3 Reasons Why Americans Are Still Broke!

three

reasons

why Americans are

still

broke

is brian preston, the money boy, you know, this show seems like it's going to be negative, but it's actually going to be a positive, uplifting show, but the truth of the matter is that We know in our current state of In our country there are many people who simply do not make sound financial decisions and are not in the healthiest financial circumstances and in our opinion, most of the time it is a little bit of their fault. Yeah, I mean, we have a big problem that I believe in. the average American is trying to keep up with Jones, that's right we have a problem where we look around us instead of being happy with what we have, we are trying to look at our neighbors and what all the statistics show is our neighbors.

They are bankrupt and this is what makes me so sad about this whole thing: you have everything in the world going for you we are in a globalized economy which means the world is getting smaller and smaller innovation is actually accelerating There's no reason why we shouldn't all benefit economically from these great things, but we can't get away from our own fair consumption. That's right, it's consumerism that is destroying the ability to create an army of dollar bills and what I think is so great is that these three

reasons

are things you can control there are things you can change things you can improve like this We'll explain to you why we feel like a lot of Americans are

broke

, but it wouldn't be a money guy, unless we give you some statistics to show you how bad Americans really are with money.

The first thing is that 78% of Americans live paycheck to paycheck, which means that 78% of Americans can't move on to the next month if their paycheck doesn't arrive this month. and it doesn't have to be that way, if you're living paycheck to paycheck, that immediately tells me something right off the bat, you're probably not saving any of your current paycheck because if you were saving, you'd be accumulating a little bit, so you're spending it all what you make and if you needed more proof of that, sixty percent of Americans can't even come up with $1,000 if they had an emergency, they're exactly in trouble, so let's figure out how to talk about what we're actually doing what's the main reason why Americans will

still

be out of money yeah, you know, I think that reminds me I think it was my mom, she says maybe she was a school teacher, she always used to say that not planning is planning to fail and we think that's The number one biggest reason Americans stay broke is because they don't have any plan in place, they don't have any kind of budget, any kind of strategy in place since Jump Street, the biggest thing we look at and I call it the ship. rudderless or starting on a road map, you know, it used to be.

I don't even know if young people who know what a road map looks like already feel it, I know it, believe me. to be even whole cottage industries where like triple-eight you tell them where you're going or you knew and they print you a little spiral brochure or you had MapQuest, but Waze is exactly what I'm talking about, but imagine if you went somewhere that you had never visited and never even used an app like Waze, you basically said, I'm going to get over this and I'll be honest with you, the average American, that's what they do when they're 20, that's what they do when they're 30 and probably Whether it's about my age, that's when the midlife crisis hits and people say, wait a minute, I'm going to be at that destination and I really don't know where. to get there I don't know how far it is I don't know how much I need that's right and that's exactly what's happening so we skipped steps so we want to show you because why would anyone buy premium brands? buying designer clothes from designer or luxury cars without knowing exactly where they are and if they are ahead of the curve behind the curve or if they were hit by the curve, but that is what is happening with America and don't get lost , listen to us, there is nothing wrong with luxury brands or nice houses or nice cars or fill in the blanks, but there is an order in which you are supposed to achieve those kinds of things and if you don't have the basics If you don't have a solid foundation in place and you get it out of hand, you set yourself up to be directionless and aimless as you move forward on your financial journey, so let's talk about planning because that's what Fidelity has in a study. that they have done.

I've talked about it on a few shows and I've published it is that one of the biggest indicators of success is whether you've taken the time to create a plan, so let's check the money, we have tips so we can make sure you're not. a rudderless ship that there's actually something going on there, so the first thing you can do when you're starting out and trying to figure things out is know where you're losing water, where you're spending your money, and the best you can. Doing that is a budget, yes, so you know you hear us all the time.

Now I will ask you if Brian is true or false. Do you make a budget? No, I hate the fake budget. I'm the same way that we don't make a budget, whatever there is. There was a time in Beau Hanson's life when he didn't have a budget when I started. I had to understand if this is what I have to enter. This is what I need to get out. How do I do it? stand in line and that's why we think that from the beginning it can make sense for you to have a budget and the good thing is that in the world that we live in there are apps, there are worksheets, there are spreadsheets, there are all kinds of things that now You can use.

I am here to make this easier than ever. Yes, budgeting is no different than exercising for me. I mean, it's something I know I don't like doing, but it's something I've practiced in the past because I was trying. To build muscle memory, create habits and that's the part: if you don't do this, you're not really going to reap the rewards of what comes from laying the foundation of your budget, so make sure you understand that the next step is to automate it. You have to automate the process the more things you can set up and this is what will allow you, if you hate budgeting there is a way around it.

You actually pay yourself first and automate all the things that come along. from your accounts monthly, so you're funding all the big things first and then you don't have to worry about the minutiae, focus on the little things, but you can't get there unless you put in the effort from the beginning. front, you know, the dirty little secret about human nature is that if we operate under this place where you know, I'm going to wait until the end of the month and whatever I have left I'll keep well, it's amazing how every you prepare to do that, you make ends meet and somehow that money finds a way to evaporate, so if you can do what you said, pay yourself first, have a scarcity environment, you will prepare yourself. for long term success so we have the automated when I mentioned the concept before the scarcity what is being talked about everyone knows we are big advocates that we should save twenty to twenty five percent for the future many younger people For example, how do I get to, or even people in their 30s, how do I get to 20?

The 25 percent shortage is one of the most important tools you can use because, while what it means is that every time you have a step forward in your income stream or your cash flow that, instead of allowing that create a change in your lifestyle or let that get away from you, you actually deliberately allocate a Porsche for long-term savings, whether you know how to save for Roth, whether it's 401k or retirement, there are purposeful ways to you. being a field general of your dollar bill army is making sure everything has a purpose, is exactly right, all of this also leads to a bigger plan and how everything can work together, because we mention this if you look at the financial order of operations or is it the money guy who likes to affectionately call foo, you know it's one of those things that you can talk about, we need to talk about the order of operations like cash reserves, making sure that you have your risk covered and the basics of your wealth, so if something happens to you, people are counting on you or not hurting you, making sure that you have a good amount of worry about debt and a good relationship with them, and then you always want to make sure that You are thinking about the future, where retirement savings are also, yes.

One of the things you have to recognize is that if you get a piece, okay, I have the budget, okay, I have my automatic savings, there are different ears, what you have to fold, if you have it, you should go see. I've done a lot of programs on the order of money-type financial operations. Check them out and that's how you can make sure you're really on the path, you're not that rudderless ship knowing you're moving in the direction you want. We're supposed to be moving forward, so to close out step one, make sure you have an action plan and actually stick to it.

It's okay if it changes every year or if you have to adjust it at the beginning, just make sure you're doing something. because a dream doesn't become a reality until it is put into practice and put on paper, so go ahead, stop being a dreamer, in fact, being a person, you are actually starting to build something for the future, love it Number two, you have to have a healthy life. relationship with debt, but the truth is that most actually have a very unhealthy relationship with it, you know, I don't know if I say this is the most important reason, but I think in the United States specifically this could be the reason most important for a consumer.

From the point of view of why people are in trouble because it has become too easy to borrow our lives to pretend what we are going through and we don't really own anything. I think you know that's how it is, life is a little cruel while you. you are young while you are carefree no no you don't have children you don't have anything that ties you down normally you are ruined mm-hmm so an entrepreneurial group has realized you know what we have all these people who are young have energy and have a lot of free time to themselves, but they don't have money if we can only create a product that helps them feel like they do have money when in reality they don't have money, that was the beginning of the credit card is correct because that is exactly what has happened: there is a whole group of people who fake their lives, go on trips, do all kinds of things, buy into consumerism on steroids, but then, guys, by telling you that this is a trap, you were slowly getting yourself into a situation where the Debt slowly consumes you to the point that you eventually become a slave to the payments you have to make, so don't let it really be debt. like a knife mm-hmm it's a very scary sharp instrument, it can be very productive, it can help you, but it cuts the fruit, it cuts the vegetables, it's amazing in those aspects, but if you never respect yourself, you forget what a knife is . and no matter how sharp it is, it can turn into a chainsaw or it can turn into something that breaks you.

You can actually lose an appendix. So when it comes to debt, we think there are actually four areas, four big areas that they can guide you towards. down the dark and scary road and Brian, you already alluded to the first one: credit cards, yeah, that's the one I think consumers are the ones that get us into the most trouble the fastest because it's so easy to let it slip away. of control. Let's go over some statistics about credit cards, why are these things? Now the first thing is that the interest rates are approximate. We just spoke to a group of engineers who are in their twenties, so they are highly educated.

We asked them what credit card fees were for. on credit card sales and they were like 22% 23% I thought that makes sense because we are always quoting the average credit card rate, but for younger people this is even more disastrous than the average, that's right , you can see. that the average APR for credit cards right now is seventeen point three percent, obviously, a big chunk of it driven up by 20-something year olds, yeah, and I'm sad that the number is typical: our credit card debt is around of eighty four hundred dollars. right, that's a lot, that's a lot of money, especially with a crew of seventeen point three percent, so what's the most important thing you can do to protect yourself?

If you are someone who uses credit cards, pay them in full every month. If you find that you're the type of person who doesn't have the discipline and doesn't have the ability to do that, then just don't use them, quit cold turkey, cut them, get rid of them, but if you're someone who likes points, like the cash back you like rewards make sure you pay them every month in the fall so I feel like me and this slide is like hanging out socially now because we didseveral presentations last week with this slide. do it today I admit it, but then I realized, I thought, Brian, this is okay, this is a public service announcement, you need the public to understand that it really is a bad word if you can't pay your credit card debt monthly , do not do it. even use it cold turkey, you know, do all the things you might need to be a Dave Ramsey type person, where you just give up these things because they're dangerous, dangerous, dangerous, if you're not responsible, remember our advice is not for 80 percent.

Of the public who have behavioral problems and no discipline, we are only giving advice to the 20 percent who can go beyond common sense and increase debt without Millionaires don't even struggle with debt, so why should they? I have a problem with this? If you're struggling with debt, fix that problem so you can move on to more of what we're sharing with the audience about this now for most people. credit cards are a smaller thing, like you, you rack up credit card debt of 100 dollars, 200 dollars at a time, we, the average debt was like 8400, yeah, 8400, okay, that's sad, but I know where you're going let's talk about something we can actually make things grow well so we think the next big mistake you can make is buying more cars than you can really afford and cars and I've said this several times .

I think this is my new favorite topic to talk about. because once again we spent a lot of time with young investors last week giving them advice. I truly believe that car loans are Napalm to your financial life, yes, because they are the most important thing and I think it is so cruel that this is an emotional psychological issue. that happens because what is probably the quickest and coolest way to be cool in high school. Oh, you have to drive a good car, if you have a good car, you can really move forward on the lease.

It worked like that in the old days, you know? I was in high school, how cool your car was and given the way things have moved up the social ladder now, luckily in college I didn't feel that pressure, maybe that's the case, but college didn't feel like that, but I think there's always an insecure Teen inside each of us who thinks you know what the car will be where I make my mark and show people how successful I am. Why would people make these efforts? That's why it's not uncommon to see people graduate from college. or they just graduate and get their first big job, think they need to reward themselves with a car that sounds fantastic on paper and, I mean, they can't even turn on the great Thor, was the third biggest advertiser in the automotive industry?

Yeah, because it's like beer, pharmaceuticals and then like a car, and you know the car industry, there are a lot of people telling you to reward yourself, there are even Christmas Christmas commercials. I saw those comments. I think it's General Motors, they have like an SUV, but he thought he was buying the truck for his wife and he bought this big black truck for himself and then the wife runs out. I was like, "I'm so excited I'm going to keep the truck and it's all supposed to be fun, you guys should beat each other's butts." it ends because they bought two new vehicles without talking to the spouse about what is going on, but this is what they whisper in your ear all the time, yes, and this is not just an ax, we know that it is really just a system that one In three people who trade in a car for a new one they are actually underwater with the car they are trading in, so they not only go into debt, but they also take on negative equity when they go to buy a new car, so let's talk.

About how we can avoid this, we have said before. I feel like we're in camp with this one too because we used this last week for our presentation. We talked about the concept of the 23-8 money guy and all that. that means they're going to be, we're being reasonable with you, we realize that cars are horrible, these things depreciate like a stone, it's not uncommon for them to lose 40 to 50 percent of their value just in the first few years owning it, but I'm going to treat you like you're an adult and I realized that sometimes you may have to finance that minivan for your family, so with that understanding, it's okay if you put 20% down , but you will slap yourself. pay off that car in three years, that's just going to happen in three years and you're not going to let the car payments exceed eight percent of your gross income, but Bo, there's an exception, a big asterisk that we put there. is that for luxury cars you want to buy a luxury car so this is Tesla BMW Mercedes Lexus Acura fill in the blank you need to be able to pay for it in a year, yes, twelve months, the same as cash, so I imagine there are two You ask, well hey guys, but what if I can't pay for my luxury car in a year?

So they are buying too nice a car or they are just faking their lifestyle. Everything we're telling you about fake it until you make it. It looks like that, if you can't afford the car or if you want to. I shared this story. Someone came up and said, "Hey, can you talk to a friend of a family member and talk to this person because she's really scared?" the car situation the car is breaking down they need to buy a new car they are thinking about taking money out of their 401k they said sure I will talk to him so I exchanged a few emails and then I did it everything went silent now.

I walked up and said what happened, what was it, oh, they actually got a great deal on financing a new BMW. That's how people keep going deeper and deeper. It's right in the ditch of bad financial decisions, so always. keep these things in mind so a car and credit cards were bad and a car is even worse because now we are talking about big numbers let's talk now Brian about the biggest problem well I mean at least with the car that people can see. what car you drive, the house, no one sees except the people who are your neighbors and where you live, and let me tell you psychologically, we've talked about this, the happiness factor happens around seventy-five thousand because that means you cover the basics. , but if you are the poorest person on the street and this is counterintuitive because you always hear that if you buy the cheapest houses on your street you will probably get the most appreciation money.

I am so fast economically, psychologically it is the best opportunity. It is the worst decision if you are the poorest person on your street, it will have negative consequences for you, so do not strive to make your house rich, life poor because there are many people who do that and many people give that advice. your young people to the kids and the real estate agents, the mortgage brokers say yeah, just stretch out, and that's what we've seen, in fact, we've seen that thirty-eight million Americans spend over thirty percent of their income on housing, up from 16 million in 2001.

What that tells me right away is that there are thirty million Americans who don't listen to the show "The Money Has" because if you listen to the show The Money Has, you would know to spend thirty percent of your housing income is not the way to make sound financial decisions. that's not where you want to be when it comes to how much to spend on housing, no, so let's give some money guys, let's give some love for some money, I've got advice and then let's also be confessional about how the down payment works, so Bo walks. them through what it's like to buy a house, what are the rules that the money guy sets?

The first thing you do every time you are going to buy a house is to think that your goal should be to put a 20% down payment and the reason why you will put a 20% down payment is More or less double: you would like to have immediately equity into the home you're purchasing, but you also won't waste money on PMI primary mortgage insurance. If you can get 20%, you don't have to worry about it. Another thing you should do is aim to have your house paid off before retirement. I can't tell you how many times someone calls us and says, "Hey, I'm thinking about retiring next, we'll say awesome, tell me a little bit." about your wallet - I'm a little bit about what you're going through oh well, I assume you're debt free oh I don't know, I still owe seven hundred thousand dollars on my house and we were like, oh God, can you?

Not being financially independent and having a mortgage, those are two different things or at least having the ability to pay the mortgage and then here's the most important thing, here's the really important thing when it comes to how much of your income should go towards your home. Towards housing, your mortgage payment must be less than 25% of your gross income, so these 38 million Americans who spend more than 30% of their income on housing are already out the door, doing it wrong. Yeah, I definitely think this is something that a lot of people get into trouble with if you look at your car, you look at your home, those are Apple's biggest bites that are probably hurting your lifestyle.

Now I want to give some love because We've all been broke before we were 20, we were 30 when you're trying to get that first house and you see this 20% off number, you know, no way, no. What I mean, just the market if you're especially like we're in Nashville, but if you live in a coastal area or a hot city like Nashville, the appreciation on a home just from a loan is probably going to be higher than you could . come up with savings and a down payment so it almost seems like the real estate market is working right now rather than you being able to control the 20% down payment so again we are very transparent and honest because I asked around .

In the entire office there is not a single person here, but let me note it. There are two people here because I lost Eric and Carter. Now we have more new exceptions with Eric, because I ask these questions, but most people here didn't write them down. 20% is fine on that first house if you have to because you're trying to get in it's because you don't want to neglect your savings you don't want to like it you know, everyone thinks about long term planning, but I'll tell you. For you, the 25 percent, there are no buts because I want to prevent you from getting into a situation where you have this big honking house that's empty and carpeted and you're sitting in the corner crying every night because you have no life. that you're living outside of that, but I want to give you enough grace so that you can Elise, hopefully, set your first foot in a house at some point in your life, now second third house.

I want you to be a little more deliberate with getting closer to that down payment goal, so we've talked about some consumer behavior, so credit cards and buying cars and then buying houses, but then there's another type of debt, now this debt It's an investment, this is a good debt because it's a debt that you accumulate to improve yourself to improve yourself a lot to build on that you can work on in the future you're investing in yourself that's right that's what they tell us we're into investing in yourself look I'm big on always being a lifelong learner investing, but this student loans thing.

I'm disgusted with what happened because I looked at what it costs me to go to the University of Georgia and it was a hell of a lot more expensive for you to go to UGA and then we hired Daniel, his full-time equivalent. I was surprised if you remember the inflation rate and it was consistent, it wasn't even a rounding error, it was 7% a year every year from when I graduated in the mid nineties until I got to Daniel. I recently graduated and I couldn't believe how jaw-dropping that was. Education has such a big growth factor, so it has really created a lot of debt among our young people, so let's give them the tools to not let this hang around. too long, but I also have a very healthy understanding of exactly how to pay it off, so as you listen, I show you that someone probably already has student loan debt, so the question you have is guys, I heard you guys talking about this eighty and eight. times and how powerful my dollar bill army can be, how should I approach building my army but also paying off my student loan debt and being the math nerds that we are?

We came up with some simple math to help you figure it out and this information. It is based on the equity risk premium, which is essentially the rate of return you earn by taking on risk. I think about it and this is what we boil it down to if you're 20 years old and a student. Loans are over 6%, you should probably prioritize paying them off instead of building your army of dollar bills and a lot of people have student loans over 6% when I was recently talking especially to this group of engineers like this last week. had interest rates of six and three quarters, six and seven eighths, so pay attention to what your interest rate is, you probably want to be aggressive if it's that high, that's right, if you have30 years old and it's about 5%, you want to start prioritizing and then once you hit 40, if your student loans are over the percentage, you need to eliminate it because when you get to age fifty or older you shouldn't have any more loan debt. students, you know one of the things because we Daniel did the research.

I would feel terrible if we left out this thing about the average student loan debt being twenty-nine thousand eight hundred, you know, and now when? In fact, that encourages me a little bit because what we always say is the right amount of student loan debt to accumulate, you really never want to accumulate more student loan debt than you will make in your first year, working well if you look at the average income in this country and you see that thirty thousand dollars. Well, that's good to see that it's not some crazy, outrageous number like eighty ninety one hundred thousand dollars on average, we'll save that for the doctors, that's right, go up your way, but it's still one of the things, so Bo, let's be friendly We talk about that because we have talked about the great debt, of course, but there are things you can do and that are also decisions for which you can die by ten thousand paper cuts.

Yes, we believe that there are some small decisions that can be costly. a fortune in the long term and that's why one of the things we want to investigate is how much people spend in different areas of their lives and this is from the MarketWatch Bureau of Labor Statistics and the Consumer Electronics Association and this is what we found, in On average, Americans spend almost $300 a month eating out, that's three hundred dollars a month going out and eating at restaurants and not spending anything bad on eating out. As long as you can afford it, that's right, what worries me is that people who eat out and create this lifestyle don't check the other boxes first, so keep reading.

I'm not against 288 going out to eat. I mean more that you do this when you don't have your financial order of operations in a good place if you tell us, oh man, I just can't tell if things are that tight and then we'll see you later. weekends, you know? you're going to buy burgers instead of eating at home maybe you're not doing well a hundred dollars a month on electronics no, I'm a gadget guy so that doesn't surprise me at all, how about these clothes on average? American spends one hundred and fifty-six dollars a month on clothes.

I'm skewing that number down, down. My wife is helping on the other side, so we have kind of a push-pull system going right now. I found the next one really interesting because we've done shows about this before, in the past, the average American spins 200 and almost $40 a month in subscriptions. Now I did it because I asked something and I thought, damn, give me some stats on what it's like. that number is so big and I don't know, it includes, you know, your internet bill, that's it, but, but, this is the newest subsidy battleground for your money and look, I'll be confessional.

Over, I cut the cord, I'm so proud that we even made you I can go find our show where we cut the cord because I moved to YouTube TV and it was a huge savings because I went from a hundred and ten dollars a month to 35, that looks great , but this is the problem I have. I filled up all those savings, what's the backfield? First of all, YouTube TV has gone up. I think we make over fifty dollars now. Oh wow, we added HGTV, so there are some wins there. We also had TNT for NBA basketball, so they had that channel. so I'm not even going to fool you too much by raising prices, but the problem here is where I have a problem is how do we keep restocking, I mean you have who you have Netflix, you have prom and then Disney Plus comes along. scene and then even before Disney Plus comes into the picture, Apple has its own streaming channel.

I know NBC has their own access to CBS because they have Star Trek and some other custom stuff and before you know it, guys, there's no doubt they would do it. you're going to spend more money on all of these subscriptions than you would if you went back to your old school cable, this is you, you have to be very deliberate about what you're subscribing to know I love what you said there, broad. because you said two things that I thought made me look so good and this is in line with our money guy advice. Did you say hey, I'm a gadget guy so I don't mind spending money?

I got you, you said, hey, I like it. Disney Plus I like this, it's okay to spend money on the things you like and the things that matter to you, the main thing is to make sure and we put this umbrella over a lot of our advice and content, you should save twenty to twenty. -five percent of your income if you can make sure you cover the basics if you want to have all the streaming subscriptions. I agree with that point, in fact I love my Disney Plus and bundle it with Hulu and Bo if that's the case.

Not everyone has seen the Imagineering series that is on Disney Plus. Malo is missing, Greby and I have already seen him as a nerd in this. I address this conversation without myself. I wasn't, it's so good. I will tell you a mistake. You know, my youngest daughter, she really loves Disney magic, but you know, she's autistic, she's ten years old, but she's more like the six-year-old in the way she processes the world that we had her in while She was there. Think about something new, is it you and they were making James Cameron's new world, what do you know about an animal kingdom and Pandora and the open door with the floating rocks that she saw where they were showing how they made the floating rocks?

She practically started crying, so it's fake, she had noticed that my daughter had no idea, so we ruined it by watching this Imagineering show, so I want to tell you that there are some risks to watching some of these shows behind the scenes, but it's gratifying to see the vision that Walt Disney had in each series kind of walks through the Imagineers and how they fulfilled Walt's visions and then how that was for all the different CEOs, plus it's something incredible, incredible, I know, I'll go to Shanghai at some point. period and you know, just because I know a lot about it from watching this, okay, not the point of the damn troll commenting on it, but I couldn't help it, so when it comes to this consumer behavior when it comes to watching Imagineering, concentrate. in spinning the things that make you happy, but don't make it out of control with your trading order, so if you can follow the money, get information on the trades, it will give you the freedom and flexibility to spin and then the second thing .

It's just that if you're someone who likes to use something like credit cards, if you do that kind of thing, make sure you pay it off in full every month. I mean, without a doubt, if you don't pay them monthly, you're digging yourself deeper. although I know you would ask Daniel he said hey I heard the average debt is around 8400 check out some stats on what it would look like if you just paid the minimum yeah so what we said is fine if we have the average annual. 17.3% percentage rate Most typical credit card users will allow you to pay a minimum of twenty-five dollars for three percent of your outstanding balance, so let's say you want to buy something for the average price of a credit card. credit of $8,400.

It will take you 189 months to pay off that thing, so your initial purchase of eighty-eight thousand three hundred ninety-eight dollars will cost you seven thousand one hundred twenty dollars in interest over the almost sixteen years that the thing you bought will last. It cost you fifteen thousand five hundred and eighteen dollars it was a blast that really breaks you, first of all seeing something that almost has like a mortgage type amortization schedule that you most likely gave to the thrift store years ago and you are still paying because that It's not a good step towards financial independence, so pay attention, don't fake it till you make it guys, don't let consumerism take over.

We're trying to get them addicted to a healthy lifestyle of paying themselves first by being a good field journal for your army of dollar bills C, you don't have to work, there will come a point where you have to work just as hard. with your brain and your hands that you will let your money do the work for you, so don't do it in front of yourself reward yourself celebrate by throwing away the Gatorade when you just graduate that you just got to the starting line you have absolutely nothing so don't fake it until you've started making some accomplishments, so we said there we think there are three reasons Americans are broke: number one was lack of budget, plan number two was this unhealthy relationship with debt , but we believe that there is a decision and this decision, understanding this concept, will have the greatest impact on your country. financial future and how successful it will ultimately be from a financial perspective, so when I first came in, I mean, I was already working in the field.

I had already quit when I started my first company in 2002, but I looked around and I was just like you. I know what's really screwed up in the world is that young people have no idea how money works, so I went to the local school system, this is in George, and I went up to the superintendent and said, "I want to teach these children the power of personal finances. before the money was shown because they realized this is two thousand and three that I am doing, this all started, the money was shown in 2006, superintendent dr. Jack Parish loved the concept, so he immediately connected me with a high school.

I remember doing the first one in a trailer because the school was so over capacity, you know, over capacity. I said that wrong, about capacity, that's why maybe that's why I put myself in the trailer but anyway these kids and the first concept I told them this long story the most important thing I told you guys is one thing I want you to take from the presentation today if you can understand this concept it will absolutely change your life is that deferred gratification is the basis of all the financial empires that are built out there, if you can take just a little bit of today for an incredible tomorrow, this will multiply, I mean, It really is Jack's magic beans, it's deferred gratification, before you realize the concept. the bigger your vision of success can be, yeah, you said something so poignant right there, Brian, the sooner you can understand this, the sooner you can understand it, the bigger, the more impactful and the more powerful it will be for your long-term success.

It's fair that I still remember that there was an illustration I pulled from that curriculum because I had gone to a local credit union to get the curriculum and even I knew it had to be like that when the first chapter covered deferred gratification . like we were cooking with a little bacon grease. I mean, this is good, but there was an illustration that I've used for years. I have used it in 401k presentations. I've used it on a lot of other things and boom, we made this show. we get together we have to get it out now producer rebbe just the owner she didn't love this idea so if you don't like it then ramiz right if you love this if you believe if you are one of these people has given how lujah is deferred gratification, this concept it's going to hit you right between the eyes, so go ahead and load it up, Bob, so let's talk about the advantage of starting early, let's take three savings and all we're going to do is say these things will be maximized.

They're going to take out their Roth IRAs every year, they're going to make six thousand, we're not going to assume that indexing is ready for that kind of thing and let's assume that everyone can earn the same rate of return, everyone is going to earn eight percent over the long run. term while they invest man you don't give the trolls ammo we usually get aggressive the younger you are and we taper off more slowly you just said you know we're going to pick a moderate 8% of trolls you guys keep going. back there's nothing to see here go under your bridge so here's the answer five hundred dollars a month or six hundred six thousand dollars a year earning 8% so let's look at three different savers.

The number one saver is Adam Adam, do you know he just graduated? Like me, he graduated early from college and said, you know what, I'm going to run away. I'm going to start saving when I'm 20 and I'll say throughout my 20s, but when I reach 30 I'm going to start living life. I'm going to start enjoying it, so you know. I'll do this on a delayed basis. I'll do it for a while, but when I'm 30, then you know I'll get married and have kids. and do all the things right then there was Bill bill said you know what I just finished at school um I don't want to start saving I still have earned the right to go around and do things so when I'm 20 I'm going to do my best and I will enjoy it, but I recognize that I am wasting some time, so I will start saving $6,000 a year every year from the time I turn thirty until I retire. until I can tell her 65 until I'm 64 and then there's Cleo and Cleo she just says you know what I'm going to do all the time I'm not going to do this early in the party, I'm just I'm going to save 6000 from when I'm 20 until the end of my career, so this is what we thought was interesting when you add up all the numbers.

Adam, who saved aloneWhen he was 20 years old, he saved sixty thousand dollars, six thousand dollars a year times ten. Bill, who saved for thirty-five years, from age thirty to sixty-four, saved two hundred and ten thousand dollars, so naturally, who has more money? That's three and a half times the amount of money. I said, that's pretty incredible, this is one of the This is a wake-up call for those who don't understand compound interest. The sooner you start, the sooner you will let your money work. Holy cow get out of their way because Bo gave them the big reveal because Adam's sixty thousand two hundred.

Bill's ten thousand, you're probably thinking that common sense is that there's no way sixty beats 210, so Adam, but he became a millionaire, turned his six thousand dollars every year, just for ten years, into almost 1, 3 million dollars, more than a millionaire bill who saved 210. thousand also became a millionaire but look at this he only ended up with a terminal value of just over 1 million 30 thousand dollars even though he saved three and a half times more he had about two hundred and fifty thousand dollars less before you shows how smart Kaleo is here's something I think is interesting Adam who only invested his first 10 years if you do the math that's about 5% so 5% is Their contribution, 95 percent, comes from appreciation, that is, the army of dollar bills.

He worked for him, Bill still did a good job, he started at 30 and stayed for 35 years, but if you notice it's about 20% of his initial contribution, the other 80% is raw and still healthy, but Adam has it much easier with only 5%. contribution that's all, it's amazing, but then there's Cleo and Cleen said, you know, and I'm either not going to do this or I'm just going to save all the time. I'm going to be consistent and what she said is that I'm going to save. 6,000 every year and so she actually saves $270,000, so that's only sixty thousand dollars more than Bill or 210 thousand more than Adam.

What did you end up with when he retired? More than 2.3 million dollars. She's a billionaire, not because she really behaved any differently than the other two guys. stayed consistent starting as early as he could, so there are multiple components here, start early mm-hmm, be consistent, yeah, and the other thing is if you think about this in terms of you're looking for freedom, if you can pay yourself to yourself first, okay. once you can do that 20 to 25 percent to start thinking about other things, that's where you can start rewarding yourself and start living a little longer, but make sure you cover the basics first, it's a very powerful thing and that's what what do you know.

I wanted to give you a little motivation, but also give you some data so that you can awaken that invisible hand and realize how powerful all the elements are working for you to be financially successful. They just have to start participating in the process. stand up and be a part of the success that is happening economically and you may wake up one day and realize that this has happened to you too, so many of you probably realize, hey, we're carrying you, we're giving you tons of advice free. What is the problem? What are these guys asking for?

Everything is based on the principle of the cycle of abundance. We will come, you, come here, we will let you learn, apply, grow, I don't know if it will be five years from now. the future I don't know if it will be in ten years I don't know if it will be in fifteen years there will come a point where you will be so successful that you will leave I need a co-pilot I need someone to look over my shoulder and tell me where things are. Maybe I'm worried that my spouse doesn't think about money the way I do.

I need someone who thinks like these guys to make sure this doesn't happen. go to the ditch right after I leave, we see people all the time, that will be the cycle of abundance that will start to push you and say, hey, remember those guys that gave you a lot of advice, that's when you'll reach back to limited wealth or money guy, we have a Contact Us page, go check that out, but I also want to give you a little humble brag that we just crossed 50,000 weeks, I mean, it was just a few days ago, yeah, so this thing is gaining speed.

I have a goal and now that I've said it out loud, it has to happen and I need your help. I don't take anything for granted. We say thank you all the time, but I do it. I need your help. I need you to tell at least three friends and family about the Money Boys show because I need that number to be one hundred thousand for the twelve thirty one hundred thousand YouTube subscribers. Go ahead and ring the bell to receive notifications. We do a lot of live shows, we want you to participate in them. I feel like I can stop barking at everyone now, but I'm excited.

I think there are a lot of great things happening in the year 2020 and this is one of those. things that I want to get the money I have the family involved in that process we are so excited we are so committed to this abundant cycle, obviously you guys come here, you can learn from the program, you can learn from the things that we publish if you have had a chance to visit our website. Go to our website. We have a blog there. If you enjoy consuming written content, we can go a little deeper and even have a resource page if you haven't visited the resource.

The page disappeared and I took advantage of the free resources Deliverable PDF Spreadsheets things you can actually take with you with your family share with your friends is there for you so be sure to check it out so we can continue this abundant cycle through the from time to time when thanks guys the money took out the team