In 2022, Elon Musk borrowed about $13 billion. Not from a friend, not from a VC, from a bank. He put up his Tesla stock as collateral, the cash landed in his account, and he paid zero income tax on it.

It’s not a loophole. That's just how money moves at the top, and of course, they don’t teach you this in school.

Here's the part that trips people up. Musk, Zuckerberg, Bezos, Ellison, Saylor, a lot of these guys pay themselves a salary of one dollar a year. It’s not a publicity stunt. It's because they figured out a sentence that should be on a poster in every classroom: you don't get rich by earning money, you get rich by owning things (and then borrowing against them).

The tax code treats earned income and owned assets completely differently. Your paycheck gets taxed before it even hits your account. An asset you own can grow for decades, and the IRS doesn't touch it until you sell. And the hidden part? Borrowed money isn't income. Doesn't matter if it's a credit card or $13 billion against Tesla shares; the IRS doesn't tax it because technically you owe it back.

So instead of selling assets (and triggering capital gains tax, plus losing the thing that was actually making you money), the wealthy borrow against them. Their stock stays invested, and compounding, the cash flows out, and no taxable event happens. Every major brokerage offers a version of this; it's usually called a securities-backed line of credit or Pledged Asset Line. Crypto has its own version too. Lots of companies offer Bitcoin-backed loans.

Then there's the part that switches this from a smart wealth hack into a generational wealth builder. When someone dies, their heirs inherit the assets at a reset cost basis. Decades of gains just disappear for tax purposes. The heirs can sell the next day and owe nothing.

This used to require serious money to access. Now SBLOCs exist at six-figure portfolio balances, crypto platforms let you borrow against holdings at four figures. These are offered on almost all the brokerages and platforms you already use.

There's real risk here too, though. Borrow too much and a market drop can trigger a margin call, forcing you to sell at the worst possible time. That's what wrecked over-leveraged investors in 2008 and crypto holders in 2022. The people doing this safely rarely borrow past 25-35% of what their assets are worth.

I get into the full strategy, the actual numbers, the safest way to start, and how much cushion you actually need in the full video here: