Why Your Gym is Not Making You Rich with Ben Pickard

[00:00:00] Hello, my friend on today’s episode, I’m back with Ben Pickard and we’re talking more about growing wealth as a gym owner. In this episode, we’re talking about why most gym owners we know are not getting rich from their gym. And we give you a very simple five step framework for how to extract value from your gym to build long term wealth for yourself personally.

So if you want to stop being a poor gym owner, this is a great episode for you to find a new path forward. So keep on listening.

Welcome to the business for unicorns podcast, where we help gym owners unleash the full potential of their business. I’m your host, Michael Keeler. Join me each week for actionable advice, expert insights, and the inside scoop on what it really takes to level up your gym. Get ready to unlock your potential and become a real unicorn in the fitness industry.

Let’s begin.[00:01:00]

Hello fitness business nerds. What’s up? Welcome to another episode of the business for unicorns podcast. I’m back again with ben What’s up, my friend? Hello Good to see you. I’m excited to dive into today’s conversation We’re actually going to do part three of talking about personal wealth for gym owners, and i’m excited, uh to finally Talk about this piece of the puzzle, which I think many of you will be excited about and take a lot of notes on.

But before we do that, a quick shout out for those of you who care about making money in your business. I think that’s probably all of you. You probably need to raise your rates every year. And for a lot of you, that’s a harder thing to do. And we’re here to make it easy. So if you go to businessunicorns.

com right now, you can get our raise your rates. Playbook. It comes with templates. You can email your clients and along with a bunch of best practices to know how much you should be raising your rates every year. So if that is a hard thing for you and you haven’t raised your rates in a while, go to the website right now or click the link down below and go get our free raise your rates playbook.

Go do it. Go do it right now, push [00:02:00] pause, go do it this immediate moment because, uh, many of you just need to raise your rates. You’re worth it. That being said, Ben, let’s dive in. I know this is really basically going to be part three of a little series about personal wealth as a gym owner. And you want to just walk everyone through what the previous two episodes have been about.

You should go listeners. You should go listen to those first, go back into the podcast stream, listen to them. I can tell you which episodes they are in a second, but then give us, Oh, they were episodes three Oh eight. Nope. No, they weren’t. They were. I’ll let you talk while I go look and see what episodes they were.

But what do we cover? Yeah. So the first step we covered was to take your financial temperature. How much are you currently making? What’s your hourly pay? What’s your dream income? And what do you need to retire? So that was step one, take your financial temperature. Step two was understanding the steps to building wealth in a training gym.

So we were talking about the business wealth side of things, which was creating wealth in your business, generate revenue, allocating that money, i. e. profit first, paying yourself, of course, [00:03:00] and then making sure you keep some of that money to continue to invest in your business for the things that you need so you can continue to grow.

Yeah. Great summary. That was brilliant. Those were episodes 304 called how to build personal wealth as a gym owner and 309, which would stop paying yourself last. So go listen to those first before we dive in today, but let’s make a hard pivot and just jump into today. So as Ben mentioned, we already talked about how to take your financial temperature, how to set your business up to both generate and pay yourself.

But then once you have the money. Once it’s actually your personal money, it’s out of your business account. We want to talk about some best practices here. And specifically, there’s just about five of them. We’re going to try and get through in this episode. So let’s start with the first one. Yeah. Yeah.

Let’s start with the first one, which is save money. What’s this all about? Yeah. So first I want to give the very quick disclaimer that. This is the point where the country you are in and the taxes of where you live are going to affect everything. We’re going to intentionally keep this broad and [00:04:00] not get into this is the exact account they need to put this in.

So disclaimer set, it varies country to country. Yeah. And I’ll, I’ll just. Tack on to your disclaimer because we say this in every episode. This is not financial advice. You should know someone in your area who knows the laws in your area, who knows your financial situation, who will advise you on what to do.

These are just best practices that have worked for us and many Unicorn Society members. So we are painting with a broad brush here, um, intentionally. Yes, so step one is save so it’s the same my same Principle as using profit first in your business profit first gives every dollar a job and it’s allocated to different digital envelopes for different things that need to happen in your business When it comes to saving on the personal side of things you want to do something roughly the same so the different accounts You use the different more accurately goals for the accounts is going to vary, but generally speaking, you want to be setting aside 10 to 20%.

If not more, I have very strong feelings about it being more, but that’s not for everybody towards [00:05:00] saving. And those can be things like an emergency fund. So if your roof leaks that you’re not like, Oh, shit, we’re screwed. It can be something like a kind of a medium term fund, such as like a wedding or a down payment on a house.

Obviously, you can have a fun fund for like vacations and awesome things you want to do or buy to make your life better. Definitely some version of a charity fund giving to causes that are near and dear to your heart. And last but not least, which I think is probably the most important big picture is retirement.

We are self employed, unless your gym has set up with some sort of pension, but you still have to contribute to it anyways. Like we don’t, you know, my father in law works for the Canadian government and he’s going to have a wonderful pension by the time he’s done. Now he has to fulfill probably 30 or 35 years in order to get that pension.

But if you owned a gym for 40 years, you’re guaranteed nothing. So it’s really important that you are setting aside money into long term savings, aka investments accounts to have that money grow. And that you don’t [00:06:00] need to be training when you’re 80. If you don’t want to be, I think this is such a place to start this conversation, Ben, because so many folks wind up only putting away what’s left over.

Kind of like the profit first idea, right? We don’t want your savings to be what’s left over after you finish spending for the month. We want your savings to be the thing that comes out of your paycheck automatically, that goes right into your 401k or your SCP or that fun fund or that peace of mind, rainy day savings fund, right?

That money comes out first. Then you budget the rest of your life based on what’s left over. That savings is like the top priority. And then after that is the budget for what you can afford to build your lifestyle around. So I think that’s really, yeah. And I love that you listed a bunch of different kinds of funds because all of the kinds of funds you will need, dear listener, is based on your values.

What do you care? What is the life you’re trying to build? Is the fun, are you in your twenties and the fun it’s fund is all about having fun and it’s about travel and it’s about. It’s about going places and [00:07:00] hanging with people or a little bit of a different chapter of life, and it’s about saving for your kids, right?

And I think depending on where you are, these funds will look different at different times in your life. But the premise for this first one is that those have got to come out of your paycheck or your distributions first. Yeah. Yeah. this one? Yeah. We’ve been saying the word fund, but these can, this isn’t some fancy thing that we know things that you don’t like.

It can literally just be a savings account. Just be a savings account. Yeah. That’s it. Yeah. It’s not an actual like charity. No, not an investment fund. Anyway. Yeah, totally. In fact, most of these probably shouldn’t be. But that’s again up to you and your financial advisor. But the idea of the idea here is that just right off the top, you’re taking away money to put it into a fund for something that’s really important, like your retirement or your kid’s education or your house fund.

And so that’s number one is if you want personal wealth from being a gym owner, you got to be saving some of the money that goes into your personal accounts. What about number two? Which is grow number two is about growing [00:08:00] your money. So as I believe we touched on a little bit at the end of the last podcast in this series, gyms are typically really good cashflow machines if you do everything, right.

But they’re not usually that valuable of an asset. So it’s important that you basically take the cash that’s generated in your business and then put it into things that will grow your money because your gym probably isn’t going to sell for 2 million. It’s not a tech company where you know, that will, your exit will be your retirement.

It’s. It’s probably not sellable at all, which pains me or it’s sellable for a bit of money, but not life changing money in the grand scheme of things. So it’s important that you’re taking those savings and putting them into things that will typically grow over time. And again, not financial advice, but the two things that we generally see work best because you’re not paying a whole bunch of fees and everything that eats away at your investments.

Our index funds, you’re essentially buying the entire market for a very low fee or real estate, which can be through like actually buying your own rental property. If you have the [00:09:00] skills and time to manage it, or it can be through. Like typically like private equity, like REITs or something like that, where you’re essentially buying into pool of money that then buys a whole bunch of doors, as they say, but units.

Yeah. Yeah. I think that’s great. Go ahead. I was going to say there can be a third one and I intentionally left this for last, cause this is really things that are speculative. This wouldn’t include the obvious speculative things like your friend’s startup that you’re not sure if it’s going to work or not, but you want to put money in because you feel like you.

Have some strange obligation. Cryptocurrency is obviously a speculative one. Yeah. But It’s also incredibly speculative if you’re going to pick your own stocks, nobody knows what the market’s going to do. Not even the best people on the planet who do this for a living know what the market’s going to do.

So dear listeners, I say this with love, but there’s no fucking chance any of us know what the market’s going to do. Yeah. So if you’re picking your own stocks, just be aware of that speculative. If you think that’s fun, go for it. I do it a little bit. Tesla is the one that I always [00:10:00] buy. No judgment, but be aware.

That’s a very small percentage. You’re not putting of the 10 or 20 percent you saved. You’re not putting it all into crypto and Tesla and your friends startup. You’re putting 98 percent of it into things like real estate index funds that go up over time and 2 percent of it into the investing equivalent of going to Vegas.

I think that’s a great distinction, right? And we know people who have put. 100 percent of their savings into crypto and other things. And most of it’s not going well for most of them. But I think what I think you’re describing here is risk, right? And it’s up to all of you to listen to this with your family and your financial advisor to determine how much risk are you wanting to take with the money you’re saving?

And usually the general practice is if you’re younger, you can take more risk because you have more time. Before you have to make that money work for you in retirement. If you’re a little older, you want to take a little less risk, but that’s totally up to you. Y’all might be daredevils taking that risk all the time.

Good for you. And some of you might be, um, super risk adverse like me. And it’s just all index funds and real estate. And [00:11:00] it’s got to find out what works for you. But that’s step number two, which is find some ways to grow your money. And you, uh, many of you probably need some professional help there. So we hope that we can recommend a few books at the end as well for people who want to get going with it because I totally we don’t have time for it on this podcast, but my journey has changed a lot from using different planners and different rest tolerances after reading a bunch of books that were not nearly as dry as I thought they would be.

It’s really changed my investing. Let’s move on to number three. So once you have saved some money and you’ve learned some ways to grow that money, then you have to protect that money in some ways. What’s that look like? Yeah. So this is all the different types of insurance. So these can be things like life insurance, disability insurance, critical illness, permanent insurance.

There’s a term I believe is states only called him umbrella insurance, medical insurance. If your country doesn’t have that included. Why don’t you rub it in? Let’s just rub it in. If your country doesn’t have that included, America. Ours is free, but it’s shitty and free. So this is where it gets like [00:12:00] even further outside of our scope.

So if before it wasn’t financial advice, this is absolutely something that’s don’t be like my friend said on this podcast, I should do this thing. Totally. But what I’ve learned through a ton of research is you want to make sure you actually have an insurable need. So if you owe half a million dollars on your house and You’re the main breadwinner in the family and you die, you’re supposed to be fucked.

If so, you may want insurance for that to make sure that the important debts are paid off. If you have a ton of money or you don’t have a lot of insurable need, like you don’t have dependents or you rent your house, you probably don’t need to get sold into some massive expensive life insurance policy.

But at least speaking to the Canadians out there, you can get term life insurance for like a hundred bucks a month for a quite a bit amount of money, which means that if I get hit by lightning tomorrow. My wife isn’t screwed because she doesn’t really know how to run the gym. So this is a thing where you definitely need to talk to somebody who knows their stuff.

The only caveat I want to put in there is generally speaking, people who sell [00:13:00] insurance make a ton of money on every sale. So it’s worth looking like a ton of money. Like an insane amount where it’s very hard for them to be objective, I imagine, unless they’re most altruistic person on the planet. Yeah.

So it’s worth getting multiple opinions on this and asking an absolute ton of questions. So don’t feel stupid to ask, Oh, I don’t know if this is a good question. So I’m not going to ask it like. They might make 50, 000 on this. So you want to try to find some good information. Yeah. Shop around, ask lots of questions.

I also want to circle back and say, I don’t want you to get hit by lightning, but I feel like Katja might, your wife might run the shit out of that gym. She might, she might crush it. Actually, there’s a very good chance. There’s some basic stuff, like, that would take some time to get up and running. Like, if she doesn’t know my banking passwords and stuff like that.

I’m just being cheeky to be a cheerleader for Katcha, because I think she’s badass. Okay, so we are saving some money. We’re growing that money. We’re doing our best to protect it. Various forms of insurance. For me, I’d also put, like, having a will. In this [00:14:00] category, make sure that things are protected, a living will, plus the other kinds of will, there’s all kinds of things you can do.

And I think a good financial planner helps you with this kind of life stuff as well. So that’s what number three is. Let’s move on to number four, which this is where it starts to get fun, which is now that you have saved some money, you’re growing that money, you’re protecting that money. It’s time to enjoy it and have some fucking fun.

So talk about that, Ben. Yeah. So in the first step here, we talked about setting money into different types of accounts, like a wedding or vacation or whatever, and whatever lights you up. Now go do those things. You’re not collecting it like they’re. Pokemon’s and you’re trying to save up for no real reason whatsoever.

And this is one that’s near and dear to my heart. Cause this is where I tend to have the most trouble, but go do those things that you enjoy. Our time on this planet is finite and tomorrow is not guaranteed. So there is an element to, yeah, if you’ve been sending money away for vacation, go have that vacation, go enjoy that thing.

Do things that like fill your cup and bring you [00:15:00] joy. And like, this is part of why we do this. Yeah. 100%. Is it your Fisher? I think that likes the Bill Perkins book, die with zero. Did you, I think it’s a Fisher recommendation. Yeah. Yeah. I think I did read it. It was, it’s a good one. So if y’all like want to dive into this topic a little more, here’s maybe our first book recommendation.

It’s Bill Perkins, P R K I N S has a book called die with zero. It’s. It’s like getting all you can from your money before you go on. I think it’s a great one to give some perspective to, yeah, we’re all going to die. And that can be motivating to really, truly live your best life and spend your money in a way that, that really encourages you to thrive.

So I think that’s a great recommendation. Live your life. And enjoy your money. And that brings us number five, which is give to give back. If you can, if you’re lucky enough to be in this life to make a good amount of money, can you help others who haven’t been as fortunate? Absolutely. And this is an important piece where give back to what you can.

Everyone’s going to have [00:16:00] different charities or organizations that matter to them, but there is something about if you’ve put in the work and done all the things where you’re in a position where you can’t help out others. I can’t say it’s our obligation by any stretch, but, and whether it’s time or money or something else, but there’s an element to giving back because not everyone, even though it doesn’t always seem like the easiest go being a gym owner, it’s not the, it’s not the easiest industry to go make a bunch of money in by a long shot.

If we figured it out there, we know there’s some other people having a rougher time, whether it’s medical conditions that matter to you or volunteer organizations you’re in your area, but I don’t have any benchmarks for this, but you should be giving a little bit back on a regular basis. Yeah. Listen, and there’s a whole kind of movement that has emerged around this idea, not that giving to charity is a new idea, but there’s a whole thing called the effective altruism movement that really got started in the kind of early two thousands.

I think that term effective altruism was maybe popularized maybe like around 2010, 2011, I want to say. And it’s a whole group of people who are saying, okay, I do want [00:17:00] to give, but I don’t just want to throw my money to any organization. How can I be as effective as possible as a philanthropist? Or as an altruistic person.

And so you can go to, I think their website, effectivealtruism. org, I’m going to guess, and, and learn more about how to be effective in your giving. Uh, especially for those of you who are fortunate to make lots of money. You want to make sure that you’re putting that money to good use. And while sure, I’m sure any charity I think is helpful, not all of them are created equal.

Not all of them have the kind of impact that you would want them to have. So do your homework there and you can rest at ease to know that every dollar you give is actually making a positive impact on the world. Yeah. 100%. Yeah. How would you summarize what we covered today here, Ben? I think the most important part is to pay yourself first.

So it’s pay yourself first and it’s coming off the top. It’s not the money that’s just leftover after you pay your bills or buy a new car or whatever. Then you’re making sure that of that money. It’s growing into long term medium term [00:18:00] assets, basically, then you’re making sure you have the appropriate amount of protection for the risk that you’re exposed to.

You’re enjoying the shit out of that money because you worked your ass off on it, slave seven days a week, nights and weekends, bootstrap that startup. You got to have some fun. And then, of course, based on your success and what you’re able to do, giving back to organizations that matter to you. But it all starts with paying yourself first and then making sure you’re doing the right things with your money.

And oftentimes that right thing is. Having some freaking fun. Yeah. That’s great summary, my friend. I think that’s a great roadmap for y’all to follow. Hope you were taking some notes. And for many of you for one of the first steps is to generate more revenue in your business to be able to do all of this.

And as a reminder, we have a great tool that’s free on our website to raise your rates. If you go to businessunicorns. com or click the link in the show notes, you can get our raise your rates template, which helps you, uh, have a really clear path for charging what you’re worth at your gym, which is one of the first steps to be able to get profit out of your gym.

So, thanks for a great conversation, Ben. I’m sure we’ll be talking more about personal wealth for gym owners as [00:19:00] we continue. This won’t be the last time, but thanks for a great one. I’ll see you on the next episode. Looking forward to it.