231: How Smart Investors Build Wealth Outside the Stock Market
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Welcome back to another episode of The Richer Geek Podcast! Today’s guest is Dr. Amir Baluch, wealth strategist, private fund manager, and international best-selling author of Make It, Keep It. Dr. Baluch has helped professionals build lasting wealth through strategic passive investments, overseeing over $700M+ in projects through Baluch Capital.
In this episode, we chat about…
Dr. Amir Baluch's journey from aspiring doctor to semi-retired anesthesiologist and full-time wealth strategist, including early failures and lessons learned from losing his life savings in an electronic payments business and his father's bankruptcy.
Why alternative investments are essential for real diversification and risk reduction
The difference between real estate, private equity, and private credit and where they fit in your portfolio
What it means to be a Limited Partner (LP) and why it’s ideal for busy professionals
Real-life tax advantages: depreciation, capital gains exemptions, opportunity zones, and more
Key Takeaways:
Diversification is Key: Don't put all your money into one asset class like the S&P Index, diversify across multiple uncorrelated asset classes to significantly reduce risk.
Beyond Stocks: Explore alternative investments like real estate, private equity, and private credit for potentially higher returns, cash flow, and tax advantages not typically found in public markets.
Understand Risk, Return, and Liquidity: Every investment has these three profiles, and while return and liquidity are easy to grasp, understanding and underwriting risk is crucial.
Tax Efficiency Matters: Strategic investing can offer substantial tax benefits through depreciation, capital gains exclusions (like IRC 1202 for private equity), and other incentives.
Investing is a Team Sport: Don't try to go it alone. Partner with experienced mentors and consider starting as a Limited Partner (LP) to learn the ropes and leverage expertise.
Continuous Learning: Always be on the lookout for new asset classes and knowledge, never assume you know everything.
Resources from Amir
LinkedIn | Baluch Capital | Get Your FREE Book Here
Resources from Mike and Nichole
+ Read the transcript
Mike: Hey everybody. Welcome back to another episode of the Richard Geek Podcast. Today we have Dr. Amir Baluch. He's a semi-retired anesthesiologist and bestselling author of the book, Make It, Keep It.
After spending half a decade working at a boutique investment bank with his securities license, he ventured on his own to create an alternative investment platform, Baluch Capital, to help high income earners achieve better work life balance, and passive income and diversity. That's what we all love.
That's what we hit on, just about every episode. How are you doing, doctor?
Amir: Doing pretty good. How's it going out there?
Mike: Doing great.
Welcome to the podcast and give everybody a little bit of background on who you are.
Amir: Like you were mentioning, I'm a semi-retired anesthesiologist, and now I'm basically full-time wealth strategist and fund manager, of course it didn't start like this.
In the year 2000, you know, almost, I guess that's a quarter of a century ago.
Mike: Yeah.
Amir: I applied to medical school, but I didn't get in. And so that was a big blow to me.
And then, I figured, okay, well I've succeeded in all these other things. Let me start my own business. And I failed at that too, and lost my life savings in electronic payments business. I said, okay, let me regroup, I'll reapply, let me move back in with my parents in Midland, Texas. And then, my dad, whose internal medicine doctor, actually went bankrupt a few months later.
We had to move to a one-bedroom apartment, $250 a month, sometimes we had hot water, sometimes we didn't. We just kind of rebooted everything. Then as I was staring at the ceiling fan, I was thinking, you know what? I don't want this to happen again or to anybody else that I know. So what do I need to do?
So I figured, let me just learn a lot about personal finance and investments.
After going through about 300 books. A lot of them are in audio format.
You know, I got into real estate, eventually I did get into medical school.
But I continued with real estate initially because there's some statistics saying, "Hey, the first million that people make is in real estate."
Now, of course I didn't get anything going when I was 21-22, but I didn't have mentors or credit or money either. You kind of need something, right? Something gets started.
Mike: You got to have something.
Amir: Right. But eventually in 2025, when I was in medical school, I was a LP in a multifamily deal with the private REIT in San Antonio.
After that in 2008, I was a resident in Miami doing anesthesia, and I did my first short sale flip while in Dallas, even though I was living in Miami.
Then in 2010, I came to Dallas to start anesthesia and in 2011 I got my securities license joined a boutique investment bank because that's what I do. I like to learn, right? So I figure how am I gonna learn about investments? Let me go to where they have the biggest investments and see how to do it right?
And after about half a decade with them, we went through a little bit under a billion dollars worth of transactions. A lot of it is multifamily hard money lending and things like that. Then, I went off on my own around 2015-2016. I pulled my brother out of his MBA courses. We started Baluch Brothers Development and Baluch Capital where we build subdivisions in Dallas.
We brought on a couple of our physician partners that really wanted to partner up with me. So we made our deals bigger and that's kind of where we, how we got to where we are now.
I continue to read. I never think I know everything, right? There's always something to learn. So as I was learning more and going to conferences and learning from the best fund managers in the world, I learned about correlation ratios and the importance of diversity, which is why we also started a few private equity funds investing in life sciences and biotech.
And then we also had some fixed income funds at 12% and 18% preferred returns for the cashflow aspect, that was not correlated to real estate and things like that.
Now we have our first fund in the public markets, but trading in the Indian stock market, which has four times the GDP of the US and you can't believe that.
And so I'm always on the lookout for what is the next asset class that's not correlated to what I'm doing to give some people some true diversity. That's what we do right now is basically a full-time job.
Mike: Yeah. Well, it sounds like it. You know, talk us through, people go to your website.
It's baluchcapital.com, everybody. And we're talking to Dr. Amir. They go on, there's some educational, you can schedule a call and then talk to us about the different types of things that you have, you know, the cash flow, the vested type of deals and then what is the advantages of being an LP?
Instead of going, "Hey, you know what, I'm just gonna stick it in Apple stock, or I'm just gonna stick it in and whatever."
Amir: This is a really good point because a lot of people don't talk about this.
First, we're talking about different asset classes, right? Why doesn't somebody just stick with S&P Index and call it a day? I'll tell you the quick answer and then I'm gonna explain different asset classes, how they're similar and how they're different.
So why shouldn't you stick with one? If you look at Goldman Sachs and JP Morgan's data, because we've had this crazy bull run in the stock market, they're predicting and nobody has a crystal ball, but some pretty smart people are predicting that the S&P Index will probably only average around 3% a year over the next 10 years.
Because we've been tracking around 13% over the last 10 or 12 years, right? So you don't wanna be stuck in something like that. And now if you do plan on retiring one day, you just push that back by a decade or more. Now, everything has a couple things in common with the stock market that have in common with everything else.
Pretty much every deal, every investment has risk, has a return profile, and has a liquidity profile at, in its simplest form. So if I say, "Hey, here's the return and here's the liquidity."
"Oh, it's a two-year note, five-year note."
"Hey, we plan on flipping this thing in six years, whatever it is, you know, then that's pretty easy to understand, but it's not easy to understand risk."
It's very hard to underwrite that and to turn into a number because there's other things that have numbers. When you diversify into private equity, even different subsets of real estate, their risk profile is different. Some are interest rate sensitive and cap rate sensitive.
Some are geographically sensitive. Some are arbitrage plays and have nothing to do with interest rate and it doesn't matter who the president is tomorrow.
When you diversify enough, and if you read Ray Dalio's book called Principles, if you diversify across eight or more asset classes that don't have correlation ratio or are not highly correlated with each other.
Mathematically, you reduce your risk by 80%, but you're still getting the same or sometimes even higher return. So if you decrease your risk by 80%, your reward to risk ratio is five times with the average person is its way easier to reduce risk than it is to squeeze out an extra 1% or 2% out of an asset class, right? So that's the reason for diversifying.
That was the main question you're asking, why not just go in S&P? That's the reason. It's probably one of the most riskiest things you could do with your money is go all in on one asset class and hope and pray that it'll be okay.
Mike: Yeah and some of the tax benefits of, you know, we know real estate, the depreciations and things like that. And you know what I'd love, not a lot of the stock market ladies and gentlemen, we call 'em K-1s, on your end reports, you can get a dividend, you can get money, you get appreciation more.
It's more stable. You actually get to save on your taxes. It's like, name a stock, name another type of asset class other than some of the things that we're dealing with, just the benefits of being an LP. When we start a first year in the syndication, the investors and especially ones like in California, they're like going, "Oh my God, you know, thank God." These accelerated depreciations and things like that because their taxes are so high, right? And people don't realize that they can also see that, you know, thinking about cash flow, I'm just throwing my money in and it's gonna appreciate and they're gonna sell them, go make money.
But they don't understand all the other different types of things, that is also the benefit of being a limited partner.
Amir: Right. That's one of the reasons I named my book, Make It, Keep It. Because keeping it, you know, that is part of the game, right? You made a lot of money. You're about to give 40%, 50% to the IRS and who knows what the government's gonna do with it. Maybe not, you know, use it appropriately, you might as well try to keep that for yourself.
It does make a lot of sense from the depreciation point of view for sure. Even among different asset classes, private equity has ruled IRC 1202, I don't know if you've heard of that, but if you buy into private company shares, the value is under $40 million.
If you hold it for more than five years before you get any payments, there's no capital gains. It's basically tax-free.
Mike: Wow.
Amir: There's all these different benefits and all these private asset classes, you just have to see what it is or like, we are building real estate in opportunity zones right now.
If you hold that for 10 years, there's no capital gains or if you bought a rental in our Fort Worth subdivision that we built. We've negotiated down the property tax to $200 a year as a tax abatement, plus $2,000 tax credit per house. They just want this area revitalized.
So we're revitalizing it, and the government is financially incentivizing us with some tax breaks.
Mike: Wow. You know, might as well take advantage of it.
I tried not to smile when you said, you know, that Washington may misuse our tax dollars. Just maybe, just maybe.
So let's talk about the funds that you have currently going on and then we'll talk a little bit about your book.
Do you have some current funds that are going on? You know, I don't know the Pre-IPO one, like maybe healthcare, another private equity.
Our listeners are gonna hit on your website and they're gonna go, well, okay, I see average returns, you know, growth, but I have no idea what exclusive Pre-IPO private company.
I don't explain some of the things that you're doing
Amir: First, I'm gonna step back and break alternative assets into three categories, or else we, it is gonna look like a laundry list.
In the alternative asset space, I think of three things. There's real estate, then there's private equity, which just means private businesses and there's a lot of them.
And then there's private credit, which could be a debt or a fixed income product. So under real estate, what do we have in real estate? We basically have doubled down on build to rent communities, which we feel is basically multifamily 2.0, but without the interest rate sensitivity and without the ceiling on rent growth.
It's also only 5% of the rental market right now and all the data is showing that we won't even come close to meeting the housing supply demand for about 15 years at the current rate that we're building. So we really like that where people can make money on the development side with promissory notes.
They could be a LP, some people want a JV if they put in more than a million. We have some joint venture opportunities. So that's for the most part what we do in real estate although my background is multifamily, but that's what we've been doing for probably the last eight years, 10 years or so.
Also, somebody wants to buy one of these properties just to have it as a rental or you know, since we write the HOA, we usually have these all approved for Airbnb. So there's some tax benefits too.
Mike: There go.
Amir: If your significant other wants to get rep status, real estate professional status and manage it. Now, crazy tax benefits, you're gonna get, I'm sure you've had a podcast on that at some point.
Mike: Yeah.
Amir: If not, you know, we should do one, so that's another option. So those are basically our two real estate plays. You could come in as a debt partner, you come in as a limited partner, or you could come in as a joint venture if you bring a group of people and knock out a whole deal with two to five people.
Now on the private equity, that's basically private businesses and a lot of things we do, we actually don't put on the website. It's just, you know, we'll build them for certain people and the thing closes before I could even market it.
Mike: Yeah.
Amir: So for example, we've bought out individual e-commerce companies and doubled their value and then sold them through brokers.
So then you get some cash flow, and then you get an equity multiple that usually doesn't take five years and usually in about two years, we could be in and out of these things. You could potentially double your money or come close. When people think private equity,
you gotta break it down into three categories. So start off with three categories, right?
And then private equity was one of them. Now, private equity, let's break it down into threes because threes are easy to remember, right? You have venture capital, which is the idea stage. Then you have growth equity, which is like your Series A, B, C. Where now they've got traction. They're not just an idea, they're actually got some revenue and they're growing.
If you wanna get into a stabilized company, that's the leverage buyout space where big private equity companies are rolling up chains of companies, right?
And making them even bigger and then passing it on to the next guy that wants to do the same thing. So in my private equity world, for the most part, we're on the edge of venture capital and growth equity. They're a little bit past the idea stage, and they're about to get on the inflection point of growth.
We like to be there. On the other side, when it comes to e-commerce, we like to buy existing stabilized stores that maybe haven't expanded to other channels or maybe haven't gone to brick and mortar. And then we do that as the value add ,so for the most part, in private equity, I stay in those two zones that I understand, which is e-commerce and specifically life sciences, biotech type stuff, and private equity.
Right now, we actually don't have any of those open. All three of the funds are closed, but we are will be reopening it up, next quarter where we have some deals where we could be partnering with an ex-CEO of Google and some other ones, I can't mention their names on here yet, but some people that, pretty much everybody is household name for some people. So, really cool things coming down the pipe.
Mike: In order to invest with you. A lot of people don't know the difference between the B's and the Cs, accreditation or not. Most of your funds are Cs?
Amir: Most of them are Cs, they used to be Bs, but now they're pretty much Cs. What does that mean? That means I could talk about these things online or on a podcast. So that's pretty much what the C means. And then also you had to verify that somebody is accredited, or in some of our funds, you had to be what's called a qualified client, which means net worth $2.1 million.
So those are the two classes of investors that we take. And sometimes if you do a 506(b) and securities get really complicated.
Mike: Yeah.
Amir: One of the reasons I went and got my securities license, but in a 506(b) where you can't advertise, in some cases you could take a certain number of non-accredited investors.
And we have thought about doing Regulation CF, which is a crowdfunding or Regulation A. And those funds, you could take anybody, but we haven't done that yet because it costs a lot more money to do that.
Most of the people that are working with me meet the accreditation requirements already.
Mike: Yeah. As GPs, we don't need someone begging us, " Hey, I need my $5,000 back because they can't pay my house payment." You don't wanna even want the deal.
Amir: Right. It's a big headache. And imagine every one of these investors, you have to still have a certain amount of bookkeeping fee costs like there's some fixed cost to handle every investor. So if the return is 10% on $5,000, right? Like $500, but the K-1 costs $150 to prepare it. Like it's not looking that good when a third of your investment is gone to the CPA fee. Right.
Mike: That's right. Because you know, a lot of people will say that it's like, " I wanna invest with you, but I'm not accredited.
I'm like, because I'm too busy to do a B, you know, and a lot of people just don't get it.
Amir: Another alternative, let's say somebody is almost an accredited investor, right?
Like maybe their net worth isn't a million, but it's $950K. And maybe they make, don't they make $180,000 a year, not $200,000. In some cases, we've put together joint venture things where maybe it sits a quick million dollar raise and we might just need five people coming in. In a joint venture, you don't have to be accredited.
So that's more like a partnership structure. But you just have to, I'm not just a curious attorney. Talk to them about what you're doing first.
Mike: Yeah.
Amir: And get all your ducks in a row but we've done joint ventures. I still have all my investors are accredited, but I don't have to, I could take somebody that's not accredited in a joint venture, although we rarely do joint ventures.
Mike: Yeah, the only time I do joint ventures is when someone gives me enough money to warrant it, and they're usually well beyond the C, you know?
Amir: Right.
Mike: So let's talk about Make It, Keep It, what made you want to do it, you know, write the book and what's in it?
Amir: While I was working full-time in the hospital, a lot of people would just ask me in the doctor's lounge, this and that and some basic stuff because you know, as doctors, we don't get any of this education in medical school or in college or anything, right? And so I was saying the same things over and over and I figured, "Hey, why don't I just write a book about it and just give people the book?"
It is a quick read. It's only like a two, two and a half hour read. But if you're starting from scratch, this really lays a decent foundation and you'll probably have more questions afterwards, but you kind of know the lay of the land. It's kind of like a map for investing to an extent. And I wrote the book chronologically where, let's say if you were a physician or anybody that's gone through some higher level education when you first came out, you don't know what to do.
You're making money right now. You just finished college or whatever school you went to. We talk a lot about the psychology of investing, what the definition of an investment is, what diversification means. And then in the middle of the book, now we have an older avatar, maybe somebody in their 40s or 50s.
Hey, now you're making money. You've got the mindset, you're making a plan. Now we talk about different asset classes and how they vary in their risk profiles. At the end, now, you've accumulated a lot of money. You have a high net worth, you have passive income at the end. We talk about how to keep it, you know, tax deductions, asset protection, also some philanthropy.
How do you give to charity? For example, I just actually bought a college in Pakistan, 3,000 students. And we're teaching them. I'm building a curriculum to teach them about AI and freelancing and stuff like that so they can make money in other countries and help out, help stabilize their economy is one of the things I wanted to do.
So that's kinda like, now my philanthropy arm is that, but we talk about how that has tax benefits too, if it's done a certain way. So that's more, now we're talking more about the Keep It side, whereas the first part of the book is more on the Make It side. That's pretty much it. So it's a two-hour read, maybe two and a half.
Mike: On Amazon?
Amir: It's on Amazon. Yep. We'll have a special link for your viewers where they could get a free copy of this book if they want. They just have to pay for the shipping.
Mike: Sure. Amir, is there anything else before I let you go, that I might have missed that you wanna talk to, with our listeners?
Amir: If the listeners out there are looking to diversify, one important thing is, just understand that diversification doesn't mean, "Oh, let me get Apple, Tesla", and a bunch of things in one asset class. You gotta be in asset classes that really are not going up and down in values based on the same variables.
And that's where I think a lot of people mess up. Either somewhere on my website or one of my webinars, on my Instagram, I talk about Yale and Harvard's endowments and how they've diversified into how they allocate a certain percentage of private equity and real estate and private credit.
So you kind of want to get an Excel file and break that down and make, kind of make a plan. And you don't have to be exactly like these other guys, but find out where you feel comfortable, where your deal flow is. For example, I'm very comfortable with real estate and e-commerce. I'm gonna do a lot more there compared to maybe doing something
farmland-related or some that I don't know anything about, you know, so my allocation's gonna be different based on my expertise and my deal flow. And then for all the listeners out there, it's gonna be a little bit different too. And for sure try not to do this on your own. I think investing is a team sport.
Like the only reason I could even do any transactions in my 20s is because I partnered up with a bunch of people. The first few years trying to do it on my own, I pretty much got nowhere. As soon I started becoming an LP. Now, actually something was happening and then I went into a deal, you know, a few years after that where I could do my own deal because I had learned from my mentor.
So, starting off with an LP as a great place to go, and if you could be an expert LP and really understand how to make a good portfolio, you probably don't actually need to do anything else than that.
Mike: Why have the headaches of being the GP if you can just make a living being an LP, right?
Amir: Right. For my overall best advice for the listeners today.
Mike: And especially ladies and gentlemen, you've heard me harp on it over and over again. It is about mentorship. It is about your networking, never stop learning. Both Amir and I are successful.
We still have our mentorships. We still have people that we ask questions.
Amir, where can people find you?
Amir: Well, LinkedIn is a pretty easy way. It should be maybe the only Amir Baluch on there, that's also a doctor. I should pop up there with a yellow background. Also, if you contact us through baluchcapital.com, that goes straight to me as well.
We'll have a couple gifts for your listeners too, if they wanna book a one-on-one call with me or if they wanna get our Top 20 Tax Checklist because I know once you become a high-income earner, you gotta protect yourself and keep it. Keep what you make. Also, if somebody wants a free copy of the book, there's gonna be a link there.
You just pay for the shipping and you can get it, you know, probably in a couple days.
Mike: Absolutely, wonderful. Amir, thank you so much for coming on The Richer Geek Podcast. We'll see you later.
Amir: Thanks. It was a pleasure. Thanks for having me on.
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ABOUT DR. AMIR BALUCH
Dr. Amir Baluch, MD is a wealth strategist, private fund manager, and international best-selling author committed to helping professionals achieve financial independence. He is the founder of Baluch Capital Partners and Financial Wellness MD, where he offers access to passive investments with high risk-adjusted returns.
With over a decade of experience in private equity and securities, Dr. Baluch has co-managed or funded more than 80 projects totaling over $700 million. Motivated by witnessing his physician father's bankruptcy at age 21, he now focuses on bridging the gap between clinical success and financial freedom.
He is the author of Make It, Keep It and Prosperity Prescription, and a contributor to Forbes, with features in Entrepreneur, Yahoo! Finance, and Business Insider.