Episode 175: Financially Free and Fearless: Penelope Jane Smith’s Wealth Wisdom – Transcript
Episode 175 Penelope Jane Smith [TRANSCRIPTION]
[Rennie Gabriel]
Hi folks, welcome to episode 175 of the Wealth On Any Income podcast. This is where we talk about money tips, techniques, attitudes, information, and provide inspiration around your business and your money. I'm your host, Rennie Gabriel.
In past episodes, we spoke about how to understand the numbers from your business, how to measure the level of pleasure based on where you spend your money, how to track your money in five to ten seconds, and what determines how close you are to complete financial choice, and how to run your business without being in your business. Last time, we had Bernie Mullen, who has turned around major league sports franchises from struggle to profitability, and today we have as our guest, Penelope Jane Smith. Penelope is the premier financial freedom mentor for women entrepreneurs and the go-to expert for some of the biggest names in the conscious business industry.
She's an acclaimed international speaker and certified trainer with over 20 years of teaching experience, the author of The Little Book of Prosperity, and the creator of Prosperity Coin, the world's first cryptocurrency designed to support financial freedom for women entrepreneurs. Her unique magic is supporting women entrepreneurs to become financially free in five years or less with $10,000 per month of passive income, so they don't have to depend on their business, a job, a partner, the government, or anyone else for money, and I know that Penelope does a fabulous job because I have actually enrolled in her program, and I have seen how terrific she is. Penelope, welcome to the Wealth on Any Income podcast.
[Penelope Jane Smith]
Amazing, Rennie. It's so fun to be here. I can hardly wait to geek out about money with you.
Let's do it.
[Rennie Gabriel]
Terrific, so we'll get right to it with some questions, and one of your core values, I know, is generosity. Tell me more about that, like the Financial Freedom 101 scholarships or whatever.
[Penelope Jane Smith]
Absolutely, so every decision that we make in our business is based around the values, and it's not something that we just, you know, discussed at a team retreat one time and put in a drawer and forgot about. Like, my team and I review these all the time. Anytime there's a decision coming up, we're like, okay, well, how does this align with our values?
I'll say, I think we should do it this way because it aligns with this value. So our values are freedom, obviously, because we're all about financial freedom, generosity, integrity, connection, and growth. So in terms of generosity, our business model is really cool.
We do provide a limited number of scholarship tickets to our Financial Freedom 101 online event. It sells for $14.97 on my website, so a lot of times when people see me in a documentary or hear me on a podcast, they'll just go and buy a ticket. But we love to give scholarship tickets out as well because we don't want money to be the reason that people don't come.
And as you know, even millionaires, multimillionaires, decamillionaires, sometimes they're like, $1,500? I don't know, you know? And so we just want to take that away.
So that's one way we get this world-class financial education out into the world is by providing some scholarship tickets. The other way we really lean into our value of generosity is we do microloans to women entrepreneurs in other countries like Asia, South America, Africa, so that we can have a positive global impact right off the bat. And for every member that joins our ongoing programs, we also do a microloan to another woman entrepreneur so that we're changing two family trees at the same time.
[Rennie Gabriel]
That's so fabulous. I know my wife and I also donate to Kiva. Oh, so great.
Yeah, so we are very familiar with that. Now, here's a silly question. Why women business owners?
[Penelope Jane Smith]
Why women? Because I don't know if you know this, but there's a gender bias in the financial services industries. Like in a lot of industries.
I don't know if you know this, Rennie, but did you know that seatbelt safety testing done based on the average human is actually done on the average man? And so women literally get injured more and die more because of seatbelts than men do because of that. And this is happening in heart medication, in healthcare and finance.
Everywhere there's this gender bias baked in. And when it comes to financial planning, the whole Wall Street investment models, again, it's based on the average man. Most financial planners are men, 86% of them, most of them over 50.
And those models don't take into account women's longer lifespans, the differences in our career paths and financial goals. And so women end up with less money at retirement, but it has to last us longer. And I find that infuriating.
So I was like, okay, let's create a true gender neutral approach to support people to become financially free in record time.
[Rennie Gabriel]
Yeah, I really love that and what you're doing. And it also aligns with my own philosophy. And I'll give you a brief example.
When my daughter was eight years of age, we were skiing up in Mammoth, California. And we got to the top of a rather steep hill. And I said, let's go down this.
And my daughter, eight years of age said, oh, I can't do that. I can't do that. I said, tell you what, you just follow me down the hill.
So she did. She followed me down the hill. We got to the bottom.
I had her turn around and look up. And I said, now look at where you came from. I don't ever want to hear you tell me there's something you can't do.
Now, maybe that's not fair to tell an eight year old, whether it's a boy or a girl, but she took that to heart. She put herself through law school. She's the executive director of a school up in Seattle, Washington, and has 110 employees under her.
Maybe that's because I told her, I don't want to hear you tell me what you can't do. She can change the oil in her car. She knows how to change the spare tire on her own.
And she raised two boys on her own.
[Penelope Jane Smith]
So you've given her an imprint or a paradigm of resourcefulness. And as a parent, that's an amazing gift. That's something I think about a lot.
Because as you know, I have a eight year old and a three year old. And I'm thinking about how do I set them up for success with life? How do I set them up for success with money?
If Gabriel, my eight year old, if he wants a set of dominoes, and it's like $12, do we just get that for him? Or do we give him opportunities to earn money and save up and buy it? Those are some of those learning moments that we're rolling out to hopefully set them up to be a resourceful adult, like your daughter, with a healthy relationship with money.
[Rennie Gabriel]
Yeah, exactly. So that's what we're both doing as parents. Now, this is a little bit personal.
And I do happen to know the answers to this, because we've had enough conversations. But for the podcast, tell me, this is a two part question. What was your biggest failure?
And what was your biggest insight from that? And how did you use that to create the success that you have?
[Penelope Jane Smith]
Oh, my God. Okay, well, you know that I have a very dramatic money story. Because I shared that with you.
But for people who aren't familiar, you know, this is wealth on any income, right? So I love that. Because it's not about how much you make, it's what happens next.
What you do with it, how you keep it, how you grow it. And so I started with $10,000 of my own money. And over four years, I turned that into over $6 million in real estate.
So I was on track to retire to be financially free by the time I was 31. And then the real estate market crashed. And everything changed.
And it just like, everything kind of collapsed, like like dominoes, actually. So it's funny, we were just talking about dominoes. It just completely wiped me out where from one day to the next, my beautiful, perfect credit score was now like 400.
You know, I lost my gorgeous home to foreclosure. I was masochistic enough to go to the auction on my own house. It was it was bad.
And I couldn't even afford to keep the electricity turned on. So it got turned off. Everything in the fridge went bad.
And I lived in fear that I was going to come home and find the locks change and find my pets trapped inside the house. I had two cats and an African parrot. And I'm like, scrambling to find another place to live scrambling to find to make ends meet.
And just not sure how I was gonna survive. And so that's my that's my riches to rags story. And then fortunately, like right around that time, I got invited to participate in this high level mastermind on Necker Island, which is Richard Branson's private island in the Caribbean.
It was a $50,000 investment. I had to come up with the money in four days. For this six day mastermind, there were no payments, no no payment plans, no refunds.
And I didn't have any reliable income sources. I didn't have any savings. I didn't have credit.
The one thing that I did have was this intuitive hit that I was supposed to be there. And I was like, okay, self. And amazingly, I worked it out.
And we can talk about that about how if you want to, but I was able to go. And that was really the beginning of turning everything around. Because the facilitator that group said that he wanted to win a Nobel Prize for single handedly turning the economy around.
And I was like, Oh, my God, like, what? What does it have to take for somebody to even set a goal like that? And how would you do it?
And so here I am sitting on a billionaire's private island, sitting with this question of like, well, what could I do to single handedly turn the global economy around? And I got the download, I got the download. And what I came up with was that everyone has their own personal economy, that may or may not have anything to do with the economy at large.
And my personal economy was in the tank. But there were other people on Necker Island having their best year in business ever. So I figured if I could support enough individual entrepreneurs, to shift their own personal economy, to create their own economy of abundance, then eventually we'd hit a tipping point.
And that would shift the community, the nation, the world, Rennie. And that's also why I started doing the micro loans to women in other countries, because I wanted to have that positive global impact. And so as a byproduct, my business is now pretty awesome.
You know, I'm able to make a healthy seven figures doing what I love, while only working part time since I have two little kids. And I've built all my assets and retirement accounts back up orders of magnitude beyond where they were before. So I'm able to now enjoy living my financial freedom vision.
And I would say, one of the biggest lessons that came out of that, one of the reasons in retrospect, because I harvested so many lessons, and I feel like I'm still harvesting lessons from that experience of losing everything in the crash, which is an experience I would not wish on anyone that was like, not fun, right. And part of why I'm so passionate about what I do is to help people avoid some of the terrible and painful mistakes that I've made. And if you faced financial challenges in your life, like the real estate crash, or a divorce, or a death, or, you know, there's so many things, people getting embezzled from or have health issues that wipe them out financially, then I can show you how you you can recover and rebuild and basically rise like a phoenix from the ashes.
So the second part of your question is, what was one lesson I'm paraphrasing that I harvested from that experience, right? Yes, one of the things that I didn't realize I didn't know, this was unconscious incompetence. Right?
Like, I didn't know, I didn't know it was I didn't really know how to manage cash flow. And that doesn't sound very sexy or exciting. But since I've learned, it has become completely life changing.
So managing cash flow just means lining up the cash that's flowing into your life with the cash that's flowing out in your life, to make sure that you're that that matches up that you have cash flowing in your system, just like in a human body, you need the oxygen and the blood to be flowing in your body to stay alive. And if you're living in the money market system, and if you run a business in the money market system, then you need cash flowing in your life to be able to survive. And I didn't understand that.
So with my business, I would make $60,000 in two days. And I'd be like, Yay, I'm making money. This is great.
And then a couple weeks later, I would need $3,000 to rent a hotel room for a retreat I was doing and I didn't have it. And I'm like, I just made 60 grand. Why don't I have $3,000?
Like, what the heck? But I didn't know that managing cash flow was a thing. And I didn't know that it was something I was missing.
And so once I realized that, that was a thing, I'm like, Oh, this is a skill set. This is a system I need, then I could go learn how to do it, figure out a system that worked for me. And oh my god, it's a whole new world.
Now I can watch the cash flows in my business and in my personal life. And if I'm going to be short, I can see, Oh, in three months, I'm going to be short. That is so much better than, Oh, I need $3,000 today.
How did this happen? So three months, that gives me a lot of time to come up with an extra $5,000 from somewhere. I can get a client, I could do an event, I could sell some courses.
There's a lot of things I could do. So it's so calm and allows me to make great decisions. Like if I want to hire a new team member, how's that going to impact the cash flow?
If I want to invest $50,000 in a mastermind or a mentorship program, how's that going to affect the cash flow? And I can see that and then be like, okay, well, this is when I'll eventually run out of cash if I don't sell anything. Which is that's always going to happen eventually.
If you stop selling things, eventually you'll run out of cash. And I can see that months, sometimes even more than a year down the road. And it's just like, it's heaven.
And so I think that if I had known then when I was losing everything, what I know now, and I'd had a good system for managing cash flow, I probably would have been able to keep my house.
[Rennie Gabriel]
That's possible.
[Penelope Jane Smith]
I definitely would have been able to keep the electricity on.
[Rennie Gabriel]
However, without that experience, you may not be enjoying and confident in what you're doing now. And the reason I say that is because I have experience as a chartered life underwriter from the insurance business, certified as a financial planner. And in neither course, not one of those did they teach how to manage cash flow, which is absurd.
But I discovered it on my own, but it took two divorces and a business failure to finally find what I needed so that I no longer have to work for a living.
[Penelope Jane Smith]
Yeah. So you see, it's totally life changing. That's why we do a deep dive on cash flow planning at my financial freedom one-on-one event, which by the way, I don't know if you want to talk about.
[Rennie Gabriel]
You can mention it now because I was going to ask you about it later. Why not now?
[Penelope Jane Smith]
Okay. So if you go to realprosperityinc.com, which is my website, you can learn all about the event.
[Rennie Gabriel]
Like I said, it's- Say that more slowly, realprosperityinc.com.
[Penelope Jane Smith]
realprosperityinc.com. Because it's a corporation, but also I want you to incorporate everything that you're learning into your way of being. So it's realprosperityinc.com.
You can see all the information, all the dates, everything. And like I said, tickets, advanced tickets are on sale for $14.97. But I want to give you the loophole for how to get one of the limited number of scholarships that we offer. If you want to pay $14.97, great. I totally love it. And if you want to get one of the scholarship tickets, I'm going to tell you how. So here's the loophole.
Here's the hack, the life hack, is when you download my Financial Freedom Formula ebook, which you can do for free. And the link for that is financialfreedomgift.com, financialfreedomgift.com. We'll put the link in the show notes.
Download that link for, download that ebook for free. And then later on the next page, you'll be able to register for one of the scholarship tickets for Financial Freedom 101. So that is, that's the secret hack.
You heard it here with Rennie, and that'll save you the $14.97 tuition.
LINK FOR EVENT SCHOLARSHIP: https://realprosperity.isrefer.com/go/scholarship/rega25/
[Rennie Gabriel]
Yeah. And I know that there is another way because that's what I did. I think I paid $97 to participate in it.
And then because I actually showed up and did the work, you refunded my $97.
[Penelope Jane Smith]
Yeah, that's what we did. So that's what exactly what I was describing. We do ask for a $97 refundable seat deposit because it helps us plan.
We send out this beautiful box. If you're listening to the audio, you can't see the box. If you're watching the video, I'm holding it up.
It's a beautiful purple box with a workbook and other materials to support you before, during, and after the event on your financial freedom journey. And those are quite expensive to send out. So we want you to only register if you're intending to show up and then you get it back.
So it really is a full scholarship.
[Rennie Gabriel]
Yeah. And I got to tell you, I am very impressed with the way you do business because I got the box. I went through the box.
It's organized. The materials are valuable. And when I had questions, whether it was you or someone on your staff directly answered my questions, and I'll give you the opposite end of my experiences.
I invested with a newer company that manufactures a very high quality bread product with only two ingredients. I'm not going to give the name. But, you know, my wife says, oh, I love this product.
And, you know, oh, they're offering the opportunity to people to invest in them. So I invested $2,500, you know, not a bit. If I get it, if it turns into something terrific, if I lose it, you know, it's not the end of the world.
I can't get them to respond to any email. They use Zendesk. I asked for, I've given you $2,500.
I would like a K1 for my tax returns. I don't get a reply. Okay.
So all of the experiences that I've had with you and your team members have just been extraordinary. And I want you to know that. And for anyone listening to know that as well, because you and I are in very similar businesses.
[Penelope Jane Smith]
Yeah. See, that comes back to values, right? Because we value the connection.
We value long-term relationships over short-term transactions. So we're always doing our best to nurture those relationships. And if we mess up, well, we have a value of integrity where we'll do our best to clean it up.
[Rennie Gabriel]
And I haven't had any need for something to be cleaned up. I'm trying to figure out what my next question should be. And I'll let you choose.
It'll either be to tell me about one of your clients who achieved the financial freedom goal that you want people to achieve, or what would be the one question I should have asked you that would give some great value to the people who are listening or watching?
[Penelope Jane Smith]
Okay. Well, I can answer both of those. So if you want to create financial freedom in record time, I want to give you like the laser version of our three-step signature approach to do that.
Step one is to create a clear financial freedom vision for yourself. This is your ideal lifestyle if you didn't have to work for money. Now, of course, like Randy and I, you might still choose to work as part of your life purpose and passion.
We don't have to be here. We're loving it. We love getting to connect.
We love getting to support you. But some of those things are going to require money. Some of the best things in life money can't buy, but come up with what is that life you want to live?
What is that vision for yourself? And then put actual numbers to it because you're financially free when your passive income from your investments and your assets is more than your expenses. So you need to know what those expenses are.
So look at what it would cost to actually maintain your financial freedom vision in reality. Now you have your passive income goal and you can always manifest better from a place of clarity. So just being clear on how much passive income you need, that alone will compress the timelines.
Step two is to buy assets. This is the golden goose model of investing where you put your money in something to grow the golden goose. And then the interest or growth or whatever you pull off is the golden eggs.
And ultimately, you want to grow a big enough golden goose that you can live off the golden eggs. And when you know how much passive income you need and you know what kind of like a average return on investment you're getting, then you can see how big of a golden goose do you need to get the golden eggs you want. And that's very clear.
Sometimes that's enough to get you there and that's all you need. So for example, one of my clients, she and her husband came to me and they wanted to be able to not work so hard, ideally retire and do passion projects like write books and travel. And at the time he was working six, seven days a week in his practice.
And she was just like, come on, come on, get out of the practice. I want to go to Mexico. Let's go.
So it was very, a lot of intense energy just trying to get by. And so with the golden goose model, we looked at all of the they had, they had a house that they didn't particularly want to stay in. They had some different investment accounts here and there.
And so it's kind of like, I look at it like puzzle pieces. Right. And I was able to move the puzzle pieces around and show them how they could be financially free now, just by getting their golden goose to lay more golden eggs.
And boom, within three months, he had closed down that physical practice and she was working on her book. They were traveling off to Mexico and then Sedona, Arizona, and just totally like living their financial freedom vision just a few months later. And I find that so, so, so inspiring.
So sometimes that's all it takes. And if that's not quite enough to get you there, then step three is to create assets. So if you're not able to grow a big enough golden goose in time or get it to lay enough golden eggs, then creating assets is where you take your time, energy, creativity, social capital to generate new streams of passive income with little or no money, anything from affiliate programs to ongoing membership sites, to drop shipping, to licensing your intellectual property.
You know, another one of my clients, she created a formula for a pet health supplement. She licensed it to another company to actually manufacture and sell. And she makes $70,000 in passive income a month.
That's awesome, right? So that can, by creating assets to fill in any gaps to get you the rest of the golden eggs you need, boom, that's another way you can compress the timelines and get there in five years or less, starting from wherever you are right now. And I've had people who were, you know, $500,000 in debt and people who are already, you know, tens of millions in assets.
And wherever you are on that journey or that spectrum, those three steps will help you get where you want to go.
[Rennie Gabriel]
Thank you, Penelope. And again, I will have the information on how people can get a hold of you in the show notes. And I want to thank you for being on the Wealth on Any Income podcast show.
[Penelope Jane Smith]
Thanks for having me. This is great.
[Rennie Gabriel]
So now to those who are still listening, if you'd like to know how books, movies, and society programs you to be poor, and what the cure is, then log on to wealthonanyincome.com forward slash TEDx or attend Penelope's Financial Freedom 101 course. From my website, you can request a free nine step roadmap to complete financial choice and philanthropy and receive an email once or twice a month with tips, techniques or inspiration around your business and your money. To my listeners, thank you for tuning in.
You can listen to the Wealth on Any Income podcast on your favorite platform and please rate, review and subscribe. Until next time, be prosperous. Bye bye for now.
