Building Wealth Beyond the 401k with Lane Kawaoka

Tim Melanson: [00:00:00] Hello and welcome to today’s episode of the Work at Home Rockstar podcast. Excited for today’s episode. We are talking to the CEO of the Wealth Elevator, and what he does is he teaches people about investing in real estate private equity. He’s got a podcast that’s been running for nine years. He writes books.

Uh, lots of cool stuff. So I’m excited to rocking out today with Lane Kawaoka. Hey, lane, you ready to rock?

Lane Kawaoka: Ready to rock Tim, thanks for having me.

Tim Melanson: Perfect. So we always start off here on a good note. Tell me a story of success that we can be inspired by.

Lane Kawaoka: So I was a engineer back in 2007 when I graduated. Uh, bought a rental property a couple years later and today, um, have bought over $2 billion of deals in the past. Um, and yeah, that engineering job went by the wayside, I think 2018, and that’s when I am now able to work from home.

Tim Melanson: Wow. Right. On engineering to, uh, to buying properties, eh, how did that, uh, [00:01:00] how did that come about? What was, where, where did the idea come from?

Lane Kawaoka: Yeah, so I mean the, the, my parents never owned rental properties. In fact, in the beginning they, they were always ones that always say, you don’t want people to live in your house because they’ll trash it. Um,

Tim Melanson: Hmm.

Lane Kawaoka: but you know, in 2000 and. Seven. I graduated and I had a good paying job, so, and I was a good saver, so I was able to save 20, 30 grand per year, and I saved that up after a couple years to.

Put in a down payment up in Seattle, Washington where I lived up there. And at that point I was always kind of brainwashed to do the 401k, you know, the retirement plans and buy a house to live in. ’cause again, that’s what we’re all taught to do. And this is in my early twenties and I was traveling all over for work at the time.

Um, you know, really never home. I was a construction supervisor. I was my first role as a engineer and. Because I was only home on Saturdays, it was kind of silly for me to have this big house to myself. So [00:02:00] kind of on a whim, I just called up an old property manager landlord and you know, kind of had got them to manage my property and I became a landlord and I, you know, lived off the company dime, you know, lived in the hotels.

They put me in and I. Got this taste of cash flow. And that was kind of the split from normal divergence of finances and investments. And, and I started to realize, like in the beginning it was, it was, you know, just beer money, right? The mortgage was 1600 and the rents were 2200. I, I was very unsophisticated.

I didn’t do nothing about like the rent value ratios you’re looking for and you know, the 50% rule where half of your expenses, typically, half of your rents typically go to go to expenses. Like things break paying for the property manager. I just, you know, thought, oh wow, this is kind of cool, right? I’m getting this, this beer money on the side and.

That was kind of when I was like, wait a minute, if I kept doing this a few more times, you know, several years, it’s not a get rich quick scheme, I’ll [00:03:00] be able to escape the rat race and you know, just fool around at home all day long.

Tim Melanson: That’s all. Some well done. Well, okay, so I don’t know, things don’t always go as planned. Usually there’s some things, some hiccups along the way and I’m wondering, can you share with me something that didn’t go as planned on, on the way on, on that journey?

Lane Kawaoka: I mean, in the beginning, you know, you’re, you’re clashing with a lot of. Financial ideas, tips out there from all kinds of sources. Um, one of the things that I’ve always told people is you never take financial advice from people who are not financially free. You know, you never take financial advice from the people at your, the day job in the cubicle world, or you know, people still at the grind 20, 30 years later ’cause they’re probably doing it wrong.

Right? And you wanna take financial advice from wealthy people or ideally, you know, first generation multimillionaire who created their own wealth. On their own. Um, and one of those things very early on was, you know, I, I thought that it would make sense to go to a [00:04:00] 15 year mortgage instead of a 30 year, right?

Because everybody talks of how much more interest do you pay In reality, investors are looking at from a different point of view of, you know, elongating your mortgage payments so that you can go and pick up more and more. Assets or properties. Right. That’s the big part of it. You know, everybody’s talking about this 50 year mortgage saying, or heck throw it a hundred years, right?

But yeah, you’re paying a bold or more insurance, but that’s kind of myopically looking at the debt portion. If you could take that mortgage and go buy, you know, because you’re shielding your monthly income a little bit, you could take that ink, that income and have it pull up and buy another property and then another property.

And another property. That’s what you have to compare the two scenarios. Um, actually kind of working on, on a video on, on this very topic. But yeah, very early on I, you know, switched to 15 year mortgage and, you know, I started to interact with more sophisticated investors and started to realize that was the opposite way I wanted to [00:05:00] do, and I had switched back, you know, so I pay a lot of money.

Of these hidden fees to these brokers to do that. And so, you know, a lot of these, like I had to kind of unlearn a lot of the things that my parents and society taught me getting into this world. And, you know, for 2000 and, you know, that was 2012, I bought a duplex, the next property in Seattle. And then, then I started to buy property sort of site unseen in Birmingham, Atlanta, Indianapolis, thousands of miles away.

And you know, more for cashflow, you know. Typically you look for properties where the monthly rents divided by the purchase price is better than 1%. So, you know, at that time, you know, buying properties that were 60, $70,000 that could rent for $800 a month out there, and this, you know, did that till 2015 were, I had 11 of these, these things coming in, but still working the engineering job, you know.

Tim Melanson: Wow. Wow. Okay. So, I mean, isn’t that interesting that we have to unlearn so [00:06:00] many things, eh, that, that we’ve been taught in order to, to have that success? I mean, hey, it makes sense. I mean, that’s why they say it’s the 1%. I mean, they must be doing something different, right?

Lane Kawaoka: Yeah. And, and, and you know, in 2016, that’s also when I started my podcast, right. Which opened a lot of doors for me networking wise. And, you know, some of those doors I walked through were just interacting with other accredited investors, you know, and credit investors. It is not like you need test or anything like that, it’s just you have a net worth of a million dollars or you make over $200,000 a year.

Um, so sort of wealthy people, right? Um, and I started to interact with them and started to realize a lot of the best practices and strategies that they did were, you know, the three, the big three big things. They invest in alternative investments. Off of the main street, the Wall Street investments. Um, number two, they, with these real estate projects, et cetera, or oil and gas, they enact a lot of these different alternative [00:07:00] tax strategies that go well beyond your retirement account.

That’s kind of small potatoes, and then they use life insurance in a unique way. Um, but this, this, these three strategies put together, I kind of call the trifecta that we talk about in the wealth elevator. Um. It’s not something that any guy can’t just do, but it’s kind of opposite of how people would put it together, in fact.

But like you said, this is how the wealthy do things. And this is what was confirmed to me multiple times and micro um, connections and interactions. And it is, you know, started to read the writing on the wall. It’s like, wow, these, these very wealthy, intelligent people, um, doing things very. Differently, but this is not something that the average joke can’t do, and that that was kind of started to be my passion.

And I mean, it started to actually upset me a little bit. You know, so many people work so hard out there banging their head against the wall so much and trying to save, and they’re just doing it the wrong [00:08:00] way in a way.

Tim Melanson: Yeah. I’ve had some similar frustrations and, and then, I mean, you know, when you start to learn these things, I don’t know if you experience the same thing, but you, you just start to tell people about it and they just think you’re crazy. It, like, they don’t take your advice at all. And I’m like, I. Well, I don’t know.

I’m just, I’m just, I’m just literally looking at this guy that makes way more than both of us combined. And that’s what he’s doing. I, I, I don’t know what to, what else to tell you. Oh, you know, it’s probably some sort of scam that they’re doing or whatever, trying to trick us. Right. But I mean, just over and over you keep on getting confirmation that they do do it differently.

Right. And, and we are taught something totally different.

Yeah,

Lane Kawaoka: Yeah, I mean, they’re not trying to sell me anything. I just met him and I met 50 other guys that are just like him. Um, and they’re all doing the same different strategies. And you know what’s cool is like everybody comes to it from different directions, but a lot of ’em came through it. Like how I did, they, they did rental properties for a [00:09:00] decade, you know, been there, done that.

And you know, they, they, after a while when you become an A credit investor, you kind of step up to that next level. And this is kind of what I talk about in my book where I have different levels of the wealth elevator, all these floors, right? The set of strategies when you’re under a million dollars net worth are different when you get above that, and then when you get three to $4 million, the strategies.

Change a bit. But, you know, going back to, you know, all those little conversations with, with all these people, you know, started to really see a stark difference. And, you know, like you said, um, you know, people have your average person out there clashes with these types of ideas. Maybe it’s ego. I mean, for me, I, I just don’t care.

I don’t, if people don’t wanna listen, I don’t care. I’m not one of these evangelist kind of guys who’s gonna just bug everybody. I’m a, I, I’m an introvert, so I’m gonna keep it to myself. Right. Um, you know, I was recently featured in the Business Insider. Uh, if you Google my name, it’s kind of a strange, um, [00:10:00] headline they wrote on me where like, I only kind of hang out with like accredit investors these days.

Uh, you know, it’s. I’m changing the title ’cause it kind of, my, my wife kind of laughed at me. She thought it was kind of weird, but you know, she’s like, yeah, you know, you don’t, you don’t really, um, talk to too many people other than your entrepreneur friends or your credit investors, you know? Um, I’m like, yeah, I don’t, I, I don’t want to, you know, um, because it’s just, I, I, I feel.

Part of it is like, I feel bad that, you know, I don’t want to tell people I don’t, I don’t like it when people tell me what to do, right? Like society telling me that you should do the 401k, you should go to a job, work from work, go into the office. So, you know, I know you’re not supposed to do this, but you know, you, you.

You treat others like how you wanna be treated, right? In fact, it should be you treat others how they wanna be treated is the more evolved way these days. But I’ve always thought like, well, I don’t wanna be treated. I don’t want people telling [00:11:00] me ramming, financial fi, religion things down my throat, so I don’t wanna do it to other people.

So that’s kind of where, you know, in 2016, I was like, you know what? I’m just gonna put it on this podcast, the wealth elevator. And if anybody’s out there wanting to listen, they’ll download it. But if not, cool, you know? You know. I don’t have to bother you.

Tim Melanson: Yeah, that’s the best way to handle it too. And, and I mean, I, I think that, uh, I mean, it, it’s like all of us are kind of the same. We, we’re not ready for something until we’re ready for it. And, you know, when people are looking for a change, they s. They start to seek it out. And I mean, if they’re still gonna, I mean, if they’re gonna get on a call with you and you’re gonna tell them you know what they’re doing and then they’re still gonna give you a hard time.

Well, I mean, like that, that’s on them. Right. But I mean, I think that right now, the good news is that the information is just everywhere. And not only that, but. There’s even differences from one wealthy person to another. Like there, there are [00:12:00] lots of different ways that you can go about accumulating wealth and really, uh, I mean, there are some major principles, but, but for the most part, you can find somebody that aligns with your personality.

Like you say you’re an introvert. Well, I mean, hey, in, in your area. I, I mean. You, you don’t have to sell anybody on anything. You’re buying real estate. I mean, you just gotta go find the right properties and, and, and buy them. You might be, uh, in a different area where you’re in sales. Well then you do have to convince people.

You do have to sell something. So there’s just lots of different ways that you can go about building your business. And for people that are looking to grow it through real estate and, and, and investing, well then you’re a perfect person to talk to. ’cause you’re, you’re doing it right.

Lane Kawaoka: I mean, there’s so many ways you can go, and that’s what I enjoy. It’s kinda like a puzzle for me. Um, you know, I like solving problems, especially these types of problems. Never like solving the, you know, with the culvert size and those, what, how, how big you build a wall, [00:13:00] that kind of problems. But.

Tim Melanson: Hmm.

Lane Kawaoka: Yes. Uh, the other day I was talking to a guy, his net worth was $12 million.

Um, he was an older gentleman and you know, he was running against RMDs and you know, he was kind of a good boy his whole life and he contributed most of that net worth to. These retirement accounts, which, you know, this, I mean, we, we talk about this a lot is, you know, the retirement accounts are not for everybody, especially for people who are judicious savers like that.

Because you get to a point now, he’s stuck. If he takes money out of there, he’s in the highest income bracket, he would, he’s paying more taxes now than he was earlier on his career. So, you know, he, he obviously read my book and he is like, dang it. Yeah. I see. I kind of see both sides of it now. It’s kind of too late.

All right, so what do we do now? And I’m like, well. You know, you, you got a high net worth. There’s so many ways you can go about and do this. Um, you know, I’m not, I try not to give financial advice. That’s just not what I do. Right. But, you know, I’m like, yo, you know, there, there are a few [00:14:00] options here.

Ultimately I try to teach people why they would do one thing, then the others so they can piece together the whole suite of strategies. Um, ultimately, you know, he. What we offer is the community, right. To bounce these ideas off of. So if I tell him to do something and it doesn’t work, he don’t blame me.

Right? I say that half jokingly, of course. But you know, I think it’s richer when you’re building a community and that’s what family office do, right? Their network is their, their net worth, and you know. But you know, that’s, that’s kind of like a average day in the life, right? Try and help people on, you know, get onto this, you know, this different mindset in a way, different set of strategies.

And, um, you know, it’s, but it’s cool. Like, I, I get to interact with a lot of people who are, you know, built their wealth on their own, right? First generation multimillionaire.

Tim Melanson: Nice. So, uh, like, tell me a little bit about that. Like, how did you go about like, meeting them, networking with them? Like were they [00:15:00] accepting of you? Like, like, I think, I think like a lot of people have an idea in their head of what these wealthy people are like and you know, was it what you thought it would be?

Lane Kawaoka: Yeah, I mean, well today they find me, right? ’cause the podcasts and then, you know, most people find me through my book, the Wealth Elevator, um, nowadays, but in the beginning, um, and, and I guess this is maybe useful advice, like I had to go seek them out myself. I had to get myself out of my house and fly somewhere to a conference.

And, um, you know, pay to play, right? I had to join a lot of groups that, you know, the entrance fee for a lot of ’em are over five figures. And for a lot of people, they just won’t do that if they even have the time, like a vacation day here, away from work. Um, at that time in 2016 when I was kind of, you know, running around meeting a lot of people during that genesis time, uh, you know, I was single.

I didn’t have kids. And, um, you know, all the vacation time I think had like 12 days a year I could [00:16:00] dedicate to this side project. Um, you know, I, I wasn’t obligated to take my family to Disneyland for seven, burning up seven days right there. So. I was at a sort of advantage in that way. And you know, I didn’t have a spouse that, you know, I say, Hey, can I join this mastermind over here that costs 25 grand?

I’m like, no, I’ll do it. You know, I asked myself, and I’ll go and do it. Right? And that was critical. You know, eventually I stopped doing that stuff because what you find is a lot of. Especially in the real estate world or the financial world or I, you probably see this entrepreneurial world, right? Like a lot of these, these online masterminds, they’re great to get started, but you know, you typically move off to other organizations.

You know, today I’m in like eo, entrepreneurs Organization. Organization, Vistage, or there’s like YPO Tiger 21, these other firms where they actually verify your revenue to get in and your net worth to get in. But um, you know, when I was starting in 2016, the [00:17:00] business, you know, it was critical that I get around other peers that were kind of trying to start things too.

Um, and, but you know, you had to pay to play for sure.

Tim Melanson: Well, and I, I think, I think that is really valuable because I, you know, like you say, eventually you sort of move on to different groups and all that stuff, but I, I think when you’re starting, doing something is better than nothing. So whatever you can get into, you know, whatever kind of mastermind you can get into is better than just.

Not doing anything at all. And then what you’ll learn as you probably did, is that, okay, there are some disadvantages to this. There’s some other ones that kind of pop up that you’re like, oh, this one would be a better fit for me. And then you just move to them and you know, you’re, I don’t think you hold a grudge against the one that you started with, right?

It was just, it was the path that you took to get there. Right.

Lane Kawaoka: Yeah, I mean, on an entrepreneur journey, it typically starts with a really ugly landing page that is like endless. Scrolled send to sell you some garbage. You get into that [00:18:00] group, you quickly leave to go, go to the other. But you wouldn’t have found the other group or people if you wouldn’t have gone to that first garbage influencer’s website first.

Right?

Tim Melanson: Yep, yep. That’s exactly it. And, and that is really what holds a lot of people back. I mean, they look at that and they’re like, eh, you know, and, but they, they never get to the next step because they didn’t take the first step. Right?

Lane Kawaoka: Right, right. And, and then the next step is, you know, you gotta put down five figures plus to get past that stage to then to meet the people. And I think the, the. To put my finger on it, it’s the people that you meet who also, some of you know, a lot of ’em are duped like you to pay that entrance fee, but you kind of flock like a, like a group of birds to the next, more fertile lands in a way is a key.

But all this happens. I mean, you know, the theme here is like we all work from home. We’re independent workers, but nothing special happens. You unless [00:19:00] you interact with multiple people, right? And you get, you built these partnerships and these synergies.

Tim Melanson: Yeah, because I think today with, you know, the world, the way it is with our, our zoom and our internet and all that stuff, like it’s, you know, your, your, your playing field is so much larger, right? I mean, maybe a long time ago, like you say, you had to get on a plane, go somewhere, uh, or you’re dealing with your local, your local network and that’s it.

But now. I mean, the playing field’s wide open. You can actually network with people. You can have a mastermind, for example, over Zoom with people from all over the world. You know, the, these things are are open. However, the downside to that is that it’s so many choices. There’s so much out there, and you know, how do you find something that’s real, you know?

Lane Kawaoka: Yeah. Yeah. I mean, I think at, at the end of the day, you cannot replace in person. I mean, like my CEO groups, we meet one day a month for eight hours the entire day in person. [00:20:00] None of this Zoom stuff. There are so many better. I mean, I, I, I mean, I, I think maybe it’s obvious, but like when you’re in face-to-face, you really build that connection where you don’t really get that with Zoom, which is why, like for my community, that I lead, like we do get a.

We have a retreat every year in Hawaii. That’s the few days long. And, um, you know, I think, I still think that’s important for me to do, right? As much as we leverage the, the, the zoom for the rest of the year and all the, the, the, the score channels, et cetera. But yeah, you know, it’s that you don’t build that special connection.

Unless you do it in person face-to-face. I, I don’t think that’ll ever change. Um, I mean, Robert Chelini, the, the guy who wrote the Influence book, I mean, he says that it, it, it’s just scientifically proven that that’s the case. But I think we’re, like, the online stuff comes into play is like [00:21:00] you’re able to prospect in a way better.

And you, you’ve, you interact with so many people and then from there you can decide, alright, who do I wanna fly to meet? As opposed to like my early days when Zoom wasn’t as popular in 2016 and I would go to a lot of just garbage conferences and, you know, meet a lot of not the best people. Uh, and I got a lot of business cards, but they, it was just a lot of dead ends.

Um. Maybe that’s how you do it. Maybe. Maybe that’s, I mean, that’s a better way of shooting fish in a barrel first. Right. See, you know, if they’re go, if they’re getting their butt to something and flying on a plane, getting a hotel room, they are a lot more bought in than some guys in some basketball shorts in their zoom zoom room in their working for their home.

Tim Melanson: Yep. I agree, and you’re gonna take things more seriously when you get some skin in the game. That’s just, that’s also scientific, right? It just is what it is, right?

Lane Kawaoka: Yeah. Yeah, so I mean you’re just dealing with people self-selecting. You’re [00:22:00] dealing with people who, you know, put some skin in the game, you know, which, if that’s just get on a plane or even, at the very least, if you’re already in Dallas and you’re gonna something in Dallas, rode out of bed, got in your car, or at least you had some price of admission from that perspective.

Tim Melanson: Yeah. Right on. Let’s talk a little bit about the cash flow aspect. ’cause I mean, especially with you, I mean, real estate, I mean, it’s, it’s a big deal. You have to put some money down. Uh, I’m wondering, like, you know, that that must have been stressful, first of all, like putting all this money up and not really knowing what’s gonna happen with it. Uh, but how did you make sure that you were gonna make more that than, than you were spending?

Lane Kawaoka: Yeah, I mean, that’s why I kept my day job for quite a while. Um, you know, I bought a 11 rental properties in 2015 and, you know, you, you, you lose money on maybe a third of ’em every year, right? Like some issue happens, a tenant trashes a property, but when you aggregate group of the mall, they, you know, they.

For that [00:23:00] many rentals, I maybe made like a few grand per month on that, you know, a couple hundred profit per property and you know, that’s it. It is somewhat steady state. Like I said, you know, like I said, like some of ’em you’re gonna lose money on throughout the year. But you know, the average is what you’re going for.

And when you get more and more properties, you’re able to hit steady state and it’s a lot more reliable income. And at that point, if you just repeat the process, finding a cash flow property on the get go, um, you know, you don’t, I, I’m not a big proponent of like wholesaling, flipping, that type of stuff, right?

That’s too much work and, and risk to me. We teach a different brand of real estate, more passive investing here. But you know, you at that point, you know, it was a good scale and that was just, you know, something for me to build upon. Like the hardest one was in the beginning when I didn’t know what I was doing.

And that’s kind of what we teach. You know, we give away a lot of free analyzers, um, especially for like the non-credit [00:24:00] investors getting started. You know, we, we kind of give away a lot of that curriculum for free on our platform, but, you know, that’s, that’s the hardest part, right? When you’re kind of getting going.

And then what I realize, ac credit investors, you know, after they own rental properties a bunch, they eventually grow out of it, and we become more of a credit investor. The legal liability of it all is just too much. Even if you buy it within LLCs, you know, LLCs are great for lower net worth investors.

You know, if you wanted more protection, you become a passive investor in LP in a larger syndication, and then you, now you get exposure to a lot more different assets, more diversification geographically. And then you’re, you know, you’re also able to expand outside of real estate buying businesses, but still having an LP position, but still having that upside and, and then tax benefits too.

Right. Um, but this is, you know, that was kind of where I was just expanding the portfolio right at that point. It’s sort of easy. Five, 10 years [00:25:00] in, it’s the first five years is the hardest part, and that’s how we try to help people get off the ground in that, that critical juncture.

Tim Melanson: Okay. Right on. Well, okay, let’s get into your solo then. So tell me what’s exciting in your business.

Lane Kawaoka: What’s exciting about my business, I mean, I get to kind of. I kind of just funny, like I, I told people I was, we were talking like, I don’t like to people to tell me what to do. Right. But I do enjoy to talk about, you know, what I write about in my book. Um, you know, apply it to certain situations and jump on these types of podcasts.

Um, and, you know, just. Maybe not debate, but have good conversations about, you know, what the wealthy do with their money versus what we’re all taught to do. And at least put people to more of a neutral point where they can decide on their own, their own destiny, um, as opposed to being locked into a 401k strategy where they’re gonna be doing it for the next 30, 40 years.

And be lucky if they clear six to [00:26:00] 8% and ride the rollercoaster along the way. You know, to me, I, what’s cool is I put that out in the ethos. People somehow find me and they jump on the email list, they read the book, and we jump on a Zoom, get to know each other. And, and at that point I think it’s this very self-selecting group of people.

And, you know, I enjoy building personal connections with all my investors. Um, you and, you know, eventually hang out in Hawaii in person, get that human interaction and um, you know, I think we. I, you know, you help people where you were once kind of, you know, struggling and this was something, something that I struggled with in 2016 myself.

I, at that time I had 11 rental properties. I thought I knew what I was doing with rentals and I sort of did. But you know, getting into the world of being in a credit investor, that was the uncertain world that I was getting into. And that’s kind of, I [00:27:00] understand that pain. That uncertainty, and that’s what I do today to kind of help people walk from that first floor of the wealth elevator being non-accredited to being an accredited investor, million dollar net worth and greater and, and kind of what do you do from there?

And we also turn into a party with other people.

Tim Melanson: So, uh, so tell me, how do we find out more about your business then?

Lane Kawaoka: They can, um, go to the Wealth elevator, um, and the Wealth Elevator podcasts. They listen to podcasts, but I would probably suggest most people just go on Amazon, pick up my book, the Wealth Elevator, um, a special offer for your folks. If they buy it and they email me team@thewealthelevator.com, we’ll hook ’em up with the free PDF and the MP three version.

Because if they’re like me, they’re not the best reader. They, we tend to just absorb things through audio form. But yeah, if you’re, if people are in a credit investor, reach out Lane@thewealthelevator.com.

Tim Melanson: So really the best people that would get the most outta this [00:28:00] would be people that are accredited investors.

Lane Kawaoka: Yeah, yeah. Like, you know, there are a lot of books written out there for, you know, people getting started and credit card debt. You know, those are the books that. Have been written thousands of times by Dave Ramsey, CSA Orman, rich Dad, poor dad, for example. You know, we, we mainly work with people who have pretty good jobs or successful businesses already that are, if not already, are credit investors or on the road to being it, you know, some of our folks are, you know, you’ve heard the acronym Henry’s High Income, not Wealthy yet, you know, so the, you know, the tech bro making $150,000 a year.

I may have a lower net worth, but you know, he’s on that trajectory to be accredited not too long in the future. But you know, what I started to realize is, you know, in this world of, you know, TikTok and YouTube shorts is, there’s all this random financial advice out there, and they’re all tips. Now, some are good, some are bad.

But [00:29:00] what was really interesting is like at what point in the journey does it make sense? Right? So. 15 year mortgage starting out may not be the best thing when you’re trying to grow your net worth. But if you’re already $5 million net worth, you know, I, I tell some people I don’t have a problem with that.

If you really are averse to debt, you know, go ahead and do it. But, you know, eliminating debt is not totally aligned with financial freedom. And we get into that in the book. You know, my book is mainly focused for higher net worth investors. You know, people who are gonna get passed that $5 million net worth by the end of their lifetime and pass it on to their kids.

Um, and, you know, it’s, uh, what introduce, are these floors, these different levels to the wealth building journey? Everything that I’ve kind of done, right? Like I had a, I had rental properties till 2015. So those, that was kind of encapsulated in the first floor of the wealth, wealth [00:30:00] elevator. The second floor is, you know, maybe you get to three, $4 million net worth and that that number is different for a lot of people.

You know, some people who I talk to are, you know, a retired couple. The kids are already off the college. Already done with college and they’re, you know, on their own. So they may only need, you know, two, two and a half million dollars net worth to be able to comfort live, you know, throw the money in G bills or something.

Really low risk, low return, and they’re fine. Family of four in California, you know, I think kind of where you’re at, right? Your kids still need you. Um, you know, you may need four, 5 million, $6 million net worth, right? So it’s a, that, that, that number sort of changes. But that’s, you know, when you get past that point, that’s when you’re kind of on that third floor of the wealth elevator and you know, I don’t wanna spoil, spoil the book the rest.

You know, that’s when you get to those higher levels and then eventually when you’re, you, you stop trading your time for money and doing a job [00:31:00] or business and you focus on just investing your money, you know, wouldn’t that be great? Huh? But that’s essentially where I think we’re all heading, you know, to be a family office.

Unfortunately, you know, most families, 90% lose their, their wealth in two to three generations ’cause their kids are boneheads. Um, but that’s why you, you, you, you focus on building a business of investing alongside of your day job in the beginning and then your business. And then you eventually, you know, you teach you, you pass on the family business of investing to the next generation.

So they don’t just blow the money. Or have kids and cut it up. Right? Like that’s event, that’s essentially what cuts mass wealth up, right? You have $10 million and then you have two kids and they have two kids each. Now $10 million is spread four to five ways.

Tim Melanson: Yeah. Yeah. Yeah. And, and then if they have even more kids [00:32:00] that by the time you’re gone, yeah.

Yeah.

That’s true. Well, so I was wondering, I, I was asked this question, who is your favorite rock star? What kind of music do you listen to, I guess?

Lane Kawaoka: Um, I like, I like, uh, em music. I like those DJs. But if you wanted to press me on the traditional, like rockstar band guitars, guys, I mean, like, I like the guys who do the entrance themes for like the major league baseball closers.

Tim Melanson: Oh

Lane Kawaoka: I like those songs, right.

Tim Melanson: yeah, absolutely. The high

energy stuff.

Lane Kawaoka: yeah. Yeah. I do CrossFit, so I like, you, like, um, is it disturbed?

Right. They’re kind of, I mean, they’re not, I guess they’re considered like a hardcore van, but they’re, you know, they’re, they’re tamed to some others I think that are out there. You probably know better than I do.

Tim Melanson: I do, yeah, it gets, it gets heavier than that. That’s for sure.

Lane Kawaoka: Yeah. Yeah. You know, I’m, I’m, I’m [00:33:00] a functioning adult these days. No longer able to wear black eyeliner and leather, you know, like some teenagers are who have nothing better to do.

Tim Melanson: Uh, you could do some cosplay, I’m sure.

Lane Kawaoka: Yeah. Yeah.

Tim Melanson: Right on. Well, thank you so much for rocking home with me today, Elaine. This has been a lot of fun.

Lane Kawaoka: Yeah. Thanks for having me, Tim. Yeah.

Tim Melanson: No problem. And to the listeners, make sure you go to workathomerockstar.com for more information and we’ll see you next time when the Work at Home Rockstar Podcast.