High-Income, Still Broke? Fix Your Money Mindset Today

Krisstina Wise (00:00)
First point of cash flow is revenue. The second point of cash flow is profit. And that’s the money left over after all the expenses of the business are paid. So that’s the second point of cash flow. The third point of cash flow is the money you move out of your business and into your household account. And then,

There’s a fourth place of cash flow. And the fourth place of cash flow is the money that’s left over after you pay all of your personal bills. And that’s called household profit. So you have business profit and household profit, business revenue and household revenue. And then your business profit, which is the fourth place of cash flow, then moves into the fifth place of cash flow is where you invest money outside of your business. And the sixth point of cash flow is where you invest money back into your business to create more cash flow.

So it’s this idea of really understanding that you want money, like dollars, to flow through all these cash flow points and focus on the cash flow and the points of cash flow intentionally versus, as entrepreneurs, just focused on trying to make more money, thinking more money will be the answer to all the money problems. And it’s just, it’s when you change, as entrepreneurs, when we change from the just focus on revenue to focus on really balance sheet net worth and profitability.

That’s where things really start shifting for the entrepreneur to feel like I’ve got more leverage, I’ve got more space, I’ve got some surplus, and I’m out of this chasing the money routine.

Michelle Kesil (02:58)
everyone, welcome to the Investor Fuel podcast. I’m your host, Michelle Kesil. Today I’m joined by someone I’m really looking forward to chatting with, Krisstina Wise, who’s been making serious moves in the real estate investing and educational space. So Krisstina, really glad to have you here with us today. I really think our listeners are going to take something away.

Krisstina Wise (02:59)
Thank you everyone.

Thank you.

Michelle Kesil (03:28)
from how you’re approaching your investing business and teaching other people how to grow their entrepreneurial business. So let’s dive into all of that.

Krisstina Wise (03:40)
Sounds good, let’s do it.

Michelle Kesil (03:42)
Awesome. So first off for people who may not be familiar with you and your world, can you give us the short version of what is your main focus these days?

Krisstina Wise (03:47)
you

My main focus is educational content through YouTube and through courses. I teach money mindset and just practical money wisdom to be able to apply to one’s life, to get out of the rat race, and to actually start to build real financial freedom that comes from wealth creation. So I teach a very practical way to do that. But I mostly focus on entrepreneurs, because having variable income and being creators, many times that

Money and entrepreneurship can be really tricky. I’ve been an entrepreneur my whole life. I’ve never had the only job I ever had. I got fired from in my mid-20s and I’ve been building businesses ever since. But managing the money and building business is something that we’re not taught. We’re just taught as entrepreneurs, go out and kick ass and build something great without understanding the money piece. That’s what I focus on is helping entrepreneurs really understand cash flow.

Michelle Kesil (04:53)
Amazing. Yeah, I would love to hear a little bit more about your story. Like, how did you get into all of this?

Krisstina Wise (05:47)
Well, I’ve always said I’m probably unemployable, but I started, I mean, I started in my mid-20s in real estate and real estate sales and really just loved sales and did really well. And from there, I got into brokerage and built a real estate brokerage and again, just heavily focused on sales and marketing. And then I sold my business and I got into real estate education and…

through this whole, through that whole thread of building different types of real estate businesses. One thing that I always loved was this idea of how do you build business while at the same time build your wealth. And for entrepreneurship, I’ve just seen so many entrepreneurs that just focus all of their energy on growth and scale and building a business and maybe investing everything back in the business and not building a personal portfolio.

alongside of building a business. And I can see that without building that portfolio and having that second safety net, many people wind up middle-aged and just don’t have any type of assets. And business still owns them. So that’s just been my career is really building businesses and building real estate portfolios side by side. And now I teach others how to do that.

Michelle Kesil (07:08)
Amazing. love that. How can someone who hasn’t built those assets yet get started on their journey?

Krisstina Wise (07:19)
Well, I think where it all starts when it comes to money in entrepreneurship,

the first thing I like to say to entrepreneurs, as many times, or newer entrepreneurs, is they want to go make a lot of money. So that’s a big inspiration to build a business, is to not be in the nine to five and to be able to build something great and make a lot of money. But then the focus usually stops there. It stops around, just want to make a lot of money or make more money, with the focus always being on making more. And the focus

doesn’t tend to be on asking the question, how much do I keep out of my business? And moving the focus from making more to keeping more, meaning what is the profit of my business that I’m going for? How much do I pay myself? And what do I do with the money that I pay myself?

So it’s thinking about money, like I say, through this cash flow mindset, and really thinking of how you want your money to flow beginning to end. And so in entrepreneurs, we have to be focused on making money and making a nice

top line, but like I said, the focus doesn’t stay there. Then it’s focusing on how do you move money through your business through a place called profitability. And profitability,

first point of cash flow is revenue. The second point of cash flow is profit. And that’s the money left over after all the expenses of the business are paid. So that’s the second point of cash flow. The third point of cash flow is the money you move out of your business and into your household account. And then,

There’s a fourth place of cash flow. And the fourth place of cash flow is the money that’s left over after you pay all of your personal bills. And that’s called household profit. So you have business profit and household profit, business revenue and household revenue. And then your business profit, which is the fourth place of cash flow, then moves into the fifth place of cash flow is where you invest money outside of your business. And the sixth point of cash flow is where you invest money back into your business to create more cash flow.

So it’s this idea of really understanding that you want money, like dollars, to flow through all these cash flow points and focus on the cash flow and the points of cash flow intentionally versus, as entrepreneurs, just focused on trying to make more money, thinking more money will be the answer to all the money problems. And it’s just, it’s when you change, as entrepreneurs, when we change from the just focus on revenue to focus on really balance sheet net worth and profitability.

That’s where things really start shifting for the entrepreneur to feel like I’ve got more leverage, I’ve got more space, I’ve got some surplus, and I’m out of this chasing the money routine.

Michelle Kesil (09:57)
Yeah, that’s so valuable. when you’re like teaching people on this, are you teaching them like how to expand their investment portfolio? Like what exactly is like your educational process? Like what are you most focused on teaching people?

Krisstina Wise (10:53)
Yeah, well I teach a methodology for understanding how much money is enough. So it’s a reverse engineered type, even though I started with cashflow point one and went from like A to Z. What I really teach is a reverse engineered way to design your financial future that you want for yourself. So it starts with asking how much is enough and how much is enough like net worth to be financially free. Because at end of the day, we all want to be financially free. So it’s a focus on freedom.

Again, as opposed to a focus on skill and revenue. And when you focus on financial freedom, then you understand that I need this amount of cash flow from assets to be able to fund the cost of living. And then you can reverse engineer. It’s like if it’s real estate, how much real estate do I have to own, for example, and build over, let’s say, a 20-year timeframe to be able to produce a cash flow that’s going to fund my life if I don’t have to work. And then you reverse engineer from there to say, OK, how much income do I need to earn?

to be able to invest enough in these different cash flow points so that I can buy real estate over this 20 years. And then you go to your business and say, okay, if I need to profit this much to pay myself to be able to invest this much, then my business needs this amount of revenue so that I can, if I generate this amount of revenue, I have this profit margin, I can pay my household this amount, I can live off that money, I save this percentage, that amount, then I can be able to fund my…

how much money I’m going to invest every single year over 20 years, over 20 years if everything goes according to plan, then I’m going to have enough cash flow for my real estate to be able to fund my life and that’s the day I become financially free. So it’s a very fluid way of going from A to Z and from Z to A and making sure these two match up and it’s all based on very practical numbers, fill in the blanks, again really focusing on these six cash flow points that as long as you hit those points of cash flow, you’re going to

be just fine. You can actually predict your financial future and start organizing your money accordingly so that you don’t just get stuck in this rat race of chasing more money and always being month to month and putting every extra dollar back into the business and just feeling like you never get ahead.

Michelle Kesil (13:05)
Yeah, that’s so valuable. You mentioned that you work a lot with money mindset. What does that look like?

Krisstina Wise (13:14)
Well, all come from, money mindset is such a big topic. mean, I could talk for days just on mindset alone. But it’s just understanding that there’s kind of two types of mindsets to be aware of. The first mindset is the one we normally think of is that do we have an abundant mindset or a scarcity mindset? And a lot of that just goes back to childhood, meaning what are our limiting beliefs around money that we need to clean up that have been planted into our…

into our minds, the way we think about money from the way we grew up, from cultural, from friends, from peers, and understanding that the cultural mindset and the mindset that we tend to inherit from our parents, our family, isn’t making anybody rich. It’s keeping people month to month, regardless of their income. So almost everyone needs an upgrade when it comes to their mindset, when we’re talking about…

know, abundance versus scarcity and just those limited beliefs and everybody, no matter even where you get in your journey, you always hit kind of that next ceiling of beliefs that then you have to break through those. And so it becomes like this lifelong journey. It’s not like you fix it and you just all of a sudden, you’re now move from one to the other and all your money problems go away. So it’s certainly a journey, but I just like to say like, if anybody listening hasn’t done that work.

It’s work that you want to do if you have any type of financial issues because your mindset is absolutely playing a part of why you’re stuck. But there’s another mindset too, and it’s a mindset that I call the difference between ⁓ the, like what I call a rich mindset and everyone else. And it’s not your abundance versus scarcity, but it’s a mindset that’s built on wealth creation. So I call it the wealth versus income mindset.

And a wealth mindset means you’re focused on building wealth. You’re focused on knowing what your freedom number is. You’re focused on understanding how much is enough. You’re focused on balance sheet and you understand what a profit and loss and balance sheet is. Because when you have a wealth mindset, you’re thinking about creating wealth. You’re thinking about creating financial freedom and you run and manage your money tightly according to that ultimate goal and plan.

So it’s a very different mindset to organize your mind and your money and your financial situation around wealth creation versus income creation. And an income mindset is what we’ve been talking about or what I’ve been talking about, which is just a constant focus on making more money, either as an entrepreneur, meaning making more revenue and trying to scale and just make more, make more, or even as a W-2, it’s just like climbing the ladder, just trying to do a side hustle. But it’s just a focus on if I make more money, my…

money problems will go away. And it tends to keep people months a month. I call it a high income broke. And that’s probably who I work with most are high income broke entrepreneurs that they make a good high income, but they’re still broke every month and they have to go do the hustle again next month to cover the bills of last month. And it’s a very stressful place to get stuck. And it’s where most entrepreneurs, where they wind up because we’re just stuck in this income mindset.

without understanding that a wealth mindset is a radically different play of money. So I just like to say that when it comes to mindset, there’s always limiting beliefs. You want to keep, always be moving, like I’m stuck in kind of some scarcity or some fear-based thinking, some line of thinking. Let me break through that next level. But then also, and that’s like I said, that’s lifelong. Once you decide to move to the wealth mindset and learn the practical skills and knowledge for doing so, you make the change. You’re in a different game. It’s moving from checkers to kind of chess.

You’re playing your money more strategically. You’re very intentional. You track your money. You know your numbers. You’re in the game. You’re playing it to win. And it’s, again, it’s just a, it’s a different way of being with your money.

Michelle Kesil (17:44)
Yeah, I really love that. mean, personally, I’ve done a lot of money mindset work and I found for me a lot of it had to do with like my nervous system, like what it felt safe to hold and healing like that aspect as well as limiting beliefs. So I love that you touched on that. And yeah, I’m really curious about this whole wealth mindset thing because I think that’s something that’s not commonly talked about. So what are just some like simple things that someone can do?

to start shifting into that more wealth and growth mindset.

Krisstina Wise (18:20)
Yeah, I love that question. Like I said, I think that the most important, one of the first things that I would love, the reason why show up in all the podcasts that I speak on, is to really, my message is, is what I want to encourage everyone to do, is do an exercise, which is how much money’s enough. And to know your number, because when you know how much money’s enough, you can quit chasing more. More money, more success.

more status, more something. But it gets you out of the more game and gets you very intentional about this is my life, this is how much money’s enough to fund it, this is a number and a target that I’m after, and I’m just gonna live my life and spend my money and invest my money and enjoy my money according to a strategy that’s aligned with hitting that number. And it’s a cash flow number. But if you don’t know how much money’s enough,

Like we all know that if we don’t have a destination in mind, we’re never going to get there. So it’s again, just so many people out hustling and grinding and, and investing everything into the business as entrepreneurs just to go more or less in circles. And I say, just start with how much money is enough and do that exercise. And it’s going to give you a path to start following. So that’s number one. Number two is to become balance sheet focused and cashflow focused and not just revenue focused.

and to really know, ⁓ what net worth am I after? How do I build net worth? What am I tracking on my balance sheet? And am I getting closer to hitting my freedom number over time? And just making sure we stay on track. And then it back ends, like how am I spending my money on a monthly basis? To make sure that the way I’m spending the money and the way I’m saving the money and the way I’m investing the money, again, is in alignment with.

hitting my freedom number because if we don’t have a freedom number and we don’t have a financial future that we’re moving towards, we’re just going to make money, spend it, and tend to be in the trap which is about where 80 % of ⁓ Americans are, which is in some sort of month-to-month cycle. And month-to-month is really stressful, regardless if you have a scarcity or abundance mindset.

Michelle Kesil (20:37)
Yeah, absolutely, that’s so valuable. What do you find are like the most common, whether that be limiting beliefs or actions that people are not taking yet that are holding them back from this like wealth creation?

Krisstina Wise (20:55)
I just think it’s a knowledge gap. We’re not taught these things. there’s what I just called baseline financial intelligence. And that’s kind of just the financial literacy is to know basic things of there’s doing some simple math, like how much money is enough and reverse engineering into all these cashflow points, like I mentioned. But it’s knowing what’s the difference between income and wealth and what’s the difference between a profit and loss and a balance sheet and what’s the difference between

assets and liabilities and ⁓ income and expenses and what is profit and just these basic terms that are money terms that many people think, that’s accounting terms or that’s just business terms or that’s just the bookkeeper’s job. And it’s like, no, it’s really understanding that if we want to create wealth and we want to build freedom and create financial independence and create that autonomy that everybody ultimately is after consciously or unconsciously.

then you have to have this baseline money knowledge and just money financial intelligence of what the most basic financial terms are and what they mean and how they’re applicable to everyone but applicable to you. So that I think that yeah there’s some mindset piece but mindset alone isn’t going to fix it if we’re missing just that financial literacy and financial intelligence required that we all can learn that’s not that difficult.

But once we have that intelligence and we apply that intelligence to our lives, then money’s going to start working. But when we don’t know what we don’t know and we’re just going at kind of what feels right or what everybody else is doing, that tends to be the formula that isn’t working.

Michelle Kesil (22:35)
Yeah, absolutely. So when it comes to like your investment journey, how has like that been one of like the key pieces to this wealth creation or like, how have you been able to foster that with these tools?

Krisstina Wise (22:56)
Well, for me, what I’ve done and what I teach others to do now that I’ve done it, but it’s is, again, for the entrepreneurs and business owners listening, is to understand that we have two, I just call it really three focuses when it comes to money, and to understand that there’s the six cash flow points that are really important to be aware of and start thinking in terms of allocating.

where your money is and how your cash flows on those six points, but then also then to think in money in these three brackets. And the first bracket is how do I flow money through my business? And how much revenue am I after? What type of profitability am I after? And just to understand that profitability is the name of the game, not more revenue. But it’s just to know, like how do I flow money through my business? ⁓

What are my margins? What are my operating costs? What is my gross profit? And just understanding that as business owners, you need to understand the basics of financials and to be tracking every dollar in the business. So that’s that piece. The second piece, and then over this career of being an entrepreneur, is to constantly grow in the business. What’s the next challenge? How do I increase the top line and the bottom line next year and the year after that?

So it’s just the 10, 20, 30, 40 years in business, it’s just to focus on money in the business to make more money. But not to stop there. Then the next question is entrepreneurs, how do I flow that money through my household in a way that I have a profitable household, there’s enough money to pay all the bills and to have that discretionary income, but to make sure that I’m saving and investing enough and not spending everything that I make or reinvesting it back in the business.

And then the final thing as entrepreneurs is like while I’m building my business, also be building my personal net worth. And that’s all on your personal balance sheet. And so it’s just understand that we’re building two things as entrepreneurs over this tenure, building our business that it grows and building our personal net worth that it grows. And they’re growing side by side over time. Just our business isn’t growing with our net worth not growing, for example, or kind of vice versa.

So that’s just it, it’s just wherever you invest is a personal decision. I say invest where you’re going to enjoy it, where you want to gain the knowledge. But when you get in the investing game, there’s two ways to be in the investing game. One is kind of set it and forget it. And that means I don’t really want to learn much, I just want to take advantage of the returns and put the money in an index fund or put it into retirement accounts and more or less just have somebody else manage it. And that’s one way to invest and that…

Weigh can work if you have 40 years and you’re just letting the market take care of the time compound interest over time. So that’s one way to invest and that means you really don’t have to learn much. You don’t have to be that involved in the investing other than the fact that you’re just putting money in every single month to let the market over 40 years produce to grow over the time at your 8 to 10%. So that’s one way to invest. But the point is that everybody needs to invest.

And if you don’t want to learn to be an investor, then take that route. But take ownership over the fact of, know how much money I need to invest on a monthly basis over time to make sure I hit my future number. The second way to invest is to be an investor. And that means just like as entrepreneurs, we’re a player in our business, like we’re looking at the money and we’re paying attention, we’re creating and we’re doing challenge, you know, we’re learning all the time.

You can’t be a successful entrepreneur and not be a player in your business, meaning you own it, you control it, you’re making decisions. If you’re going to, you have to do the same with an investor if you really want to build wealth through investing. And that means choose whatever type of investing you’re going to get excited about learning. So I just love residential real estate and small multifamily. I love it. I mean, I think about real estate every single day. I’m on Zillow every single day looking.

at numbers and doing the things. I’m in my portfolio and I’m managing properties. And so the way I look at it, have two businesses. I have my income generating business, which is my, like my working income. I’m always building my business. I’m here today for the sake of growing that business. And then I’ve got my other business, which is my real estate portfolio business where I’m managing those properties and I’m looking at buying property and selling property in 1031 and everything that I’m doing there. So I have these two wealth building engines.

One is my business business and one is my real estate business. But I’m as knowledgeable about my investing business and real estate as I am about my business. So it’s just understanding that, you what games do you want to play? And there’s not a right or wrong way to do it. One might take more time because you’re waiting for a 40-year market. The other one, you might be able to cut that in half. But just choose your field and play the game based on what type of energy and knowledge and capacity you want to put into it.

Michelle Kesil (28:02)
Amazing, that is so helpful. Thank you for sharing that. So before we wrap up here, if someone wants to reach out, collaborate or just learn more from you, what’s the best way to reach you?

Krisstina Wise (28:15)
The probably the best thing is YouTube, just my name at Krisstina Wise, KN2S’s. So at Krisstina Wise on YouTube, where I do a lot of financial education and you can reach out to me through YouTube. If you want to read my book, it’s fallingformoney.com, which is a way to get a free copy of my book, Falling for Money, but fallingformoney.com. But it’s less about the book and it would get anyone that wants to get on my email list. I don’t spam, but I really send out really valuable things.

just education or podcasts or things that I think would be worth listening to. And then the final thing is krisstina.com/live is I’m having an investor event that is in the last weekend of September. If anybody’s listening before the last week of September here in Park City, Utah, I’m going to be sharing my real estate investing secrets that I’ve never shared publicly before as I’m going to release my real estate investing book here later this year. So

That’s all going to go hand in hand. But yeah, I’m pretty easy to find if somebody wants to.

Michelle Kesil (29:19)
Perfect, thank you. I appreciate your time, your story and perspective. We need more people in this space who are doing things in this right way. So thanks again for being here.

Krisstina Wise (29:30)
My pleasure. Thank you, Michelle.

Michelle Kesil (29:32)
Yeah, and for those of you that are tuning in, if you got value from this, make sure you’ve subscribed. We got more conversations coming with operators just like Krisstina, who are out here building real businesses. And we’ll see you all in the next episode.