126. Money Ripples: A Conversation with Cash Flow Expert Chris Miles
Adopt a cashflow passive income mentality and invest in assets that generate regular, predictable cash flow. In this episode, we sit down with cash flow expert Chris Miles as he discusses the value of asset-backed investments and the importance of holding cash for strategic investment decisions. After transitioning from financial advising to real estate investing, Chris got to retire at 28.
About Chris Miles
Chris Miles is a cash flow expert and the “anti-financial” advisor. Through his company Money Ripples, he works with clients to become financially independent and significantly increase their cash flow. Chris is also the host of the Money Ripples podcast.
Here are some power takeaways from today’s conversation:
[01:50] Growing with a scarcity mindset
[04:16] How he got into financial advising
[06:59] How Chris retired at 28 because of real estate investing
[10:16] The accumulation theory and financial institutions
[12:30] The FIRE Movement vs. the cashflow passive income mentality
[15:42] The value in asset-backed investment
[18:47] Why you shouldn’t bank on values going up
[21:12] What you need to know when investing in oil
[24:25] The value of holding cash today
[31:35] When investing in insurance makes sense
[35:33] Tips for finding quality operators
Episode Highlights:
[12:30] The FIRE Movement vs. The Cashflow Passive Income Mentality
The FIRE (Financial Independence, Retire Early) movement has gained significant popularity in recent years, focusing on accumulating a certain amount of wealth and living off a small percentage of it each year. However, this model has been debunked by various simulations that suggest a withdrawal rate of 3% or less, rather than the commonly suggested 4%. Living on 3% of a million-dollar portfolio amounts to a lifestyle below the poverty line, which is not what individuals envision when they think about financial independence. On the other hand, a cashflow passive income mentality focuses on investing in assets that generate regular, stable, and predictable cash flow. By investing in turnkey rentals, apartment syndications, and oil and gas royalties, for example, individuals can create a steady stream of passive income that can significantly improve their quality of life.
[15:42] The Value in Asset-Backed Investment
Asset-backed investments like real estate classes are less volatile than stocks. The S&P 500's yield average over the last 30 years is lower than expected at around 7.7%. Diversification in the stock market can be illusory due to a few dominant players causing fluctuations. Real estate investments offer lower risks and higher returns, making them a promising alternative investment with long-term growth potential.
[20:25] The Value of Holding Cash Today
In 2022, there was a prevalent belief that holding cash was a poor financial decision due to the risk of inflation. However, when the masses say one thing, it is often wise to do the opposite. While real estate and stock markets may be subject to fluctuations, cash can provide stability in uncertain times. If banks tighten their lending practices and quantitative tightening occurs, those who have cash on hand may have an advantage. While other investors may have their capital locked up in assets, cash holders have more flexibility and freedom to invest in opportunities as they arise. Thus, holding cash can be a strategic decision, particularly when other forms of investment are perceived to be high-risk or overpriced. In short, cash is still king or queen in uncertain times.
This show is for entertainment purposes only. Nothing said on the show should be considered financial advice. Before making any decisions, consult a professional. This show is copyrighted by Passive Investing from Left Field and Left Field Investors. Written permissions must be granted before syndication or rebroadcasting.
Resources Mentioned:
Learn more about Rise48 Equity's multifamily investments and schedule a call with their CEO Zach Haptonstall at rise48equity.com/invest.
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