Gym Bro Is Going To Die In Poverty | Financial Audit

Hey, my name's Osse. I'm based out of. the Dallas area. I am 29 years old and. this is financial audit. What do you do in Dallas for a living? I'm actually a personal trainer. So, I. just about last year started my gym. It's actually a fitness minded. Oh, so. you have a gym? Yeah. If it was based in. Austin, I need to go because I need to. go. So, you know, I mean Hey, we'll be. happy to help you out anyway we can. Yeah, but that's pretty sweet. So, how. long has this gym been open? Just Well, we signed the lease about a year ago.

Mhm. But officially open, I would say. probably like. 6 9 months, roughly. How much money did. you put in this thing? Oh, man. I think right now it's it's kind of hard. to say because. A lot of it's debt. Huh? A lot of it's. debt. All of it's debt. Yeah. All of it's debt? You didn't save up any. money to put into this thing? No. way to open a business, but go ahead. Yeah, I mean, honestly, in hindsight, you know, I do wish I do think that's. something I should have probably taken. care of before I actually started. I.

feel like I would have probably been way. better off. Um, but I was just so eager and when the. opportunity came, you know, I just I. felt the need to jump at it and. How did the opportunity come? What do you mean? So, one of my clients, uh, he's I've been training him for like. 2 3 years now and of course all he hears. me talking about is how I want to open. up this gym. And he kept, uh, hearing about these. struggles that once again, in hindsight. now I feel like it was just things that. I needed to to solve, but um, I feel. like these were speed bumps I couldn't. get past and I don't know, he just he.

was being nice and he said, "You know. what? Well, I'll loan you the money to. help you get the gym started.". Oh, he loaned you the money, but you. also have like so much credit card debt. and stuff as well. Okay. So, I yeah, we'll definitely get into that. So, that. happened a little bit after the fact. Oh, jeez. Okay. So, Wow. So, there's a lot to dig into here. I want. to hear from. your perspective, how's your financial situation right now. and then give yourself a score zero out. of 10. Uh so I'm going to be completely honest.

It It is pretty bad. Uh it's not good. I would say from one. out of 10, I'm probably like a. probably out of four and slowly I would. say declining if I don't do something. about it. And then your business, how's your. business health and finances and give it. a score as well. I guess I I see I have. the bad habit of merging the two. You've. merged it? So that I kind of that one's probably. the same as well. So let's talk about. some income. What are you bringing home. on average on a monthly basis into your. own pocket? What It's hard to say because I just.

there's so merged. I It's I do a. horrible job of keeping it separate. Oh, you got to keep it separate, man, especially for taxes and everything. Yeah, when that's that's a tricky part. When it comes to doing taxes, I. basically it takes me a long time. because now I have to like go, you know, statement by statement and looking at. all the numbers. All right. How much money does your. business bring in? So right now on average we're bringing. in about uh 10k a month. A month? Mhm. That's. in total? Roughly, yeah. Now after expenses, what is that looking.

like? To be honest, I haven't done the math. Dude, you've been in business for a year. but you don't know what your. Yeah, now I realize I have a. probably got a problem that is actually. Yeah. Now you're realizing that? How now? Woah. woah woah woah woah. Okay. All right. Well, I have this is a business. I have. overhead. I have a full-time employee. I. have contracted things out. I'm bringing. out a second full-time employee. I know my numbers. I wouldn't be able to survive if I. didn't know my numbers. Yeah. You don't.

know your numbers? No, you're right. I. definitely should. Are you in the green or the red? Um. On a monthly basis. Do you at least know that, please? No, I. am uh slightly in the red. Slightly? I would yeah, very slightly. it cost to run your business on a. monthly basis? I would say about right. now is cost about two grand, roughly. A. month? A month, without. and that's only because I have a I still.

have a beta's lease going on. What Okay, before we dive in we I I need. to I need to understand more about this. before we even dive into things. Let's. talk about your overhead expenses. You. bring in $10,000 a month, what's your. rent? My rent right now is 1,600 a. month. Okay, for the business location? Yes. Not bad. Only only right now. It's and it's going to go up very soon. It's going to go up in June and that's. the beta's lease. June's next month. To what? July, I'm sorry. Okay, to what? About.

um. uh 4,600. What the. Why? So, that's basically the in the. area that I'm in that is basically the. the cost per square foot. low? Cuz that's the beta's lease. So, I. negotiated a 6-month beta's lease. Uh. So, then for the first 6 months kind of. give you a little bit to to help you out. a little bit, get you up and running, you're only paying the triple net. Do. you have employees?

Uh currently just my girlfriend. She's. also. What do you pay her? So, right now. uh she keeps about 60% commission. 60% commission? Mhm. Okay. Okay. So, how much money does she bring. in then for the business? Uh 4,500. 4,500? But, once again so. $2,700 a month. I want to take a brief. moment to thank today's episode sponsor. Kudos. Be warned, this sponsorship is. for credit card people. If you are not a. credit card person like many people in.

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going to join.kudos.com/caleb. The future will thank you later. With. her since we live together and we run it. together, a lot of our finances are also. intertwined. So like this just kind of. that's the number on paper, but in. reality, I mean if we need more for. whatever reason, we kind of just merge. the our finances. Dude, you're kicking this thing off with. a. bang. Oh, okay. Equipment, how much do you put aside for.

equipment on a monthly basis? What do. you spend on equipment? Uh equipment, zero right now. Good. Well, except except for the loan that I. do have on what's called the inbody. body scanner. So that's one of the loans. that I sent you over. Woah, I think I've had someone on the. show who was getting one of those. Mhm. Dude, it's like it does like very. detailed like body fat percentages, right? And stuff? Uh yeah, it does Yeah, I wouldn't Yeah, you could say that. I think Okay, what is that monthly. payment?

That one is about 160. A month? Yeah. Okay. Uh now stuff like cleaning. supplies and crap like that, you. probably don't even know, but what do. you think that is a monthly basis? Uh. yeah, man, I do horrible with. accounting. Electricity and water? Yeah, so electricity, uh I'm looking at. roughly about. 150 to 200 a month. Okay. Um water is included into the triple. nets. So that's just all what I'm paying. right now in my in my lease. Um internet, it's about 80.

Um. and then uh I have a Pandora. subscription. Uh that one is just so I play music in. the the without the How much? That one I believe is about 10 a month. Okay. And. um What other business expenses do you. have in a month? Insurances? Do you have. insurances? Not right now, but I should definitely. get it. You should. What if someone gets hurt in. your gym, dude? Yeah, I definitely. should. Definitely be getting. Yeah, that should be emergency number.

one immediately now. Does. uh. signing an a. waiver does that cover that at all? I. know I need to get insurance regardless, but just curious. I'm not an expert on that, but I would. always have insurance with some kind of. businesses with some umbrella maybe. something. Either way. Um but yes, a waiver is probably a very. important aspect of that as well. It's. always good to get some kind of legal. advice of which I am not that mind, but. uh definitely always good to get some. advice and it's worth that little.

upfront cost 300 bucks whatever it might. be to save thousands, tens of thousands. dollars down the road. What uh what else. do you have on a monthly basis for your. business? Well, right now, of course, the credit. card debt, the business credit card. debt. Um that one right now I am under a like. special program that they have which is. basically just reduced interest and a. reduced monthly payments to help you. chip at it. And that one's roughly about. 370 a month. 370? Yeah, that's.

That's dude. Okay, and you took out a personal loan. from this dude, right? Yes, that it took. out. What's his minimum monthly payment? That. one I believe is 170. How much did you borrow from him? Oh wait, you're talking about uh the. personal Oh, no, so I did take out. another personal loan. And that was a while back. Um but now if Didn't a guy lend you. money for this thing? Yes, that one he. lent me 50k. And how much do you pay him.

on a monthly basis? So technically I'm. paying him about 1,360. a month, but it's doing an of services. So I train him and his wife three times. a week, and that's basically how I pay. him. you bring in, is that after that or is. that before that? Is that calculated. into your $10,000 a month? calculated inside the $10,000 a month. Okay, so we're deleting that. Yeah. All right, anything else you can think. of, dude? Um Cuz I need to get any kind of insight. in here to calculate anything.

Trying to think. Um. Going to give you I'm going to I mean, you buy. rags and wipes and cleaning supplies and. crap, right? I do, but it's not as much as you would. think. It's very I mean, I haven't. not going to make it cost a ton, but you. do. I so, I don't think I bought any since we I. mean, I bought in bulk when I when I. first opened it up, and I don't think I. bought any since. Yeah. Clean supplies? Yeah. Do you have. cleaners? No, we clean ourselves. Okay.

I'm just going to say $50 a month on. average. When you run out of that stuff. Okay. Which I think is quite quite quite. conservative. That is $6,520. Man, I'm going to get roasted in the. comments. $3,480. should be left. And then, yeah, just. living expenses is what eats away at the. rest. So, that should be able to take to you, and then you set aside money for taxes. You want to sit down with the.

tax expert for business taxes and your. own taxes anyway, but are you have an. LLC set up? Yeah, I do. Good. Is money essentially. being sent into there, expenses coming. out through there, and then money. leaving there to you. from what's left? No, that's a great idea, though. Yeah. Did you talk to anyone about how to do. any of this when you did this? No, and. that's probably why it's all messed up. you talk to anyone or at least look up. stuff or like take a class or anything? Uh you You what, to be honest, I guess I.

just. I figured out I figured I would be able. to figure it out, which obviously I'm. not doing the best job at it. But you say you're in the red. There. should be an additional $3,480 a month. How How would you be in the red? On a monthly basis. I get because I'm. I'm I'm Like I said, my. my finances are so merged. I'm just like. taking into account also personal. finances into that. Yeah, personal. spending into that as well. Okay. I can't think of a good segue, but you. should subscribe cuz we're trying. to get to 500,000 subscribers. Thank you.

to everyone who has subscribed so far. All right. You're stressing me out real quick. Real quick. I'm stressing myself out. Yeah, I bet, dude. I I don't know how you're. sleeping, to be honest. Let's start with your debts. Let's see. where things are at. So, this is Blue. Cash Preferred from American Express. New Balance. $4,898. 59 cents.

Okay. With this $86 minimum monthly payment, and you are losing $33.41. in interest on a monthly basis. Okay. Okay. You paid off $86. It's good, but then you purchased $55.58. If we have I assume you would like to. pay off the debt, right? Yeah, absolutely. Then why the are. you possibly purchasing on it? I had no. idea. I don't even know what it is, to.

be honest. It might be. fact, you purchase on all the cards. By. the way, we've looked into it. So, don't. be too surprised with this. You purchase. on every single one. I thought, to be. honest, I had canceled everything that I. was on that card, and I guess I just I. assumed that it was all canceled. I. didn't check. But yeah, my goal has been. to not use them anymore. Why are you and your girlfriend both on. this card? That shouldn't be a thing if. it's a girlfriend, not wife. So, the idea was to help her build. credit cuz at the time when I got that. credit card, we were actually using it.

responsibly. And the reason the way that that. accumulated was after we got the gym. What did you do before the gym? I was also personal trainer, but I was. independent. So, I just basically. making more money, aren't you? Oh, yeah. Yeah. I was definitely not even close to this. much in debt. It was It's only happened. after I opened up the gym. You got some. Audible, some digital goods, NFL app type stuff. Oh, I canceled that. I got. Sounds. Well, I would go check on that. and challenge it. Yeah. Then you also have some AAA Texas. insurance through there. Okay. Total.

interest charged so far in 2023, $400. $9.82. from one card. One card and I'm even. halfway through the year yet, my dude. One of your stupid debts. Oh, man, that. hurt. Dumb. Now, we have Blue Business. So, this is. business. That's the business. The other one was personal, correct?

Yes. This one's business. We have a new. balance. of. $12,691. Now, minimum monthly payment, $371, which is absolutely disgusting. $81.47. of interest was accrued within the. month. You paid $371. Good, I'm happy with. that. But then you still purchased $40. And I don't know how cuz after $40 and. the interest, you are $691.

above the credit limit. Above the death. credit limit death. This is crap. Yeah. Why are you possibly purchasing on. something that's above the credit card. limit? You want to be successful in this. business. I want you to be successful. But what is the idea behind this? Where. is the mentality? Uh to be honest, I'm sure it's just not. paying enough attention to where the. current where where it was at the time. I've currently tried not to use it, so I. assumed I'd canceled everything on it.

without even checking, so. Well, you. know where this business credit card. went to? Two record stores and Disney. Plus. Okay, that's probably not me. Well, you should probably think about. that. Think about how this card is used, cuz that's a business card and I don't. think those are business expenses, my. dude. That's definitely not. Yeah. And guess what? Not even a half a year done yet, $1,112.42. in interest gone. Taken from you,

squeezed from your business that is. barely making money. At least according to you. It should be generating at least $3,480. of profit. I don't know. Now, I don't know what the. this is. What is this? What is this crap? Oh, so I just sent you I didn't even. look at it myself. So, this is for the. InBody. Um, which is basically. Total amount financed $6,260. Do you. know how much is left on it or is that. how much is left on it? Cuz this is hard. to see. I didn't know this was like your.

agreement. How much is left on it? Um. you get it? I got it in uh, May of last. year and I've been paying it since, so. basically I'm at a year now. I'm going to guess it's around 5,000. 2,260, we'll say. And what's the thing called? InBody. Huh, dude. Okay. So, I'm guessing it's. about 5,260 now. Maybe. With a $99.37.

and a monthly payment and I don't know. what the interest is that's been accrued. on this. I don't know what's going on. I. don't know the interest rate. I know. nothing. There's no interest on that. It's a 0% interest all the way through? If you do minimum monthly payment, it. will be 0% all the way through? Mhm. Okay. Now, why'd you take out an Upstart. loan? Um. So, yeah, that that one I had I took it. out because. um. the lease was about to start and at the.

time I didn't have any money to first. pay my first month's rent. Then you don't open the. business. At that point I already had signed the. lease. At that if but you still signed. it. Why did you sign it? Well, when I. signed the lease, of course I had the. funds and the funds Where'd they go? So, what happened is when I first signed the. lease, I signed it in. uh May and with the promise from. the land the property manager that.

basically everything that needed to be. done with the space would be done within. a month. So, I took that month off from. training and started getting the gym. ready. So, as soon as the month was up, I can hit the ground running and start. training all that good stuff. But, they hired a contractor that she. contractor was trying to install an. electrical panel without getting any. kind of uh permits. Uh I did not know this. I got the CO to. come and check out the place. He saw. that the electrical panel was being. installed. Uh the CO inspector's a. certificate of occupancy. But, you. started this without an emergency fund.

either way with all the. always happens when starting businesses, getting a house, or anything. Doesn't. matter because you don't do it until you. have a fully funded emergency fund. Makes sense. What's the minimum monthly payment on. this thing though? Uh that one's uh. What is it? 100 and I think. Upstart Man, I forgot I forgot it. Dude, you don't even know what you owe. on a monthly basis. Um I just forgot. I do know. Well, I. used to know. I don't know right now.

That one's is high interest. That one's. like 30%. Yeah, it's 30 death percent. Absolutely. Haven't even gotten there yet. But, what's the minimum monthly payment on. this thing? Oh, man. We can't budget you. out if you don't even know your minimum. monthly payment? Maybe it's in the checking account. I'm. probably Yeah, definitely should be. That's insane. 30% you signed up for? 30% and yet you didn't just go crazy on. paying that off? You know, that was the idea when I got. it and I thought it would be much easier.

to get there, but my current struggle. has just been finding a trainer. When. did you get it? Uh You don't need to. hire a trainer. Well, yeah, I thought I. would be able to do that. Are you having business that is unable. to be met? Yes. How much? Well, it varies, but it's about two to. three leads per month. So, like two to three like leads are, you know, just people who sign up they. want an assessment done and then once. they come in do the assessment then we. Only two to three people a month? I. guess I don't know the personal training.

business, but. We're not too big right now and two to. three, I mean, one person can be, you. know, from it could be a thousand or as. low. Okay, what are you going to pay them as. a base salary? So, they're going to be. paid a 40% rate and the reason I'm. trying to do that is to be Commission. only? I'm good with the commission, but. no base? No, no base. It's commission. only. Okay. Okay, that's fine. Okay, that might be might be worth it, but I. would rather you and your girlfriend. work as many people as you can I'm kind. of I'm maxed out already uh with my.

time. Is she as well? And she's she's. she's getting close. No, put these. people to them. The moment that you guys. are incapable incapable of working any. other second, then you can bring out. someone. Until then, everything should be capped within. The. downside is a lot of people want the. same times. and so in those peak hours she's booked. Yeah. And I'm completely booked. If it's. commission only, it's it's not bad, but. I'd rather you do as much as you can, but. That's kind of commission only. That was.

the idea of the loan, too, because at. that time I did have a trainer. And I. did, but the terms I was very stupid. with the way I set up the terms and when. I tried to reverse those terms, I don't. even want to get into the terms. But. when I tried to reverse the terms, of course, he didn't like that. What. were the terms? Uh it was just a very. unfavorable on my end just because I saw. him Well, he was basically a friend at. that point and. What was his commission? His commission was the same as hers, which was like a 60/40. I keep 40, you. keep 60. But the with the unfair part, because I was trying to help him out, I.

would say that I think it was about a. thousand only after he got to a a pass. of that I think 2,000 actually it was. That he would I'll start charging him. commission. And of course, it was like he never really got past. that 2,000. And so I when I tried to. reverse that and say, "Okay, I got to. start charging you commission on these. people that I've given you, um otherwise. I'm not going to be able to stay. afloat." Of course, he didn't like that. And also, I didn't like the way he was. training either and he was missing. sessions once in a while and he's would.

show up late once in a while, so I had. to let him go. No, I'd fire him for. that, but. Okay. So, we have a checking account. This is a checking account. This isn't a. business. This is a personal checking. account. Started with $30. Are you sure that's not a business? I. thought that was a business. Oh, it is a business. You're right. I. apologize. Uh thank you. To be honest, it's all the same to me. with $30 though. That number hasn't. changed. Yeah. Ended with $1,239. That's. good. That's good.

In here, is this a lot of Zelles in from. yourself? Looks like. No, they're from. clients. Um that's kind of the the main. way I charge right now, which is. definitely got to change. is. you. Okay, well, you did Zelle. Okay. Yeah, that is you. Okay. So, there were. a couple Zelles from you though, unless. I'm assuming. Zelles. Cuz usually I Zelle out, but not. typically in to that account. Nope,

that's you. First and last name. confirmed. But, yep. Do you mind if I check? Sure. Hm. Yeah, that's strange. There's a couple. there, but there's like a thesis from a. client. And that one's from a client. So, we got some clients. And then we got. some other deposits and cash deposits. and mostly sales. And then some. QuickBooks as well. So, the business account it must be. fully You said you don't get anything. for the gym. Well, we don't need to get. any equipment We don't need to get any.

cleaning supplies anymore, but I'm. seeing Amazon, Amazon, Amazon. Oh, that's Amazon. Amazon, okay. Amazon and Amazon. That's. fair. Amazon, Amazon, Amazon. So, what the No, those are That has been. gym equipment and I did forget about. that. So, recently we have been getting. like little stuff here and there. Well, little stuff is stacking up. Little. stuff. 1 2 3 4. 5 6 7 8 9. little stuff. And they're not cheap little stuff. either. Then we're also getting Chipotle. and G Suite and G Suite and Thumbtack.

and The G Suite is for the like. what it's for. Okay. And Golden Chick. and. and then Chipotle and Chipotle and. RaceTrac and Firehouse Subs and pizza. and Prime Video, 7 Mile Cafe, Capital. Solutions. So, that's by the way. that's the InBody. And that makes sense. That makes sense. Okay. PT Minder. So, that's for with my.

session tracking. Hulu. Is that for your. session tracking? That is not. RaceTrac, PlayStation Network on the. business account. I honestly I forgot that that was on. there. I canceled that already. Adobe, Thumbtack, Prime Video, more. Amazon, RaceTrac, more Amazon, Kindle, Prime Video. So, multiple Prime Video. things. LinkedIn ads, that makes sense. now. Pandora. and yeah, we already talked about that. And Amazon again and Canva and. Thumbtack, Prime Video again. Three.

times Prime Video and then one, two, three more Amazon. So, we're up to like. what? 15, 16, 17 Amazons now? Never buy. equipment, never buy supplies. Okay. Mhm. Gardens Valley and Shopify. Shopify, that's fair. But all that other. crap, okay. Thumbtack, by the way, that. was. Yeah, that I I don't know what I I I. swear I could have canceled that. Uh. Thumbtack Uh that's for marketing. So, that's how I get. That's how I get some leads for for. personal training. So, Thumbtack is a uh.

it's a website. So, if you go on there. and I. hire people, yeah. Yeah, exactly. tasks. Yeah, exactly. So, you're putting. ads on there? No, every time I get a. lead, so they don't charge the the of. course the customer, they charge me. So, every time someone says I want a. personal trainer and they say, "Okay, you know, Fitness Minded looks like a. good. Oh, you can do that on Thumbtack? Okay, I. they charge me. Okay. That's okay. That's okay. But then an overdraft an overdraft fee. We're spending so much money that we're. getting an overdraft fee cuz you're.

overdrafting. Why are we possibly getting Chipotle. that many times, doing all those Prime. Videos and stupid eating out and getting. coffee if we can't even afford to have. the money in our account? If we can't. even have the money in our account, how. are we expected to survive? What's the idea behind it? Why are we. doing this? Why are we spending this. much crap on crap if we're overdrafting. and we're not paying off debts quicker? It is definitely an excuse. So, the. Chipotle situation is uh our commute is.

super long. So, typically um when we're. about to move, but so it takes us 30. minutes to get there. I train 4, 5. hours. 30 minutes is a long commute. Well, and. then 45 minutes on the way back with. traffic. We do that twice a day. So, then we come back, we end up sitting. down, um. we end up working for a few hours. By. the time I look at my watch, I got to go. back already. So, then in order to beat. traffic is, you know, something that. takes me an hour during my. every other fitness person in the world. does. Meal. yeah, that's what I said. It is It is an. excuse. Yeah, it's an excuse. So, it's. it's dumb.

You can't pay off crap. I'm good with. taking advantage of things for tax. deductions, but you can't even pay off. the debts you have. You can't You're. overdrafting on the checking. We're not. doing that crap anymore. That's stupid. Overdrafting, jeez. And other things are uh. paying the cards and. Zelle payments to yourself again. I. mean, you're doing those are. withdrawals. Zelle payments to yourself. Zelle payments to girlfriend. Zelle payments to self.

So, do you have a personal checking. account on top of this? Mhm. Is that one. of the things you sent me? Yeah, it's. They weren't statements. Yeah. I had a hard time getting the statement. for that one, but it's like basically an. Excel sheet that just has the same. thing, all the. charges. Okay, beginning balance, $66. What do we I'm running balance, $21 is. what we ended with. That's I mean, I hope you don't run into. anything cuz you'll overdraft on there. as well. Maybe you did.

I mean, you. Not yet. No, not yet. Yeah, you're very. close. Zelling. Keep the change transfer. More Chipotle. LA Fitness, why don't you work out your. at your own damn gym? I've been meaning. to cancel that. I don't even. Cancel that. Yeah, I haven't even gone there in I. don't know how long. Lots of Zelling, more Chipotle, and more. Chipotle. What is RaceTrac? My goodness, it's every second of your life. That's gas. Gas, we're okay with. Okay, I've just. never heard of that place. Oh, thank goodness, cuz that pops up.

everywhere. So, every time I said. RaceTrac before, that's actually okay. We're chilling. I put that on your business account, though. Yeah. Well, uh depends on the community. Well, we'll. have to figure it out. Sit down with a. CPA, see what's tax deductible. Keep the change and then Spectrum. internet. So, right now this is an. absolute disaster. Then what is this? What is this? Business loan is this. These are the PT sessions. Okay, I see how you're doing the math. Yeah, that's just a simple like little. Excel sheet there. So, what if they stop doing the PT?

Uh so. uh they would. kind of agreed not to. Like forever? Not. forever, just of course until the loan. is paid off and they've kind of do enjoy. Yeah, they do enjoy the personal. training. I mean, we're we're very. close. Uh I was over at their house for. Thanksgiving. So, it's something that. they see the value in. That at least. this is what they've told me, that they. see the value in. They see themselves. doing this for a very long time and. they're very well off, so it's not. anything that would like. uh financially strain them.

a year, looks like. Roughly, yeah. So, personal loan. we're sitting at 35,400. No interest? No interest. Good. And it looks like they do it once a. month-ish, right? Yeah, they get uh they each get 12. sessions once a month uh once a month. Roughly. So, if they don't take trips or. something like that. So, it's both of them. Yeah. You're getting. 12. So,

why do quick math when calculator. exists? 1320? Yeah, 1320. Oh, yeah, we already said. that earlier, didn't we? So, 1320 a. month. is the payment, but it's what's being. taken away from you. Well, it's being. taken away from you, so it's still an. important thing. Rather than charge for. that. So, you can start putting that towards. things, but it's 0%. and it's a interesting situation. Okay. Any other debt?

No. No car payment, nothing like that. So, your car is paid off? What's your. car? It's a 2014 Kia Optima. Okay. No other. income sources either? This is kind of. it right now? Yeah. Okay, so. I'm with the money you spent on Amazon, is all that for the gym honestly, honestly? To be honest, yeah. And all 100%. necessary? Um. I mean, I get Yeah, we could probably. train without it. So, not 100%.

but. I don't know what it is. I have no. insight into it. I want to give you a. part of that budget for your business. budget to do the stuff. I want to know. what you need. How much do you need? You. said nothing at first. You already. bought everything and then we saw you. spent hundreds and hundreds of dollars. So, what do you need? What can we. allocate to your business on a monthly. basis? For See, this for equipments, um Just the stuff you get on Amazon cuz. I don't even know what it is. I mean, I. could Let me try to look into it real. quick. Let me tell you. Sure. Let me see.

Now, some stuff uh. my girlfriend gets in my since my. account is on there, she forgets to. switch it over to her card. That has to be a requirement from now. on. We need to separate these things. Yeah. Separate these things now. And the business stuff is going through. your business account. So, that is the. business. So, you said you weren't doing that. earlier but you are. So, it's a little. funny but I think a big part of the. Amazon transactions are probably stuff. that. my girlfriend gets and forgets to switch.

the card over to hers. Um but so, something that I the stuff. that I've gotten for the business is. like I got a little mic to be able to do. content. uh inside the gym. So, I do want to. start doing more uh start doing YouTube. content and do more social media content. to help with the you know, promote the. gym. Um then I got uh like a medicine ball, like a 15-lb medicine ball, uh some sliders which is something that. you put like on the turf to kind of on. your feet that you stand on to help you. know, slide and do some exercises.

Uh some lifting straps. So, those are. for some clients that. Okay, so there's stuff to get. There's. stuff to get. Allocate for me a. reasonable amount of money that we are. budgeting into the business on a monthly. basis for this crap. $200 a month? Does that sound. reasonable? that sounds reasonable. Yeah, more than. reasonable. Just cuz I think the. only thing that we have to get on a like. reoccurring is going to be. um. like the paper towels for the restroom. Uh. That's included in this 200, right?

Yeah. Yeah, uh toilet paper, of course. That brings your soap business budget. budg- well, sh-. cuz it's about to just get destroyed. in July. Damn it. Okay. That's kind of why I'm also in a hurry. to get more trainers to try to get also, you know, Cuz okay, you bring in $10,000. a month. You right now spend 670, but. that's about to go from 670. to 9,670,

meaning. on the edge, if you follow your business. budget 100%. of which we laid out at the beginning of. the episode, you'd only be walking away with a few. hundred bucks. You can't live off of that. I I assume. you have a rent. Yeah. Oh. The good news is that's going to. decrease. I was just paying a little too. much. There's not even a point of like. um. Oh jeez. There's not even a point of. like.

starting to build out a budget for like. the low rent thing cuz that's only a. month. It's only a month. Mhm. I mean, uh. do you have savings on the side? Uh no. Okay. So, through the end of this month. and then through next month, what I. would do to start preparing, man, that. 3,200. or whatever that should come into your. account cuz you're going to follow this. business Okay, rent again, we're going. to do this again. Rent 1,600, uh paid. your girlfriend from the $10,000 $2,700,

uh one of the loans, $160. Electric, $200. Internet, $80. Music, $10. Uh another one of the credit, $360. And then $1,360. is taken away from the $10,000 to go to. those people that you are paying from. you know, the $50,000 that they get. view. And then other stuff for the. business just needing to keep it going, $200. So, comes out to a total of. $6,670.

So, of that money that is left over. the remainder of this month and you need. to follow that budget 100% strictly or. you're going to be. Set that aside this month, set it aside. next month in your own personal savings. Just so you can have a little bit. Because what's about to happen is you're. going to have like. couple hundred dollars left over on a. monthly basis starting in two in in a. month and a half. What what's the date? Yeah, no no no, in a month. In a month. at this point.

Cuz that's going to be like July 1st, right? Mhm. So, it's only going to be. So, uh. tell me about a day in the life of. business. What uh what are your hours? So, I train typically from 6:00 a.m. to. roughly. uh. 9:00 a.m. Sometimes I go into 10:00 a.m. Okay. Uh from there I typically either. work out or lately I haven't even worked.

out. I just kind of go straight home. Until. uh until. I go back in typically at 4:00 p.m. Um sometimes 3:00 p.m. So, what is that. 10:00 to 10:00 to 3:00 you have off? Yeah. Okay. And then when you're off in. the evening? Well, technic- kind of off cuz of course. I go home and then I do all the stuff on. the computer that need to be doing. Okay. Like marketing and you know all. the accounting and all that kind of. well, accounting probably not enough. Well, not at all. Not at all. Uh uh you. off? I get off at uh usually 7:00,

sometimes 8:00 p.m. Okay. So, so what you're going to do? Probably starting now, but certainly. because you're going to have a zero. money. uh starting in July. Yeah, I agree. Maybe bring on some trainers that can. work those heavy hours as well that are. purely commission based if you can even. get them. Tough part of this conversation. cuz she's sitting right there. Hello. She takes a big commission thing.

Would it make more sense to. get someone. to replace her position that does 40%. commission instead of 60? Plus. intertwining relationship with work. that can get messy. I'm not rooting against any relationship. but there's no legal binding with a. marriage. Sometimes relationships don't. work out. Mhm. Just being realistic. about the risk plus taking an extra 20%. commission from what someone else would. be making when were our margins are. nothing. I don't know. Mhm. That might. be something worth thinking about.

I don't want to be the bad guy but we. need to squeeze margin where we can find. it and then yes, bring in those other. people. But if they're just sitting. around doing nothing and you could be. doing the work instead of them, do the. work. But maybe bring on one person, see. how it goes for a bit. But let them know the risk as well. Don't be a dick about it. You know, don't bring them in with the. potential of them getting let go pretty. quickly because there's just not enough. work for them to do. Right. But if you. could be doing the work, do the work. Now, what I was going to say, what you.

should be doing, okay, from 10:00 to. 12:00, do the crap online every day. Do. the crap online. 12:00 to 3:00. 12:00 to 3:00, dude, try to drive some. Uber. Try to do anything. I would say. work at a coffee shop or whatever. It's. going to be hard in those couple hours. for someone to just want to take you on. after that. So, do some of those you can. go do these at the times you desire type. jobs. It's not going to bring in much, but you need to bring in some extra cuz. you're about to have zero margin. Yeah. Actually, with the way this is going, this is going to head towards a business. bankruptcy and then a personal.

bankruptcy, to be very clear. Yeah. Cuz there's there's nothing. That's. something that I wish I would have is. this you know, this is something I wish. I would have done or so that's kind of. how all this debt accumulated during the. months where I was in training and the. studio wasn't ready. This is where I. what I could have been doing and I. didn't do. And then after. I really wish I would have done it cuz I. would have not accrued this much debt. After 8, go towards like a pop populous. area of the area and drive Uber to. midnight.

And then go home, get a few hours of. sleep, do it over and over again 7 days. a week. Just because you have no other option. Right. You really have nothing. Maybe you're. working at McDonald's from 10 Oh, crap. Yeah, again, just not a lot of hours. You might be work I don't ever recommend. that people don't get sleep. Sleep's. great. I love sleep. I sleep a lot. Why? You know what I could do is I could just. open up So, something I I I could open. up my hours a little bit more and I. could try to work a little bit later. So, I do have clients. Yeah, if you can, absolutely. So, when I.

was hearing that, I was hearing like. those are the times that people will. work out. But, if there's other times. you can do, bring in as much as. possible, absolutely. You kidding me? As much as you can work this position, do it. And then just do those on-demand. positions outside of that, but you just. it's time to start working. Well, but we should know personal side, what's your rent what's your portion of. rent and utilities and all that stuff. combined? Um so, rent's right total rent right now.

is. Oh, when's this new place? So, this new. place is June. May 31st. So, it's it's coming up. Oh, perfect. So, what's that going to. be? What's your portion going to be? Um. 675. Okay. 675 for rent and then what about. utilities? Utilities, um All utilities, internet, gas, electric. My portion probably about I would say. probably about 150. Okay. Now in the business expenses we're. calculating gas as well, but let's just.

do for personal. Gas, how much are you. spending on a monthly basis? Right now. with the with the current commute we're. spending about 60 a week. you think the new commute will be? Oh, the new commute will be way shorter. Now. it's going to be no traffic, it's going. to be like 8 minutes, something like. that. So it's going to go down from 60 to 20? Well, right now it's actually uh 120. 120 a week? A month? Week? So it's 120. minutes a day that we spend in commuting. in minutes. I'm talking gas costs. You said 60 a. week. 60 a week for gas, yeah. thinking 20 a week now? Yeah, it should. go down a lot more. Averages out to $80.

Okay. Going to give you groceries. Your portion cuz you guys will split it, right? You split groceries? Mhm. 200 for. yourself. And then household items, toilet paper, all that crap, 60. What about health. insurance? What are you guys doing for. health insurance these days? What are. you doing? Nothing. Well, get health. insurance. Get health insurance. Dude, you got to. take care of yourself.

And honestly with the income that's. coming in you're probably going to want. to do like um the health care exchange. and get something that's like doesn't. cost much money but gives you a little. bit of protection. Okay. Okay? Jeez. I'm going to say $100. Sign up for that now. You do not want to. not do that. You're going to get into a dangerous. situation and force into bankruptcy. What is. car insurance?

Uh that one is 200. Okay. So rent at 675, car insurance at 200, with the utilities of 150, gas at 80. Groceries at 200. Toilet paper and stuff at 50. Health insurance 100, sign up for that. immediately. What about your phone bill? My parents pay for that right now. Okay. Okay. Sure.

So, your personal expenses, minimum in. order to survive, well, there's also the. Okay. Well, you Okay, so one of these is. a. The Upstart is personal? Technically, yes. But, we don't know the. minimum monthly payment on that, and we. did not put that in your business. minimum monthly. Uh I think we did. You sure? I I thought so. Okay. 160 is what you said then for that, if. that's what that is. What we did not.

have there was the personal blue, though. $86 for that. It's for that credit card, the blue. personal card. Meaning, minimum order to survive is. $1,541 a month. Um and you don't have that. You won't. have that. You won't have. You a thousand 200 of that you will not. have starting in a month from now. So, what are you going to do about that?

You essentially have to work a second. job. You got to get more money coming in. by If there is this pent-up demand that. you're saying, and I'm just trusting you. with that, and hoping you're 100%. correct, cuz if not, honestly, it's. about to get. Um yeah, then bringing in someone in our. commission who's able to minimum. generate that off their 40%. their 60% that's going to you. Those are the options. You're working. that second job, or their 60% brings in. that minimum. But, other than that, I. mean, there's nothing There's nothing.

else to put towards that. There's. There's Right now, there's no money to. put towards living. There's is no money. to put towards that. So, I'm a little. scared. Usually, what I would do from here is. say, "Okay, here is the little bit. that's left over. Here's what we can. bring in a little extra. Here's the way. we pay off the debt." Right now, that's. not even a part of the conversation. Right now, we're just saying, "How can. we even afford to survive?". So, again, it's going to be that extra. person if you can, and or probably and.

you working that second job. You're. pretty much. only going to see your girlfriend at. work. You're pretty much going to be. working from the moment you wake up till. you go to sleep cuz it's not an option. cuz you're not going to survive and then. we're going to go into business. bankruptcy cuz you can't pay the the. three minimum loans that you have with. the Well, the Upstart's personal. So, you're not going to The business loan, the blue one at $12,691. with a $371 minimum monthly payment, you're not going to be able to pay that. eventually. Then, you're going to need. to go into bankruptcy. Same with the.

Nbody, you're not going to be able to. pay that. And then, you know, you owe. that $35,000 to the personal people. Like, you can keep doing that forever, the personal training forever? Hopefully, they don't want to ever. switch personal trainers or go off of. that or else you're going to also owe. tens of thousands of dollars. So, there's an inherent risk there that's. not baked into the other stuff. And. then, on the personal side of things, you can't pay for the $1,541. a month that you have to pay for things. So, the personal blue credit card of. $5,000, you can't afford to pay that. That's. going to go into collections.

Uh the Upstart at $5,000, can't afford. that. That's going to go into. collections or something. You might have. to declare bankruptcy. I don't know. I'm. scared. I'm a little flabbergasted right. now because the only thing that matters. at this point is what you're going to do. to bring in more income. I can go. through a debt repayment plan all day. Right now, that plan is impossible to. exist because it just matters what are. you going to do to bring in that income. Yeah, I think right now my only option. is uh well, do DoorDash in my free time.

and then try to continue to. Uh. I think my best solution that would. really help is just getting another. personal trainer and then trying to. market as hard as I can to get them. filled. have you been looking for this employee? So, we had one not too long ago. Um he recently put his Well, he put his. two weeks in about. 3 weeks ago. So, we've been looking ever. since and. we kind of we find people and then it. doesn't end up not working out. So, yeah, about about 3 weeks we've been. trying to look.

for another one. So, the gym is fitness-minded? Yes. Okay, Dallas? Yes. What do you think. they'll bring in on a monthly basis? Um. monthly basis. Yeah, in these conversations you're. having with potential applicants, what. do you think they're going to take home. in their pocket? Uh so, I think a trainer would a trainer. could be roughly at once they're a. full-time, they can be around $4,000 a. month take home. uh before taxes. Yeah, so are they contracted? Uh no, they just No, they're not. Are.

they W-2'd? They're W-2'd. Yeah. So, before taxes, so. Do you provide any. benefits, anything like that? So, that'll be once they get to. full-time. When do they get to full-time? Once So, it just depends on the amount number of. leads we're able to get in and uh what. uh the packages they're able to sell off. those leads on. 50,000 I mean, $50,000 a year. I mean, you could be able to. hire someone with that. What do What do. personal trainers make in.

outside of the business? Uh if they're independent. it depends on the It depends on a lot of. things. It depends on the commission. rate that the uh gym is giving them or. if they're independent, the prices that. they're. the whatever whatever their prices are. You think you're going to hire someone. for 48 a year? Um. I was hoping to, but now. thinking maybe I should probably. increase that. Would you take it? A I start So, starting off I would have.

I was definitely making. for a beginner? Yes. So, starting off. and then I mean, we're more willing to. definitely This is kind of what we're. starting off with, but I'm definitely. willing to negotiate and offer more. Is. a beginner going to be what your. business is looking for and needs right. now? Or are you going to need someone with. more expertise? No, I think we're looking more for a. beginner because we are trying to uh. mold them and trying to There's a. certain. method that we want to try out with our. current clients that I've found success. with my clients and I want to see if I. can recreate that with another trainer.

that I feel like could help. Okay. Well, maybe you'll find someone. watching this video in the Dallas area. that's interested in starting off their. personal training stuff. On your personal side of things, I am. just very nervous. I don't know how. you're going to afford to live. I need. you to get health insurance cuz if. anything happens, it's you're going to. just you're going to be done financially. for a very very very long time. I don't. want you to go into bankruptcy. It's. like the last last. last thing we can do, but.

we're just headed to I I'm not trying to. be just overly negative, but we're just. heading to a place of just financial. nuclear. explosions. Yeah, no. I definitely feel. it. I've been feeling the pressure a lot. more lately. No chance to move location? Uh. well, I would have to break the lease. and I don't know what that would. Oh, that's true. What's your lease for? 5 years? Oh. Ooh. What have you done?

What have you done? What it comes down. to now is yeah, trying to increase your. income by either up in your rates or by. bringing someone in or working more. hours within there that you talked. about. Then, just keeping yourself. alive, man. You just got to work another job. It's. it comes down to that. I'm just hoping. I mean, honestly, what's your credit. score? Uh in the 600s. It's about 650, I. believe. There's Upstart. I bet you.

could consolidate that like through a I. bet you could get a personal loan. No, I know a lot of people dislike them, but I mean, I've worked with them and. I've seen people get. better than 30% on like SoFi personal. loans. Go for I you could shop the. rates, see what fits best for you. You. can find something on Credit Karma. They. have like the the loans that they. guarantee you'll be approved for and if. you if you don't get approved for it, they pay you, but I mean, there's. there's options out there, man. And 30% I would absolutely try to get a.

personal loan, just pay that off. Maybe. consolidate some of these credit cards. I don't know, but you need to cut them. up, never use them. You can't, dude. You're spending on credit cards that. you're losing a thousand. I mean, with all the interest combined, you're you've lost like a couple to a. few thousand dollars this year already. and you're already make. with one with where rent's going to be. for the place, you're already negative. in terms of your personal. So, now this is. we might have to clean up some of the.

loans by consolidating, maybe getting. some personal loans and then you just. got to increase your income as much as. possible and then tack them as much as. you can. Like I said, because I'm so nervous about the. business and stuff like this, over the. next month you're setting aside that. extra Well, no, no, cuz I mean, some of. it will go to living expenses anyway, so. I don't even know. Maybe you can only. set aside like a thousand dollars this. next month, but whatever you can, cut. back, dude. We're not going out to eat. anymore, business or not, tax deductible. or not. We just can't. You can't afford.

it. You're not going to be able to. afford groceries here pretty soon. When rent goes up, it takes everything. from you. You already basically your. your margin's zero dollars and then how. do you survive? I don't know. So, I. don't want to just be a Debbie Downer. I'm not just going to continue saying. the same thing over and over again? I'm. just I'm nervous. What do you think? What are you going to. do, man? How's this going to look? Uh. I'm optimistic. You guys it's my nature. And I do believe that. um if I find the right person.

uh double down on the marketing, I think. I mean it all I think within a month I. could definitely turn it around. I mean. it's going to be incredibly hard and uh. in the meantime while it does turn. around, just do what I can to make extra. cash like DoorDash or. um whatever else I can find just to keep. me afloat in the meantime. Any final thoughts? Uh. no, not right now. But I definitely got. to. uh get better at accounting. For Jose, I'm honestly.

I'm terrified, but. hopefully he's able to overcome this. income situation by bringing in another. person. I don't know. We'll just have to. see. The follow-up is going to be very. telling to see what happens, but I'm. personally nervous and Hammer Financial. scored He gave himself a four out of 10. I don't really know how, but spending is. ridiculous, overspending. It's zero out. of 10. Debt, it's insane, zero out of. 10. Retirement, there's nothing, zero. out of 10. Emergency fund, there's. nothing, zero out of 10. Uh real estate, not even in that world yet, zero out of. 10. It's a Hammer Financial score, zero.

out of 10. This can't be better than. that. This is one of the worst. situations we've seen ever by far. But to make it better, if you want a. free $5, you can sign up for Acorns in. the description below using my link. You. get a free $5, I get a free $5. Everybody wins, it's great. Don't forget. to follow my Instagram and Twitter. Peace.