The 4 Sources of Cash (and why I bought a $10M building) | Ep 842
episodePreviously titled “The 4 Sources of Cash (and why I bought a $10M building) | Ep 869” — renamed by the publisher on Aug 2, 2026
Transcript
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Transcript generated automatically by AI and may contain errors.
What behaviors do wealthy people exhibit?
The richest people I know, that is the behavior that they typically use. They're like, I want this thing, and so I'm gonna go make the money to buy the thing. I'm not gonna use my existing income. I'm not gonna use my existing resources. I'm not gonna use my savings.
How does Alex Hormozi approach debt?
I'm not gonna go into debt unless I know that I'm gonna pay it off within a year and I have no prepayment penalty and I have a clear plan of how I'm gonna do it. They have a clear plan of how they're gonna make the money on a very defined time period, and it's from doing above and beyond. What's going on? Welcome back. I've been stockpiling some ideas and I had a free morning and I slept well. So I figured I would just unload them. And for those of you who are, who got some time between sales calls, between customer calls, maybe you're in your lunch break, whatever it is, maybe I'll give you a little something. A lot of people talk about money beliefs. I tend to not like it. I prefer thinking of things in behaviors. So what do I change about what I do?
I think that if you think in terms of behaviors, then there are behaviors that people who have money do that people who do not have money don't do. And there's also the reverse. Behaviors that poor people do that rich people don't do. And so I want to talk about one very specific one that served me exceptionally well. And I can try and break this down as well as I can imagine. I'll give you a few tactical examples as we go through. So right now, I'm in a studio that probably cost me some of the neighbors of like $500,000, which is egregious. But it cost me about $500,000 to build this thing. And it's sitting inside of a building that cost me, I think, $9.1 million, something like that. I think I put like $2 or $3 million in this building.
So call it a $10 million building conservatively. I paid for it in cash. And the reason I bring this up is because I think that I've noticed different spending habits between rich and poor. That seems obvious, but I want to dive a little bit deeper. So not that long ago, I overheard somebody say, go buy that motorcycle because you could always make money in the future. And I kind of like hated that. And I thought about where the sources of money that I tend to draw from in order to make a purchase. Now, the reason that I bring up this building being a significant purchase is it was less that the price was a significant purchase and more so that I didn't need this building at the time. I just wanted to have a place to have a home gym that would be more than like a commercial gym. And I wanted to have a place for meetups and things like that. And I could come up with a rational explanation that between all the portfolio companies, we were spending about $4 million a year in event spaces.
And I was like, well, if I had a big enough space for all of them to do their internal meetings, their quarterlies, fly out their staff and their team and have a venue, then I could probably save that and it would pay for the building. But I remember Layla was like, hey, maybe we should just get like a 5,000 square foot building. So this building is about 36,000 square feet, much bigger.
What are the four sources of cash?
I remember hearing this and I was like, that's appropriately sized for where we're at now. But it's not the size building that I would want it to be for where I want to go. And so I remember telling her, I said, I promise if we buy this building, I will make sure that it makes us more money than it has cost us. And so this goes to the sources of cash. And so there are basically four. And you can pretty much determine how wealthy someone is by where they're spending from. And so let me walk you through it. You've got what I would consider past money. So that would be savings. So that's earnings that you had in the past, and that's money that you put away. The next money is you have income money. So this is the money that you make every single month.
You can spend this money rather than touching your savings. This makes sense. Then you've got debt money. which is basically future earnings. Like this is money, I'm gonna take debt and I'm gonna pay with future money, right? And I'm gonna have to pay this debt off. And then finally is the category that I like to have, which is, I'll call it new money. Now you're like, what does that even mean?
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Chapters
8 chapters
1
What behaviors do wealthy people exhibit?
0:02–0:15
2
How does Alex Hormozi approach debt?
0:15–2:45
3
What are the four sources of cash?
2:45–7:56
4
How can I leverage existing resources for new income?
7:56–10:15
5
What is the importance of a clear financial plan?
10:15
6
How does spending behavior differ between rich and poor?
2:27–3:06
7
What lessons can be learned from buying real estate?
3:06–8:11
8
How can I make investments pay for themselves?
8:11–13:01
Speakers
1 identifiedMore from The Game with Alex Hormozi
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How to Think Like the Top 1% | Ep 996
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