Episode 54: How to Be Wealthy & Wellthy with Krisstina Wise

Acquania Escarne 0:03

You are listening to the Purpose of Money podcast, a podcast where we talk about ways to build wealth and create more freedom in your life today. I am your host Acquania Escarne.

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Hey guys, welcome back to the Purpose of Money Podcast. I'm super excited today to have special guest Krisstina Wise. She is a self made millionaire who almost lost her life in 2013. She is the most influential real estate leader in the country. And she has been featured in USA Today recognized by Apple and Evernote for her creative leadership and emerging technologies. Krisstina, thank you so much for being on my podcast today. Welcome to the show.

Krisstina Wise 0:56

Oh, my goodness, thank you for the invitation. I'm so happy to be here.

Acquania Escarne 0:59

Congratulations on all of your success. Your story is so inspirational. But I wanted to know, can you tell us a little bit more about your life changing moment in 2013.

Krisstina Wise 1:10

My accolade list is long. And it's pretty amazing when I look back on it. But the other side of the coin are stories that nearly killed me. So it's wonderful to put all those things on a bio. And they do sound amazing. And they can be inspirational. But what I didn't know at the time, as I was really trading my health for wealth, I was just in the rat race and I couldn't slow down and wherever, whatever rung of the ladder of success I got to is never enough I need to go the next one. The next one, I had run marathons and I had run Boston, nothing was ever satisfactory. And that's what took me down, I was fine. One moment, the next day, I couldn't get out of bed. And then it went downhill from there. And I spent a full year fighting for my life not knowing what was going on. So really, the turning point about that is, is I left my industry, which was real estate, technology, all these things that top 100 those different that I was I just led the industry to national level. And after I got back from being sick, I walked away from the industry because I just realized that I didn't want to be in that race anymore. I didn't want to play that game anymore. The cost was too high. And I've learned a lot of just kind of life and spiritual lessons and the healing journey. And I always say a healing journey is really a spiritual one for anybody that's been through it. Now what I do, and I teach, I try to teach in a way these life principles and wealth and money principles, so that we can go towards and grow our wealth, but not at the sacrifice of our health.

Acquania Escarne 2:38

I love that you talk about that. Because I tell my clients all the time that your health is your wealth. And without good health, it's very difficult for you to build wealth for yourself or anyone else. So I'm curious to know a little bit more about your perspective on how they're the same thing in your personal life you have expressed that you were fighting for your life. But how else do you see in other people's lives, how the two are so connected, they need to be treated as such, like they belong together. And they're both needs to be maintained.

Krisstina Wise 3:08

Yeah, and really, if we can look at them as distinct parts, but the same thing as well. And it's like our body is one system, but we have all these distinct parts of our body with ones missing, it's not going to work even though it's one body. And that's really what I learned. I was oblivious and blind before that my health was I just took advantage of it. But it was always there until it wasn't and I think that one set for so many people that we think we're healthy and all of a sudden there's a heart attack or there's cancer or there's diabetes or whatever they could fill in the blank is and so much of it does go back to stress and just bad probably poor lifestyle habits.

But yeah, I even named my company my new brand. And what I do today coming out of that experience is called Wealthy and it's money w e a l t h wealthy then it's wealthy w e l t h y really with a plan the names that that money wealth is important but for the sake of why why do we want money? Why do we need money? Why are we working so hard to grow our money to be able to pay the cost of a healthy lifestyle right and not just be our bodies healthy but mentally healthy, physically healthy, emotionally healthy, relationally healthy, and all these take money of course, but it also just takes awareness and it takes time and attention and intention.

When I came out of that. And we came up with this idea of wealthy I actually went back to the etymology of the words health and wealth. And when you track both these words all the way back to the creation of the words they actually say the same things they have the same definition. So when I looked up wealth, w e a l t h it comes from the Old English Wheel, w e a l, which at the time meant well being, welfare, meaning you fare well, and it was a state of good fortune and happiness.

Krisstina Wise 5:00

So the root word like at the very beginning, the source word of the money of the of wealth was happiness was well being. And that's now when you move that over to health and you go back to the etymology of health, what health means that means happiness well being, you know that your being is well. And so I found it very fascinating that not only do we need one, to have the other really, but they actually go back to the same root concepts. And I think we can all what I learned from my experience, in taking my health for granted is that without knowing it, I just pushed myself all the time. And I was like, in this rat race of how fast could I reach a success and more success. But what I learned from my own experience is that I had the money and build wealth, I had money, I had great businesses, I had great income, I had great assets, I had good passive income from those assets, mostly real estate. So I thought I was doing everything right. I've done all the things.

But when I was in my bed and couldn't get out, and I couldn't work my what happened in my business, when I'm not in my business anymore, what happened, the income started to go down, because I wasn't there to run it 24/7 Put in those 80 hours a week that was dependent on so that my income went down, my business started to crumble. And that so that was just the money piece, then I had to start selling assets because it cost me so much to to heal me, it wasn't covered by insurance because as a random as a random illness. But then I had to start selling things because to pay for it. Granted, luckily, I had the cash and could do it. But now I'm trading my wealth to get my health back when I spent a decade busting ass to get that wealth in the first place. And now it's going out to get my health that I sacrificed. And then the final piece that that was the piece that was filled with so much grief and remorse and regret, which were just grief, remorse and regret or such dark, sad, heavy emotions and feelings, I was just stuck in it because here I was dying I hadn't even lived yet.

So I was always waiting to live in the future when I accumulated more and more and that more just kept the next one the next more. And when I was there, not only was I just sad, because but because of that, but I was also I couldn't enjoy my money that I'd worked so hard for I couldn't go out to eat, I couldn't travel, I couldn't leave my bed, I couldn't enjoy life, I couldn't spend time with my children, which I'd sacrificed a lot of time with to be on that proverbial success ladder. So all of those things just woke me up that we're just in this game of more success, more money, more everything more consumables, and it can be such a trap when we're not connected. What really matters is to understand and I'll complete that long diatribe by saying that, that when we really understand that the wealth, the money, wealth, is just underwrite the cost of living a good meaningful life. And knowing how much money it takes to live that life. Money doesn't have to be a chase all the time, we can get out of that game and out of that trap that ultimately not only lead to disease and potentially kill us like in my situation, but it doesn't lead to fulfillment or happiness either.

Acquania Escarne 8:04

I love that. And that actually segues into the next thing I wanted to talk about is how do you calculate your sovereignty number, you talk about that a lot on your website, but I want my listeners to have an idea on how they could do it at home so they could start to plan like you said, for being able to be free and knowing that they have the resources to do it.

Krisstina Wise 8:25

I'm so glad you asked that question. I don't get the asked that very often. I love answering that one. So it's a really important question, I think. And so sovereignty, freedom just means when I say the word sovereignty, but like financial sovereignty just means we're full, we're complete, we're secure, we're steady. We don't have all that anxiety and fear on a day to day basis, even subconsciously, because we feel we feel we're capable. We're know we're on the right track. We're know we're headed in the right trajectory, because we know our numbers. And how do we know we're going to go? How do we know where we get to get or if we get there, if we don't know where we're going, we always need the destination first, if I'm going to go from here to Virginia, to visit you, but I don't know where you live, I can't find you and tell me you tell me your address. I'm not going to get there. I could travel the whole world and never find you but you give me a pinpoint address, I can reach you in a few hours.

So money is the same thing and all these things. It's understanding that what is the kind of the that sovereignty number, that financial freedom number that means when we hit that number, we've done it right. And it's different for everyone. The thing is, it's different for everyone. But how we calculate that number is just a few rules of thumb that are pretty simple to calculate. But it does many times it requires a compounding calculator. So anybody that's never used a compounding calculator means they're probably in the income game and not the wealth game. Because when you're really focused on wealth, you understand compounding, and you want to plug in these numbers on a you know, on a semi regular basis.

But so what we do is the first step that's required is know how much does it cost to live your current life. So it's really important to tally that up, let's say on an annual average. amount on an annual amount, divide that by 12. And month to month, what is that amount? Is it $5,000? a month, $10,000 a month, $20,000 a month. But what is it currently, and let's just pretend it's $10,000 a month, which is what you're making and spending on this life that that is your current cost. The second step is to calculate is that offering you enough money to really live the life that you want right now. So let's pretend that it's 20,000, that you calculate that you think if I brought home $20,000 a month, and then that would serve, that'd be more than enough money on a monthly basis on an annual basis to really fund everything that's important to me, if I blow it out more than that, great, but if not, it's enough. So now what we do is we multiply both those numbers by 20. And then that becomes your freedom number, your sovereignty number. So if it's 10,000, so let's just say to make the math easy, let's switch and it's $100,000 a year. So if your numbers $100,000, a year, which is what, like 8777 a month or something, but if it's 100,000 a year, multiply that by 20. And that means your freedom numbers $2 million of net worth.

So that's the number you're going after. And now we can put that into what's called reverse compounding calculator, put in that 2 million, and it will tell you how much you need to start, you know, saving, investing and whatever that average interest rates going to be, to tell you how long it's going to take and how much you need to start putting away now. So something as simple as that these are very kind of rule of thumb rough numbers, but it's a great way to get started. And you do that for your current amount. And then if it's $200,000 a year, multiply that by 20. And now it's gonna be $4 million. So now when you hit that $4 million, if it's invested in places where you can live off the interest of that about 5%, that's gonna pay you that $200,000 a year. And that's what freedom is, like true financial freedom. Sovereignty means you're on track and you're feeling secure, because you know, your numbers and you're on track, you're putting money away for tomorrow, and you're living a good life today. And you're in this growth and you're very conscious about about your money, and you spend time with it to make sure you stay on track. But when you know your numbers, and you're on track right there with it's going to take years to cheat these numbers, you're going to because it's math that serves you to take it out even life crisis or something, you're gonna you're going to do that and year over year, you're going to start to create more surplus and more space and the more wealth that you have in the form of net worth and assets, you're that much farther away from that month to month anxiety and stress. And so that's part of being on what I call the sovereignty track.

But what happens is like true financial freedom, when we hit that space, hit that number, that means the income from our assets, that net worth can replace our working income. So that gets us freedom of choice. In real wealth is choice, it means we can choose what we do with our time because the money is going to be there, whether we get out of bed or not. It is that choice, which is the freedom it's you know, freedom from unwanted obligations, relationships, constraints, anxieties, and freedom to live the life the freedom to choose what we want to do with our time.

Acquania Escarne 13:12

I love that I love all of that. Because that really breaks it down, you presented the math, I'll definitely make sure to put that in the show notes. So people can calculate their number I challenge listeners to calculate their numbers so they can get on track and have confidence that they're going in the right direction. So I'm going to pivot a little bit because I also love another perspective that you mentioned. And you talk about where you should treat your finances like a business. And I sometimes joke with my husband, and I'm the CEO of our family's finances. And so I wanted you to tell me more about that. Why should people treat their finances like a business? And what does MYOB stand for?

Krisstina Wise 13:54

Girlfriend you did your homework? I love these questions. So first of all, most of who I work with are entrepreneurs want to call micro business owners, coaches podcasters, those of us that we really are our business one way or another. So what can be difficult in that case is separating ourselves from the work that we do in our business. But at the end of the day, it's to as entrepreneurs when it come micro business owners it's like self employed solopreneur with some help and kind of different things. But that can get very confusing because it's like we are the business and if we don't do the podcasts that day, then obviously nothing's going to happen. What MYOB stands for it says it's mind your own business. You know you say mind your own business type of thing, but mind your own business means mind it. You want to mind your business, meaning you want to work on your business. And what is the CEO of our business businesses means that we take ourselves out of it and we look at how much money do we want to earn, what are the expenses of our business? What's our burn rate, what's our profitability that we're looking at, and understand like business It's just business but where we need to be the CEO, half of our business sometimes, and sometimes we're in our business is the technician of the practitioner meeting we're doing, you and I are both in our business right now, we're not working on it.

But that's what MYOB stands for we that we need to really need to mind that business and all the elements of it. Because what we want to do in our business is create what's called profit. We don't just focus on top line, we want to know bottom line, why? Because our profit is what we want to move from the business account moving to our household account. Now, it's to understand that our business is just to make income, it's just business, it's numbers, it's black and white. Yeah, we're passionate, we love it, we help people, we want to make the world a better place. Awesome. And we want to get paid handsomely for doing so that's part of it as well. And that's exchange give a lot of value and energy and awesome and help people in return. They they reciprocate with some form of payment. And that's what we do, we exchange currencies as a way to exchange value.

But that's just business, right? We're live where the money matter, it's just business and it's the business for profitability. We always need to be focused on business. Now the intention and the goal is to move the profit from our business into our household is to understand when we can think of our household as a business, just what you said, we need now we need to become the CEO of our household business of household finance, the finance part of household because it costs money to live, and but how we live and experience life outdoors. That type of spending is all in our household. But just like we need to be running profit and losses in our business, we need to be running profit and losses in our household to really see how we're doing based on our personal goals, financial goals, just like we run numbers and the business for the business goals.

So that's just it. When we start thinking in terms of profit, what is profit on our household profit or households that we set aside, we sweep, and we don't spend today so that we can invest and over time have that money, that's going to be that future trust fund those assets is going to pay us 100 or $200,000. Once the assets reach that amount, and we can pull up that cash flow in forms of interest or dividends or renter, however, it's invested. But we if we're not running our numbers, if we're not looking for money for not treating it as a business, then we're likely going to overspend, we're going to spend in the wrong places, we're going to slowly but surely get into debt, we're going to make decisions again, somewhat blindly and unconsciously, it really sat self sabotage, unknowingly. We're working hard. We're building families, we're doing hard work, we're doing good. And at the same time, we're killing ourselves financially, we're robbing ourselves without knowing it, we understand that our business is about making a profit, and our big household business is about wealth, then it becomes a wealth game. And strategy is very different than income and income strategy. Most people are in the income game. And wealth and income are two, you know, different distinctions. So when you play the wealth game, you play money very differently, and you look at it differently. And it all happens in your household, you don't get rich in your business, you build wealth in your household.

Acquania Escarne 17:57

I like that, because that kind of goes into what you were saying about how making more money is not always the solution. So that's what you're getting at is some people assume I just need to make more money, I need to make more money. But as you said, it's about what you're doing with it. Even if you're paying yourself from your business. Are you managing your household finances responsibly? Are you sweeping that excess that you haven't spent into future investments or capital that can pay you to enjoy your freedom? Or are you overspending or paying off debt because you have this extra money, you're spending it too. So I think that's really important. And I liked how you presented it, because now I'm thinking it from that perspective and getting my husband to do it, too. And he's on board. He's Wait, that makes a lot of sense. And a lot of times, it's hard for people to realize, just because you got a raise doesn't mean you have to spend it. So I really like that. So thanks for sharing that, that philosophy. And hopefully a lot of people will take it to heart and start to apply it to their own finances. So now I want to transition to talk more about your academy and who's it for? What do some of the students get when they are working in the program with you? And how can they join?

Krisstina Wise 19:14

Yeah, thank you for that question as well. Let me just say one thing, too. Last thing we're just talking about, and that is, there's something it's to understand there's this money law and is called Parkinson's Law, and Parkinson's law money. We've heard it many times as a productivity space. But Parkinson's Law also applies to money. And Parkinson's Law. Money says there's two parts to it. Part A says expenses will always rise to match income. And it's insidious, it's invisible. We don't even know it's so natural that we don't even know it's happening. So we're not paying attention to our money. And we're not tracking it. We're not talking about it. We're not looking at it. We're not moving it. We're not in charge of it. It naturally happens. It's like breathing. We don't think about breathing but we just breathe in and breathe out. So this is most of us. without knowing that this is even in place, we're victim to it without knowing it. And this is what's defeating, and keep most people on that hamster wheel, that the more money you make, the more money you spend. And so as you make more money in your business, you get the raises or now you have a double income, whatever the case is, when you get when you start making more money, and even significantly more money. Naturally, the expenses fall for it.

We went from 100,000 a year we get married, and now our spouse makes 100,000 years and now it's yeah, we just went from I just went from 100 A week went to 200. Do we drive the same cars? Do we drive? Do we stay in the same apartment or house? Do we go on the same vacations? No, what happens we trade it's like, Yeah, whoa, now we can have this car. And now we can these vacations and now we can buy, we can put we can afford the payments, we can put furniture on the interest credit card that they said that they would do it because everybody wants to sell you debt. Now everybody wants to sell you the lifestyle through these payments. So every time you get a new payment, you increase the cost of your living. And now we're paying, we're bringing in the banks, and we're keeping the banks rich, because anytime you pay interest, you're robbing yourself of that same interest. And so one of the principles is stay out of debt, you know, only don't put anything on any card that you can't pay cash for. Because we want those margins that otherwise would go the credit card that you're paying to interesting in credit cards you want to put towards that future fund, which is going to be your that towards that money that we just talked about. That's you're going to use over time.

So you're either paying the money to the banks in the form of interest, you're going to pay you in the fact that you get to collect the interest. And so that's just a mindset shift there to think about it that way. But that's just it is to know if we're not really in our money and aware of it, we're going to fall victim to that part of Parkinson's Law. The second part of Parkinson's Law says that we're what was once a luxury becomes a necessity. So with every raise comes a next level of necessities, so then sometimes the incomes fluctuate, maybe one of the spouses loses their job for a while, you know, we go down, but now we're used to this lifestyle at 200,000. Nobody wants to go back to down to 100,000, we almost sometimes feel entitled and so we get used to the conveniences and the inaudible of a lot more money. So when we can just be aware of that and not be victim to it, and know that profit first. And so when you really get into the wealth game, and now the income game, the income spending game that I'm referencing, your profit comes off first in your household, what that means is your take is 10 or 20%, or whatever your number is off the top based on those calculations, I gave you how much money you need to take up the top, you take that off first, and then you spend with leftover, most people say, Hey, I don't have any thing leftover. Now after all my expenses, I'll save an investment future when I make more money, and then I'll do it. But then Parkinson's Law hits effect. And now you're just 10 20 years older, and you still haven't started that because of that expense creep. So it's just really important to know that we want to know these numbers and not be, you know, victim to Parkinson's Law.

Acquania Escarne 23:04

Wow, that's a lot, but I want to unpack it for some of our listeners, because I'd never heard of that before. So that's news to me. And I think that's so valuable because it does happen. And a lot of people pursue the job that pays more, or get the jobs that come with bonuses for the purpose of being able to do more things or to buy more things. And you just presented a perspective where that type of lifestyle is keeping the banks rich. And that's the kind of money that we could be keeping for ourselves and making ourselves wealthy. So I really want people to take that to heart and process that for themselves and see how you can transition your mindset to be able to keep more of that wealth in the household and towards your personal goals. And like you said earning that interest instead of giving it to the banks that was really good. Is that the type of concepts that you teach in your academy?

Krisstina Wise 24:01

Yeah, so all these things are exactly we learn in the academy and the Sovereignty Academy is a money school. So I created this in the tagline is everything we should have learned about in school about money, but they didn't offer that class. It's understanding that money is a life skill. What is common sense about money you make it you spend it is what's keeping us paycheck to paycheck. And there's wisdom, that kind of the conventional wisdom common what I call the common sense, money is creating us unknowingly to self sabotage those dreams and desires in the near future and the long term. So that's why I teach things like the principles and how much money is enough and to you know, to have the calculators and reverse into some of these numbers so that we can get on track.

It's also to know to that, that we need goals, what are what's the destination and goals we need some tools like what are the calculators and some of the formulas very simple to figure out but we need to know these numbers. It's it's math, so it's very predictable once we know what the numbers are and we can do that. And we need systems. And so most people, they don't really have a financial system. The system is the machine, the wealth creating machine that we want to build so that it holds the money accountable and allows us to move at different ways. It really understanding that we're in charge, we're responsible charging and control of our own destiny, our own financial destiny, and it's available for everyone. And it really isn't. It's not complicated, but it is learned. It's learned knowledge and learn skill and learn behavior. Most people don't figure it out on their own sounds like you've done a lot of study of money and wealth. I've spent decades rigorous study to get good at what I do. And now I can teach it after years of learning and applying and making mistakes. And that didn't work and I am where I am now. But it's not just it didn't happen by accident. It came because I was very intentional about it, about learning. And every time I'd learned new things, I'd be like, Oh my God, like how can we don't know this or learn this. So that's what Sovereignty Academy is the money school to help us learn these things so that we can get, we can learn everything we need to know about money so we can get on track to build our financial destinies that we're working so hard for.

Acquania Escarne 26:12

I love that. And it's so true. I have been a money nerd for quite some time. My dad bought me, Rich Dad, Poor Dad by Robert Kiyosaki when I was 16, and I read it. And then I started saving for retirement with my first paycheck from a retail job. So I'm one of the interesting kids who was like, I don't want to work forever at 16. I was like, I'm retiring early, and I'm gonna start saving now. But most 16 year olds are not thinking that. And then most 20 year olds in college weren't thinking that either. So when I'm telling people Oh, yeah, I have a Roth Individual Retirement Account. They're looking at me, like, who's Roth? What are you talking about? So I totally understand what you're saying. And I think that what you're providing is very valuable and useful. So thank you for setting up a place where people can learn what we're not learning in school. That's, that's pretty dope. So the name of the podcast is called the Purpose of Money. And I always ask my guests, this is my signature question. What is your purpose for money?

Krisstina Wise 27:14

My purpose for money is to underwrite the cost of living a good, meaningful, awesome, connected, space filled life. And like I said, when I was just in the rat race all the time, I was missing life, it was just about more money, and comparison and getting the next award next word, and it was empty. And there was never an end in sight, I would have done that forever, and really miss my life. And I thought it was for the sake of chasing more money, I don't know. So yeah, like the purpose of my money is to very be very just know how much money is enough and to make sure that I'm spending my money in ways that allow me to live a good life, because that's what it's for, to be healthy, to have great relationships, to have space and time. And ultimately, that for financial freedom, so that I can just I have more choice and can do what I want, when I want and how I want.

Acquania Escarne 28:06

Last but not least, because I think you're awesome. And I really learned a lot from you today. I want my listeners to be able to follow you join your academy. So can you tell me what's the best way to keep in contact with you go ahead and drop your website and social media platforms.

Krisstina Wise 28:24

Awesome. Thank you. If anybody's interested in the money school, just go to SovereigntyAcademy.com. So that's just if you're inaudible interested. And in that, if not, I have my own podcast to Wealthy Podcast, which I have lots of these types of conversations, but I'm interviewing people smarter than I am, I am better to have done more than I so I'm learning from them. So it's always nice to listen in. And then Instagram, Krisstina Wise, everything I do is at Krisstina Wise, inaudible two S's and finally, I have a free copy of my book is called Falling for Money.com , and I talk a lot about this. It's an easy read. And it's just you can get through it and an evening or maybe a couple days if you breeze through it. But again, I bring forth a lot of these principles and tell a lot of story in the book. And that's just it Falling For Money.com if anybody wants a free copy.

Acquania Escarne 29:10

Love it. I'll make sure to include all of that in the show notes so everyone can check you out. follow you on social. And of course guys, if you love this episode, please share it with others and leave a five star review where you're listening. Thank you so much Krisstina for being on the show today. I cannot wait to continue to share this wisdom and information with my friends and family. Thank you so much.

Krisstina Wise 29:34

You're so welcome and great questions. I love them.

Acquania Escarne 29:36

Thank you for listening to the Purpose of Money podcast. For more resources and information, check out my website, the Purposeofmoney.com. And while you're there. Please sign up for our newsletter so you have the latest information on new episodes and blog posts. Until next time, keep creating freedom in your life today.

Transcribed by https://otter.ai