This is part one of a two part discussion with Patrick Donohoe, is the go-to wealth management guy for Ryan's wealthiest peers and today's discussion centered on the mindset for wealth.

 

What are the first steps that happen when working with a financial strategist like Patrick? You will be immensely surprised — and get ready think about answers to really hard questions.

 

Key takeaways

[3:15] Patrick made his money in financial services. He shares his story, from moving van to where he is today and the mindset change that it all required.

 

Mindset will dictate your success [7:50] Having a lot of money does not mean that you will be wealthy. The one thing you have to do is figure out what it is you want to be doing in the end, money can't be the goal.

 

1. What do you really want?

2. Why do you want it?

3. Have you been acting in a way to achieve it?

 

The infinite game [13:00] Retirement is anti-life, the idea is to keep growing in ways that maximise your experience of life and ultimately contribute the most to society. Be adamant about growing.

 

The menu [14:15] The way Patrick counsels his customers isn't so much about products and strategies, but more about stages:

 

1. Certainty — no consumer debt, adequate reserves, healthy savings.

2. Vitality — you use your money to fund a fulfilling lifestyle.

3. Freedom

4. Independence

 

People are predominantly in the first and second stages. And a lot of people come to Patrick while in those 2 first stages — people are afraid.

 

Graduating from the Vitality stage [16:56] Graduation isn't going to happen if you're not taking a vacation.

 

With all this talk, Ryan begins to suspect Patrick's work really isn't about selling his customers products… Helping them find out who they are and what they want is more like it — and palliating their blind spots!

 

Captive [19:05] Patrick explains what Captive Insurance is — an insurance company you own that provides protection against legitimate business disruptions, and incidentally also serves as a tax ambiguity.

 

Passive cash flow = freedom? [24:00] Passive cash flow exceeding your expenses would sound like a good path to freedom? Patrick challenges this: freedom is a mindset.

 

First thing first is you should have a good bookkeeper just to get a sense of how your business is doing objectively.

 

The gap [26:00] The difference between what a person is and what a person wants is typically twofold:

 

1. Ignorance.

2. Discipline.

 

We are all our own worst enemies.

 

Social conditioning [27:51] There are a million possible financial strategies, but the way we are taught to think about money:

- It is the root of all evil

- Rich people are bad

- Money and time are correlated

 

So addressing those ideas we have — what is freedom, what is time, what is money is the first step to defining what the vision for your life should be.

 

What is your purpose, your reason, your soul?

 

Worthwhile pursuits [31:00] Due diligence skips over the people part… if you strip all of the numbers away, is there something there that still matters?

 

A business owner's values and how they align with the business itself, as well as what their goal is in the long term are good predictors of a business's success.

 

The catalyst to eventually making it is the people running the company, their "why", what they are after in life.

 

Losing [33:40] Who you are and how you act when things are going south say a lot about you… Patrick will not invest in a business owner that has never lost money.

 

Pause for some decisions [36:17] Before tuning in for part two of this in-depth discussion with Patrick, Ryan wants you to decide what you want and what you're doing all this for. Decide what your worthwhile pursuit is.

 

Tune in next time, for the number one investment with the highest ROI!

 

Thanks for listening!