In this episode of Coffee with Carl, attorney Carl Zoellner encourages a paradigm shift in the way people think about finances and assets to build passive income for financial freedom.
If your goal is financial freedom, you first need to know your net worth.
What’s goes into net worth? Traditionally, figuring your net worth involves considering all your assets. But what actually counts as an asset?
Infinity Investing teaches us to think differently about the things we own. For instance, when figuring net worth, most people include the value of their residence. That’s what the industry teaches.
However, when trying to reach financial independence, there’s more to the picture. The calculations change. Instead of looking only to equity for value, our Infinity Investing Workshop teaches a new way of calculating net worth. Namely, consider expenses against income. If it costs you money on a monthly or annual basis, it’s not an asset. It’s a liability.
Instead, focus on building passive income. The five types of passive income are rents, royalties, dividends, and short- and long-term capital gains.
Once you’re making enough money from your passive investments to live without working, that’s when you’ve reached financial freedom. Another way to think of financial independence is “Infinity income.” Every investment beyond that is gravy.
Watch as Carl compares the old and new methods of calculating net worth and explains the importance of redefining what we consider an “asset.”
Resources mentioned in this video:
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If you have any questions, comments, or feedback about this episode, let us know at [email protected].