealth outside of Wall Street.
I know sounds strange coming from a guy that mixes
living on Wall Street, but you know what, there are
other ways to do it, or let's just say a
combination thereof. But first, once again, good session today at
two twenty six gain on the DOUBT one fifty one
on the Nasdaq and a twenty five point increase on
(12:27):
the S and P five hundred. Well, once again, as
I said earlier, if you think wealth can only be
built on Wall Street, you're absolutely incorrect. It can be
built in a lot of ways. And again, the purpose
of today's show is really simple. Let me help you diversify.
I let our firm help you diversify your wealth into
areas outside the scope of Wall Street. It should be
a portion of it, but it doesn't have to be everything.
(12:47):
For some people, that's all they do. It's what they
feel comfortable with, no problem. But for those that want
to diversify, and you know, something interesting we're seeing is
in the younger generation. This is exactly what they want
to do. They wanted to fine and build their wealth. Well,
it's a portion of it, but it's not everything like
some of the older generations are. So this is kind
of interesting. So if you have any kids or grandkids,
(13:11):
you know what, pick up the podcast. Tell them pick
up the podcast. This may be right down their rally.
All right, So let's get into I don't know what
do I have here. I've got about I guess about
seven different systems and ideas for you. Okay, so here
we go. How do we build wealth outside the stock market?
First one, many of you do it already, real estate investing.
(13:31):
How do we build wealth there? Well, I've got four
points for you. Number one, rental income and appreciation, right,
long term cash flow, hopefully some equity growth ability as
we discussed yesterday with the boys' ability to borrow against
some of it. If you need to to use it
either to pay off lower interest debt or to buy
more real estate or to buy more investments. It gives
(13:52):
you a lot of advantages. And as I always say
when I recommend real estate to a client, one thing
that the stock that real estate can do that the
stock market can in most cases, it can give you
some terrific tax advantages. This great thing called depreciation a
phantom expense. Right, It's a way to lower your taxable
income without really doing much. Right, That's what depreciation is
(14:12):
all about. Cash flow. We love adding real estate to
our client's portfolio when they're in or near retirement. Why
because it's another income source. Let's go to point number
two under real estate ten thirty one. Tax deferred exchanges.
Just got finished doing one, or helping a client with
one a few days ago last week. Phenomenal tax strategy. Right.
(14:35):
This is where you sell an appreciated piece of investment
real estate and you exchange it for another investment real
estate or business of equal or greater value. You buy
a rental house, let's say, for five hundred thousand. A
few years later it's worth seven hundred thousand. You go, oh, man,
I want to sell it, but I don't want to
pay capital gains tax that two hundred thousand dollars profit.
(14:56):
Guess what do a tax deferred exchange ten thirty one?
Move that over you find another property seven hundred thousand
dollars or more. You do that. You follow all the rules,
and again we did a couple of shows a few
months or a few weeks ago about ten thirty one's
follow all the rules and you will be deferring your taxes. Okay.
(15:17):
Now you may be saying, okay, great, I get to defer.
But remember this is what many of the wealthy will
do with real estate. They do tax deferred exchanges, one
after the other. Right, They've got them going for years
upon years, and then what happens to all of us
at some point we die. When we die, our beneficiaries
that inherit that property received a stepped up basis. So
let's say we started in twenty twenty five buying a
(15:39):
five hundred thousand dollars property. A couple of years later,
it's worth seven hundred thousand. We want to sell it,
and we go out, we do a ten thirty one
tax deferred exchange, buy another investment property of equal or
greater value. So we buy one for seven hundred and
fifty thousand, and we hold that until it hits a million,
and then we do it again, and maybe we decide
to sell that million dollar property for one point five million,
and we continue to do that under ten thirty one
(16:01):
TAXI for exchanges and by the time we die. Let's
say it's all worth three hundred thousand. You started with
five hundred. Now you're in properties that are worth three
or three million. You haven't paid a dime of capital
gains tax on it, and then you die. Well, if
you are my children, guess what. If you are my beneficiary,
my children or whomever I've named, guess what you get
(16:22):
to inherit that real estate that's worth one and a
half or three million dollars. That's your new cost basis,
not my five hundred thousand. You see the major difference there,
really really powerful strategy, especially for those of you listening
in California or other parts of the country where you
have a big high capital gains tax, because not only
do you have to pay federal, but you have to
pay state. In some states no matter, we don't obviously,
(16:45):
but California you do. It could be as high as
thirteen point three percent. So make sure if you have
an investment property you want to sell, make sure you
consider the ten thirty one TAXI for exchange. Great way
to build wealth, and eventually you know, you die and
like I said, your kids receive the stepped up basis.
Another great way short term rentals and accessory dwelling units
(17:06):
eight US. We discussed this a few days ago on
the show again the city of Renos passing some new
rules making it more favorable for you to be able
to build an ADU in some circumstances. These are little
dwellings that you put if you have a big enough
property your zone correctly, you follow all the rules that
you can put in the backyard. Maybe you got a
couple of acres and you can put one in the
backyard rent it out right. That's a great way to
(17:28):
build wealth. Maybe that thing will appreciate in value. But
you're going to get some cash flow that Hopefully you
take that cash flow and invest it into something else
and multiply that cash flow so you're getting a thousand
dollars a month rent from that ADU beautiful instead of
spending one thousand. Take it and put it in the
stock market or in some other investment that we'll talk about.
And then finally, commercial and mixed use real estate offer
(17:50):
often higher cap rates, lease stability. Again, when you start
getting into commercial real estate, it has a whole set
of risk and rewards that residential real estate doesn't. And
you know, especially when we're talking single family rents, right,
How nice would it be to get into a big
commercial building, a warehouse space or something if it fits
your parameters? And again, nice stable long term leases and
(18:13):
great depreciation schedules on some of those. If you do
the what's called segregation depreciation, where you're breaking down all
the elements of that commercial building and assigning a lower
depreciation schedule versus the entire structure. It's called cost segregation.
Very very powerful tax strategy and a great way to
(18:33):
build wealth. So real estate, let your imagination wonder. You know,
we of course can get into what we call package products.
When it comes to real estate, you always those to consider,
and again we've been more happy to sit down and
share those with you. Let me squeeze in business ownership
before I go to break. So what can you do
on the business ownership to build wealth outside of Wall Street?
Of course, you can start or buy an existing business.
(18:55):
You have direct control, you have scalable income. That's how
I built my net worth through businesses. There's no better
way in my opinion. No stock market, no real estate,
no nothing can build wealth faster, more sustainable, and in
greater amount than a business can that's my opinion. Some
don't agree with that, But I tell you what, you
(19:16):
build a solid business, you have unlimited income potential, you
get some tax deductions, you hopefully get to do what
you want to do. You don't dread getting out a bit.
I don't dread getting out a bit. I can't wait
every morning when my alarm goes off a four to
hit the ground running. I love it. Am I tired
by Friday afternoon, absolutely, but it's a great feeling because
I've worked hard all week. Build a business. Folks, especially
(19:37):
those of you that are young, no better way in
the world to build your net worth in my opinion,
and that you talk about investing out of Wall Street.
Those of you that don't want to start from the
ground floor, consider buying a franchise. Pluses and minuses to franchises.
But you know, there's a lot of people that have
been become extremely wealthy. Look at some of your McDonald's
franchisees right, just as an example, there are some very
(19:58):
very wealthy franchise he's out there. Because you're coming into
a turnkey system, you have to give a little bit
back to the parent, absolutely, but in return, hopefully you
have a proven business model, and you're not having to
go through a lot of the trials and tribulations many
of us do when we start a new business. And
don't forget about silent partnerships. Right, nothing says you have
to have day to day involvement into the business. You
(20:20):
can be kind of the bank right, invest the capital
without the day to day management, lend the money to
the up and rising entrepreneur or the existing entrepreneur, and
get some pretty nice interest rates these days for doing that.
I just run across that situation the other day where
I had a friend that is in a cash bind
and he needed to borrow some money. And it's like, well,
it's gonna cost you a lot of money to do that,
(20:43):
but you know what I offered him wasn't fair. I said,
you know, here's the number to my banker. Go contact
him and get yourself a line of credit real quick.
Get past your little hiccum. Wish I could have helped him,
but just didn't make economic sense for either one of us.
But again, you can be involved. I've shared stories over
the years. I've had clients that just made a living
literally going in by an existing business and improving it,
(21:06):
making it very very profitable, and then they turn around
and sell it, and then they go on and do
the next one and the next one, or they invest
in again, maybe a friend, family or whomever, someone that
has a good operating business, but maybe they want to
double or triple the revenues. They need capital to do it.
Good luck getting capital from the bank these days. It's
very very difficult, especially if you're a young business. But
(21:26):
you know, if you know these people and you can
collateralize what you're going to lend to that entrepreneur, maybe
an idea for you to consider wealth building outside of
Wall Street. We'll come back and talk about my third idea,
which is private lending and notes, similar to what I
told you a moment ago, but we'll go into more detail.
S turned over to Jack Saban News traffic and whether
it's what he has. Hey, Jack, Welcome back to the
John Sanchez Show on Newstalk seven eighty KO. Wait once again,
(21:48):
we finished with a nice set result on the market
to twenty sixteen on the dalm a Zac grows one
to fifty one s somep hire by twenty five. All right,
we're going through different ways to build wealth outside of
Wall Street. All right, I've covered real estate investing again
under that rental income and Appreciation ten thirty one taxi
fort exchanges, short term rentals in ADUs and commercial or
(22:08):
mixed real estate. Then we got into my second idea
business ownership started by an existing business. Look at a franchise.
If you want to don't want to start from ground zero,
or if you don't want to be involved but you
have the capital to do it, consider being a silent
partner in another business. All right, here's my third point,
private lending and notes. How do you like this term?
(22:29):
Be the bank earn a fixed rate of return by
lending money to real estate investors or small business owners. Again,
make sure you have your CPA, your attorney involved, write
up everything correctly, make sure you've got good collateral. Once again,
there are some somewhat stringent rules in Nevada when it
comes to lending in real estate. There a certain amount
that you can do without being considered a quote mortgage lender.
(22:53):
So again, your attorneyshould able to direct you in that area.
But I've seen clients over the years. For the most part,
I don't recall any of them that had a loan
go bad on them, But boy, they made some pretty
good money. You know, you charge a few points or
maybe more three or four points upfront higher than expected
rates because again, these people need the money quickly, you know,
(23:15):
ten to fifteen percent I've seen over the years, and
like I said, numerous points up front can be pretty lucrative.
Usually they do it for about a year and they
collateralize the real estate that the that the person needs
the money for. So not a bad way to go. Again,
make sure your whole team's involved with that great way
to build wealth outside of Wall Street. Now under my
private lending, I also have collateralized notes again protect the
(23:38):
downside with real assets. A collateralized note can go for
anything someone that you know, again, a business owner for example,
that needs to buy a new piece of equipment and
the bank will give them the money or they need
the money now. And the bank of course takes forever
to give a loan these days. So you can look
at doing the collateralized loan, same type of thing, figure
out what you want to charge as far as points
(23:58):
and the interest rate, and then similar to what I
mentioned about the silent partnership on the real estate side,
or excuse me, on the business ownership side. You can
also do, of course, what we call peer to peer
lending platforms. There's all kinds of them out there. I
use one personally, just a full disclosure. I can't tell
you the name of it, but I send in a
little bit of money every single week, and they structure
(24:21):
it among a number of notes. Right, they turn around
and lend money out. I don't have to do anything,
and collecting a pretty nice interest rate on it, et
CETERA great way to go. But there's all kinds of
those companies that are out there that do the peer
to pure lending. I don't say it's going to be rich,
but not a bad cash flow. You just have to
understand it and what the fees are and so on
(24:41):
and so forth. All right, let's move on to number four,
the alternatives. Folks, if you haven't already heard, you're going
to be hearing more and more and more in the
press about alts or alternative investments. And the reason I
say that is because the Trump administration Department of Labor
are in the midst it looks like they've quasi approved
it and seeing anything where it's one hundred percent finalized,
(25:02):
where alternative investments are going to be offered in four
to one case for the first time ever in history. Now,
what's an all, Well, pretty much anything that's not involved
in Wall Street. It can be real estate, precious metals,
private equity, so and so forth. Again, there's a lot
of pluses and minuses to them. You have to really
understand what you're doing or have an advisor that does.
But let's just go down the list. So, one great
(25:24):
alternative investment you can do on your own precious metals, right, well,
remember where gold was just a few weeks ago, much
lower than where or much higher than where it is
right now. But again, many if you like to own gold,
that's an alternative investment to your stock market portfolio. It's
a great hedge against inflation, market volatility, so on and
so forth. And again you can use any precious metal
in that example. We just got going, got done going
(25:46):
through that big run up in the rare earth metals.
Right those stocks were just on fire for a while,
but they've created ever since. Second alternative investment, private equity
and venture capital, early stage or growth phased companies. You
ever see some of these guys in thousand CNBC that
are worth billions and billions of dollars and they read
I watched one the other day. They didn't read the
(26:07):
companies that this gentleman had been a venture capital or
a private equity investor in, but they instead showed the
logos of all the companies. And these are guys. You
know again, I'm talking on the big scale that got
in early days of you know, Meta and some of
the great companies. There's so many of them now that
are getting involved in you know, upstart AI type of companies.
(26:29):
But you don't have to go to that biggest scale, right.
There's remember of years ago I was involved in a
in a local venture capital group and it was a
great opportunity. Right. People come in business owners come in
new or experience, and they pitched their idea to you,
and you do your due diligence and it may you know, fit,
and then you go, okay, you know, I'm going to
(26:51):
give you or lend you X amount of dollars in
return for X amount ownership of the company. That's how
the big boys do it. You can do it on
a small scale. Maybe you have a good friend or
relative of a neighbor or whatever the case is. It
has a great business idea, but they lacked the capital
that's private equity and venture capital. So once again make
sure you're turning your CPA or involved. But boy, all
it takes is one big one to hit and it
(27:12):
can be very lucrative. Second is collectibles and tangibles. Boy,
this is an area that's getting a lot of attention.
Not because of art wine, classic cars those have been around.
Farmland has always continue to be a very, very wonderful
alternative investment. You can read up on the stats of it,
but believe it or not, farmland for in most cases
(27:33):
has outperformed the stock market. You know, if you're working
the land yourself or you're just buying farmland and leasing
it out, a lot of great tax advantages and income
potential and hopefully appreciation as well. Rogers said, they ain't
making no more land. But here's one part under the
collectibles and tangibles that's really starting to get a lot
of attention. Sports teams. Have you read any of those
(27:55):
stories about how private equity and venture capital firms are
now coming in and taking a minority stake and NFL
teams for example, WNBA, NBA teams, etc. This is now
becoming basically an asset class just like a stock bond
mutual fund these sports teams. Many funds are being created
now that are going out and actively seeking ownership percentages
(28:18):
of some of these professional teams. I think this is
just the beginning. I think this is going to be
an area that is going to grow dramatically. I would
not be surprised if I don't know, I'll pick a
time period, say ten years from now, long ways out
that they don't have some type of a private equity
or venture capital opportunity for people to invest in college
(28:39):
football teams. Right, very very lucrative for most colleges. But
most colleges, of course they need capital because they're paying
out a lot of money under these nil deals right
where they're paying the college athletes to perform, and many
of them need capital. Well, I'll tell you if a
venture capital fund came a call in with multi billions
for some state of that football team, I bet they'd consider.
(29:02):
And I've heard there's actually some rumblings going on right
now that that may be, you know, well before the
ten years that I just predicted. So sports teams of
all sorts, right, we've seen pickleball teams now and bad
I mean, you name it. There's soccer is another huge one.
Private equity is really involved in professional soccer teams like
on the MLS side and overseas, et cetera. So again,
(29:25):
depending upon what you want to look at, there see
if you can get involved in a fund, or maybe
again you can get in and get involved on a
smaller scale for a younger up and coming team, maybe
a sport that's not real popular yet. I know in
the world of rodeo that I followed very closely a
few years ago, so I got really smart and they said,
look at, these bulls are worth you know, in some
cases millions and millions of dollars. If this bull is
(29:47):
very successful and bucks off, you know, majority of the
cowboys on it, and these bulls would be worth millions
and millions of dollars. Their semen is worth millions and
millions of dollars in a lot of cases. And so
one guy got really smarter. I think a company that
excuse me, and they look at we're gonna sell off
portions of this bowl. You know, for X amount of
dollars you can own ten percent or five or twenty
or fifty or whatever. Took off like Gangbusters. I haven't
(30:08):
seen the last couple of years if that's still around.
But let your imagination wonder when it comes to anything
sports related. And then finally under my alts, structured notes
and annuities. Again, structured notes are somewhere to what I
mentioned earlier. We know about annuities, great income solutions. Just
again understand the pluses and the minuses of all of those.
Let's see, I'm going to say five and six for
(30:29):
when we come back from the break, because these are
really good ones. I want to kind of wrap up with.
Let's turn it over to Jack say excuse me to
Kristin snow right now, traffic center kerr Risten, Welcome back
to the John Sanchez Show on News Talk seven eighty
ko H, all right, we're going to continue on our
discussion how to build wealth outside of Wall Street. So
we're working on well, we just wrapped up the alternative investments.
(30:49):
Now I want to move into a really really great
area self directed retirement accounts. Oh yes, self directed iras.
Keep in mind, folks you may or may not know this.
Stay tuned. You'll be hearing much more from us on
this U than the next month or so. An IRA
can be invested into anything outside the scope of collectibles
meaning stamps and rugs and life insurance. Yes, you heard
(31:13):
me correctly. An IRA can be invested into anything other
than collectibles, stamps and rugs and life insurance. Want to
buy real estate inside your IRA? You can? Want to
go buy account inside your IRA? You can, And like
I said, in a short period of time, we're going
to make some major announcements and show you how it.
Sanche's got capital management. We're gonna be able to help
you do this. But that is a great way to
(31:36):
build wealth if you obviously choose the right investments. But
I want to take you back for a second to
the entrepreneurship side of things. There's another tremendous way. I
love setting these up for clients. They're called solo four
to one case. They're a four to one case the
name says, but solo is the key. They're designed for
a one person business or a husband and wife business
(31:57):
if you have employees. Forget what I'm going to tell
you now. What are they? So? They're a very simple
retirement plan that you can set up when you are
self employed. But the contribution limits far surpass a normal
four to one K And I'll tell you how I
use them for our clients. Here's your numbers. If you
are age zero to forty nine, let's kind of go
(32:22):
with that. Twenty three thousand, five hundred dollars is your
twenty twenty five limit right now. If we are age
fifty to fifty nine, we get to play catchup. We
get to add another seventy five hundred dollars, bringing our
total to thirty one thousand dollars. Okay, Now, if you
are age sixty to sixty three, remember we have this
(32:43):
extra large contribution catchup for the next couple of years.
For those of us that are sixty to sixty three,
it's not the seventy five hundred dollars catchup. It's eleven
two hundred and fifty dollars ketchup. So you take your
twenty three five, you add the eleven thousand, two fifty.
That's thirty four thousan seven hundred and fifty dollars pre
tax you get to put into the solo for one K.
(33:05):
But here's a little trick. Your business can also contribute,
and that business contribution can be up to twenty five
percent of your compensation in most situations, bringing the maximum
that you can contribute pre tax in a solo for
one K to seventy thousand dollars. Pretty good chunk of money, right, Okay, Now,
(33:31):
why is this a wealth building strategy outside of Wall Street? Well,
first of all, you've obviously reduced your taxes for your
business and yourself personally, depend upon your business structure. But
where I use this? A lot for real estate agents
or real estate investors that are a business, a true business.
And how do I use it? Well, guess what? You
build these up to a large enough value. One great
(33:51):
thing about a solo four one K. It's like the
Big Boy four oh one K you get through an employer.
You can borrow against fifty percent or up to fifty
percent or up to fifty thousand dollars of your value.
So if you had one hundred thousand dollars sitting in
your solo for one kit, you can turn around and
take a loan of your own money for fifty thousand dollars,
pay back schedule up to five years. Great tool to
get your hands on capital very quick, maybe a real
(34:13):
estate deal comes up or whatever the case is, tremendous
way to go. So another way to build wealth outside
of Wall Street backdoor wroth irays, boy I wish I
had about another hour to talk to you about those.
That again is where for those of you that make
too much money to be able to qualify to go
into a roth ira. But this is where you fund
a traditional ira. You don't get the tax deduction, but
(34:36):
you immediately converted into a roth ira. And the idea
is you have to try to do it with zero tax.
So you put in your seventy five hundred dollars IRA
contribution and the next day you convert it into a
wroth and guess what. Now you have eight thousand dollars
or seventy five hundred dollars in a tax free, tax
deferred investment, meaning the roth ira that you can turn
(34:58):
around and do a lot of things with. So the
bottom line is this, folks. And then my final point
was different insurance products like index universal life annuities and things,
but we don't have time for that. So the bottom
line is this, here's your goal to build wealth outside
of Wall Street, build multiple strings of income, use cash flow,
not to go home, blow on stuff, but to buy
more assets and focus on time freedom not just net worth. That,
(35:22):
my fans, is true financial freedom. Hope you enjoyed it.
Want more info, call the office or send us say
an email. God bless, have a great afternoon see tomorrow
on the John Sanchi Show. John Sanchez is a registered
investment advisor, and the opinions expressed by Sanchez Gone Capital Management,
LLC on this show or their own and do not
reflect the opinions of News Talks seven eighty or its
(35:44):
pairing company, Cumulus Media. All statements and opinions expressed are
based upon information considered reliable, although it should not be
relied upon. As such, Any statements or opinions are subject
to change without notice. Information presented is for educational purposes
on the end, does not intend to make an offer
or solicitation for the sale or purchase of any specific securities, investments,
(36:05):
or investment strategies. Investments involve risk, and, unless otherwise stated
or are not guaranteed, information expressed does not take into
account your specific situation or objectives, and is not intended
as recommendations appropriate for any individual. Listeners are encouraged to
seek advice from a qualified tax, legal, or investment advisor
to determine whether any information presented may be suitable for
(36:28):
their specific situation. Past performance is not indicative of future performance.
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