>> Get The Book (Buy Back Your Time): https://bit.ly/3pCTG78 >> Subscribe to My Newsletter: https://bit.ly/3Every day, you’re making a choice: stay broke or build wealth.And it all comes down to habits.In this episode, I’m breaking down the 9 money habits that keep people stuck and struggling—some I learned the hard way going from broke at 24 to millionaire at 27, and others I’ve seen destroy the finances of people around me.If you’re ready to break free and start building real wealth, start here.
Chapter 1: Who is Dan Martell and what is his financial journey?
Every day, you choose if you'll be rich or broke in the future, and it all comes down to habits. I'm going to share with you the nine money habits that are keeping you broke. Some of these I learned going from broke at 24 to millionaire at 27, and some are what I've observed in people I know that just can't seem to get ahead. Welcome to the Martell Method.
I went from rehab at 17 to building a hundred million dollar empire and being a Wall Street Journal best-selling author. In this podcast I'll show you exactly how to build a life and business you don't grow to hate. My best-selling book Buy Back Your Time is out now. Grab a copy at buybackyourtime.com or at any of your preferred online retailers.
Chapter 2: What is the first money habit that keeps you broke?
Starting with habit number one, taking advice from broke people. If they don't have what you want, don't do what they do. You should only get advice from people who are where you wanna be. You would never take workout tips from an overweight fitness coach. Why would you listen to a broke financial advisor? Why would you listen to your parents that have never done the thing you wanna do?
I'm not saying be rude about it. I'm saying be careful who you ask for advice from. So here are the three types of people you should be getting advice from. The first are mentors. These are people who have succeeded in the thing that you wanna go do. There are folks that can act like a guide to the big decisions. See, I always say mentors are the people you turn to instead of your parents.
Number two are coaches, specialists with deep, deep expertise in the area you wanna be successful in. If somebody was an Olympic athlete, you would say, well, who are you coaching with? Based on their ability to help other people just like them get to the Olympics. You wanna find the people that have the blueprint for success to help you get rich. Three is peers, people on a similar journey.
These are ideally people that are like one to two years ahead of you because they'll bring you the certainty that you're making the right decision for what's working in the market today. Everybody else, take their feedback with a grain of salt. I'm not saying plug your ears, but I'm just saying you can listen politely and then ignore their advice.
But bad advice isn't the only thing holding you back. Before we get back to the episode, if you want to jumpstart your week with my top stories and tactics, be sure to subscribe to the Martell Method newsletter. It's where you'll elevate your mindset, fitness, and business in less than five minutes a week. Find it at martellmethod.com.
Which brings us to habit number two, ignoring your bank account. In the early days, I was talking to one of my mentors and he asked me a simple question. He said, what are your numbers right now in the business? And the crazy part was, is I didn't know. And he got pissed. If you want to be a successful business person, you need to focus on your numbers.
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Chapter 3: Why is it important to track your bank account regularly?
You need to know that what you look at will grow. If you don't look at it, if you stick your head in the sand, you get a report once a month, it's not going to work out. See, the more frequently you measure, the less likely you'll get off track. So this is how I keep a good money pulse. Number one, review it daily. Every day, I log into my bank account and I look at my cash.
I look at how much money I have. My rule is called the 24-hour rule. If I haven't looked in the last 24 hours, big no-no. Number two, you wanna automate your tracking. If you don't have a budget for your life, then every decision will feel like a decision. The truth is, if you can't afford it, you shouldn't do it. So there's apps out there.
They're free, personal finance apps that will help you automate all this tracking Number three is look ahead. This is all about saving and planning for expenses and making the right investments. And I know this might sound boring, but here's the deal. If you don't become a saver, then it doesn't matter how much money you make if you're always spending more than you're actually taking it.
Number four, create sensors. This is a simple concept that changes everything if you're actually monitoring. But think about like your credit card, you get notified every time there's a transaction so that cash in your bank account, let's say in your savings drops too low, you'll get an email. You want to make sure you set up these sensors so that nothing weird happens without your awareness.
But just knowing what you have in the bank won't be enough. Which brings us to habit number three, trying to get rich quick. Real wealth is built over time, not overnight. There's this crazy moment in my life about a decade ago. where I decided to invest in real estate in Detroit. I'm Canadian. What am I doing investing in another country in another city?
Well, some guy at an event told me that the bank was selling homes for $10,000. What he failed to tell me is the reason the bank was selling these for $10,000 is because these homes were run down crack houses. Essentially they were liabilities to the bank and they were just trying to get it off their books.
So I showed up with hundreds of thousands of dollars and bought these homes with my brother thinking it was a good idea. After not hearing from a property manager for a while and getting my brother to get on a plane to go look at these homes, for him to call me and say, dude, we got to get rid of these as soon as possible because we're now liable for those things.
I lost $100,000 on that deal because I was trying to get rich quick in an industry I had no experience in, in another country, in a city I didn't even live in. I deserve to learn that lesson. Here's what I've learned. FOMO, fear of missing out, is a terrible reason to make financial decisions. Instead, here's how to build real wealth. Number one, build a skill that's valuable to the market.
Anything like sales, marketing, AI automation, real skills that there's demand and need out there in the world that people pay you top dollar to do, build that skill. That's how we start by creating wealth. The second is we have to solve real problems. I remember when I started off, I just wanted to build apps for my friends. Problem was my friends were teenagers that didn't have any money.
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Chapter 4: What are the risks of trying to get rich quick?
Go outside, pick up the phone, go on the internet, sell what you do, your skill, solve a problem to a stranger, take money, you have a business. Before you incorporate, before you open up a business account, it doesn't matter. You can make up to 30,000 a year and just file your taxes like a normal person. So don't overcomplicate that, just get started.
But building wealth won't happen if you're still doing it with your time. Which brings us to habit number four that's keeping you broke, trading time for money. When I was starting off as a 19, 20 year old programmer, I got a job making $30 an hour, which was huge money at the time. My dad was so proud. Everybody's like, oh my God, you're working at the best company in the city.
What I knew is that if I only got paid when I showed up, then my income was always gonna be tied to my time. What I've learned is there's three levels of time trading that if you master will help you actually get rich. Level one trader, being an employee. This is where you trade your time for money, like I just said. See, what you get paid for is based on what you did.
The problem is that it's linear. Instead of getting paid for the outcome, you're getting paid for the time. Level two trader is an entrepreneur. This is when you start trading money for time.
You have a business, you make money, and then you take some of that money, and then you hire somebody through labor, like an administrative assistant, to be able to take things off of your plate so you have more time to go create more money. Level three trader is an empire builder. And this is where you trade money for money. And this is all about getting your money to work for you.
This is investing in other businesses, investing in your own business. But when you can start getting a return on your money that doesn't involve you showing up and doing work, that's when you start to build real wealth. But making more money won't help if you don't pay attention to how you spend it.
Before we get back to the episode, if you actually want to know what my real life looks like and see the people and the businesses and the companies I buy and my family and just like how I make it all work, go follow me on Instagram. Dan Martell, 2LZMartell on Instagram. It's where I show the behind the scenes, the real deal, real time. I'd love to see you there. Have an amazing day.
Which brings us to habit number five, paying for status. Stop buying things you can't afford to impress people you don't like. And I know how silly I sound, but you gotta understand, I went like 20 years of building and investing, building and investing before I ever spent money on anything to make me look fancy.
Once you get to a place where your income is a surplus and you're investing and you want to start rewarding yourself through life, through experiences, through objects, then it's really about what you do to make yourself feel good. See, I dare you to be simple. I dare you not to be fancy. I dare you to focus on outcomes and goals before you ever focus on perception.
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Chapter 5: How does trading time for money limit your wealth?
I dare you to spend the least amount of money to build your dreams. The other one is learn how to have money and not spend it. I remember one time a kid won some inheritance and he said, what should I do with the money? Where should I invest it? I was like, here's what I recommend you do. Spend it on nothing for 12 months, grab 10,000 in cash, put it in your pocket and walk around and don't use it.
Carry the cash with you. Because if you can learn to have money without spending it, it sounds wild, but it'll change your whole belief around money. Some people cannot have money in their bank account without spending it. The other one, the only winning move is not to play the game. You're allowed to decide, I don't wanna play this game. I'm cool being me.
If you can learn to be you, then your possessions don't possess you. See, that's a problem with buying luxury stuff that most people that don't do the work don't understand is that these things are necessities. They should never be that way. But even if you're avoiding luxury, you might still be making this spending mistake, which brings us to habit number six, impulse buying.
I am the worst at this, okay? I'm gonna tell you why I can teach this to you because I sit on TikTok every night and then I grab these links and I send it to my house manager and say, Betty, can you please buy this thing? Something I probably don't need. The good news is it's like, it's not that expensive. I buy literally tchotchkes, $12, $15 gifts for friends.
Here's what I learned though a long time ago that changed everything that allowed me to get to a place where I can do that and not even worry about it. The skill to develop is called delayed gratification. Delayed gratification is more powerful than compound interest. If you can push off that purchase, you will change your whole life.
Most young people get into the economy after school or they start a business and then they just saddle themselves with just crazy stuff from new couches to new BMW leases to new condo leases. Like it just creates all this pressure. The truth is, is that the world is against you.
All these people creating these financial products to give you credit, to lend you stuff, to lease you stuff, they're doing it to make money. If you can just delay it, then you don't start off life feeling like you're trying to walk with a chain and ball around your financial ankle. So here's what I think about it. A yes to your impulse is a no to your dreams.
If you know what you can invest that money in towards your dreams, your education, that skill, that business, you have to defer the satisfaction of today so that you know what you're building towards. What I do instead is I tie my big purchases to a goal. It's part of my achievement system.
So for example, when I did 75 hard the first time, the goal of finishing that, complying 100%, 75 days in a row, was getting my first orange McLaren. Project Visible Labs, the reward for that was bringing my family on a big trip to Cabo. If you can just delay for a little bit and you tie the desire to a goal, then you just teach yourself to keep striving for more and that's positive.
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Chapter 6: Why is paying for status a money habit that keeps you broke?
You're not saddling yourself in all this debt or buying stuff you don't need today. Controlling spending becomes pointless if you're still making this mistake with your time.
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Which brings us to habit number seven, which keeps you broke, spending time to save money. This one's going to hurt your brain. Broke people spend time to save money and rich people spend money to save time. You do not have any more time than anybody else that's rich and you have to figure out ways to get more leverage. I remember growing up watching my dad mow the lawns of his rental properties.
And I was like, dad, you're spending your whole Sundays mowing all these lawns. Why don't you just pay somebody else to mow it for you? I mean, you can afford to do it. He said, well, I like to do it. And I said, well, if you'd like to mow the lawn so much, why don't you offer to do the neighbors? He's like, well, I don't like to do it that much.
You're never going to be able to grow if you don't learn how to use money to buy back your time. So the way I like to teach it is both personal and business. Think on the personal side.
What are the things you do in your home from simple things like doing the laundry, cleaning your home, maybe cooking, grocery shops, running errands to the business side, answering your emails, scheduling meetings, making purchases, doing research. There's all these little micro activities that don't feel like a big deal that add up to five, 10, 15 hours a week, both at home and
in your business that you could spend money so that you have the time to take care of yourself or invest in a new skill to go be more valuable to your employer, to your company. But how do you know how much to spend? For me, that's where I came up with this formula called the buyback rate. Essentially, you take your annual income.
If it's a business, you take whatever you pay yourself and you divide that by 2,000. And the reason it's 2,000 is because most people work 2,000 hours in a year. That'll essentially give you how much money you make per hour. So if you make 200,000 and you divide that by 2,000, that's $100 an hour. So your buyback rate is one quarter of that.
And the reason why is you wanna get a four times ROI on buying back that hour. So if I can spend $25 or less to buy back an hour of my time, because my buyback rate is $25, then I am freeing up and making a great investment in my life. Then I can take that time and go work on being more valuable, go make more money, Honestly, just take care of myself so the whole thing doesn't feel hard.
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