Rich Habits Podcast – 13: How to Become a Millionaire in a Recession, Angel Investing, and Credit Cards

Intro

In this episode of the Rich Habits Podcast, the hosts discuss how to become a millionaire in a recession, angel investing, and credit cards. They provide valuable insights and strategies for building wealth even during challenging economic times.

Main Takeaways

Building Wealth in a Recession

• The mindset shift is crucial in becoming a millionaire during a recession.
• Time in the market, not timing the market is the key to building long-term wealth.
• Recessions are an opportunity to invest at a discount.
• Today’s millionaires were made in the last recession by investing consistently and being disciplined with their investing habits.
• Investing during a recession is only hard if you make it hard.

Investing Strategies

• There are still ways to make money in the markets during a recession by investing in index funds and ETFs.
• Scared money doesn’t make money, and it’s important to take shots and make investments even during a recession.
• Diversifying investments during a recession can be an opportunity to invest in discounted companies that are likely to survive.
• During a recession, consider investing in high-growth speculative companies that you understand well and have an investment thesis behind.
• Don’t follow the herd mentality of moving to safety during a recession, as speculative stocks aren’t always that speculative.

Credit Cards and Passive Income

• Optimizing credit card usage is important for maximizing benefits and improving credit score.
• Many people with high-end credit cards don’t pay off their balances, leading to debt and financial trouble.
• Consider adding passive income-focused ETFs to your portfolio, but carefully consider the investment objectives, risks, charges, and expenses before investing.
• Investing in real estate can be a great way to generate passive income and build wealth over time.
• Starting a vending machine business can also provide a fun and profitable side hustle.

Angel Investing and House Hacking

• Angel investing is a great strategy to put your money to work and take some shots with your money.
• Y Combinator’s website is a good place to find startups to invest in.
• Get on the angel list email list to get all of their deal flow.
• When house hacking, make sure to have a spelled-out lease for the room that spells out the rules and common areas.
• Selection process for roommates is crucial when sharing your main home with strangers.

Summary

Building Wealth in a Recession

During a recession, it’s essential to adopt a millionaire mindset and focus on long-term wealth building rather than trying to time the market. Recessions present opportunities to invest at a discount, and the key is to invest consistently and be disciplined with your investing habits. By taking advantage of discounted investments and avoiding fear-based decision-making, you can build wealth even during challenging economic times.

Investing Strategies

Investing during a recession doesn’t have to be daunting. By diversifying your investments and considering high-growth speculative companies with a solid investment thesis, you can capitalize on potential gains. It’s important to avoid following the herd mentality and instead focus on good companies with good balance sheets. Additionally, incorporating passive income-focused ETFs into your portfolio can provide a steady stream of income. Careful research and consideration of investment objectives and risks are crucial.

Credit Cards and Passive Income

Optimizing credit card usage is key to maximizing benefits and improving your credit score. However, it’s important to avoid accumulating debt by paying off credit card balances. Investing in real estate and starting a vending machine business are two viable ways to generate passive income and build wealth over time. These strategies require careful planning and consideration of the associated risks and expenses.

Angel Investing and House Hacking

Angel investing offers an opportunity to invest in startups and potentially earn significant returns. Platforms like Y Combinator and angel list provide access to promising investment opportunities. When house hacking, it’s crucial to have clear lease agreements that outline rules and common areas. Selecting trustworthy roommates is essential when sharing your main home with strangers. House hacking can be a lucrative strategy for generating passive income by having roommates who contribute to your mortgage payments.

Conclusion

By adopting the right mindset, investing strategically, optimizing credit card usage, and exploring passive income opportunities, you can navigate a recession and build wealth. The Rich Habits Podcast offers valuable insights and practical advice to help listeners improve their financial well-being. With over 85,000 weekly listeners and a spot in the top 50 business podcasts on Spotify, the hosts express gratitude and love for their audience, encouraging them to come back every week and continue their journey towards financial success.