The 4 Types of Money (and the 1 type only rich people use)

The Four Types of Money00:00:08

Alex describes the four types of money: past money (savings), income money, debt money (future earnings), and new money.

New Money Explained00:01:19

New money involves generating additional income specifically for a desired purchase, without impacting existing income or savings. This approach fosters resourcefulness and avoids debt.

The Building Example00:02:27

Alex recounts buying a building, justifying the purchase with the potential for new revenue streams, such as saving on event space costs for portfolio companies. He used existing resources to generate new gains.

Sawdust Money00:03:52

Sawdust money refers to using existing resources more efficiently to generate new income for a specific project or purchase.

The Paul McCartney Analogy00:05:04

Alex shares a story about Paul McCartney writing a song to fund his desired swimming pool, creating 'new money' instead of drawing from existing resources.

Being Resourceful00:06:00

The focus shifts to creating new resources by utilizing existing but underutilized assets. This is better than 'draining' current resources for purchases.

Creating a Vacuum00:06:52

The idea of creating a 'vacuum' or increasing demand for money through deprivation is introduced to inspire the creation of new income streams

Applying to Business00:08:59

Alex states the advisory services were spun up to cover the building costs mentioned previously. If two business machines are desirable, obtain the doper one.

Staying Ahead by Making More00:09:25

The key takeaway is to stay ahead of spending by increasing 'new money' relative to new purchases, instead of just increasing lifestyle relative to income.