The #1 Financial Freedom SECRET Rich People WON’T Tell You!
In this episode of The School of Greatness, Codie Sanchez shares her insights on building financial freedom, explaining that wealth-building requires more than just saving money. She discusses how her early experiences shaped her financial journey and describes how observing wealthy individuals helped her understand that financial success depends more on strategy than intelligence.
The episode covers practical approaches to increasing wealth, from leveraging corporate jobs as learning opportunities to buying established businesses rather than launching startups. Sanchez details her preference for "boring" but reliable businesses like laundromats and trade service franchises, while also exploring the role of relationships in business success. She shares how she and her husband approach their financial partnership by focusing on their individual strengths rather than traditional gender roles.
This is a preview of the Shortform summary of the Sep 12, 2025 episode of the The School of Greatness
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1-Page Summary
Journey From "Broke" Mindset to Financial Freedom
Codie Sanchez shares how her college experience of having her mother monitor her bank account sparked a determination to achieve financial freedom. She came to understand that time, not money, was the truly irreplaceable resource. A pivotal moment in her journey came when she met wealthy individuals who weren't exceptionally intelligent, leading her to realize that financial success was more about wisdom and strategy than raw intelligence.
Earning More Money: Strategies and Principles Beyond Saving
Sanchez and Lewis Howes emphasize that saving alone won't build wealth. They advocate for focusing on earning more through skill development and strategic negotiations. Both recommend using employment at large companies as paid learning opportunities. Sanchez specifically advises negotiating for performance bonuses and warns against accepting premature job titles or raises. She cautions against investing in non-cash-flowing startups until establishing a solid financial foundation.
Building Successful, Cash-Flowing Businesses and Franchises
When it comes to business ownership, Sanchez strongly prefers buying established businesses over launching startups, citing the latter's high failure rate. She recommends starting with low-risk franchises, particularly in trade services, due to their recession-resistant nature. For those with more experience, she suggests buying existing businesses outright, potentially using seller financing. Sanchez particularly endorses "boring businesses" like laundromats, which offer consistent returns and lower risk.
Value of Relationships, Partnerships, and Choosing the Right People
Drawing from personal experience, Sanchez discusses the delicate balance between personal and professional relationships. She only does business with friends after they've demonstrated shared work ethic. In her marriage, Sanchez describes how she and her husband complement each other's strengths - she excels at making money while he offers protection and risk assessment. They approach their partnership without adhering to traditional gender roles, instead dividing responsibilities based on individual preferences and talents.
1-Page Summary
Additional Materials
Clarifications
- In the context of achieving financial freedom, the emphasis on time as a valuable resource highlights the idea that how you use your time can have a significant impact on your financial success. This perspective suggests that making strategic decisions and investments early on can lead to greater financial gains in the long run. By prioritizing activities that generate passive income or long-term wealth accumulation, individuals can leverage time as a key asset in building financial stability and independence.
- The distinction between wisdom/strategy and raw intelligence in financial success lies in the fact that while raw intelligence can help in understanding complex concepts, wisdom and strategy involve practical application and decision-making based on experience and foresight. Financial success often requires more than just intelligence; it necessitates the ability to make sound judgments, adapt to changing circumstances, and take calculated risks based on a deep understanding of the market and one's own goals. Wisdom and strategy in finance involve long-term planning, risk management, and the ability to navigate uncertainties effectively, traits that may not solely rely on high IQ but on a combination of knowledge, experience, and critical thinking skills.
- Using employment at large companies as paid learning opportunities involves working for established corporations to gain valuable experience, skills, and industry knowledge while earning a salary. This approach allows individuals to learn from experienced professionals, access training programs, and understand corporate structures and operations. It can provide a stable environment for skill development and networking, setting a strong foundation for future career growth and entrepreneurial endeavors. This strategy is often recommended for individuals seeking to enhance their expertise, build a professional network, and potentially leverage their corporate experience for future ventures.
- Negotiating for performance bonuses involves discussing additional compensation based on achieving specific goals or targets beyond regular salary. This incentivizes employees to excel in their roles and contribute significantly to the company's success. By securing performance bonuses, individuals can increase their overall income and accelerate their wealth-building efforts. It's a strategic approach to financial growth that rewards exceptional performance and aligns incentives between employees and employers.
- Investing in non-cash-flowing startups without a solid financial foundation means putting money into new businesses that are not generating profits to cover their expenses. This type of investment can be risky as it may take time for the startup to become profitable, potentially leading to financial strain if the investor relies solely on these investments for income. Having a solid financial foundation, such as stable income from other sources or savings, can provide a buffer against potential losses from such high-risk investments. It is generally advisable to have a diversified investment portfolio that includes more stable assets alongside riskier ventures like non-cash-flowing startups.
- Preference for buying established businesses over launching startups:
- Buying established businesses is favored due to their lower failure rates and existing customer base.
- Established businesses often have proven revenue streams and operational systems in place.
- Launching startups typically involves higher risk and uncertainty compared to established businesses.
- Buying an established business can provide a more immediate income stream compared to the time it takes for a startup to become profitable.
- Low-risk franchises in trade services typically involve businesses that provide essential services with consistent demand, such as plumbing, electrical work, or HVAC services. These franchises often have a proven business model, established brand recognition, and ongoing support from the franchisor. Due to the essential nature of these services, they tend to be less affected by economic downturns, making them relatively stable investments. Choosing a franchise in a trade service sector can offer a lower risk compared to other industries due to the recurring need for these services in both good and challenging economic times.
- Seller financing, in the context of buying existing businesses, involves the seller providing a loan to the buyer to cover a portion of the purchase price. This arrangement allows the buyer to acquire the business with less upfront capital, as they make payments to the seller over time. It can be a win-win situation where the seller continues to earn income from the business while transferring ownership gradually. Seller financing terms, such as interest rates and repayment schedules, are typically negotiated between the buyer and the seller as part of the purchase agreement.
- Investing in "boring businesses" like laundromats is often favored for their stable cash flow and lower risk compared to more volatile ventures. These businesses provide essential services that have consistent demand regardless of economic conditions. Laundromats typically have predictable revenue streams, making them attractive for investors seeking steady returns. The simplicity of the business model and the recurring nature of the service contribute to the perceived reliability and stability of such investments.
- Sanchez emphasizes the importance of maintaining a clear boundary between personal and professional relationships. She believes in working with friends only after they have proven their dedication to shared goals. In her own marriage, Sanchez and her husband leverage their individual strengths to create a balanced partnership, focusing on complementary skills rather than traditional gender roles. She advocates for aligning responsibilities based on each person's strengths and preferences to foster a successful personal and professional dynamic.
- When Codie Sanchez mentions doing business with friends only after demonstrating shared work ethic, she is emphasizing the importance of ensuring that personal relationships do not interfere with professional responsibilities. This approach helps maintain professionalism and ensures that business partnerships are based on mutual trust and reliability. By waiting to collaborate until after confirming shared work ethic, potential conflicts arising from differing work styles or commitment levels can be minimized. This strategy aims to protect both the business interests and the personal relationships involved.
- Sanchez and her husband complement each other's strengths in their marriage: she excels at making money, while he provides protection and risk assessment. They divide responsibilities based on individual preferences and talents, rather than adhering to traditional gender roles. Their partnership is built on a shared work ethic and a balance between personal and professional relationships.
- In Sanchez's partnership with her husband, they do not conform to traditional gender roles. They divide responsibilities based on individual preferences and talents, rather than predefined gender norms. This approach allows them to leverage each other's strengths effectively. Their dynamic showcases a modern and personalized approach to partnership and collaboration.
Counterarguments
- While time is indeed a valuable resource, some might argue that without initial capital, it can be challenging to leverage time effectively to achieve financial freedom.
- The idea that financial success is more about wisdom and strategy than intelligence could be debated, as some might argue that a certain level of intelligence is often a prerequisite for developing the wisdom and strategy necessary for financial success.
- The recommendation to focus on earning more might overlook the importance of saving and investing wisely; some financial advisors stress the balance of earning, saving, and investing.
- The suggestion to use employment at large companies as a learning opportunity might not be feasible for everyone, especially those who thrive in smaller companies or entrepreneurial ventures.
- Negotiating for performance bonuses assumes that one is in an industry or position where this is possible, which might not be the case for all workers.
- The caution against investing in non-cash-flowing startups could be seen as overly conservative, as some startups do offer significant growth potential and can be a path to financial freedom for some investors.
- Preferring established businesses over startups might not account for the potential innovation, agility, and growth that new companies can offer.
- The recommendation for low-risk franchises might not be suitable for individuals seeking more creative control or those who have a unique business idea that doesn't fit the franchise model.
- The endorsement of "boring businesses" might not resonate with entrepreneurs who are driven by passion and innovation, which can also lead to financial success.
- The advice to only do business with friends after they've demonstrated a shared work ethic might not consider the complexities of mixing personal and professional relationships, which can sometimes lead to tension or conflict regardless of work ethic.
- The approach to marriage and partnership described by Sanchez might not be applicable or desirable for all couples, who may have different views on financial roles and responsibilities within a relationship.
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Journey From "Broke" Mindset to Financial Freedom
Speaker Overcame Financial and Control Challenges In College
Codie Sanchez recalls her college days, describing how her mother's monitoring of her bank account made her feel controlled—questioning her spending habits and scrutinizing her financial decisions. This lack of autonomy ignited her inner rebel and led to an epiphany: Codie never wanted to experience such control from someone else again. She began to see money as a means of freedom, an essential key to unlocking the power to make her own choices and live life on her own terms.
Rebel Driven by Experiences, Determined to Control Their Financial Freedom
Her experiences in college drove Codie to be determined to achieve financial freedom. She came to the realization that time is the only resource that is irreplaceable. Codie reflected on how she used to reach out to successful individuals to ask for their time, wanting to learn and shadow them, thus taking from their limited resource. However, she has since shifted perspectives, understanding how valuable it is to be a giver of time, not a taker.
Seeing Wealthy yet Unexceptional Individuals Inspired Speaker's Financial Success Potential
Witnessing a wealthy person who was not extraordinarily intelligent or knowledgeable was a pivotal moment that inspired Codie Sanchez's confidence in her own potential for financial su ...
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Journey From "Broke" Mindset to Financial Freedom
Additional Materials
Counterarguments
- While Codie's desire for financial freedom is understandable, it's important to recognize that parental involvement in finances during college can sometimes stem from a place of concern and responsibility rather than control.
- The concept of financial freedom is subjective and can vary greatly from person to person; what Codie views as freedom, others might see as just one aspect of a more complex financial picture.
- The shift from being a time taker to a time giver is commendable, but it's also essential to maintain a balance where one can both give and receive time in a way that fosters mutual growth and learning.
- The observation that wealth doesn't require exceptional intelligence might overlook the role that various forms of privilege, such as education, social networks, and starting capital, can play in achieving financial success.
- While wisdom and ...
Actionables
- You can track your daily activities for a week to identify where you're a time taker or a time giver, then adjust your habits to prioritize giving time to others. For example, if you notice you spend an hour each day on social media, consider using that time to help a family member with a task or volunteer for a cause you care about.
- Start a "Freedom Fund" by setting aside a small percentage of your income each month, dedicated to investments or savings that will increase your financial autonomy. This could be as simple as opening a high-yield savings account or starting with a low-cost index fund, making your money work for you over time.
- Create a "Wisdom Network" by reachi ...
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Earning More Money: Strategies and Principles Beyond Saving
Codie Sanchez and Lewis Howes discuss the limitations of saving as a path to wealth and advocate for strategies focused on earning more through skills development and strategic negotiations.
Saving Alone Won't Build Wealth; Earning More Is Key
Boost Wealth By Maximizing Skills and Negotiation
Codie Sanchez drives home the point that you can't save your way to wealth, insisting that earning more is the key. She contends that saving cultivates a scarcity mindset, which hinders wealth generation, and encourages the focus to be on making dollars more productive. Sanchez underscores the value of being an employee at a big company, which allows for learning without risking personal funds. Lewis Howes notes that through such employment, you're effectively being paid to master skills. Both agree that once you cease learning in such roles, it’s time to move on.
Speaker Advocates For Taking Extra Responsibilities For Performance Bonuses
Speaker Warns Against Early Job Titles or Raises
Sanchez and Howes discuss that the strategies that lead to making one's first substantial sum of money will not suffice in ascending to higher levels of wealth. They suggest a transition from functioning as a hardworking employee to becoming an investor and owner.
Sanchez specifically proposes considering equity in business deals brought to employers. On the other hand, Lewis reflects on his unsuccessful investments in startups, leading to his realization that focusing on his own projects yielded better outcomes. Sanchez warns against investments in non-cash flowing startups until one has a solid financial base.
As they address common misconceptions around wealth accumulation, Sanchez advises negotiating for performance bonuses as a method to enhance income. She encourages seeking additional pay for exceeding specific goals like growing a podcast's outreach. Lewis reinforces the idea by encouraging listeners to demonstrate their increased value to their company and to have the confidence to seek commensurate rewards.
Sanchez acknowledges tha ...
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Earning More Money: Strategies and Principles Beyond Saving
Additional Materials
Clarifications
- Strategies focused on earning more through skills development and strategic negotiations involve actively improving your abilities and knowledge to increase your value in the job market. This can lead to better job opportunities and higher income potential. Strategic negotiations entail effectively advocating for yourself in discussions related to salary, bonuses, promotions, and other financial aspects of your work. By combining skill enhancement with negotiation tactics, individuals can work towards maximizing their earnings and financial growth.
- Common misconceptions around wealth accumulation often revolve around the belief that saving alone is sufficient for building wealth. However, the text emphasizes that earning more through skill development and strategic negotiations is crucial for wealth generation. Additionally, the transition from being a diligent employee to becoming an investor and owner is highlighted as a key strategy for ascending to higher levels of wealth. The importance of seeking additional pay through performance bonuses and demonstrating increased value to one's company is underscored as a means to enhance income and accelerate wealth accumulation.
- Taking on extra responsibilities for performance bonuses involves going beyond your regular job duties to achieve specific goals or targets set by your employer in exchange for additional financial rewards. This can include tasks or projects that are outside your usual scope of work but contribute to the company's success. By taking on these extra responsibilities and meeting or exceeding the agreed-upon objectives, employees can earn bonuses or incentives on top of their base salary. It is a way for individuals to showcase their value, drive, and commitment to their role and the organization.
- Setting clear goals tied to continued employment means establishing specific objectives or targets that an employee must achieve to maintain their job. These goals are typically outlined by the employer an ...
Counterarguments
- While earning more is important, saving and investing wisely are also crucial components of building wealth.
- A focus on earning can lead to burnout or work-life imbalance if not managed properly.
- Not everyone has the opportunity or ability to negotiate for performance bonuses or equity in their roles.
- Some individuals may achieve wealth through frugality and smart saving strategies, even if these are not the norm.
- The idea that saving cultivates a scarcity mindset may not apply universally; for some, it can encourage discipline and financial management skills.
- Being an employee at a big company may not always offer the best learning opportunities, especially if the environment is not conducive to growth or the company does not invest in employee development.
- Personal projects and entrepreneurship are not viable or desirable paths for everyone; some individuals may prefer or be more successful in traditional employment.
- Equity in startups, while risky, can sometimes lead to significant wealth if the company succeeds, and some individuals may be well-positioned to take that risk.
- The assumption that one should move on from a job once they cease learning may not consider other factors that keep people in jobs, such as job security, benefits, or personal circum ...
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Building Successful, Cash-Flowing Businesses and Franchises
Codie Sanchez provides insights on approaches to achieve success through acquiring and running businesses, emphasizing that buying businesses often offers a higher success rate than starting from scratch.
Buying Businesses Offers Higher Success Than Starting From Scratch
Codie Sanchez expresses a clear preference for buying established businesses over launching startups. She cites the high failure rate of startups, noting that 90% do not make money, which contrasts starkly with the success rates of acquired businesses. She advises those new to business to start with low-risk franchises, especially in trade services, due to their recession-resistant nature. For individuals with more experience in running businesses, Sanchez suggests buying a business outright if they prefer not to work within a franchise model. She warns against the pitfalls of startups, noting their high failure rates, intense workloads, and mentioning that the average startup founder might go years without making money.
10-step Guide To Acquiring a Business With Creative Financing Methods Like Seller Financing
Despite detailed steps not being included in the content provided, Codie Sanchez does touch upon the concept of using seller financing to acquire businesses. She emphasizes that this method can be less dependant on one's cash reserves and without the need for bank loans or other intermediaries. Sanchez outlines a 10-step process adapted from private equity, which includes understanding opportunities, determining a good business fit, convincing sellers, finding businesses for sale, securing financing, negotiation, structuring terms, closing deal documents, performing due diligence, and handling the business post-purchase correctly.
Benefits Of Investing In Low-risk Businesses Over Startups
Low-risk, Reliable Cash Flow Businesses
Sanchez leans towards investing in existing cash-flowing businesses, like laundromats, that provide consistent returns and are less likely to fail. She notes that laundromats, with a 90% success rate, require less initial investment and provide consistent, albeit not huge, profits. Starting with such businesses allows an individual to learn about running a business with relatively low risk. ...
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Building Successful, Cash-Flowing Businesses and Franchises
Additional Materials
Counterarguments
- While buying established businesses may have a higher initial success rate, it can also come with legacy issues, such as outdated practices or hidden debts, which can be challenging for new owners to navigate.
- Low-risk franchises may offer a blueprint for success, but they can also limit creativity and innovation due to their rigid business models and operational guidelines.
- The recommendation to buy a business outright may not account for the potential for industry disruption or changes in consumer behavior that could affect the business's future success.
- Seller financing can be beneficial, but it also may come with higher interest rates or unfavorable terms compared to traditional financing options.
- The 10-step process for acquiring a business is a simplification and may not capture the complexity and unpredictability involved in such transactions.
- Laundromats and other cash-flowing businesses touted as low-risk may still be susceptible to market changes, technological advancements, or shifts in consumer preferences.
- Franchises, while offering support and established systems, often require significant upfront fees and ongoing royalties, which can reduce the profitability for the franchisee.
- SBA loans are a useful tool for purchasing businesses, but they also require strict adherence to guidelines and can be difficu ...
Actionables
- You can explore local business networking events to connect with potential sellers and understand the local market landscape. By attending these events, you'll gain insights into which businesses might be up for sale, the general sentiment towards different industries, and potentially meet business owners who are considering selling but haven't listed their business yet. For example, join your local Chamber of Commerce and attend their mixers or industry-specific networking groups related to trade services or laundromats.
- Consider setting up informational interviews with franchise owners to learn about the day-to-day operations and challenges they face. This will give you a clearer picture of what it's like to run a franchise and help you decide if this path aligns with your goals. Reach out to franchise owners through LinkedIn or local business directories, and ask if they would be willing to share their experiences over a coffee or a virtual meeting.
- Create a simple financial model to c ...
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Value of Relationships, Partnerships, and Choosing the Right People
The podcast guests share their personal experiences and insights on the importance of choosing the right people in both personal and professional relationships, emphasizing the value of complementing strengths and understanding roles.
Speaker on Business Partnerships Warns Against Mixing Personal and Professional
Codie Sanchez reflects on the risks of mixing personal and professional relationships. She mentions that she only does business with friends after they have proven they share her work ethic. This comes from a lesson learned where a business deal can negatively impact a friendship, showcasing the necessity for thorough partner vetting.
A Personal Experience of a Business Deal Damaging a Friendship, Highlighting the Need for Thorough Partner Vetting
Lewis Howes shares a personal anecdote where following a breakup, he re-evaluated his friendships after noticing that some business friends, whom he thought were also real friends, failed to support him and distanced themselves. Howes learned from this experience the importance of a genuine support network and became more selective about whom he offered his help. He noticed that those who were distant during difficult times often returned later seeking assistance for their own projects.
Speaker and Spouse Emphasize Strengths Over Traditional Gender Roles
Codie Sanchez and her husband find balance and success by complementing each other's strengths and acknowledging their weaknesses, which is influential in achieving their goals.
Partner Complements Strengths and Weaknesses Crucial for Goals
Sanchez shares that her marriage has taught her the value of experiencing life and not just focusing on work. Her husband's focus on fun and experiences balances her inclination toward work. She excels at making money while her husband is skilled at offering protection and looking at potential downsides. In their venture fund, their different approaches are highlighted where she often acts as "Captain No," carefully scrutinizing startup investments. This arrangement works because ...
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Value of Relationships, Partnerships, and Choosing the Right People
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Clarifications
- A venture fund is a pool of capital raised from investors to invest in early-stage, high-potential startups. These funds are managed by professional venture capitalists who make investment decisions on behalf of the fund's investors. Venture funds play a crucial role in supporting innovation and entrepreneurship by providing funding and expertise to help startups grow and succeed. The success of a venture fund is typically measured by the returns it generates for its investors through successful exits, such as acquisitions or initial public offerings (IPOs).
- "Captain No" is a nickname used to describe Codie Sanchez's role in scrutinizing startup investments in her venture fund ...
Counterarguments
- While choosing the right people is crucial, it's also important to recognize that people can grow and change over time, and someone who may not seem like the right fit initially could become a valuable partner with the right development.
- Complementing strengths is important, but it's also necessary to ensure that all partners are willing to develop in areas of weakness to create a more resilient team.
- Mixing personal and professional relationships can be risky, but it can also lead to stronger trust and collaboration when managed properly.
- Thorough partner vetting is important, but it can sometimes lead to missed opportunities by being overly cautious or dismissive of potential partners who may not meet all criteria initially.
- Genuine support networks are important, but it's also valuable to understand that professional relationships may not always provide personal support, and that's an acceptable boundary.
- Being selective about offering help can be valuable, but it can also be seen as transactional and may hinder the development of more open and generous professional communities.
- Acknowledging strengths and weaknesses is crucial, but overemphasis on this can lead to pigeonholing and a lack of personal growth or exploration outside one's comfort zone.
- Balancing life and work is valuable, but what constitutes balance can vary greatly between individuals, and some may find ful ...
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