How to Measure Your Net Worth - YouTube

There used to be a time when you and I heard the words, "net worth," all we ever thought

about is a dollar sign.

Because we link net worth to money.

I will explain net worth to you in a way that's completely different because today your net

worth has a complete different meaning, And it's good news for you.

But hang tight before I get into it.

So, it's 1999 and I'm 21 years old.

That's the story I want to tell you.

And I got out of the Army and I'm in Hollywood, and in L.A. And every time I go out I see

valets with Lamborghini and Ferrari and Bentleys and Porsches and all these exotic cars, and

I want one of these cars.

I want to become a millionaire myself as well.

And I find this one man who was wealthy, and I pulled him aside and said, "Do you mind

if I have lunch with you?"

And he had lunch with me.

And the entire time during lunch, I kept asking him, "How'd you become a millionaire?

How'd you become a millionaire?"

I'm 21, naive, don't have a clue on what's going on, right?

And he finally stopped me and said, "Man, you're asking everything around money.

You have the idea in a wrong way."

And I said, "What do you mean by that?"

He said, "Look, let me just explain it to you this way.

If I was to take this hand right now, and if I were to cover your mouth and your nose,

what would you be thinking about?"

I said, "I'd be thinking about air."

He said, "Do you know why?"

I said, "Because I don't have any of it."

He said, "Of course.

Do you know why all you think about is money?"

I said, "Why?"

He said, "Because you have none of it.

All you're thinking about is money because you have none of it.

So you are allowing this money problem to prevent you from ever finding out your purpose

in life.

You've got to get this money problem squared away quickly.

Think about it this way.

How much access to oxygen do you have right now?"

I said, "Unlimited."

He said, "Do you ever go bragging about how much oxygen you have?

Do you go to people and go like this [deep breath].

Do you brag?

Do you show off?"

I said, "No."

He said it's the same thing with money.

He said, "Hurry up and get your money problem squared away."

But he explained it in a way that I realized it wasn't just about money.

It was something bigger than money.

So today, if you're not a deca-millionaire, I know we have several billionaires and several

people who follow this Valuetainment channel who are worth hundreds if not tens of millions

of dollars, but I'm talking to the guys who maybe don't have the millions yet.

Let me explain it to you in a completely different way.

Your net worth today is four different brackets.

One is the actual money.

The other one is your health.

the other one is skill, and the other one is your influence and your voice.

Let me explain.

This [money] is a byproduct of these three.

Not the other way around.

This comes because of these three.

This is just one aspect of your net worth.

A person could be very wealthy, dying, no longer can apply his skill set, and he no

longer has influence and voice, because he can't speak any more.

That money doesn't mean anything today.

Right?

So let's talk about these three areas.

Health is part of your net worth.

Why?

If you can move, if you can talk, if you can see this video.

If you can hear me, if you can comprehend, if your brain can process all the information

that's taking and saying I don't believe this, I don't believe this, I like this, this is

amazing, I never heard this before, this is cool, what if I did this.

Let me write this down.

I process this part.

If your heart can feel, if you're feeling the emotion, right?

If you can walk, if you can go around, if you can do all that other stuff, it's part

of your net worth.

You need to make sure you take care of your body fat, because it helps you with stamina,

energy, you can last a lot longer.

The longer you can last, the more possibility you have of making money.

The other one is skill.

If Edgar back here is standing right back there, Edgar knows how to use cameras.

He comes here and tells me all these different things about cameras.

He knows how to do the sound.

All the other guys know how to do a certain skill set.

They're forever going to be fine because they have a skill set.

That's part of their net worth.

You're buying a skill.

Imagine you have a country.

And everybody lost everything.

And you're trying to go live on this country.

What question are they going to ask you before they let you come into the country?

How much money are you bringing to this country?

What's the other thing?

What do you know?

What skills do you have?

Why does a country ask that?

Because it's part of your net worth.

We want some skills to come into the country.

And last but not least, it's your influence and voice.

Let me explain something to you.

If somebody all of a sudden, their influence goes up, social media, Twitter, YouTube - it

doesn't matter.

If their influence suddenly goes up, you better believe money follows.

And a lot of people surprisingly are not paying attention to this today.

Several people are figuring it out.

But some are still moving way too slow on influence and voice.

Think about the guy that's the president today.

He had more influence and he knew how to use his voice, even though it ticked off half

the population.

So what's influence and voice?

Twitter, Instagram, Facebook, YouTube, Email.

Telling your story.

Telling the argument.

Telling your thoughts.

That's part of your influence and your voice.

These three, contribute toward your financial net worth.

But they are part of your total net worth.

This is a package.

Nobody just gets it with only one.

Now, if you're watching this video because your pure interest is around money, let

me explain to you on the financial side on what your net worth has to do with four different

areas.

One is your credit score, then it's savings, then it's income, then it's investments.

A lot of times people will say, "Well, the most important thing is your savings!"

Or, "The most important thing is your investments."

My dad would say, "Credit is the most important thing!"

No, it's about making money!

So what is the most important thing?

Every one of them matters.

Every one of them matters.

Credit today - when we started PHP Agency, the insurance agency, financial firm, every

insurance company that wanted to give us contracts, they did every type of background check on

me.

Misdemeanor, felony, DUI, credit, late payments.

I'm talking every single thing.

And it would come back this this [thick].

Okay?

So if I didn't have good credit, I don't get those contracts.

Because I don't have good credit.

Your credit has to do with the money the bank's willing to pay you, a car loan, a house loan,

a business loan.

Everything comes back to how solid of a credit you have.

It's that important.

Some people don't pay attention to this.

It hurts you.

You need to pay attention to your credit.

The other part is savings.

What is the important thing about savings?

Why savings?

Why is savings so important?

Savings helps this [mind] work better.

The more savings you have in place - think about it this way.

Imagine you're about to get into a fight with a guy that's twice your size.

And you go by yourself.

And you don't know how to fight.

And that guy knows mixed martial arts.

What's going to happen with this?

Are you pretty confident?

You're going to go to this guy and he's going to come and do a couple of kicks and you're

done.

Now let me give you some backing.

You're going to go fight that guy, except you've got 100 people that are willing to

come with you as well.

And all those 100 people are bigger than you.

And you go to that guy, and he's by himself.

He's twice as big as you, but you got 100 people behind you.

You say, you want to fight?

Let's fight.

He says, "Wait a minute.

I came to fight one-on-one."

No, I came to leverage.

I brought leverage.

You don't have leverage?

I have leverage.

You want to fight?

Let's go!

This guy's not going to fight you.

Why?

Because you have savings.

Savings gives you leverage.

Savings gives you backing.

Savings is those 100 people standing behind you where people say, I'm not going to mess

with you.

Or, I'm going to do business with you, because you've got a lot of backing.

That's savings.

Savings allows you to process things better.

Savings allows you to make better decisions, lead better, every single way.

You become a better CEO, you become a better executive.

You become a better recruiter, better salesman, if you have savings in place.

And savings is three different brackets.

It's not all checking account.

You've got to make sure short-term's taking care of mid-term, long-term.

If you're single right now, you may say, "I don't have any kids.

I don't have to worry about my kids," then it's all short-term.

Fine.

If you've got kids, you're married you've got to make sure mid-term.

If you've got an eight-year-old daughter, ten year's college, at 18 years old, you've

got to think about these types of things.

If you've got a 16-year-old daughter, 10 years, 26, marriage.

In your culture, do you pay, do you pay?

How much do you need to set aside.

Is $50,000 a wedding?

I don't know those numbers.

But you need to be prepared for it because that time is coming very, very quickly.

And it's long-term, retirement, investments, and all that other stuff.

So short-term is 0-12 months, mid-term is 1-10 years, and long-term is 10+ years.

And then we have income.

Let's talk about income.

Sometimes income, I have an income that's $100,000 income.

But it's only an active income.

If I stop working, I don't make it.

And then the other side is passive income.

But it's only $1,000 a month.

So what's important?

It's important to have both.

I like active and I like passive.

Some people will tell you, you want to have multiple streams of income!

And I get questions all the time.

Pat, you know, I want to do it the right way.

I want seven different businesses to pay me because imagine.

There's always this one guy that wants to do it the fastest way to become rich.

I'm going get 10 different businesses, and these 10 different businesses, if each of

them pays me $1,000, I'm going to be a multi-millionaire."

Listen, don't listen to that guy.

Do not listen to that guy.

Before you have a very strong passive income, you've got to have one solid, on solid, solid

income that's coming in.

Solid.

You don't want to go too many multiple streams of income and they're all 10%, 10%, 10%, 10%,

10%.

I would much rather have one stream of income that's 90% and it's strong, that can feed

others, than try to do it 10, 10, 10, 10, 10.

I wouldn't take that route.

So income is extremely critical, because this helps with the others.

And last but not it's your investments.

Stocks, bonds, stock options, real estate, art work, portfolios that have to do with

certain baseball cards, collectibles that you have.

That's investments.

That's growing on a yearly basis.

Okay perfect.

Now how do I increase my net worth.

And you may say, "Hey, I'm worth a billion dollars today.

Or I'm worth 100 million today.

I'm worth 10 million today.

I'm worth a million.

Or you may say, "I'm worth 50,000.

What do I do with this?"

No problem.

First of all, take this out, we have a sheet for you to download.

If you're on PatrickBetDavid.com, you should see it all the way in the bottom.

If you don't, you need to go to PatrickBetDavid.com to the link, and just search this, if you

don't see this already, just search it, and go all the way to the bottom.

There's a PDF.

Download the PDF.

When you download this PDF, write down your credit score.

What is your credit score?

Right here.

Write down your credit score.

Write down your income, active, passive.

Write down your savings.

Short-term, mid-term, long-term.

Write down your investments, how much you have in your investments.

Write those numbers out.

Look at it.

How do you feel about it?

That's the first thing.

Okay?

Second thing, start tracking it on monthly basis.

Every single month, start tracking it.

I started tracking this back in 2004, when I realized I had hit rock bottom, I had to

start tracking.

I had rock bottom August of '03, I started tracking '04, everything started changing.

So start tracking, then put a goal, and then you drive it.

So it's, write it out, track it, put a goal, drive it.

What does drive it mean?

You're driving your credit score to go higher.

So if you got a late fee from two years ago, you're actually going to contact Ford dealership

and say, "hey, why did you put a late fee?

I was never late."

Then they contact the bureaus and they take it off, and your credit score jumps up 17

points.

That's driving your credit score.

How do you drive your income?

How can I get paid more at my job?

How can I make more money at my company I'm working at?

How can I make more?

You're driving your income.

You're driving your passive income.

You're driving it, right?

The same with savings, same with investments.

Now, same time you're doing this [financial], I need you to also do the same thing on this

side [left].

On the same sheet of paper you're downloading the PDF document.

Write down your total net worth.

Net worth is assets minus liabilities.

So if you have $100,000 in total savings, and you owe $70,000, it's really $30,000,

your total net worth is what you have.

Your influence.

Your voice.

Write down how many people follow your voice.

Facebook total followers.

okay, it's going to be in the box, Twitter total followers, YouTube subscribers, email

subscribers, Instagram, Snapchat, write all of it in your box.

What is the total amount of people that are following you?

Write that number in here.

Your health.

How is your weight?

Your weight to your height, how's it looking?

Have you gone and measured it to see how it looks?

How's your body fat?

When's the last time you went to the doctor and just said, I want to do a complete body

test.

I want to take a blood test here.

I want my body fat, and you start gauging it every three months, you go to the doctor,

and you do your body fat, you do blood tests.

Every three months.

How's this looking?

How's that looking?

You start tracking it.

Skills.

In this box.

What are you an expert in?

Write it in that box.

I'm an expert at coding.

I'm an expert at selling.

I'm an expert at this.

I'm an expert in real estate.

I'm an expert in whatever it is, write it in here.

Once you write it in there, and you look at this, you'll say, okay, this makes sense.

I have 9,200 people that follow me, I got $39,000 of savings here.

My body fat is 19%, and I got work to do here because I need to drop 22 pounds.

And skills, honestly, I mean, I'm pretty good at soccer, but I'm not going to be a professional

soccer player.

I'm pretty good with whatever it is, but I've got to figure this thing out.

That's the point when you're looking at this and it's right in front of you, both of these,

you say, man, I got some work to do.

So that's when you add on this side, what skills do you want to add, and how do you

become an expert at it.

What is your goal here [health], how do you become an expert at it.

What is your goal here [financial], how do you drive this.

How do you drive this [influence].

Remember, it goes back to the four things.

You first write it out.

So you look at it.

Two, you track it.

Three, you give it a goal, and four, you drive it.

You drive both of these and all of a sudden, you notice you net worth increasing, and then

you're looking back five years from now, ten years from now, and saying, 'holy moly, I'm

worth $17 million?

I'm worth $693,000?

I'm worth $193 million?

How did this happen?

Because you focused on all of these.

These two different brackets that you're looking at, you focus on these, and things started

changing.

Instead of the typical logical, academia way of in the box thinking of net worth is all

tied to your money.

BS.

This is all part of your net worth.

Don't let anybody fool you.

That's old school.

This is new school.

Don't let these old school people teach you how to increase your net worth who are still

stuck making $62,000 at a university or somewhere they're teaching, and they themselves don't

have a high net worth and they want to tell you how to get a high net worth.

Okay.

I'm just telling you, times have changed.

Adjust, pivot.

The good news is, now you have this information.

What you do with it, is completely up to you.

Edgar, let's get that pillow here.

I kind of like today's episode, man.

Today's episode got me excited.

I think it's something that a lot of people can truly take advantage of.

So anyway, with that being said, comment with your thoughts and questions on the bottom.

By the way, if you haven't yet subscribed to this channel, this is our pillow we got

from my friend Jennifer Mac.

Our goal is to get to a million subs by the end of 2017.

We firmly believe this is the best channel on YouTube for entrepreneurship.

The best channel.

There's a lot of motivational, regurgitating, you can do it, school sucks, all this other

stuff, but there's no how to do follow up with it.

There's a lot of great daily vlogs that you see people doing, hey, follow my life, all

this other stuff.

Show me how to do it.

Nothing wrong with all that stuff.

I think Snapchat itself is a daily blog and here, we want to show you how to do it so

you can actually go out there and get results, like tens of thousands of people are right

now, from studying the content on Valuetainment.

So if you haven't subscribed yet, what are you waiting for?

Click on that button here.

Subscribe, and then click on the notification, so you're one of the first to get all the

videos that's coming to you.

Good catch, Edgar.

And with that being said, thanks so much for watching everybody.

Take care.

Bye bye.