His rise to wealth and celebrity status is anything but the stuff of fairy tales. “Growing up I was a really sick kid. My dad was in the military, which meant he was overseas a lot and I had a working mom. Being a middle class family back in the 1970s meant we only had one TV… and it wasn’t in your room … so when I was 8 years old I began developing a passion for reading history, and it’s never stopped.”
That thirst for knowledge and hunger to achieve his own success eventually evolved into entrepreneurship. “I was a businessman for a long time before I was a celebrity,” said Harrison, “and to succeed for over 20 years, as I have, you have to be innovative and have a lot of perseverance. When times got tough, you have to lay people off and work two or even three shifts straight, sometimes spending 24 hours at the shop. When you’re the boss you have no one else to turn to.”
Like other successful business owners, Harrison did whatever it took to keep his company up and running, “even before I owned the building I’m in now, I was the electrician who went through and rewired everything.”
Asked what advice he has for aspiring entrepreneurs he emphasized the importance of reading (a lot) and “if you don’t have a great work ethic don’t even try it.” Advice that mirrors his own grueling work day that begins at 4:30 a.m. and ends at home with some reading by 6 p.m.
When asked how he invests all those big profits from the pawn business, Harrison’s answer seemed to mimic his inventory at the shop. “I do a little bit of everything,” he said.
“I have an advisor who does some investing for me, but I also do some of my own.” As you might expect, he’s a big fan of gold and silver (the name of his Las Vegas Shop is Gold & Silver Pawn Shop). His own personal asset allocation includes 10% gold and silver (which he calls an insurance policy) 80% in blue chip companies, leaving 10% to have “a little crazy fun with.” Like those treasure hunters who walk away from Rick’s pawnshop with less money than they’d hoped for, the king of pawnbrokers says, “You may not always win with that 10% but eventually you will get that rocket.”
Rick’s investment style is a wake-up call not only for other business owners but regular investors as well. Now more than any other time in history people are more responsible for their retirement savings and investing. Making it crucially important to be more involved in the investment selection and monitoring process. That doesn’t mean you have to follow his asset allocation, but it does mean you may want to start looking at how you can be more involved.
Obviously, Rick has his own unique perspective on investing, particularly in the area of precious metals, which interestingly, very few investment professionals even have access to. He personally created his own position in a leveraged Silver ETF because none of his contacts could get their hands on the industrial commodity, believing that over time it’s destined to rebound. And, unlike many mainstream investors, he can actually quote ticker symbols and talk daily pricing.
When it comes to his own retirement, Harrison has more questions than answers. “Ten years ago I tried to slow down and sell many of my businesses, but within a couple years I had a bunch more. Work is in my blood, but we’ll see. When the show ends, which it will, simply because it’s TV and that’s what happens, then I’ll have to think about it. If I’m still having fun I’ll probably just stick with it.”
That prompted me to ask Rick about his 72 year-old dad, aka The Old Man, and his retirement plans. “My dad’s the type that would die six months after retiring,” he laughed, “so I plan to have him work here forever, which should keep him alive forever.” A reality that many people face.
There are a lot of things in the world that can kill you, but I have found one of the biggest threats to longevity is retirement itself. The potential loss of purpose, identity, and personal interaction is something retirees need to plan and prepare for. There’s a lot more to retirement than just the dollars and cents of it and Rick’s comments highlight the need for people to prepare for the mental, social, and physical aspects of it.
Of course one of the ways retirees can fill their time and replace their work identity is to become garage salers or treasure hunters looking for that $10 item that’s worth $1,000’s. Making me curious about Rick’s most profitable purchase, his biggest mistake and what treasures he’s kept for himself.
“Twenty years ago a woman walked into the shop with four sets of American Indian photogravures by Edward Curtis.” Like most viewers and people who visit his shop, I didn’t know who Edward Curtis was or what the heck a photo grave was, so Rick gave me a free history lesson, (which you can hear in the audio clip). As it turns out, the owner of those photos graves only wanted $50 for all four sets so Rick decided to take a chance. A few trips to the library later, he sold them for $20,000 … a handsome profit any investor would take.
Listen to Rick explain photogravures only the way he can, how much he pays all of those experts who come into the shop, the advice he gives to everyone, and more.
Of course with the good comes the bad. Harrison admits that he is not immune to mistakes and “in business you have to be innovative, but so are crooks. A couple of times I got lazy and didn’t pay attention to new and improved fakes, so a few times I lost some big money on Rolex's.”
As far as his home collection goes, Rick said, “I have a lot of weird things in my library and I just bought a rare, colored map from the1650s that has the ‘island of California’ on it.”
While many people may not wish to have such a map in their home collection, Harrison's endeavors offer investors a rare look at someone who has amassed wealth and celebrity status through physical assets such as gold, silver, his business real estate, and historical artifacts. A very different form of diversification and wealth creation than the paper currency so many people plow into the paper statements of their 401(k)’s every month.
By making the most out of what life dealt him as a child, he has risen to great heights of entrepreneurship in a manner that we can all learn from. His willingness to educate and inform is contagious, and so I leave all of you would-be treasure hunters out there with one last tip from the pawn guru: “When you come across something, and its quality is just outrageous, that’s probably something of value. It’s been that way for hundreds and hundreds of years – the really, really expensive stuff is also really, really high quality.
A lesson in quality and value that can not only be applied to treasures but also to investments, financial professionals, and how you plan your retirement.
P.S. Leave me a comment if you thought the article was helpful. Also, let me know what other stars and celebrities you want me to interview about investing, retirement, and life lessons from the top.
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