Jason Hartman: Welcome to the Creating Wealth Show. This is your host, Jason Hartman and this is episode number 280 okay we’re getting close to 300. Hey, you know every 10th show we do a non-real estate, non-personal finance topic. However, this show happens to fall on a time where we need to do a quick debrief on our Atlanta Creating Wealth Boot Camp and Property Tour. So, we’ll do that for a few minutes here and then we will go to today’s guest, David Essel, who is a dynamic radio talk show host on XM Satellite Radio and he is a life coach and an expert in addiction recovery. Now, you may not think this applies to you and I didn’t neither because I don’t feel like I have any addictions okay which is good but we all have this little addictions, this little things that kind of control our lives in certain ways and David will talk about that and how they really impact every single one of us and how we can be more successful and more fulfilled. So, the show is in two parts and we will talk about the tour first and then we will be back with David Essel in part two.
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Jason Hartman: I want to give you an update and kind of a debrief on our Atlanta Creating Wealth Boot Camp and our distressed property tour there. We just had an awesome weekend and just kind of wanted to share some of the things and frequently asked questions from that event with you and since it was her birthday yesterday maybe we’ll start. I’ve got some of our investment counselors on the line. But maybe we’ll start with Molly. Molly, so what was your impression of the weekend?
Molly: You know I thought that Saturday was a great Creating Wealth Boot Camp. We had so many people. The event was sold out. It was the first time we were on the East Coast. So, we are able to have people come from all different states on the East Coast. People that were local to Georgia and North Carolina were able to drive in. People just loved everything that you had to say especially the things about Obama and Steve Jobs and apple.
Jason Hartman: I know what you’re getting at. Folks for those of you who don’t know —
Molly: By the way, I forgot to mention on the best tour that you mentioned Jimmy Carter three times and by the way Jimmy Carter and I have the same birthday.
Jason Hartman: There you go, so what Molly is talking about it’s kind of a little bit of an inside joke. She will be in back of the room and she will do chicken scratches every time I reference something I reference a lot. So that’s what she is talking about. But good “hey Sarah you’re here too.” What were your impressions?
Sarah: Yeah well you know I love your boot camps. I’ve been around for a while and I attend your boot camp every year and every year I sit in the back and I just think it’s a great refresher course even if you’ve already attended and heard the content. You’re always current bringing new information to the table. I take in information differently every time depending on where you at and your investment horizon. You hear piece of information and it’s just have a different take on what you’re doing. So, I really enjoyed the content I’ve always and I just would like to say thanks to all of our out of town guests.
Jason Hartman: Yeah, we have people coming from all over the country and even one foreign country this time. We’ve had people coming to our events from Europe before and Japanese but this time, Sarah, mention maybe a couple of those you wanted to share.
Sarah: Yeah well we had Joe come in. I’ve been talking with Joe for a while. That was so great. To put a face with a name great to see Joe and he bought his father Dave from Ontario so that was great.
Jason Hartman: Good. Yeah that was good, we had so many people come from so many different places and folks we are going to do a lot more of these events that are on location in different markets and we’re working on planning one now so stay tuned for announcements on that. But Steve what were some of your impressions?
Steve: Well, right along with what you just said about you know we’re scheduling some new boot camps and things coming up and it was very beneficial for people to come from all over the place and put their boots on the ground in Atlanta. We always talked about how their 400 markets across the country well there’s plenty in Atlanta by itself and we host it. We got up and we went out and sell properties all day on Sunday and we barely scratch to the surface on East side of Atlanta. And it was so good to see all these different communities and learn about what drives each of them and I think the investors found that to be very beneficial to not only see the house but look up and down the street and kind of get that feel of the neighborhood was a big benefit to everybody.
Jason Hartman: Yeah no question. Just nothing takes the place in our high-tech world we sort of loose touch with high touch. I guess I should say but nothing takes the place of actually boots on the ground so to speak and being there and seeing things first hand and not just that really meeting people first hand I think we got to share so many meals together and spend so much time together with everybody. One of our attendees even drove me back to the airport and thank you for the ride. They were from New Port Beach and we had flights that were departing around the same time. And it’s just great but that actually leads me to another thing. I want to talk about like frequently asked questions and things that people brought up that either we’ve talked about on the show and we just haven’t made it clear and understandable enough. I’m always saying how we learn so much from our investors. But also things that maybe just need to be kind of repeated or understood or maybe it’s a new question too. So, think about that. But I’ll talk about one right now and that is – someone was considering “Gosh that should we do, should we buy a home” they were renters now in Southern California in Orange County and they were thinking – “should we buy a property or should was buy investment property.” Should we buy property a home to live in or should we keep renting or buy investment properties and so let me just kind of share this little equation and sort of scenario that was interesting. I said to them how much would it cost you to buy the home you’re living in now that you’re renting. They said well it’d cost about $450 thousand and then I thought how much are you paying in rent and I believe they said they were paying about $2300. And you know we talked about on the shows and at the various seminars that we do, we talked about an RV ratio of at least 1% which you can obtain now although that is declining as prices are rising remember folks, rents always lag prices. And so it’s always the prices that go up first and the rents that follow later and it takes a couple of years to get to catch up. Well, they are basically getting to use of a $450 thousand property now for $2300 or so per month which is actually a great deal okay because think about it. If you were to deploy $450 thousand investing in property with us, first of all you’d be diversified and that would be better than having all your eggs in one basket. The old saying all real estate is local but in addition to that, the RV or the rent value ratio of at least 1% and probably 1.2 maybe even 1.4 maybe even for some of our markets a little bit better than 1.4. We’ve seen them up to 1.8 in the past and just on the 1% number, a $450 thousand portfolio should yield a gross income of $4500 per month or 1% of 450. So why would it ever make sense to buy a property that your using as a rental to live in when you can gain control of that properly for only $2300 per month. It’s a much better deal to be a renter there and then rent lower price properties in diversified markets to other people. Do you guys have any comments on that, I mean, sort of an interesting thing. Everybody is sort of always coned into thinking if you will that “hey you know you got to own your home.” I think you have to own property but I rather have that property produce income because the house in which you live is just a liability, it’s an expense. Robert Kiyosaki points that out all the time.
Sarah: Yeah I like chime in on that note because over the years I’ve been slowly following your show and your advice when I first started I thought it was crazy the thought of renting your house was crazy but here I am five years later and I just turned my primary residence in Toronto and I’m renting a much nicer house for only a few hundred dollars more and when I did the map what the down payment would be to buy the same house and how long it would take me to make that money back I just – it was a no brain because I’m renting a great house here in Southern California as well. And I’m really thankful for my landlord hasn’t been to your seminar.
Jason Hartman: And I am thankful because the penthouse I rent in Phoenix I’m glad my landlord haven’t been to my seminar either because I’m renting probably what is I would guess a $1.8 million property for a whopping $3600 a month and I mean it’s a great deal. That $1.8 million that I could deploy into properties through my own company’s network I mean that would produce at least $18 thousand a month. So I’d be crazy to own this place. And then, on top of that I have home owners association fees, I’d be responsible for all the repairs. It’s great to be a landlord if you own low price properties, properties that have good rental value ratios. But if want to live in a high-end property that most of us do it’s better to rent a high-end property and buy low-end properties to rent to other people. And the reason for this folks is because there is something known as rent elasticity. There is very little elasticity when you move in to a high-end property. So, this was illustrated to me many, many years ago when I was 19 years old. I remember being at a seminar at the DoubleTree Hotel in Orange California and there was a funny speaker I think he is still around. I should get him on the show, the guy is hilarious. He is a CPA and most CPAs aren’t very funny but his name was (Danny Santucci) and he was talking about one of his client who was renting a house on Balboa Island. Now, Balboa Island is a very nice little quaint island community in New Port Beach California and it’s very expensive. And the quote was “he said you’re a wealthy man why are you renting. You’re a multi- multimillionaire, what are you doing renting your house that you live in.” And the client responded back to Danny Santucci and he said “hey we’re else can I get control of a $1 million property for only $3500 a month” and forgive if I didn’t get those numbers exactly right but it was something along those lines. This was like 20 years ago okay. But yeah it’s just amazing that it’s just a better deal to be a renter. Any comments from Steve or Molly on that one?
Steve: I have one, yeah. Molly, I’ll be done really quick here, but that’s what the clients found us. Many of them came for more expensive markets. We had clients from California, East Coast and funny enough were talking about will you investigation in a lower end properties. Many of these properties however didn’t seem so low-end. It was the pricing that was low-end.
Jason Hartman: Right not the property.
Steve: But the quality and the neighborhood of the properties were amazing. I heard a multiple comments throughout the weekend of people saying “geez maybe I should move to Atlanta.”
Jason Hartman: Yeah right.
Stave: I had a client purchase a property, I’m not kidding you thing this for close in 2011 for $311 thousand. That’s 2011, that’s not 2006 okay.
Jason Hartman: Yeah it’s last year in other words, it’s amazing.
Steve: Right, right and it is 3500 square feet, he bought it for $139 thousand and it’s a beautiful looking house.
Jason Hartman: Oh yeah, yeah.
Steve: That’s what you can do out here. So, many times we say it’s low-end, it’s not so low-end. I mean many of these clients were saying I had no problem living in this neighborhood and that was staggering fact that I saw time and time again.
Jason Hartman: You are so right. All of the properties we saw on the tour except for one of them and that were a nice enough neighborhood the one I’m excluding from the mix there but all of them where in this super nice areas. I mean you walk into them and they’ve got beautiful entry monuments. They average swim and tennis. They have large lawns and landscaping. You’d never see graffiti in these areas okay. These are not cheap crappy rental properties I mean these are areas probably anyone listening including yours truly would certainly be willing to live in. I can’t believe that either. So, Steve just out of curiosity on that property you’ve just mentioned it was for close for much last year?
Steve: $311 thousand.
Jason Hartman: And they paid $139 for it and it’s like 3500 square feet you said?
Steve: 3500 square feet and I’m trying to find the year build on this.
Jason Hartman: That’s what I wanted to know.
Steve: But it’s very new. You can tell it. It’s a newer home. Oh it’s build in 2007. So there you go. It’s a beautiful looking house. I don’t want my wife to see the proforma, she’s going to want to move down there and live in it.
Jason Hartman: Yeah it’s amazing. So it’s impossible to address all of the frequently asked questions on this quick debrief from the tour because over two and half days that were so many discussions and questions and meals together and times that we shared and so forth but Sarah you had one client and ask you about diversification and I think maybe it’s worth just bringing that one up here.
Sarah: Yeah, so, that’s a question I get all the time and really the question is how much do you diversify? Do you buy a few in the market and then a few in another market? Do you buy in three to five markets? What is your recommendation?
Jason Hartman: Yeah, well, I will be the first to say that I made a bit of a mistake on my own portfolio. And my mistake is that, I used to buy an every single market that we recommend. And I got over diversified and I would not recommend over diversifying although I would recommend diversification for sure but do it more something more like this because see the more you diversify, you have a little less power with your property manager maybe and that’s the great thing what we bring is that we bring them all that business. So you can come to us for recourse if you have any trouble with your property manager because some of these property managers more than half of their entire business are business we’ve sent them. They’ve really re-design their whole company to work around our client tell. But it’s nice to have like, few of the same insurance agents, a few of the same property managers. So you’re just dealing with fewer parties. But you still got to diversify in some degree okay you must do that to protect yourself and get the maximum upside. So if someone was going to buy 10 properties for example or let me just make a round number. Let me make 12 okay for purposes of this discussion. I would buy 12 properties in three to four markets. So you have three or four properties in each market. I wouldn’t buy 12 properties in twelve cities or twelve markets. I would pick three to four markets and spread 10 or 12 properties around those markets. We’ve got clients that are buying 30, 40, 60, 80 properties and again I would try to be in – if it’s a large, large portfolio like say 80 properties, no more than maybe six markets. I think that’s enough diversification and I want this portfolio to be easy enough for you to actually manage and run once you’ve gone through the acquisition and stabilization stages to where you can just deal with a few enough parties that you can kind of keep track of people if you will. Does that makes sense Sarah?
Sarah: Well yeah. But let me ask you this, what if someone had the intention of buying 12 properties but they are not able to accomplish that goal say within the year. Let say there are able to only do three in the first and maybe three in the next year you know they’re doing it incrementally.
Jason Hartman: Yeah.
Sarah: So would you say they would do their first three in the same market because maybe that’s a hot market. They are able to get a great deal and then put those three properties with the same property manager and then six months, two year later when they are ready for the next set, do those in another market or how would you recommend they do that after doing it over time?
Jason Hartman: Well that’s a good question. There’s never any guarantee that you’ll be able to acquire the following property. So if someone has a plan to acquire 12 for example, I think they should diversify from the beginning. So if they acquiring three or four properties now, they should do that in two markets and then build the other markets, the other three, the other number three market with the number four market later as they acquire more properties but maybe two markets to start.
Sarah: Yeah that sounds good. I tend to agree.
Jason Hartman: Good, so Molly one of the clients who was on the tour I just wanted to have you share some information from one of the proformas on one of the purchases. It’s pretty amazing these numbers. But go ahead and share that with us if you would.
Molly: It is, it’s amazing and I’m going bounce back to the couple that we are talking about from Orange County considering purchasing a primary residence in Orange County. I had dinner with them on Saturday night and we’re talking about deploying money as you discuss and they ended up moving forward on the property in Atlanta. They are paying $118,900 for it. Their total cash invested is going to be just over $30,000 including closing cost. Properties in a rent for $1200 a month so, that’s a 1% rent to value ratio which is awesome. Their cash on cash return is 11% a year and their cash flow is over $3300 a month. Their issue in purchasing a primary residence here in Orange County as they keep getting out bided. They are in multiple offer situations even when they are bidding over and above the list price now they are still not getting a home. So the benefit of being able to purchase income properties nationally is – they’re on the ground, they are to able to touch, feel, see the property. They were able to walk out to our local markets specialist and say “okay I want this property” and it was held off the market for them immediately. There were no multiple offers, they didn’t have any of that high pressure stress. It was an amazing situation.
Jason Hartman: Let me just mention something about that though, right at the beginning so first of all when we do our tours we, ask our local market specialist to hold properties off the market for the attendees on the tour. So we have a waiting supply of properties. Now, one of the clients actually kind of did the opportunity for this thing that I thought it was good. I got to give him credit for it. They went a day early and looked around at the properties and were able to buy one before anybody else got there so that was pretty good. Our local market specialists for Atlanta said as soon as we go on the bus on Sunday morning said we’re not going to do any bidding wars if you want a certain property that we see right just write your name on the proforma and hand me the proforma and he was going to write a number of the people on the proforma. The first one to turn it in, the second one to turn it in, and give them the property in that order, so you know he had a few of them with like four people that had turn in the proforma and wanted to buy that one but as the tour developed they got to see other properties and they thought well I could take that one or that one it didn’t much matter. So that’s a good point but I do want to say to listeners you do sometimes get out bid that does happens. On the tour it’s a little bit special because what we do is we get our local market specialist to basically close the market for us and not offer these properties to anybody else for maybe two, three, four weeks before the tour or so. It does cost more to keep those properties in their inventory but they feel it’s worth it because we bring them a big audience of investors on the tour so, yeah good points. Thanks.
Sarah: Well can I just chime in there, real quickly I know you got to wrap up the call but I just want to say you know that’s one of the many benefits in working for a network. I get call all the time from people who have been submitting offers on their own to just from the banks and there’s a lot of big hedge funds and cash fire and foreign investors coming in and eating up and over bidding this inventory and some of them just say, you know, I give up can you help me get my hands on a property and I’m hearing that more and more every day. So, again one of the many benefits in working with us because we can help you hang on with some other inventory.
Jason Hartman: Yeah we’re getting into one of those markets pretty hard to operate to be a buyer because the prices are escalating and the inventory is getting gobbled up like crazy so, yup good points. Well, thanks to all of you for sharing your thoughts and impressions on the weekend. It was a great weekend just a big success and we so much appreciate everybody flying out from all the corners to join us for our tour and will announce the next one soon and again thanks to our investment counselors and our local market specialist and their team. We have the attorney speak who is a settlement attorney, the property manager, the insurance person, the contractors, rehabbers, and the field people for the local market specialist, people got to meet them. Just all in all it was great for everybody to come and look people in the eye, shake their hand and really get a sense of the market and also get the Creating Wealth Boot Camp Information as well and we really start brand new 40-page workbook with that event and now we’re making a few modifications of that for the next one so we constantly evolve and we make these things better all the time and we appreciate all of you attending out events and we appreciate your continued faith in us, so thanks very much.
Sarah: Yeah thanks everybody.
Steve: Yeah thanks.
Introduction: Have you listened to the Creating Wealth Series? I mean from the beginning. If not, you can go ahead and get booked one that shows 1 through 20 in digital download. These are advance strategies for wealth creation. For more information, go www.JasonHartman.com.
Jason Hartman: My pleasure to welcome David Essel to the show. He is a coach. He is a TV host, a radio host on XM Satellite Radio and In-All Faith’s Minister and expert on life success and talking about the “one thing” that will radically change your life forever. So I think you’ll enjoy this interview today and very charismatic guy we have here. David welcome, how are you?
David Essel: Hey Jason awesome to be with you, yes.
Jason Hartman: Good, good and see you are charismatic. Look at that response.
David Essel: On queue right? On queue.
Jason Hartman: On queue exactly. Tell us a little bit about your work and what are the things you do?
David Essel: You know Jason, my work is all about personal growth. I write books. I have the XM shows you mentioned. I have been a life coach since 1991. Back before they even called us life coaches in’91 they called us lifestyle coaches.
Jason Hartman: Right, right that was before it was trendy.
David Essel: Yeah absolutely. But my work – I work in addiction recovery and every area of my if I’m writing or radio or coaching Jason it’s all about helping people move from where they are right now to where they really want to be. Similar to what you do in the world of finance.
Jason Hartman: Yeah, absolutely. So why is addiction recovery such a big part of it? I mean that seems frankly a little bit like an odd pairing to me when you say the “one thing” that will radically change your life forever life coaching all the sort of positive stuff I guess I would view that as.
David Essel: Right.
Jason Hartman: And then you say addiction recovery that’s positive if you can do it but it sounds pretty negative. I mean, when people think of addiction they think of people that are really down and out, kind of contrast or maybe going to that little bit if you would.
David Essel: Yeah, well it’s interesting because while we have the image in our mind of what you said, we think of addiction we think the guy in the gutter or some are homeless, someone homeless somewhere or strong out on heroin. In actuality, addiction is problem in our society that I can tell you right now Jason without doubt every person in this country is suffering from one form of addiction or another.
Jason Hartman: Give us some examples.
David Essel: Absolutely, we have the addiction to spending. We have the addiction to greed power. We have the addiction to being right. We have the addiction to try to control others. We have the addiction to alcohol. We have the addiction to nicotine, to food, right now as you and I are talking 70% of the United States of America is either overweight or obese. Now, 70% that’s a massive number, within that number, only 10% have a genetic liability.
Jason Hartman: Right, so people try to use that excused as well it’s just genetic. But that’s only a small number.
David Essel: Yeah it’s tiny. So 70% of United States of America is overweight or obese that means that 70% just almost 70% of this country has an addiction to food. So, when we talked about addiction, you know addiction to gossip, addiction to negative thinking. You know, there are so many different forms of addiction and when you mentioned like the premise of all my work in life is surrounded around this thing this theory that I came up we called “The One Thing Theory” in 1996 and what we do now is we state this very blankly to everyone. There is one thing in your life right now that if you’re to go after and take care of. It’s the thing you denied, delayed or procrastinating on, your life would rather be changed. For some people Jason, it’s an addiction. For some people it’s their finances, you know, they have their head in the sand, they don’t want to talk about money, they are afraid to talk about money but if they were just to get a grip on money their life would radically change. For someone else it’s their love relationship. You know they are in a dead relationship. If they have been denying, delaying, procrastinating working on that relationship, if they would just to attack that “one thing” their life would radically change so that’s how I came up with this concept of “the one thing that will radically change your life forever.”
Jason Hartman: So, I guess when it’s in the field of these things and especially in addiction now that you’ve explained that a little bit more. You know, oddly you did not mention some addictions that have been in the news a lot lately and that is sexual addiction with Tiger Woods and so forth and zillions of other people. It’s just that he happened to be having a known variety.
David Essel: Right.
Jason Hartman: But you know also I could tell you I think another big addiction our society suffers from is this addiction to kind of like the caffeine culture, the energy drinks and stuff like that it makes people so hot headed and short.
David Essel: Absolutely.
Jason Hartman: I’ve really noticed that in the past several years as a real change since the Red Bull phenomenon started. So I guess the first thing here probably is “to thine own self be true: to know oneself, to know itself” how do we first identify these addictive behaviors or this one thing in our life that needs to be taken care off.
David Essel: I can give you a short answer, the long answer Jason is going to be that within about the next two days on my website at www.talkdavid.com because this is such an important issue we decided to put up three free training videos to help people find their “one thing”. It’s not easy because most of us are in denial. When someone said to me at one time years ago “you know I think you need to look at that alcohol addiction that you have” and their talking to me and I went right into denial like most of us. I don’t have that problem, I don’t have this problem. So, what we’re doing on our website is we’re putting up three free training videos that people can take so they can narrow down break out of the denial and find their “one thing”. Now, you said something very interesting when you’re talking about the world of addiction, a lot of times people think of that as a negative but in reality for most of us if it’s an addiction to caffeine, if it’s an addiction to alcohol, sex you know who broke it out for their sexual addiction —
Jason Hartman: Bill Clinton maybe.
David Essel: Well Bill Clinton — but he got caught but the person that came out and actually said I have an addiction was David Duchovny, the actor.
Jason Hartman: Oh, okay.
David Essel: A number of years ago from the X-Files, you know, he came out in public and said “I have to take time off from filming to go to recovery center for my sexual addiction.” Like that was mind blowing back then to have someone admit it, right?
Jason Hartman: What year is this that he did that?
David Essel: I’m going to say it was probably 10 years ago.
Jason Hartman: That is pretty mind blowing that he just came out and said that. It seems to me like I have a friend that has trouble with alcohol. And like some addictions, they’ve got to be just tremendously hard to deal with because there ever present in society. So, when you take things like sex, alcohol and I got to bring another one up that you mentioned earlier gossip. The totally destructive force of gossip which is just something we’ve all done, we all do it at times but that just can ruin people’s lives. It can turn out to be such an evil thing really and those things that are like ever present, sex is ever present in society right?
David Essel: Right.
Jason Hartman: Those have got to be particularly hard like if you got a drug addiction problem and say you can beat it, you’ve had treatment for it, you’ve done whatever you need to do, you know, you can sort of be away from drugs. But you can’t be away from alcohol, you can’t be away from sex and you certainly can’t be away from gossip because those things are just – there’re like the air. They are just everywhere.
David Essel: Right and then you throw in food.
Jason Hartman: Well, yeah food, thank you.
David Essel: Right. But let me tell you something Jason, you know I’ve worked in the world of addiction recovery for 20 years and I can tell you something that’s going shock possibly you but definitely your listeners and that is we never allow someone to say in the recovery that my addiction is more difficult than any other. We never allow someone to go there because this is what clients love to do. They’ll come in and say “well you know my sexual addiction is worse than heroin because I have to have sex its part of why we’re here. My food addiction is worse than nicotine because I have to eat food to survive.” My blank, blank, blank, however, here’s the trap, if we start saying my addiction is worse than someone else’s we’ve just given our self a foot out the door to walk away from recovery.
Jason Hartman: It’s an escape patch, yeah. Not good, correct.
David Essel: Absolutely, so even though what you and I are talking about seems logical, the logic and intellect does not have a chance against addiction recovery. So, we stop people right away and say “okay that’s maybe what you believe before but we’re going to have to remove that from your vocabulary because if you keep saying that food is more difficult to recover from the cocaine you’ll never recover.”
Jason Hartman: Fair enough. Fair enough make sense, so no qualifiers as to the severity of the addiction. I was just kind of pointing out that those things that are just all around us in the culture constantly those have got to be really tough because this friend of mine with the alcohol thing unlike just every event, every social event involves it. What you do, how you avoid it.
David Essel: Yes. Well Jason let me tell you great story. So, when I was addicted in alcohol I’m in recovery, love recovery by the way I absolutely love it —
Jason Hartman: You’re addictive to recovery.
David Essel: What you say?
Jason Hartman: You’re addictive to recovery.
David Essel: Exactly, which is a very healthy addiction if you’re going to have one.
Jason Hartman: Fair enough.
David Essel: And so here I am nationally syndicated radio talk show host, motivational speaker, author, blah, blah, blah, minister you name it I’m all these things, I’m traveling around the country, doing my gig, motivating people, and I’m full blown alcoholic which for me meant that every night I drink and so I would go to speak at a conference and I would go up in the stage, do my motivational speaking, come off and I would be drawn to this table, I go over to a table, might be at left side of the room at one conference, the right side of the room and the other and I start talking to people and next thing we’re all going out for a drinks and life is amazing. I get sober. I’m on stage, I’m doing my stuff, and I’m drawn to a table, left side, right side, I turn it doesn’t matter well gosh on it they’re all sober and so the law of attraction is so powerful that when I was an alcoholic I thought everyone drink. It’s just what men do. It’s just what you do when you are at a conference. It’s just what you do when you’re on vacation. However, when you get sober and my one thing at that time was getting sober that was a thing that was destroy my life even though I was wealthy, living on the beach, new sports cars all that crap it was destroying my life. But isn’t it interesting that once I took care of my one thing all of a sudden I see the whole world doesn’t drink and not every successful business men drinks. As a matter of fact, we’ve change the tide and if you look at a lot of successful business people today, men and/or women, alcohol is either none existent or it’s minimal.
Jason Hartman: Well it’s definitely minimal because I remember the movies and the curing about the old days and the concept of the three martini lunch I mean nobody does that nowadays. Thank God.
David Essel: Right.
Jason Hartman: Now they don’t but they used to be sort of the norm. I mean it was common to get on an airplane and drink like a fish too. People used to do that all the time in the old days. But okay, so we all agree on that and that’s all true. What do you do to overcome addictions? I mean how do you recover from them?
David Essel: Well the number one rule is to say “you’ll never recover alone.” The odds are no one recovers from addiction to food, gossip, negative thinking, nicotine, cocaine, alcohol, greed, spending or any other addiction in the world or one that we haven’t talked about Jason that is the largest silent addiction in the world and that is co-dependency.
Jason Hartman: Oh, yeah interesting.
David Essel: And the definition of co-dependency is an unhealthy desire to be accepted by others or unhealthy fear of rejection from others. So co-dependency is a massive addiction especially in love relationships, oh my God. But the number one rule is you’re not going to recover by yourself and the reason why is, is that for the most part regardless of what the addiction is maybe one of the one’s you and I are talking about, it could be one of the other million that are out there is because the intellect will try to justify just buying this shirt this week because it is on sale. The intellect will say but it is my niece’s wedding it is okay if I drink here and see we have to get outside of ourselves and be accountable to someone else or program and here’s the number one key to recovery. We must be willing to surrender 100% of the process of recovery to someone other than ourselves in order for recovery to last.
Jason Hartman: Is that the AA method?
David Essel: You know what it is recovery’s method, AA and Twelve Steps are awesome but I will say this, they’re awesome however, they are 70 years old and so the power of them has to be updated and so in my work. I work with people one on one from all over the world to help them recover from any addiction whatsoever. We use the first three steps and in step number three they talked about surrendering to a higher power. And what we’ve done Jason is we’ve said look at its not — a higher power is great. We have to have that in recovery but we even have to bring it down to earth and say I must be humble enough to recover to James’ Smith program or David Essel’s program or the Willow Recovery Center program. I must be humble enough on the human level, the physical plain to turn myself over and follow what other people say even when I don’t want to and if we’re not willing to do that, those are the people that keep struggling with recovery, they keep going back to the food, the alcohol, the nicotine, the gossip whatever. But when you’re really — if you really want if any of your listeners really want to get clean from power, control with the need to be right, co-dependency, we have to come to a place in life where we say I’m going to follow someone else 100%. When we do that, just like with myself, I jerk around my recovery for years. Here I am a recovery coach as an alcoholic I’m helping other people get clean with all that I knew, I couldn’t get myself clean.
Jason Hartman: Right that’s the shoemaker with no shoes type of scenario. So what other steps can someone take, so submitting to someone else is — say that again.
David Essel: Yeah we must surrender 100% to someone else’s program. So I will give an example, almost all states in the Unites States have some type of a free tobacco quit line or the Health Department offers some type of smoking cessation program. So someone will say “I don’t want to hire a guy like David Essel, I want to do it for free through my County Health Department.” So great go, but when you go do everything they say. Don’t go, well I’m going to follow A, B, F and G of the program because the other letters just don’t make sense to me. We got to follow a program a 100% in order for it to work. So no matter what the addiction is, you know that’s the number one because I want to go back to this Jason, you might be able to muzzle your way out of an addiction to alcohol, nicotine, food, spending, gambling, sex, muzzling means you might be able to stop the addiction for awhile but the odds are you’re going to go back to it without help from the outside world that holds you accountable to a program. It’s like this, if I’m going to — before the show you and I were laughing about stock market et cetera, et cetera right? So, we look at financial planning if I don’t surrender, I’m not a financial planner, that’s not my area of expertise, if I want to maximize my potential I want to go to someone who knows what the heck they’re doing, who was a track record right?
Jason Hartman: Yeah fair enough.
David Essel: And I’m going to say — I mean if I have to argue with a financial planner it may not be the right financial planner but I want to go to someone and say “please show me what to do to maximize my investment.” It’s the same thing with addiction recovery.
Jason Hartman: Right, right.
David Essel: Same thing.
Jason Hartman: Okay so, surrendering to someone, what else after that?
David Essel: After that is making a decision to do what it takes to stay sober. And that might mean letting go of friends who want to pull you into gossip, or want to pull you into going out on Friday night for drinks or you may have to change who you hang around with that’s number two. That’s huge you know, so, number one is surrender. Number two is you may have to change the people you hang around with. Number three is finding activities that will give you that same endorphin rush as your addiction that are healthy. So, we say that for someone that eats food, well the type of foods that satisfy the addiction usually has something to do with salt, sugar, fat or carbohydrates because all those substances within seconds in the body alter bring chemistry. So, we’re going to cut out a lot of these foods that give you these high but we have to supplement, what maybe meditation, maybe walking, maybe exercise, maybe taichi, maybe taekwondo, maybe on ballroom dance.
Jason Hartman: Yeah so substitution, take the bad activity and substitute it with another one. Now, that just sort of begs a question David, what about the concept of substituting one addiction for another and here’s my example. There are studies that say and I don’t know if they are true or not or how valid they are but they are studies that say that when smoking started declining in US, obesity started to sky rocketing.
David Essel: Right.
Jason Hartman: So the argument there would be the people substituted one addiction for another and who knows which one worse. I think they’re both bad but what do you think about that?
David Essel: Well what you’re talking about we have a clinical term called cross addiction and every addict, every alcoholic will cross addict. It’s a fact of life. What we try to do is we try to intercept the addiction from something negative, degrading et cetera into a positive addiction. So what happens is with all addictions Jason, there’s juice. There’s an endorphin rush to the brain. There is dopamine that’s increased in the brain. There are all these different chemicals that are released through cocaine, nicotine, food, alcohol, spending, sex, greed, gossip even gossip. There is a flood of chemicals to the brain when we think we are more powerful than Lindsey Lohan by putting her down again. There is a chemical rush. So cross addiction says is that when I quit drinking I’m going to start smoking or when I quit eating I’m going to start smoking or when I quit drinking I’m going to smoke pot. You know, like they’re just all kinds of games we play. So cross addiction is almost always going to happen but this is again where why it’s so important to work with the program or in individual because the individual can set us up and go okay now this is going to happen I’m going to guarantee you. You’re brain is going to crave some type of influx of chemicals once you remove your known addiction. So let’s be on the lookout and be ready to substitute something healthy for that cross addiction. The point you bring up is incredibly valid which is once again, Jason, why very few people ever recover by themselves.
Jason Hartman: We’ll be back in just a minute.
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Jason Hartman: I think if you have to pick an addiction that’s a good one if there is such a thing, you know I pick exercise. But I got to tell you, I had a girlfriend who was really like addicted to exercise. And I mean, I wish I had as much motivation to exercise as often as she did but I got to tell you that can be an addiction too.
David Essel: Oh absolutely. Now, I will tell you this, the percent of people in United States addicted to exercise you could put on the head of a pin.
Jason Hartman: Small number.
David Essel: Yeah, I mean it’s so tiny. It does happen, it does happen but it’s incredibly small. We believe now the statistics are always tough to say because people lie during the surveys but right now about even though they say it is 22, about 30 to 35% of Americans are addicted in nicotine, addicted to smoking. Anywhere from 40 to 45% are addicted to alcohol. Now let me tell how we know this, the fastest growing form of alcohol addiction is binge drinking. Now, what’s going to blow many of your listeners minds right now, Jason, is that binge drinking means for a woman three drinks or more in one evening or for a man four drinks or more and what we know is —
Jason Hartman: Here is what I want to ask you.
David Essel: Yeah.
Jason Hartman: How long is the evening? See I’m already qualified.
David Essel: Exactly.
Jason Hartman: I’ve had more than four drinks in the night before.
David Essel: Yeah and so someone but you know either honest truth of it is, is that someone might drink once a month and they could be an alcoholic because I’m at Friday night they have a six pack or two and even if they only drink once a month, that’s pure alcoholic behavior because what that says is I cannot control it. Once I start I can’t stop. Now, what is the government and the national institutes for health have to say about any alcohol whatsoever. The most for a woman is one drink a day. The most for a man is two. So, when we go pass that we have to say that we’ve walked in to alcohol dependency at three and at four and I know people hate to hear this but four drinks in one night that’s alcoholic behavior. And what happens, you have four drinks and you get pissed off at your partner and you say something using shouldn’t say.
Jason Hartman: Yeah it all leads to — see this lead to bad things, yeah exactly. Go ahead.
David Essel: And then or you have two drinks, I’m working with a woman on Washington DC right now is a client and she’s gained 25 pounds in the last two years and its all when she’s drinking. She has two glasses of wine forget it. She’ll eat whatever is in front of her. All a sudden people had alcohol and then I have other clients that when they have – after they have two glasses of wine they start smoking.
Jason Hartman: The alcohol that one bad behavior leads to other bad behaviors because it lessens everybody’s inhibitions and people become irresponsible and God forbid it might lead to driving.
David Essel: Right.
Jason Hartman: That’s probably the worst one of them all.
David Essel: Exactly Jason. So in this concept of the “one thing” that will radically change your life forever what we say to people and to your listeners right now, write down the major areas of life. Relationship with myself, finances, career, my physical health, spirituality, relationship with others. These are those of the main six areas of life and then we go okay now set looking also those individually and say which one of those areas have I denied, delayed, procrastinated taking care off. Which of the areas has created the most chaos? I mean am I holding on to resentments so strongly against a former husband or wife that whenever I hear their name I spit blood you know type of the thing. Am I totally irresponsible financially? Am I in financial mess? Am I overweight and struggling with health issues? Is my career a mess? Do I totally disrespect myself because of my eating, drinking, smoking whatever? We choose the one area, Jason, just one at a time never more than one goal at time and we apply ourselves to go after that “one thing” that is wrecking our lives. And when we do it we often have to ask for help. It might be trying to recruit a neighbor to walk five days a week or it might be hire a new coach or going to a weekend seminar on financial planning but we have to be honest with ourselves. What are we denying, delaying, procrastinating working on. What do we not want to deal with? That is your one thing and if you take care of just that one thing and apply yourself for 90 days, in the past are all of our works since 1991 has shown that your life will radically change just by doing the “one thing”.
Jason Hartman: Yeah because the one thing leads to so many other things.
David Essel: Absolutely. Oh my God Jason, absolutely. But when you decide and here is the thing that is so different, sometimes people look at me and they think that I’ve lost my mind because before we created the system, I used to do what all other goal setters would do. We would go after multiple goals, well let’s go after three days a week and exercise and then let’s set up this financial planning thing and let’s take a look here a resume for your career, and let’s get a path back to God and we had people working on all these multiple goals but it never worked because once you hit some area of difficulty you quit. And with our program when you choose the “one thing”, you have no other goal destructions. You can’t start a new goal until you finish the one.
Jason Hartman: Make sense, you got to do one thing at a time stay focus for sure. Just wrapping up here, David, what else would you like people to know about just the general life success and I know it all in work leads back to this concept. We’ve been discussing about addiction because you’re right that is so critical and everybody’s got something, everybody’s got their thing. It could be as minor as seemingly things like gossip or controlling nature or something like that. So there are just so many things out there but as a life coach like pardon me because I still think there’s sort of this kind of negative view of the addiction concept right as we started out talking. What is some general kind of closing thoughts that you have on, just greater life success, living a fuller life.
David Essel: I love that question Jason. Number one, —
Jason Hartman: It’s very broad.
David Essel: It is fine, it’s fine. It’s never too late to change. You might be listening to this and you’re 70 years, you smoke for 50 years it is okay. It’s time to change. It’s never too late to save a marriage or relationship at least to really give it a damn good try. It’s never too late to lose weight. It’s never too late to get a hold of your finances. In other words, everyone listening right now maybe in their minds they’re thinking of the major thing they’ve denied, delayed, working on it is never too late. Now the cool number two, the coolest thing in the world is by doing this you’re going to increase yourself esteem so it’s never too late to feel better about who you are, by being responsible, by asking for help, by being vulnerable, and the last thing I would say to sort of wrap this up is we need to live more boldly. We have this one life, even if you believe in reincarnation or if you don’t, let just say we have this, we know we have this life, we’re physically alive we know it. This might be it. So, let’s live boldly. Let’s ask for help, let’s be humble. Let say we don’t know, let’s attack that which we haven’t wanted to attack so that our future will be so much brighter. And the final thought of all my final thoughts is that there are millions of people before us who have overcome greater obstacles than we were hopefully ever face by asking for help and have created the life they’ve wanted. So we can do it too.
Jason Hartman: Absolutely, it can be done. It can be done.
David Essel: Right.
Jason Hartman: Well David thank you so much for sharing these thoughts with us today and tell people when are you on XM so people can listen and give out your website once again too.
David Essel: Yeah absolutely, if people will go to www.talkdavid.com they’ll find all the information about the XM satellite radio show which is every Saturday night from 6 to 9 Eastern, 3 to 6 Pacific. We have amazing guest as a matter of fact our own Jason Hartman is going to a guest of mine in the future.
Jason Hartman: Hey, I heard he is good.
David Essel: Yeah, no Jason I’ve heard he’s phenomenal. But if you go to www.talkdavid.com you’ll also be able to sign up for the free three training videos on the “one thing” because I know that — you know in the radio interview we can only do so much and but there you got it all. And then of course there’s information at www.talkdavid.com about my six books and all the other stuff I do. So please visit and take advantage of it.
Jason Hartman: Fantastic. Well David Essel keep up the great work and thank you so much for sharing these ideas with us today, very powerful, very useful to literally every person on this earth so very broad appealing, no question about it. Thank you.
David Essel: Alright, thanks a bunch Jason. Have a great day. (Top image: Flickr | Alan Cleaver)
The Jason Hartman Team
Transcribed by: Renee
