Neil Patel Has $100M and Refuses to Raise Entitled Kids

We spoke to Neil Patel in this week's episode of Moneywise.

Neil is a self-made entrepreneur best known for his bootstrapped marketing agency and software businesses. His flagship company, Neil Patel Digital, generates around $100 million in annual revenue.

Like all Moneywise episodes, Neil breaks down his net worth, income, portfolio, and monthly expenses and then I, your humble host, pick it all apart.

We also went deep on: his evolution from frugal $15,000/month living to his current $200,000/month lifestyle, why he prefers bootstrapped businesses over venture-backed ones, and how he's raising non-spoiled children despite his wealth.

Below you'll find my summary of the episode along with the entire transcript.

And by the way...this podcast, the concept of it came from Hampton, a private, highly vetted community for CEOs, business owners, those types of people. Most of the people do, on average, around $25 million a year in revenue. And so I'm able to see tons of conversations about wealth, how to handle all the changes that come with it, how to spend, how to save all these types of questions that typically aren't happening out in public. If you are a CEO of a company, you own a business that does at least 2 million in revenue, check this out. New Moneywise episodes come out weekly.

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Now, below are the notes and the full transcript.

The Numbers

• Net worth: 9+ figures (at least $100 million)
• Monthly spending: $120,000-$180,000/month (roughly $200,000/month)
• Core business revenue: Neil Patel Digital generates approximately $100 million annually
• Other key assets: Multiple software companies including Crazyegg
• Monthly donation budget: $100,000-$150,000/month
• Actual living expenses: $50,000-$70,000/month (without donations)
• Real estate: 4 homes in Beverly Hills, including a condo at the Mandarin Oriental
• Property taxes: $300,000-$400,000/year
• HOA fees: $10,000/month for his condo
• Vehicle fleet: Maybach, Bentley SUV ($300,000), Lincoln Navigator, Honda Odyssey
• Staff expenditure: Multiple staff including nannies, cleaners, and a full-time driver, each paid $100,000+/year
• Past spending examples: $35,000 on bed sheets, $2 million on furniture for his Vegas home
• Goal: Reaching $1 billion in annual revenue before age 50 (approximately 3 years before turning 50)

From $15,000 to $200,000 Per Month: Neil's Spending Evolution

Neil's spending habits have drastically changed over the years. In a blog post from 2014 titled "How a Ferrari Made Me a Million Bucks," he shared that he only needed $15,000/month to be happy. Fast forward to today, and he's spending over 13 times that amount each month.

What changed? "It's called marriage and having kids, so it's not really [by] choice," Neil explained. But the more nuanced answer is that he spends this way because he can. His businesses generate substantial cash flow, and he reinvests most of it rather than taking it as personal income.

Neil's spending reached its peak during his Las Vegas period: "In my last house, I spent $2 million on furniture. The one I lived in in Vegas. Literally. You would see it on Architectural Digest if we showed the pictures of it."

Despite his high spending, Neil maintains he's not extravagant compared to many of his peers: "I feel broke compared to a lot of my friends. I have some friends who are just like, 'Yeah, I'm building a 40,000 square foot home.' And some of these people own 7 or 8 homes like that."

The Business Philosophy Behind Neil's Wealth

Neil's wealth stems primarily from bootstrapped businesses rather than venture-backed companies. "Funny enough, I made my most money as an entrepreneur and all my bootstrapped ventures. I made the least amount of money from all my venture-backed businesses," he shared.

His business strategy involves using high-margin software businesses to generate cash flow, then reinvesting in other cash-flowing assets: "The way I evolved as an entrepreneur is I took all the money that I made from software because it had high margins. You're talking about some of these businesses are running at like 70 plus percent EBITDA, started taking the cash flow and then using the cash flow to reinvest in other businesses that spit off more cash flow."

This approach has proven more successful for him than other investment strategies: "I've tried doing a lot of different ventures, like raising money for companies, investing in stock markets, doing a ton of angel investments. I've generated the most income from reinvesting in other businesses that I control."

Balancing Luxury and Purpose

Neil's approach to spending has evolved significantly from his early "lifestyle marketing" days when he would buy luxury items to create business connections. Today, his substantial monthly spending is balanced by an equally substantial commitment to philanthropy.

"The biggest chunk of our expenses is donations," Neil explained. "My wife and I, we just had the philosophy of like, it's cool going to the Super Bowl. We did it. I'd rather give the money to some kid who is from Missouri or somewhere, and they can't afford to go to college. For us, that just makes us more happy."

Neil estimates that his actual living expenses are around $50,000-$70,000 per month, with donations accounting for an additional $100,000-$150,000 monthly. He's also cut back on certain luxury experiences: "When we first did our last My First Million [podcast appearance], I would spend more on things like experiences going to the Super Bowl and flying private and all this kind of stuff that doesn't happen these days."

Even with his wealth, Neil maintains some surprisingly practical habits: "I will go southwest if I go from here to Vegas... I will go economy on Southwest Airlines."

Raising Children Amidst Wealth

One of Neil's biggest concerns is ensuring his children don't grow up spoiled by wealth. This has influenced his recent spending decisions and lifestyle choices.

"We don't want our children growing up thinking that they deserve more because it was getting really out of hand," he explained. "So-and-so had a birthday party with a pony. I need a pony or unicorn at my birthday... Let's go to Disneyland. Let's just hop on a plane and go to Disney World and get the Fastpass that cost six grand so we don't have to wait in lines. And they start thinking, this is normal life."

Neil contrasts this with his own upbringing: "My first job was picking up trash and cleaning restrooms. My dad was born in Uganda. The Indians were exiled out of Uganda, UK took in people, and then my mom was a teacher and was educated in India. They struggled. I struggled, my wife struggled. Our kids don't understand this and we want to change that."

Despite his concerns about how his children perceive wealth, Neil has established irrevocable trusts for each of his children that will provide them with nine-figure inheritances. However, he notes: "They can't just do whatever they want with the money. The money's there in case they need to live on Mars or anything like that."

Other Key Quotes

"Being content and happy with who you are and where you're at in life is more important than being a billionaire. Assuming you have enough money to at least provide the necessities and hopefully a little bit more than that."

"I don't really look at it percentage wise, but I just don't spend that much. In comparison, I'm not saying I make a lot of money. Just because I have income doesn't mean I'm actually taking home that money."

"I want my net worth when I die to be close to zero. I've given my kids enough."

"I spend where it makes sense to me, and I don't really have a budget because I'm still saving by far the majority of my income."

"There comes a certain point in life where it's hard to spend the money unless you want to live a crazy life and crazy life being. Do you want boats and planes and all this kind of stuff? And if you don't want a lot of that kind of stuff, life isn't that expensive."

"If I had to pick one thing that I spend money on, that's a splurge. It's a driver."

Links You Might Like

• Neil Patel Digital
• Crazyegg - Website Heatmaps & A/B Testing
• How a Ferrari Made Me a Million Bucks - Neil's 2014 blog post
• Neil's Episode on My First Million

Full Transcript

[00:00:06] Neil Patel: I didn't realize I spent $35,000 on bed sheets. Sometimes you just spend money and I don't really think about it.

[00:00:14] Sam Parr: That's coming from a guy who spends around $200,000 a month. That's the ballpark. And the reason I say that's the ballpark is because even Neil doesn't know exactly how much he spends.

[00:00:23] Neil Patel: I don't keep track of my expenses every month.

[00:00:32] Sam Parr: All right, everyone. So that is my friend Neil Patel. He's a really popular entrepreneur and marketer. And $200,000 is a lot of money. But Neil's spending wasn't always like this. In fact, years ago, something like ten years ago, he had a blog post that I remember reading when I was just starting out my business career, and he said something like, he only needs to spend around $15,000 a month to be happy. And so it begs the question, what changed? So in this episode of Money Wise, we're gonna learn why it's changed, how it's changed, and we're gonna get some valuable takeaways on how you should approach your monthly spending. What's happening? Everyone, I'm Sam Parr and this is money wise. There's a ton of podcasts out there and resources that teach you how to be wealthy and how to make money, but there aren't that many resources that try to teach you how to handle the life changes that wealth brings. I'm the co-founder of Hampton, a private, highly vetted community for CEOs, business owners, those types of people. Most of the people do, on average, around $25 million a year in revenue. And so I'm able to see tons of conversations about wealth, how to handle all the changes that come with it, how to spend, how to save all these types of questions that typically aren't happening out in public. And by the way, if you are a CEO of a company, you own a business that does at least 2 million in revenue. Check it out. Join Hampton Calm in this podcast. Money wise, we talk about real numbers and real people who are doing things that typically are only spoken about behind closed doors. The people who come on, they're going to be radically transparent about numbers. Sometimes they're anonymous, sometimes they're not. In today's episode, we're going to talk about monthly spend. And the guess is Neil Patel.

[00:01:59] Sam Parr: All right, before we get into Neil and his spending and all that good stuff, we need to set a little background here. I need to tell you how rich Neil is and how he made his money. The first thing you should know about Neil is that he's self-made and almost entirely from bootstrapped companies.

[00:02:12] Neil Patel: Funny enough, I made my most money as an entrepreneur and all my bootstrapped ventures. I made the least amount of money from all my venture backed businesses.

[00:02:21] Sam Parr: His biggest business is called Neil Patel Digital, and it's a bootstrapped agency that specializes in SEO, and it breaks in around $100 million a year in revenue. Along with the agency, Neil Patel Digital also owns a handful of software companies.

[00:02:33] Neil Patel: We stopped counting, and we don't look at it as how many businesses anymore because we're buying. We buy a lot every single year and we just merge them into the main parent companies.

[00:02:42] Sam Parr: Aside from the agency, one of the biggest software companies that Neil Patel Digital owns is called Crazyegg. It's a software that helps track your website visitors.

[00:02:50] Neil Patel: Crazy. It was probably the largest business I ever created and then took the money from that to create more companies. And then there's pretty much just two Crazy Egg and Neil Patel digital, and that's it. Everything else just gets fits in with one of those two companies.

[00:03:05] Sam Parr: So at this point, basically all of Neil's wealth has come from buying and building businesses.

[00:03:10] Neil Patel: The way I evolved as an entrepreneur is I took all the money that I made from software because it had high margins. You're talking about some of these businesses are running at like 70 plus percent EBITDA, started taking the cash flow and then using the cash flow to reinvest in other businesses that spit off more cash flow. I've tried doing a lot of different ventures, like raising money for companies, investing in stock markets, doing a ton of angel investments. I've generated the most income from reinvesting in other businesses that I control, and when I mean control either owned fully or control majority.

[00:03:44] Sam Parr: So all of this has led to a net worth for Neil of over nine figures. And what's crazy is you're going to see in this episode, Neil shares everything, but he didn't exactly share anything about his net worth other than saying it was at least nine figures.

[00:03:57] Neil Patel: I could say I don't want to say.

[00:04:01] Sam Parr: So when I started this interview with Neil, I told him the reason I wanted him to come on was because of that blog post that I read that was like ten years old. The blog post that said that he needs to spend only $15,000 a month in order to be happy. Now, let me recap that 2014 blog post that I keep referring to. The blog post is called How a Ferrari Made Me a million bucks. In the article, Neil detailed his frugal lifestyle. He said that he lived at home until he was around 23. Then he moved to an apartment which, as he described it, was across the street from a drug park in Seattle, and overall he spent relatively little money. But then something happened that changed his perspective on money. Someone gifted him a $6,000 watch, and what he noticed was that he got a lot of attention because of the watch, and it was a good type of attention. People who he eventually did business with came up to him, and that was like his conversation starter was that fancy watch. And that insight led him to an experiment where he started spending money on luxurious things to see which stuff would start, conversations with the people that he wanted to meet. And eventually what he found was even if he didn't buy these items, even if he was just around luxurious, nice stuff, people started talking to him. He didn't even have to buy it.

[00:05:08] Neil Patel: I've never owned a Ferrari. I think the Ferrari was me driving a Ferrari on a race track. None of them have been mine though. I'm shocked on how many people hit you up being like, wow, cool car. And even if you tell them it's not yours, you're like, sure, you know what I mean?

[00:05:25] Sam Parr: But it's actually a good thing. According to Neel, his lack of Ferrari was probably best for all of us.

[00:05:30] Neil Patel: I'm a terrible driver. Like the amount of times I got into car accidents, almost all of them were my fault.

[00:05:37] Sam Parr: Hey, I'm happy that he's able to admit that, but I digress. In the article we're talking about, Neel himself said that he really didn't give a shit about most of the stuff that he was buying. And yet he kept spending and kept getting connections because of it. He called it lifestyle marketing. It's got a good ring to it. But then he got sick of it. The whole point, though, of this entire conversation is a comment that he made about the blog post years later, after the blog went live. He said that he was spending all of this money basically to portray an image of being successful. In fact, he said he spent $250,000 on furniture. However, in reality, he could only have spent $15,000 a month and he would be perfectly satisfied.

[00:06:15] Neil Patel: And then I gave away all the furniture in my apartment, too. And then I lived there a period of time where no furniture.

[00:06:20] Sam Parr: So fast forward to 2022, and I talked to Neil and he told me something that blew my mind. He told me how much money he spends per month now.

[00:06:27] Neil Patel: Right now, if I had to guess on my burn rate 120 to 180 a month.

[00:06:32] Sam Parr: What? That's insane.

[00:06:34] Sam Parr: And that gets us to the answer of the question that I originally asked, which is what changed? How did he start with $15,000 a month and multiply that by 13 times. And that's what he's spending now. The answer you probably could have guessed.

[00:06:46] Neil Patel: It's called marriage and having kids, so it's not really of choice.

[00:06:53] Sam Parr: But the more nuanced answer is that he spends this way because he can. Something important to understand is how much your mindset around spending is shaped by your past. If your whole life you grew up only being able to spend a hundred bucks a month at the grocery store, and then all of a sudden you could spend as much as you want. That's going to be a direct contradiction to all of those learned behaviors the way that you used to behave. But and this is a huge but spending and not worrying about money is a huge part about why we work so hard to make it in the first place. So if you're not embracing it, and this is something I ask myself all the time, what's the point? Of course, there's a huge downside to this. There's a huge downside to recklessly spending and throwing your money. But even at the top of his spending, Neal isn't doing that because he understands his own wealth. He accepts it, and he recognizes the fear of losing. It is mostly irrational. Listen, I know it can be a tough thing to wrap your head around. I struggle with it as well. But you make money so you can have nice things when you want them. So buy them. Be smart and buy them. That said, there's still a lot to glean from Neal's spending evolution, including how he spends with no budget and while still healthily growing his net worth. And also, and this is a shock, how his spending of around $200,000 a month. How that's nothing compared to some of his friends. But let's find out why Neil's approach to spending shifted from $15,000 a month to the most extravagant era of spending in his life. Living in Las Vegas.

[00:08:09] Neil Patel: In my last house, I spent $2 million on furniture. Okay. The one I lived in in Vegas. Literally. You would see it on Architectural Digest if we showed the pictures of it. And we refuse to let people take pictures and showcase it. And in Vegas, that house had the highest price per square foot sale in history for a custom house. Like we spent that much money on it.

[00:08:29] Sam Parr: What's been like the mindset shift of like, going to 15,000 a month to $200,000 a month? Sometimes I imagine even more. Has the threshold of I so like for me, it was a long time when I was broke. It was like anything above $100, I'm going to sweat. Anything less, I'm not going to think about it now. It's like, I'm not gonna sweat if it's above five grand. Like anything. Impulse buy below five grand. It's like whatever. If you want to just get it. Has that number changed of the threshold of, like, you're going to sweat versus or not sweat, but you're going to think about versus not think about.

[00:09:03] Neil Patel: No, not really. I don't have a threshold in my head. I just really look at something like, do I want it or not? Like if I actually look at my credit card and what I spend, like if you exclude donations just to maintain household life insurance, which I cut down on, I used to have a whole life policy. I turned it into a term policy. But if you look at just the basic necessities like a home, HOA, electricity, etc., I could easily live under 30 grand a month. It's not like I need to spend more or less or anything like that, and that's a lot. And that's including things like kids schooling and whatnot. Life isn't too expensive. What's really expensive for us? I think the biggest chunk of our expenses is donations. When we first did our last, my first million, I would spend more things on things like experiences going to the Super Bowl and flying private and all this kind of stuff that doesn't happen these days. Like, we cut out a lot of that kind of stuff. And I'm not saying those things are bad or good. My wife and I, we just had the philosophy of like, it's cool going to the Super Bowl. We did it. I'd rather give the money to some kid who is from Missouri or somewhere, and they can't afford to go to college. Right. Like for us, that just makes us more happy. So we cut off most of the spending in areas that really don't matter. And we decided to just give more to other people. And I'm not saying that's the right decision or wrong decision. It just makes us more happy as individuals.

[00:10:30] Sam Parr: You're not flying private anymore.

[00:10:32] Neil Patel: No, I will go southwest if I go from here to Vegas. Which, funny enough, I have to go. In a few weeks, I will go economy on Southwest Airlines. I don't think southwest doesn't even have first class. But I go economy.

[00:10:44] Sam Parr: Would you go? Economy on southwest with your family?

[00:10:47] Neil Patel: No.

[00:10:52] Sam Parr: Neil says he could do 30 K a month or so, but he doesn't because he doesn't need to, and he's not trying to hide it.

[00:10:59] Neil Patel: I remember in our old house that we had in Vegas, we're in LA now. I had these amazing bed sheets and they were just so soft. And then I bought more bed sheets, enough for my kids and us and multiple pairs because you get them dry cleaned. I didn't realize I spent $35,000 on bed sheets. You know, I just bought them. But, like, sometimes you just spend money and I don't really think about it. And it's not that I want to spend 35 grand on bed sheets. I like how they're soft. I sleep for eight hours a day. I sleep, you know, every single day. I'd rather have things like a mattress or bed sheets or whatever. Be super comfortable versus trying to save a dollar here or there. I've also found in life that it's easier to make the money. I still am quite a bit of a saver. I don't really spend the majority of my money by any means, but I do splurge here and there on things that matter.

[00:11:48] Sam Parr: So even though he said he could do 15,000 or 30,000 a month, in reality he's doing something like $200,000 a month. Let's quickly find out where that money is going. And we're going to start with housing costs.

[00:12:00] Neil Patel: Ten grand a month for HOA. At least that's homeowners. Homeowners association or something like that. Right? I think that's what it stands for because I live in a condo. I live in the Mandarin Oriental in Beverly Hills, so they charge. It's not a hotel, but it's only condo, even though the brand is a hotel. But the HOA dues are just expensive. But the beautiful part is the service is really good.

[00:12:21] Sam Parr: And by the way, that cost. That's just for where he's currently living. That does not include everything that he's paying for housing.

[00:12:27] Neil Patel: I have quite a few homes. We have four homes in Beverly Hills. The property tax alone is through the roof. I don't know how much I spend on property tax a year, maybe 300, 400 max.

[00:12:41] Sam Parr: Now my favorite part. Let's talk cars.

[00:12:44] Neil Patel: We have quite a few cars, even though we have a Honda Odyssey and I mainly drive it. I do have a maybach. My wife has a Bentley SUV. We also have a big SUV to, I think an extended Lincoln Navigator. But the cars aren't that expensive. It's just insurance. I don't know what we pay on insurance.

[00:12:59] Sam Parr: Well, a Bentley SUV is expensive. I think that you're talking about, uh, is it called the Coleman? I forget what they're called, but that's like a $400,000 rolls.

[00:13:06] Neil Patel: Those are expensive. Those are like a half a million bucks. I think we only paid 300 grand for ours. For the Bentley.

[00:13:12] Sam Parr: I mean, 300 grand for an SUV is a lot of money.

[00:13:14] Neil Patel: I know, like, I'm hearing myself say it. I'm like.

[00:13:16] Sam Parr: But but at least like a Ferrari sports car. You could say that's a toy. An SUV isn't always a toy. That's purely just because it's kind of sick. It's awesome. Now let's get to some other stuff.

[00:13:28] Neil Patel: Staff is always a big expense. We have nannies, cleaners, full time driver, you know, that adds up and we pay staff really well. I'll assume if someone works for us, they make 100 grand a year. We typically at least pay 100 grand per person, no matter what they do, because we believe that people work hard and they deserve to be paid well.

[00:13:49] Sam Parr: And of course, there's food. He's not going to go to McDonald's every day, is he?

[00:13:53] Neil Patel: Food is a big expense, you know, going to restaurants like a lot of time, you go with friends. I don't even drink alcohol. You know, spending 500 bucks or $1,000 between 2 or 3 people.

[00:14:03] Sam Parr: And one of Neil's favorite things to give money to one of his favorite ways to spend money, which I love hearing, is donations.

[00:14:10] Neil Patel: We still donate a lot of money. My wife loves donating and I do too. It makes other people happy and hopefully you can change our lives.

[00:14:17] Sam Parr: How much are you spending per month? Donating?

[00:14:19] Neil Patel: I don't know, I haven't checked, but if I had to guess somewhere between 100 and 150 a month.

[00:14:24] Sam Parr: Okay, so then your real life living expenses are probably 50 to 100 a month, and then your donations are double that or triple that.

[00:14:33] Neil Patel: If I had a guess of real expenditure on a monthly basis, 50 to like 60, maybe 70 max a month.

[00:14:41] Sam Parr: Those are huge numbers. I asked him a bunch of more questions because I wanted to dive deeper. Do you set a budget? So what I do is I have a like a number for me right now. I think it's 40 or 50 grand a month where I'm like, I just want to stay below that. And I don't budget. I just say just stay below roughly that number and whatever it gets spent on, it gets spent on, and I'm not going to sweat it. Do you have like a number where you try to stay below, or are you just like, whatever I want, I get.

[00:15:07] Neil Patel: It's not whatever I want, I get like, I bought the Apple Vision Pro and then I was like, I'm not going to use this and this thing causes a headache. So I returned it. But, uh, more so I spend where it makes sense to me, and I don't really have a budget because I'm still saving by far the majority of my income. Like, I'm not spending, you know, 30% of my income or 40 or 50 or even 10% or anywhere near there. So I'm saving quite a bit of money. Still.

[00:15:32] Sam Parr: That's a significant income. Then if you're spending 2.4 million a year, so then you're just saying I want to keep it below a certain percentage.

[00:15:39] Neil Patel: I don't really look at it percentage wise, but I just don't spend that much. In comparison, I'm not saying I make a lot of money. Just because I have income doesn't mean I'm actually taking home that money. If you leave money in a corporation, your S corp, it flows through. You still pay taxes. Then you use money to buy more businesses and grow and expand. So it's not like I'm actually putting tons of cash in my pocket every single year. I could if I choose to, but what's the point? It's not like I'm going to use the money. Might as well just keep the cash and just keep growing.

[00:16:07] Sam Parr: So the way that I spend is I try to invest most of my income. And when I think of spending, I just say like, if I make an investment, even if it's just S&P 500, sometimes I think I just want to live off those passive gains. Is that how you think of it when you're thinking income versus spending?

[00:16:23] Neil Patel: So the way I look at my life isn't that way. I have enough invested into alternative investments and publicly held investments where I could just live off of that and never work, Kind of like the S&P philosophy. But like if you're enough hedge funds or private equity funds as well as publicly traded stocks, you could live off of a portion of that each year. So the way I live life is I know I can live off of my investments. I choose not to, and I can do that without changing my life. So I just double down and keep growing the business. Like there comes a certain point in life. I'm not saying that I make a ton of money or anything like that, but there comes a certain point in life where it's hard to spend the money unless you want to live a crazy life and crazy life being. Do you want boats and planes and all this kind of stuff? And if you don't want a lot of that kind of stuff, life isn't that expensive. I live in like right now I'm walking around. I live in a 3000 square foot condo between my wife and kids. We're happy with that. I don't necessarily need anything bigger. I see my kids a lot, like no joke. They're around everywhere, you know? They're in our space. There is no office or anything like that, but we interact with them on a daily basis for many more hours than we did in a 10,800 square foot house. My wife and I love it.

[00:17:44] Sam Parr: But then why do you have three other houses?

[00:17:46] Neil Patel: We couldn't decide which one we wanted and where we wanted to live. I know that's stupid, but that's how it ended up being one for the in-laws. So technically one is in-laws, one is us, and then two others are homes that we thought we were going to live in here. And we decided that we wanted more land and like for our kids to run around in the backyard and stuff like that. So we'll eventually sell those to and eventually get out of the condo and find a home with land. Like, I'm not saying land like you see in the East coast, but if we get an acre in Beverly Hills, we would be happy.

[00:18:23] Sam Parr: Now, speaking of kids, this is something I know I worry about. And I actually talked to Neil a lot about this, which is how do you raise children that aren't spoiled when you're spending this much. And Neil's kids are actually a huge part as to why he's cut back lately on lavish spending.

[00:18:38] Neil Patel: We don't want our children growing up thinking that they deserve more because it was getting really out of hand. And I'll give you examples of this, right. So-and-so had a birthday party with a pony. I need a pony or unicorn at my birthday. I know there's no unicorns, but you're talking about a little kid, right? You know, they put a little crown on.

[00:18:55] Sam Parr: They give me a pony and some super glue, and I'll get you a unicorn. I'll get you. I got a guy. I'll get you a unicorn.

[00:19:01] Neil Patel: But you get the point, right? Like, I want this, like, let's go to Disneyland. Let's just hop on a plane and go to Disney World and get the Fastpass that cost six grand so we don't have to wait in lines. And they start thinking, this is normal life. And there's a point. My first job was picking up trash and cleaning restrooms. My dad was born in Uganda. The Indians were exiled out of Uganda, UK took in people, and then my mom was a teacher and was educated in India. They struggled. I struggled, my wife struggled. Our kids don't understand this and we want to change that, because we don't want to raise these children who think they deserve all these fancy homes and fancy clothes and all this kind of stuff.

[00:19:41] Sam Parr: I totally get this. This kid stuff, I totally understand. I'm a new dad. I'm raising my kids, hopefully not to be spoiled. And that's just something I think about actually, all the time. I want to go deeper on that, but I'm going to save it for its own episode. We're going to talk all about parenting and how you can raise a kid, hopefully, who isn't spoiled while you're making a lot and maybe spending a lot of money. It's something that I have huge fears over, and a lot of people in Hampton complain about this, which is how do you make sure your kids are healthy, both emotionally, physically, spiritually, while maybe you're killing it in the business game? All right. Now back to the main topic, which is spending. I was asking Neal all about luxury stuff, and even though if he's cutting back, what types of luxuries does he want to spend on? If you had to give most things up, if he was had to create his budget from scratch, what things would he not want to give up no matter what?

[00:20:27] Neil Patel: If I had to pick one thing that I spend money on, that's a splurge. It's a driver. And I have, uh, like the Mercedes S-Class. Maybach, right? The only reason I love that is in LA, there's tons of traffic, so then I don't have to worry about it. I bust out my iPad, not my laptop. Because you have, like, the laptop tables or trays. The iPad has internet, right? So you can pay for like T-Mobile or AT&T or whatnot. So I can work in the back. And the other reason I have a driver is I'm a terrible driver. Like the amount of times I've gotten into car accidents, almost all of them were my fault except one. And when I told the girl that it's okay, I don't need your information, she thought I was hitting on her. I was like, no, no, no, no, I'm just happy. It's not my fault you can go. I don't care that you did damage to my car. And she was like a student or something, right? I'm like, you don't need this headache. And what is it going to cost me? A few thousand bucks to repair? Whoop de. Do you know? But that's probably the only splurge that I really have that I like. And I am very unlikely to get rid of because it just makes my life super convenient.

[00:21:35] Sam Parr: So my takeaway from all this, the lesson that I think a lot of people are getting, which is if you have money and you're making a lot of money and you know what makes you happy, spend it. You don't have to be cheap if you're not going to run out. This is something that I personally struggle with. I'm a tightwad like I used to be, even though my earning and my net worth has gone up a ton. But there are a few caveats that I have when it comes to spending. The first is only buy things that you think truly make you happy. The second, and this is maybe just for me, but it's buy things that can last a really long time. And the third, don't buy stuff that eventually will own you. This is a huge problem that people have with buying new things, with owning a lot of stuff is that stuff eventually starts to own you. You stress out about it, you're worried about how to store it, how to take care of it. And I think that is an incredibly stressful place to be in. And of course, the most important thing, which is do not overspend. You have to know what your income is. You have to know what you're comfortable spending. And yes, Neil said that he doesn't have a budget, but he's Neil Patel. And no matter how many times he says. "I'm not saying I make a lot of money."

[00:22:34] Sam Parr: He's making a ton of money. So if you're like me and if you're closer to my end of things, which is I'm a pretty frugal person, I think, compared to my income. And you're nervous about spending too recklessly. Here's a few things I like to do. The first is I have not exactly a budget, but I have a feeling I know I want to spend this much per month, and at the end of the month I look back and I say, did I spend above or below this amount? If yes, maybe I should cut back the next month. Or if no, then I know I have a little bit more budget for the next month. For me, I just have a top line number. Right now it's around $30,000, so every month I try to spend a little bit less than 30 grand or right at 30 grand. That number I feel like I'm able to acquire or use and buy everything that I want. Eventually, maybe that's going to be a little bit higher, but right now I'm comfortable with $30,000. The second thing that I like to do is I have like a splurge number. So like any number below about $1,000.

[00:23:25] Sam Parr: I just buy it. I don't think twice. Above $1,000, I sometimes think, do I actually want this? Will this actually make me happy? If it does, then I continue to buy it. If it doesn't, I don't. But regardless if those numbers work for you, maybe they're way higher. Maybe they're way lower. The most important thing you could do for your own wealth and happiness is to have some perspective. So I've got a bunch of wealthy friends, and I guess I'm wealthy as well. What's funny about people is that you're saying, I don't know where it goes. You're saying it's not that fancy and it's not that crazy. You don't need a lot to be crazy. But like, we have to acknowledge that. And I have to acknowledge to myself all the time I'm like, this is insane. This is crazy. Isn't it funny how you're like, well, it's not that crazy. I don't have boats and planes. It's like, well, you have a driver, though, you've got the Bentley, you've got four homes in Beverly Hills. Isn't that funny how we say things to ourselves like this? Isn't that insane? Like the needle moves constantly.

[00:24:16] Neil Patel: Yes, but also the other thing too is this. What are you comparing it to? I feel broke compared to a lot of my friends. I have some friends who are just like, yeah, I'm building a 40,000 square foot home. I'm like, wait, you don't even have kids in your house anymore? You need 40,000ft². I'm like, yeah. I'm like, your kids are all grown up and old. I'm like, what do you need? 40,000ft² for. And some of these people are like, they own 7 or 8 homes that are like that, right? So it's just like, what do you compare to? But on the flip side, I have friends who have no homes. They just rent and you would be like, okay, they just rent condos or apartments. They don't they must not spend a lot. And they may drive cars like a Prius or a Kia or anything like that, but yet their burn is like six, 700 grand a month. And you would look at them and you're like, ah, how can they spend that much? They don't have that much money. You're like, nah, they're probably worth 5 to $10 billion. You just can't tell. And they just have a ton of money. Where do they go? Where does their money go? Like, I've talked to someone, they're like, I don't know, but if you had $5 billion, do you really care where 500 grand, $10 million goes every month? Probably not. I'm not in that position, so I can't say, but. And when they say they spend 500 grand to a million, they probably spend more. And they're just not keeping track. Just like I don't keep track of my expenses every month.

[00:25:40] Sam Parr: In the previous episode, we talked about money and happiness. In my opinion, having a little bit more money definitely makes you a little bit more happy. Doesn't necessarily make you happy, but it makes you happier. And if you're lucky enough to one day become wealthy. I think the key to staying happy is keeping that perspective. And that's for two reasons. One, like we just talked about, there's always someone with more than you, and it kind of sucks comparing yourself to them, because there's always going to be people who have more or who are healthier, happier. There's always more. There's always another level. And comparing yourself to them is just a stupid way to live life. And by the way, the people who you admire, the people who I admire, I bet they would trade it all to be younger, something I have or to be healthier or whatever they don't have people are always envious of others, even if it seems from the outside that they have everything. And the second reason is that lacking gratitude will eat away at your happiness. I know this for a fact. Be grateful for your wealth. Be grateful for your hard work. Be grateful that those around you maybe helped make it possible. And more importantly, be grateful for your luck. That's it for the advice. But we still have a couple more questions for Neil. First, if you had to reduce his spending to around $50,000 a month, what would he spend on.

[00:26:48] Neil Patel: In-laws and parents close to us? They get to do what they want within reason, like travel, wherever. We'll get them business class tickets so they can go to sleep instead of like if they're flying international long distances. Um, my kids can go in economy. What else would I allocated on living? Just rent or mortgage? Life insurance? I think that's great donations. If I didn't already say that. I don't really have too many things. I don't mind driving. I don't really need a driver. I could drive a Honda Odyssey. I'm okay with it. I hate driving a Bentley or these fancy cars, because it's hard for me to turn my head and see out of the back because they make these tiny windows or these cool shapes. Like, I like the normal traditional cars because I'm a terrible driver.

[00:27:29] Sam Parr: But Neil, why do you have this stuff then? If you hate it, why do you have it?

[00:27:32] Neil Patel: The Bentley my wife likes. That's her car. The Maybach I like because I don't like driving. But I'm saying if I only had $50,000, I don't need some of those things. Like, I could live without them. But the reality is, I don't have a $50,000 budget so I can have whatever I want within reason.

[00:27:50] Sam Parr: Neil's an impressive guy, and even though he's spending a couple hundred thousand dollars a month, his wealth is increasing very, very fast. The last thing that I asked him, I asked him, where do you want to be in terms of wealth at age 50? For context, he's about 38 years old now.

[00:28:03] Neil Patel: My current goal and it's not we'll round up to 50. It's a little bit younger of a age. I want to get to a billion in revenue a year.

[00:28:11] Sam Parr: And you said that was before 50.

[00:28:13] Neil Patel: Yes. It's a few years before 53 years before. But yeah.

[00:28:17] Sam Parr: That's like your target where you're like, it would be really cool if we could hit a billion by that year.

[00:28:21] Neil Patel: An annual revenue bootstrapped and being financially responsible from an EBITDA perspective. But yes. And by the way, it depends what you consider net worth too. Like if I get there, I'm going, I'm donating it. I don't want my net worth to be billions of dollars. I want my net worth when I die to be close to zero. I've given my kids enough and the value that I given them in stock alone. Each kid, I have an irrevocable trust. They can't just do whatever they want with the money. The money's there in case they need to live on Mars or anything like that. But both kids will pretty much have. Or they have nine figures each. They're good.

[00:28:58] Sam Parr: So in conclusion, enjoy your money. It's a tool to make life better.

[00:29:02] Neil Patel: Being content and happy with who you are and where you're at in life is more important than being a billionaire. Assuming you have enough money to at least provide the necessities and hopefully a little bit more than that.

[00:29:15] Speaker3: I swear, you're the gold. I've been running for it like I woke up and won the top bra.

[00:29:23] Sam Parr: All right, that's it for this episode of Money Wise. However, before you go, I'm not sure if we're gonna keep making these. I need to know from you so you can do two things. First, I want you to go to money wise in the iTunes podcast app, and I want you to leave a review. Whether it's a negative review or a positive review, I want you to let me know. Do you want us to keep making these episodes? It's a lot of work, but we'll do it if you guys want it. Otherwise, these conversations are gonna just stay private inside of Hampton. And the second thing is, I'm on Twitter, the Sam Parr. Tweet at me. Let me know what other types of conversations on money wise do you want us to have? Do you want us to keep having these? Do you want us to not have these anymore? You can let me know. The Sam Parr on Twitter, if we do keep making these, do me a favor and click subscribe on iTunes. Click subscribe on Spotify. Click subscribe on whichever podcast app you're on. If you're on YouTube, that way you'll be alerted when we actually do have new episodes. And of course, if you are a business owner, a CEO, a startup founder, check out Hampton join hampton.com.

[00:30:15] Sam Parr: It's a vetted community. We vet everyone. We interview everyone. I actually approve everyone myself. And you could check out these types of conversations. We have hundreds, almost thousands of members who have these types of conversations. The average person has a company of doing around $25 million a year in revenue. But if you have at least 2 million in revenue, you're able to apply and be interviewed for a position. It's all digital companies, all high growth companies. So check it out. Join Hampton. Com and last but not least, I got to give a shout out to Jackie and Harry at Lower Street. It's lower Street. They're the folks who produce this podcast. They make all sorts of branded podcasts for different companies, and they helped make this one come to life. It's a ton of work. They've made it very easy for me, and I just want to give them a shout out. So if you're a company that wants a podcast, check it out lower street wise. All right. This is Sam from Money Wise. Check it out. Tweet at me if you love this. Leave a review. And if you're a startup founder, check out Join Hampton dot com.