Rabbi Evan Moffic, author of The Happiness Prayer, talks about happiness and what leads to a meaningful life.
His rich insight on religion, capitalism and happiness give us a new way of approaching personal gain and how we can share that with others. And he invites us to ask ourselves, does more money lead to more happiness?
Mitch Russo 0:00
So my name is Mitch Russo, and I’m getting started in real estate investing and I came to this conference to learn more about what Jason does after listening to his podcast and loving it for as many months as I have. I figured it was finally time to meet the man behind the voice, and explore his methods for real estate investing, which so far have been fabulous. I love the way he ties information together. I love the way he sources other people to present their way of doing things as well. So for me this conferences eye opening, it’s fascinating, and it will lead me to making much better real estate investment century.
Announcer 0:42
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.
Jason Hartman 1:32
Welcome to Episode 1381 380 and greetings still from beautiful Aspen, Colorado. Sadly, I was just not feeling well enough to go skiing today. really wanted to but you know, hey, I did my speaking engagements. met a lot of great new people on this trip that was awesome but did not get to hit the slopes now. I guess I could go tomorrow, but before I head back to the Sunshine State, so maybe that’ll be possible, but right now, I’m just not feeling like it’s going to happen. Oh, well Oh, well. So today is a 10th episode show and you know what that means? We go off topic, discuss something of general interest every 10th episode. And today it will be that age old question, that question that people without money will always tell you that money doesn’t buy happiness. When someone says that to you, I think you should just simply ask them if poverty buys happiness, and see what they say. See what they say because it’s a fair question, right? Does money buy happiness? Does poverty buy happiness? Does being in the middle buy happiness can happiness be purchased at all can be bought? Probably not, probably not. But it can free us up a little bit. So we have the possibility of happiness. That’s what I’ll say. But today we’re going to have a better expert than myself. And that is our occasional guest on the show, Rabbi Evan Moffitt will be with us. And we will have an excerpt from his live presentation at our last profits in paradise event in beautiful Orlando, from the gorgeous Hyatt Regency Hotel. And so you’ll hear that today when we get to the main portion of the show. But first, let’s talk about one of my favorite subjects, not money and happiness, but inflation and happiness. Well, not inflation and happiness, just inflation and the ability to gripe about it. Okay, so we’ve got the Super Bowl coming up right? What Are the prices of Super Bowl tickets? Are they affected by inflation? It’s a fair question. Now a buddy of mine that was here on the trip left early today. The rest of the group is still here. He left because he was taking his dad to the Super Bowl. And I asked him, I said, How much did you pay for those Super Bowl tickets? We were sitting around a table bunch of people were asking him that question. Looks like he got kind of a deal. Now of course, it depends on where the seats are clearly right. But this is a survey done by ticket IQ. I guess they’re taking average secondary market listing prices of Super Bowl tickets over the last decade over the last 10 years. So what’s that look like folks? Now? One thing you got to consider too. It doesn’t just matter about inflation and ticket prices. It also matters obviously Who’s playing? Right? How interesting is that game going to be? Right? That obviously drives the ticket prices too. But a lot of these people buy these tickets way, way, way in advance before they even know who’s playing. Right. So anyway, you know, for whatever it’s worth, I just thought we would look at inflation in the prices of Super Bowl tickets. So let’s go 2010 the average Super Bowl ticket.
Evan Moffic 5:29
Well,
Jason Hartman 5:30
maybe I should start with 2020. Yeah, I think I’ll go backwards, go down list 2020. If you want to buy a ticket for this game, you’re going to pay an average of 70 $700. I’m going to round off in the interest of saving time. 7700 bucks per ticket. Ooh, that’s a little pricey. Gosh, you buy a couple of those. And you could just put the down payment on a new income property. I think that might be a better deal. You can watch the game at home and you know, get an income property. That’s completely income for life right? 7700 bucks for a single ticket to have you go, you’re paying 15 grand, you can almost buy rental property with that almost 2019 prices were a lot lower 4900 bucks 2018 $4,000 so much lower the two prior years now in 2017. And I don’t remember who was playing or what the big deal about these games was, but you sports fans out there will know I don’t really follow sports that much 50 $400 2016 40 $600 and something amazing happened in 2015 What the heck was going on in 2015 sports fans, go to Jason hartman.com slash ask and give us your opinion on this and tell me what I don’t know because I didn’t have time to look up who was playing each of these years or what the big deal was about the game. But in 2015, the prices were the highest of all So this is clearly not exactly a study and inflation but if you take out 2015 it pretty much follows an inflationary line. So 2015 90 $700 almost 10 grand to those, you’d have the down payment on your income property, which would be much better deal 2014 prices were dramatically lower. In fact, they were about one fourth 2500 bucks 2013 just a little lower 2500 and change but a little lower than the other one I’m rounding 2012 2900 bucks 2011 30 $600 in 2010, the cheapest of all 2300 bucks. So the overall gist of it is that in 2010, you could buy tickets for 20 $300 apiece, and in 2020 you’re going to pay 70 $700 apiece. I know there’s some ups and downs in there which are kind of interesting. Okay, now one more thing before we get to the does my Happiness question which is an age old question. Fannie Mae, Fannie Mae is warning lenders remember Fannie Mae is not a lender, they are a secondary market, the biggest secondary market in the mortgage in the world for mortgages, not just in a country in the world by a huge, huge margin, okay? They are warning their lenders that there is a growing list of fake employers, employers, companies that don’t even exist showing up on mortgage applications. In a housing wire article, the list of fake companies grows to 65. So, you know, what has always amazed me is why would anyone ever bother being a crook, being a crook? I mean, at least this kind of a crook. This takes a lot of thinking to figure this out, you know, to to figure out what you’re going to call your fake company and figure out where it’s going to be located. And how much it’s going to pay you and all this kind of stuff, right? A lot of these crimes, you know, these criminal masterminds that you see profiled on, you know, movies, TV and books, True Crime books, whatever, you know, you’re thinking, all the effort they made, they could have just done it the legit way.
Jason Hartman 9:18
Check this out. It’s really quite interesting. Back in 2018, Fannie Mae issued a warning to lenders After identifying approximately 30 fake companies that were appearing on mortgage applications and documentation as their place of employment. Right. And now that list has grown. So I guess these criminals, they probably have a little private group on social media where, hey, what’s your fake company the week posted up there and we’ll all say we work there together, and we’ll get a we’ll get alone when we shouldn’t get alone, right. It’s truly amazing that people bother with this stuff. Check this out. All of the previously identified fake companies were located in guests Were my former home state, the Socialist Republic of California, and 15 of the new ones. Were also located in California. Now you have to say located in quotes because they weren’t really located anywhere. They didn’t exist. Okay? In total, these 65 while they say now potentially fade companies, right? There are an unknown number of mortgages floating out there in the world loans that were actually made, where people said they worked at these companies check out the names of some of them became a position on East Lowell street in Ontario. Okay, see why pet food located on Boyle Avenue in Los Angeles, galaxies, auto parts and accessories located on stellar drive in Culver City Hey, I used to live in Culver City. When I was kid in Culver City was not a very nice area back then I’ll tell you that gbf freight system located in Bakersfield, and the list just goes on and on. It’s kind of hilarious how legit the sound West LA dental studio located on overland Avenue in Los Angeles. God, I used to ride my bike on overland Avenue. I know exactly where that is. But it’s pretty interesting. Now, this is a sign. Why is this important to us as investors? Well, number one, it’s just interesting. Hey, I think it’s interesting. But it also shows you the potential for another mortgage meltdown, right? This is obviously small, it’s tiny compared to what happened. That kind of sparked the Great Recession. But if there’s rampant fraud in the system, and no one is putting the brakes on the fraud, you’re going to have a disaster, you’re going to have another mortgage meltdown. And also I want to remind you, do not confuse the mortgage meltdown with the Great Recession. This is a two part story. The mortgage meltdown was only part one Okay, and that was not completely different and obviously not completely detached from the overall great recession. But there were many other fraudulent activities, way beyond mortgage lending, going on behind the scenes when they securitize those mortgages. And hey, if you read the book or saw the movie The Big Short, you know what happened? Right or margin call? great movie, you must watch margin call. Okay, go get it. I talked about margin call when I saw it when I lived in Arizona. So yeah, margin calls really, really good. Check that out. And here’s the thing with these fake companies right. Fannie Mae noticed that the series of red flags that popped up in these loan applications were number one, they weren’t third party originated or broker loan origination. In other words, they weren’t made by banks. At the bank, you’re probably not going to have as much fraud unless you’re talking about Wells Fargo Of course because it Wells Fargo there’s a fraud allegation about once a week. Yeah, shame on Wells Fargo, you disgusting company. Hey, shame on Chase Bank to your disgusting and hey, Bank of America. Your hands aren’t so clean either. I can’t think of anything to pick on City Bank right now but I think it’s something will be back to you on that. But just remember what all the bad deeds these companies did in the last 10 years. Anyway, that’s a whole nother story whole nother story, whole nother story, but mostly the fraud comes from the broker network. Okay. These are all loans that were originated between 2015 and today, and the employment or the occupation stated by the borrower did not really coincide with the borrower’s profile like their age or experience. In other words, they were puffing themselves up. They were almost all in California. That’s the Common denominator. And remember, California my home state was ground zero for mortgage fraud, because in Orange County, California, where I lived for the vast majority of my adult life, that was ground zero if you watched any of the documentaries or movies or read any of the articles, you know, that led up to the mortgage crisis in the Great Recession, it was all in Southern California. That’s where it all that’s kind of the genesis of that, that whole market, the borrower’s prior employment shows student so they went from a student to like this high paying job at where they go. West LA dental studio or how about senior home health care located on industrial Boulevard in Victorville? Or how about ideal pro systems on Barnard Avenue in San Jose? Okay, that’s where all of these people work supposedly worked. They notice many things here and I won’t go through them all but One of the things they noticed that was interesting is that the pay stubs supplied as part of the loan application process lacked the typical withholdings for health care, various medical payments, 401k, etc, that a typical pay stub would have on them. So yeah, they’re just you know, Fannie Mae saying, hey, exercise caution. If those loans go bad, you might be buying them back. And remember, that’s the punishment for these brokers and why Be honest ones want to be careful and they don’t want clients that are committing a bunch of fraud because if they are, they might have to buy that loan back if that loan fails to perform, right. And so you know, that can bankrupt a company. Obviously, if you got to buy loans back, I had a couple of different mortgage businesses. They were small, they were not big, big mortgage operations. But the big decision was to go from being a mortgage broker to a mortgage banker, and as a mortgage banker, instead of just brokering alone and getting a fee from the lender you sent the deal to right when the loan was funded. Instead of that you would fund the loan off your own what’s called warehouse line, which was like your own line of credit that might be for, you know, many, many millions of dollars. I mean, these companies have giant warehouse mines. So they would fund the loan and then sell it off, you know, sometimes just in a matter of a couple of days, right? It would happen really quickly. They wouldn’t keep it for very long at all. The danger is if that loan goes bad, and you fund it off that line, man, you’re going to be buying that loan back and think about how much that could cost especially where my company was in Irvine Newport Beach area, those loan amounts could be a million dollars, couple million bucks. You buy a couple of those back, you’re out of business, so so it’s pretty significant, obviously. Okay, let’s get to our attempt show topic and talk about happiness. And here we go with the rabbi.
Evan Moffic 16:58
So what Jason asked me to talk about and what I wrote a book about it was initially and the podcast about is is about happiness and what leads to a meaningful life. So we know if you listen to Jason new follow Jason’s advice and the 10 commandments, you’re going to be wealthy even in the game we played earlier today, the lowest team had extraordinary success. So then, what’s the point of it? Right? we all we all know, it’s great to make money. Right, wonderful. But does that make us happier? And I think that’s an interesting question, because in life, are we just really out to make more money in order to continue to make more money? What do you think? Yes, yes. You know, I mean, it’s, that is, in some ways, how we’re programmed. It’s wonderful to make money. But what I’ve experienced and I’m sure some of you probably I certainly know people that are extraordinarily wealthy, you know, people part of my congregation, just people I’ve met, and I can tell you unequivocally that once you reach a certain level more wealth does not mean more happiness. It’s absolutely true. And so what is it that makes for a happier life. And we’re going to look at that through the lens of both wealth, and just positive psychology. And Jason has interviewed a lot of the top positive psychology people and the world had been on the show. But I’m going to try to kind of break it down into how that really helps us what we can do as income property investors in terms of living a happier life. The first thing is to sort of define what happiness means. Let me ask you what, what is happiness? How would you define it?
Jason Hartman 18:36
What are some age old question? Yeah,
Evan Moffic 18:38
it’s an age old question. What is it?
Evan Moffic 18:41
contribution and growth. That’s great. Other ideas? fulfillment,
Evan Moffic 18:46
right.
Evan Moffic 18:48
carefreeness So kind of a freedom in a way. Yeah.
Evan Moffic 18:53
freedom to choose. That’s right. Now, what’s interesting and what’s wonderful is nobody really said sort of pleasure. So we are Don’t confuse pleasure, sort of hedonism with happiness. And the two are different. The two are different. They each have their place, right? We all know certain things that give us great pleasure, a massage a great meal, you know, you use your own imagination. There’s wonderful things that bring us pleasure. But happiness is something different. Happiness is a sense of contribution of living a life of satisfaction. And there are certain techniques that help us get there. And we’re going to talk about those. But first, I want to address this question as to Is there a connection between wealth and happiness? That’s a very interesting question. Because there are extremes on both sides. There are people who say, the more money you make, the happier you are. Now, there is some truth to that. What the statistics say and this was a 2015 study is that up until $75,000, now it actually is different. In Atlanta. It was $42,000, which seemed a little odd. In New York, it was $120,000 But once you reach that, up until that point, there’s a one to one correlation between, the more money you make, the happier you are. Once you get past that $75,000, they’re still a marginal increase in happiness, up until about $200,000. Once you get to $200,000 a year, there’s annual income. There is no correlation between happiness and more income. And interesting, interesting. So a $200,000. However, that was a 2015 study. But there is another little wrinkle in that a most the most recent study in 2018, which was in Australia, added a new question. And the question was, how satisfied are you with your life on a rating from one to 10, which is a really interesting way of putting it and what they found is that even over $200,000, there’s greater satisfaction up until about $350,000 but correlated as to where you are. So if you live in Orange County, you know if it doesn’t work, it’s okay. Okay.
Evan Moffic 21:08
Okay, so if you’re in a place like Orange County, Orange County, California, expensive Orange County, I’ve been rich I’ve been poor riches betters, we’ll get to that we’ll get to the Orange County, California. If you live there, or some other wealthy area, you actually are continually marginally happier with more income because we’re comparing ourselves to other people, we human beings, we are absolutely always comparing ourselves. So, you know, there’s a great joke about happiness and say, you know, if you make more money than your brother in law, you’re happier. But But you know, but but the idea is that, you know, it’s a comparison that we are we are comparing ourselves to others that’s, and so even over $200,000 if we make $250,000 and we work at the same company and our neighbor who works at the company makes $300,000 we may be margin less happy. And that was answered on this life satisfaction survey. So there is some connection between wealth and happiness. Yeah, up into a point, there’s a one to one correlation to about $75,000, then diminishing returns, it stops at about 200,000 a year. But how satisfied are you with your life? So the comparison if you make $200,000, your neighbor x $350,000, you may feel better making more. But as Jason often talks about, there’s a difference. Money is currency. And there are different forms of currency. And I would argue that happiness is a kind of currency. If you are making a contribution with your job, and you’re getting that satisfaction, you are actually happier, even if you’re making, let’s say, less money than your neighbor. So to keep on the question of money and happiness, if we’re making a lot of money, how we spend it makes us happier, right? I mean, so what kinds of spending actually increase our happiness these are all according to studies, spending money on other people, generosity that absolutely makes us happier all the time. I mean, there’s no question, meaningful experiences. Now that that’s a very interesting studies say, experiences, we’ve all been said, spending money on experiences is better than buying things. But experiences are different for people. So for some people could be a new car, for some people could be a safari for another person could be starting a charity. So these are a great trip. So experiences make us happier. Also convenience, right traveling first class Well, it’s it’s much better, you know, it’s actually kind of bad to travel first class because then you really like it, then you want to spend more money to do it. But if you can afford it, it’s better. Personal Development, learning, spending money on conferences like this improves our happiness. And then the New York Times just a couple weeks ago, had a fascinating article. The headline was, Why do rich people keep working as everyone here heard of the fire movement, you know, financial independence, retire early, you probably heard of that. It’s really not that accurate because a lot of people once they make a lot of money, I’ve seen it with people who retire early. There’s a whole group in my community called men enjoying leisure. And a lot of these guys sold their businesses when they were in their 50s in their 60s, and they’re just looking for things to do. It’s really, it’s really interesting. And they generally are unhappy accomplishment when we are successful at doing certain things. And we can continue to do them even if we don’t need to. We’re happier. We feel like we’re contributing something to the world. That goes back. This model of perma. So perma is this guy, Martin Seligman. He’s one of the most famous psychologists in the world. And he said, he had been a practicing psychologist, he actually did the studies that talked about learned helplessness. And what this was was if you have a dog and you have, say, one of those electronic fences, and you install that and the dog gets shocked because of the color they’re wearing, well After a couple days, you could take that collar off. And the dog still won’t go past where they were shocked, because they’ve learned that they can’t do that. And what Seligman discovered is a lot of human beings are like that. If we experience failure after failure, then we feel like we can’t achieve more. So he was very famous for he did a study in the 1960s that talked about this phenomenon. But then in the 1990s, he said, you know, psychology has focused so much on what’s wrong with people. Why don’t we focus on what’s right with people? And then he asked the question, Freud, who sort of discovered modern psychiatry said, the whole point of psychotherapy was to turn neurotic misery into ordinary unhappiness, which is actually not that great a goal. So Seligman said, let’s actually say what actually leads to a happy life. And he came up with this framework, which is just so great, that perma, so these five things, positive emotions, so smiling, having fun, listening to music, these kind of things make us happier. The second is engagement. When we’re engaged with something that’s meaningful, so that could be volunteering for a school, a church, being part of a community, very important. The third is relationships. This has been proven over and over again that relationships really matter so much there’s, there was a study having somebody that you could call at two in the morning, for any reason that would answer your call, having a few of those people in your life actually correlates with happiness. And very interesting what the study found is that women tend to have way more of those kinds of friends than men, which is very interesting. So meaningful relationships contributes to happiness, for his meaning and purpose. That means that we’re living for something bigger than ourselves. That’s where religion really comes in. So of course, I’m a rabbi having having a sense that our lives are part of something bigger than ourselves. But it doesn’t just have to be religion. It can be a community, a place that we really care about. It could be a team, even something bigger than ourselves. That we feel a connection to having a kind of purpose for what we’re doing. And then the fifth is accomplishment. And that, by the way is not just professional, that could be a sport. There’s taking up a sport, learning how to play tennis as we get older or golf or learning a new language, that sense of accomplishment contributes to our happiness. So this perma is a really good clue for how we can live a happier life. I love this quote. And I just found it on a random YouTube video Money can’t buy happiness, but it does put a nice down payment on it. And this is I just took this because Jason often talks about Denis waitley happiness is when what you think what you say and what you do are in harmony. Love that. So since I’m a rabbi, and Jason said I was giving a sermon is money and spirituality. Now this is where, you know, we hear a lot of news about capitalism, socialism. I’m a believer, and I know Jason is and I think we hear on people on the podcast, that capitalism is actually so good for society. And this is a rabbi that I read a lot, Daniel Lapin, and he said wealth is God’s way of incentivizing you to do exactly what he wants you to do, which is to care obsessive Lee about satisfying the needs and desires of his other children. So essentially, when you do a service for somebody, when you provide housing for somebody, you are doing something for somebody else, you’re playing clean, safe, affordable housing, talk the podcast recently about, you know, my daughter has a math tutor, which is expensive, I pay that math tutor, but I am grateful because she is providing a service. So capitalism actually incentivizes us to, to serve others. There is actually a religious dimension to capitalism, and the spiritual material. We talk about these as separate realms. One of the things in Judaism is that they’re not that everything is connected. You know, there is this kind of myth that poverty is good. And it makes us holier, you know, we have in Christianity there are monks that that they take a vow of poverty so my good friends who are priests have taken a vow of poverty. But one of the interesting things about Judaism is that’s never been a part of it. And I would say it’s not really a legitimate part of religion because the famous quote from the Gospel says love of money is the root of all evil, not money itself. Money isn’t the root of all evil, but love of money, essentially, when we make it an idol. When we make getting more and more and more without a bigger picture, when we do that, then we’re unhappy and that’s idolatrous. So, so grateful to be here. And thank you Jason for the invitation.
Jason Hartman 29:32
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