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‘A tool to have fun’

White clarified how his views on money differ from Cardone’s.

“You look at money as — you take all this money and you have to take it so that you can reinvest it into properties and make more money off your money and all that stuff and that’s a certain kind. I look at money as a tool to have fun,” White explained.

He added that besides enjoying his wealth, he also takes care of his family and friends and contributes to charitable causes.

However, at the heart of it, White emphasized the importance of money as a tool for enjoyment.

“Life is all about memories,” he said. “Life is about building memories with your family, with your friends, with the people that you care about. And the way that you build some of the greatest memories of your life is doing things that cost money.”

White shared some of his memorable experiences with Cardone, including renting yachts and even entire islands.

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Cardone’s real message

That being said, Cardone wasn’t necessarily condoning spending money in his original video — he was more drawing attention to the way certain big spenders choose to fund these purchases.

“I’m buying the same stuff, the difference is how we’re buying it: you are buying out of earned income, and I’m buying out of passive income,” he clarified.

He emphasized that lavish spending of earned income is what often causes pro athletes and famous rappers to go broke.

Instead of using his earned income for extravagant purchases, Cardone has a different strategy.

“You know what I do with my earned income? I buy buildings,” he stated.

These buildings generate passive income for Cardone, which he then uses to support his luxurious lifestyle.

“There’s 250 units behind me,” Cardone said while pointing to an apartment complex. “It's going to pay $2,200 a month for every person that lives in one of those units… I own 7,000 of those. If there’s cash flow from those 7,000, then and only then do I buy something stupid.”

This raises the question: how much “stupid” stuff can a person buy?

“You can go as stupid as your cash flow, as long as it’s free cash flow, meaning passive income,” he explained.

Residential real estate has been a popular choice for generating passive income, as tenants have to pay rent every month. It also serves as an effective hedge against inflation since rising costs of raw materials and labor make new constructions more expensive, thereby increasing the value of existing properties.

Of course, not everyone can acquire thousands of units like Cardone. However, through real estate investment trusts (REITs) and crowdfunding platforms, retail investors can access substantial property portfolios and earn monthly rental income without becoming a landlord.

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Jing Pan Investment Reporter

Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.

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