Your Biggest Problem Isn’t What You Think It Is (Ep. 336)

We in the egg industry need to be the victims.
We always need to be rescued.
We can't do anything for ourselves.
That's the mentality these people have.
It's hard.
It's hard.
Don't you know how hard it is for us?
Yeah, everybody has hard.
Everybody knows how hard it is.
The question is, how can we make it easier?
And if we're not asking that question,
we're not going to get the answer.
If there is something in front of me, I'm like,
ooh, how can I make that an opportunity?
And I just naturally do that.
And it's just so interesting to me how people don't.
How people just sit in this narrative of it's hard.
We just want to stay where we're at.
Hello, hello, hello, and welcome back to the podcast.
Thank you very much for being here.
All right.
Today, we're going to talk about cash flow, some negative Nellies.
It's all around that topic of cash flow.
And I have a post on the Book of Faces,
and none of those people that commented are going to listen to this
because based on their comments,
they're not looking to learn anything.
Let's just say that.
So we have a post that is a short little clip of me
talking about the excess money in the cattle industry right now
because of cattle prices, obviously.
And the amount of people.
I did some screenshots.
This is the third time I'm recording this,
so I'm not going to read them again.
But I did screenshots and I probably have,
I don't know, six or seven screenshots of people saying excess money.
What are you talking about, lady?
Has anybody told her that there are still expenses?
One guy called me some names because, you know,
he's far more intelligent than I am.
And so it's just so interesting to see 20, 30 comments saying,
where do you think this excess money is?
We don't have excess money.
The cost of feed went up.
The cost of fertilizer went up.
The cost of cattle went up to even buy them back.
So where is this excess money?
Honey, you got excess money
because you sold cattle
and you sold cattle for more than what you've sold them for in the past.
That is called excess money.
Here is the challenge that most people are not thinking about.
And that is how to use that excess money.
And that's what I was talking about in the video.
But most of them didn't even get to the end of that video to understand that.
This truly is what is going to set successful people apart from unsuccessful people.
If you have a good explanation as of to why I am wrong there,
please, by all means, let me know.
How people utilize money is what sets them apart.
You can take two people that make the exact same amount of money
and one person is going to have a better outcome than the other person.
Nelson talked about that in Becoming Your Own Banker.
He's talking about if you took two cars
and you gave the exact same car to two different people,
one is going to go further than the other because of how they take care of it.
It's the exact same thing here.
And I don't understand why people can't think about that.
And here's a good example.
I was talking to a couple within the last couple of weeks
and they were talking about how they were going to sell some land
and they wanted to take the proceeds from this land
and they wanted to pay off their land note on the rest of the land that they have.
They want to pay off their land note
and then they had a couple of vehicles and a trailer
and some other stuff they wanted to pay off.
Now, some of those debts were at 7.5% to 8%.
The land note, however, is at 4%.
And so I said, you don't hardly have any debt.
Why do you want to pay all of these things off?
And I said, just so you feel warm and cozy,
like it gives you less anxiety because he's a business owner
and their cash flow isn't steady.
Is that why?
Yep, that was why.
I said, okay, I can totally understand that.
I said, but right now our problem is cash flow
because his business isn't super busy due to where they live.
So if your business isn't busy, we have a cash flow problem.
Our normal response is if we pay everything off
and then we don't have any cash flow,
we're okay because we don't owe anybody any money.
And I said, if you don't have cash flow,
but then you need to purchase something,
you can't do that because all of your money is wrapped up in these things.
So your vehicle's paid off, your land's paid off,
everything's paid off and that's great.
But now we don't have any cash flow.
We still need cash flow to go buy things.
If we can't buy the things, we have to go back to the bank
and we have to ask them for money, right?
In order for them to give us money, we need cash flow to pay them.
So they're not going to easily give us money if we don't have the cash flow.
So my alternative question is when we sell the land,
do we want to pay off a couple of the high interest notes,
free up some of those payments, but not pay off the land?
Because the land is paying for itself essentially because it's being rented out.
So can we utilize money differently?
So now we have a chunk of money that is not equity and ground
because we didn't pay that off.
Now we have this chunk of money.
Can we buy something with that chunk of money?
Can we buy a rental property with it?
Could we be a private lender to where we're lending money at 15, 20%?
I know people that are doing that,
especially because this individual has family farms.
Like they're paying eight and a half.
They could be paying anywhere between seven and a half
to probably nine for operating money.
So if they're good farmers and if you know they can pay you back,
would you be willing to lend it to them at 9%?
They had talked about wanting an Airbnb.
Fantastic.
Can we use that money to create more cash flow?
Out of all of the comments on my Facebook post,
only I know one for sure,
maybe two people had some comments about how they're buying more cattle
to create more cash flow and they get the game, right?
The majority of people are not thinking that way.
And the couple that met with me,
they weren't thinking that way,
but they're educating themselves and they're trying to do better.
What most people are doing is not thinking at all,
except the fact that they're thinking about how stupid I am.
Because, you know, what the hell would I know?
So they're thinking about how dumb I am,
but they're not thinking about why is she saying this?
What makes her talk about that?
And what is she even talking about that maybe I should go read the book, right?
The utilization of money is so important.
If we do not understand how to create cash flow,
then we are going to be stuck in this cycle constantly.
You guys have heard me say it a million times,
being debt free is not the answer.
Cash flow is the answer.
If you do not have cash flow,
you cannot buy groceries.
You cannot put gas in your vehicle.
You can't do those things.
Yes, you could do those with a credit card
and you could pay a lot of interest to get that done.
But we want to have a system that is constantly providing us income.
And do we always need to be physically working for that income?
I don't know.
Maybe.
I mean, nothing is passive in my books.
I've got several rental properties.
Those suckers are not passive.
That is the biggest lie ever.
That is not passive.
I don't know that you can be a business owner of any kind
and be like, oh yeah, that's just passive income.
Yeah.
Because why?
Yeah, you ain't doing anything
and you hired somebody to do it.
And are they even doing it up to the standards that you want?
So there's all those things that need to be figured out around it.
But these conversations that I'm having
are not any different on a day-to-day basis.
And I think that we need to understand
when we have this excess money,
how are we going to use it?
Are we going to run it through a life insurance policy
that we can create our banking system?
Are we going to run it through that policy?
And then we're going to borrow against it to buy more cattle.
We're going to borrow against it to use that cash for operating.
We're going to use it to buy a baler.
We're going to use it to buy feed.
Whatever that is.
Most of us are saying,
we don't have any money, Mary Jo.
You are an idiot.
Because it's gone.
Yes, I know it's gone.
How did we utilize it?
Through that process of getting it.
Because we have the excess money.
And how are we using it?
It's no different in farming.
I know I've kind of been talking about ranching.
It's no different in farming.
If we have cash,
and we're not borrowing every dollar to operate,
and we have some cash,
how did that cash move through our system?
And it's not something that we really think about.
We're just like,
oh, we've got cash in the account,
so we don't have to go to our line of credit.
We've got this cash in the account,
so we're going to just write a check for fertilizer,
or we're going to write a check for unhadris,
or we're going to write a check for chemicals,
or whatever that might be, right?
We're going to write our check for seed.
In an earlier podcast,
I talked about the fact that
farmers don't always know when I ask them,
what are your operating costs?
And they give me what their line of credit is.
Those are not always the same.
And it's amazing to me also,
that video is also running on Facebook.
And it's amazing to see the responses on that as well.
Because if we know our numbers,
even if we know our numbers,
we still don't truly always understand
how that money is being utilized
and running through the system.
Your life insurance policy
is really the before asset.
Can we put the money there before
and then we can still borrow against it?
It's still earning uninterrupted compound interest.
It's created a death benefit.
It's done all of these wonderful things.
Can we utilize it better
so that we're creating more cash flow?
And when we create more cash flow,
that creates more income.
When we create more income,
that creates more taxes.
And so it's just this absolute vicious cycle.
But so many people think,
I am an idiot,
that that is not going to happen.
I don't know what she's talking about,
but they don't want to look any further into it.
Or we have this mentality
that everything needs to be paid off
so that we can feel warm and cozy.
So if we go back to this couple even
and say, okay,
let them pay everything off.
That's great.
But then where is the cash flow?
Did we create any extra cash flow?
No.
We kept the cash flow of their household
exactly the same.
Instead, if we use that money
and we buy an Airbnb,
which is what they wanted to do,
we use some of that money
to buy an Airbnb.
If they make a good decision on the Airbnb,
then that can produce cash flow for them.
And now we've increased the amount of money
coming into their household.
And so we have to ask the right questions.
We have to think about it correctly.
So many people are not.
And it is evident
that people don't want to learn
or their feelers get all up in a bunch
because somebody said something
that maybe just poked them a little bit,
maybe just said something a little bit
where they're playing victim
and they don't want to get out of that.
I'm seeing a lot of that in that post
that it's just attracting a lot of people
for whatever reason
that are playing victim.
We in the egg industry
need to be the victims.
We always need to be rescued.
We can't do anything for ourselves.
That's the mentality
that these people have.
It's hard.
It's hard.
Don't you know how hard it is for us?
Yeah.
Everybody has hard.
Everybody knows how hard it is.
The question is,
how can we make it easier?
And if we're not asking that question,
we're not going to get the answer.
I also talked to a lady yesterday.
Super fun conversation.
She was a little bit of a mini me.
And she had all kinds of businesses,
was doing all kinds of things.
And she's like,
I just see opportunity everywhere I go.
And that is exactly how I am.
If there is something in front of me,
I'm like,
ooh, how can I make that an opportunity?
And I just naturally do that.
And it's just so interesting to me
how people don't.
How people just sit in this narrative
of it's hard.
And you do not know what you're talking about
because we don't have excess money.
The cost of everything has gone up.
Yes, I know the cost of everything has gone up.
I'm not new here.
You're new to me,
but I'm not new here.
But we don't stop to think about
what is she saying
that could actually make some sense.
We just want to stay where we're at.
So anyway,
a little bit of a rant today.
This is probably coming out,
I'm guessing,
the day after Christmas.
I don't know.
Hope you had a fantastic Christmas.
Our office is closed
during the holidays.
So we will not be in the office.
So I hope that you guys had a great time
and you have a fantastic rest of your day.
You guys know the routine.
If you need something,
email me,
Mary Jo at Without The Bank.
Have a good one.
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to the Farming Without The Bank podcast.
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