Principles Drive Strategy, Tactics, and What You Buy

Curtis May teaches principles-based planning, which can be helpful to every real estate agent and business owner. He teaches a specific framework: to first outline your principles.

“Principles drive strategy,” said Curtis. “What you do in strategy drives tactics – what you buy. Most people are operating without principles.”

“Everybody wants to start with investing,” he said. “But the financial plan precedes the investment plan, What is it that you want? And why? And then what are you trying to achieve?”

“The first principle is to save,” said Curtis. “Save – we say 15 to 20% of your gross income.” 

“You have to save so you have money to invest,” he said. 

The second principle he teaches is maximum protection. 

“You have to play defense. Defense wins championships.” he said. “So that's looking at your auto, your home, your liability limit, your umbrella policies. Do you know what happens if you can't work? Do you have disability insurance? Do you have proper medical insurance? Do you have your power of attorney and your health care directive? Do you have a trust? Do you have an asset protection trust? Are you adequately insured, which is life insurance.”

Another one of the principles he teaches is focusing on cash flow – buying and building assets that send you a check every month.

After establishing one’s principles, Curtis then teaches two strategies. One is called Cash Flow mapping and the other is Infinite Banking.

“But what precedes IBC is a savings strategy and a system to manage cash flow and run your personal economy like a bank,” said Curtis.

He also differentiates the types of cash flow you should have. He believes you need two weeks in physical cash, “like in your mattress,” he said – in an emergency, such as if the power goes out and you can’t access your bank account. 

The next area of cash flow is about a month of liquidity in the bank, which he calls “ATM money, personal and business.” 

The third area is to have over $5,000 or $10,000 stored in properly structured life insurance – which has the benefit of being liquified in a matter of days, if needed, and can also serve as an asset that can help when applying for a loan towards a real estate investment. 

“I don't try to tell people what to invest in because, first of all, investing is not about buying something. It's about becoming something,” said Curtis. “So you have to become a good broker agent. You have to become a good real estate investor. How do you do that? You have to study, you have to learn stuff, you need mentors.”

Most people are chasing investments,” he said. “I think the key to wealth is finding better investments that pay a greater rate of return. But usually, you have to take more risks to do that and risk means probability of loss – it doesn’t mean opportunity for gain. And so what you do is we start with the basics. So if you're going to create maximum wealth, you have to create maximum efficiency.”

“There are six ways people lose money,” said Curtis. “Number one: how people manage cash flow. That is why he teaches Cash Flow mapping and the different types of savings and investment buckets to put that cash flow in.

Curtis believes that as a business owner your number one investment is your business or businesses. Properly managing cash flow and investments should help you be properly structured to keep reinvesting in your business so you can continue to grow.

He believes each person should focus on what they do best, work hard, continue to get better at their craft, save money, and invest it back into their business – the most important investment they can make.

To watch or listen to Dan Lesniak’s full conversation with Curtis May, check out Episode 391 of the HyperFast Agent podcast.