Take advantage man, and keep in mind this is exponential, meaning that if you can save 2x the amount that will get you 3 mil, you'll have 6 million plus in retirement. This video is over a year old, have you been able to save? Congrats on learning this early man!
17? Sheesh I wish I had known this 13 years ago. It can be hard to make all these changes at once, especially at your age. Take it slow. Any step in the right direction is a good step.
25 year old, got my first real job last year. I was putting 33% of my income towards debt payment [only $10K left now]. I recently started side hustle to go aggressive towards debt payments. It sucks right now to work like 60-70hrs a week, but in a year's time it is going to be so peaceful.
Eating out more is for retired established people who paid their dues in the kitchen for decades. At work, a minimum cafeteria lunch is 7.00; but plenty order more. That’s a minimum of 140.00 a month, and you can at least cut that in half bringing a lunch. That extra $70.00 a month comes in handy when you have a car expense. Right now I have some bananas blackening so I made banana muffins. I will also make dinner with meat and veggies, I at least buy meat from Sprouts. I have organic hash browns, cheese and eggs for breakfast, all from Grocery Outlet. I’m waiting for the peppermint tea my sister gave me to soak in a teapot with a tea holder inside...got the whole thing for free at work during a cleanup, no one claimed it. Put everything to use, use it up, do what you can yourself, save and invest. Even if you make mistakes it’s better than supporting a selfish user.
My 20s have been a total mess. I fought depression throughout high school and college, the support I received was ineffective in many ways. Life shortly after college was hell on earth due to insane family events and circumstances; I often felt like I was playing an ugly game of cat and mouse while running for my life. Without God I probably would have committed suicide. I'm now 28 working a job I don't like and praying that I can see the truth of what this video presents as I sit with a net worth of less than $20,000 (including expensive stuff like my car). I really want to make the most of the money I earn for personal reasons so that I can become wealthy in ways unimaginable. Thanks Money Guy team and keep it up.
You can do it, sounds about where I was at 28. I had student loans and some credit card debt and had been saving some money, my net worth was negative. For years I have only made $30,000/yr then I got a ~$50,000/yr job 5 years ago and now have a net worth of over $90,000 and I think I am on track for a decent retirement (no house yet though). I've also had periods of unemployment where I made basically no money. In fact, I look back and think that I made so many mistakes, I can list about 10 of them, I could have had $300,000 by now and yet I am still somehow on track. So just know that it can be done, even though it feels bad at the moment. I don't know your situation but I focused on investing, then paying off debt once my income increased, and then built up better savings and put more into investing. I probably saved about 10-20% of my income
This is really interesting. Here in the UK the "big lie" seems to be that wanting to be wealthy is in some way immoral. We don't talk about money, we don't share and raise each other up.
I work for a UK based company and the only clown who talks politics consistently is super liberal who won't take a full time job because he wants to be a contractor to pay less taxes. You can fill me in on that one, he constantly boasts about it and some 2 year rule. But his narrative is always greedy corporations are the problem and those of US in the without state run healthcare are demons.
If you attain financial freedom you have options . I get to see the lives of the wealthy , middle class and poor it’s the mindset and habits that set them apart. Money is only a tool at the end none of us will take it with us. If done right the next generation of your family will do better also you can help people with your money. You can still be kind and generous toward man kind. If you don’t talk about financial literacy other people will control you.
I’m in my mid 20s .... one thing I’m learning the hard way is delaying gratification Jesus take the wheel ! The video I accidentally stubbled upon that I nvr knew I needed god is good! God bless y’all 📝📝
I hope things are going well for you! Be grateful you figured this out in your mid twenties! I just turned 33 and finally figured it out about a year back. You're ahead of the game my friend!
As someone who doesn’t make much, this really helps a ton. I wish I would of been putting way more in when I started my current company 9 years ago. Still working out awesome - but even during Rona here putting in way more due to not spending much has made a huge impact on just the last 2 years - if people start in their early 20’s they will be set even by mid 30’s like me. Keep up the great work
I love that you guys talk about how hard it is having young children. Something always happens. Someone is always sick, or teething, or opening up the front door wearing only a diaper and going for a walk-a-bout.
Could you do a video on people who earn below average income please not government averages. We don't all expect to become millionaires but it would be good to get some helpful advice all the same.
This! Most people I know do not earn the sort of 'averages' these guys were talking about, and most of the jobs advertised are for well below that (even manager level). I'd like to know the median salary and advice based on that.
Thanks for the well thought-out content! I'm a physician who won't finish my subspecialty training until my mid 30's so it's unfortunate to be so far behind the 8 ball getting an 'army of dollar bills' to work in my favor. Hoping to be able to save 40-50% of my income at that point to start catching up, though. Look forward to seeing more from your channel!
After watching so many videos abt you guys comparing your life experiences being diff cz of your generation difference, why am i noticing today that one of you prefers monitor screen and another one paper notes . Makes me realize how honest u guys are in sharing each of ur experiences and perspectives 😅 good work guys- i am sitting in Canada but even then all this is still very helpful.
I came to this country in 1988 with NOTHING. Graduated with a HS Diploma, served in public service ever since. I started investing $50 per paycheck at 22 yrs old, increased a couple dollars every raise. Now at 40 yrs of age, I have 300K+ and make 150K annually. GOD BLESS AMERICA and Capitalism. I WILL RETIRE A MILLIONAIRE by MY OWN DOING/DISCIPLINE!
I’ve been driving my Impala for the last 9 years. When I get a different vehicle I plan on getting a 20k car max. I’ll put down 20% and invest the difference assuming the interest is lower than what I’d make in the market.
I do agree that all wealth is not inherited and amassing wealth in USA can be attainable! But I must say that all wealth transfers is not inherited by death of relatives or lump sums of money given to children. What we and the data don’t discuss is In vitro wealth transfers between parents, grandparents to children such as did your family pay for any of your college education, did you grow up in good neighborhoods with good schools, did your parents ever pay your rent or car note or any of your bills, was a car ever given to you, did you ever have to finically support your parents, did your parents help you get your job (since a lot college graduates get their jobs by social capital in other words connections), did your parents help you with down payment on home or live at home basically rent free, so yes with investing you can attain wealth but also don’t leave out the many ways people are passed down wealth and how they are given a leg up in life. Because when people say they were poor and saved millions, they may not have received an inheritance but they were helped out in other ways! Wealth is built by having access to opportunities first and then requiring the skills to take advantage of those opportunities!
This is all true, but intangible. The point is just look at the numbers. I wish they wouldn’t have used averages, and would have used the lowest wages. The fact is that at if you saved $250 a month for 45 years at a 10% return, you’d have something akin to $2 million at 65 and you’d be able to withdraw $70k per year without ever drawing down your $2 million.
I’m currently at 11%now saving for taxes after taxes I’m bumping my 11% to 25% in my Roth 401k with company match plus I am putting in my personal investments
How should we consider household income? Double the amounts? How do things change for couples if these number are for individuals? Might be worth a podcast segment. Also the title says "low income" but then you use average income... Half of us make less than average so these numbers are high to many people. I'll just save as much as I can for as long as I can.
The numbers don’t change, just use percentages. If both of you are making $25k a year then that’s 15-20% of $50k instead of the individual $25k. You will be saving double the amount, but it’s still 15-20%. I think the whole point is, you don’t need to be making a six figure salary in your 20s to become a millionaire.
If you are a couple that's two individuals. Each person should strive for the 15-20% range. Yes many of us make way less than the average income. That's really not relevant. Saving 15-20% means that by retirement you should have enough wealth to maintain your lifestyle. Retirement is really more about maintaining your quality of life after you are unable to labor anymore, being a millionaire isn't really that big a deal by today's standards anyway. If you are living on a low income now it will take less to stay at that level than for someone with a higher income who's lifestyle is above that. If you want to live as a wealthy individual later you must invest a high percentage when young so it has time to compound over the years. When you are old compounding interest just doesn't happen as time is limited.
Is there a compilation video of all of the best and most convincing advise for teenagers/young adults? You guys should mash all of your clips that would be inspiring and profound facts/figures into one video!
i guess im asking the wrong place but does anyone know a trick to get back into an Instagram account?? I was stupid lost my account password. I love any assistance you can give me
I'd like to see this redone in 2023, where inflation is making it next to impossible to get ahead for most people. Even a "high" salary is now just "average."
Good info, but just some constructive feedback: Y’all comment too much on the “show notes,” visuals, and gestures, etc. Those are tools to deliver your message. They should not be something you comment on. Your show notes should be completely “behind the scenes”; your audience shouldn’t even be aware that they exist. The gestures and visuals should work by themselves without needing to verbally take notice of them or comment on who made them or how much effort or time they spent on them. Your show will be smoother and more effective if you let them work for you without drawing audience attention to them unnecessarily. Just my 2¢.
I have never made more than $15 an hour and still don't, and my net worth went up from negative $81,000 in 2008 to now over $650,000, I am 57 years old
Oh crap! I’m 40 and just last year climbed out of student loan debt & credit card debt. I maxed out my Roth this year, but I only have $18k in savings :/
Why would a late 30 year old want to cut back on their return so young? It just seems like 25 years still allows for tons of risk capacity. Why not step down your risk in you mid to late 50's when you are within 10 years or so?
A lot of really good information here, but the title is misleading. "Low paying job" is less than the average, but it seems most of the calculations were based on the national average.
Ok- So I keep hearing that I should be saving 15 - 20% of my gross income and I would like to know how that is being figured. I am a local government employee with a state umbrella retirement plan (IPERS). In this my group has to contribute 6.29% of gross which is matched by 9.44% from the employer. This alone makes 15.73% of gross. Above this is the FICA system takes 6.2% of my gross which is matched by 6.2% from my employer for a total of another 12.4% of my gross. I then have been contributing to an individual IRA at the post 50 y.o. max rate of $7k/yr. which currently amounts to another 12.3% of my gross. We just sold a small rental house and that is being converted into 457b funds. As I figure things this amounts to over 40.43% of my gross income. We have at least 5 of the 7 Baby Steps covered with #3 & #7 still in progress. On those two we have about 3 months reserve, and we give between 14 - 17% to 501c3 entities. The word wealth seems ambiguous and elusive, but I think we are on our way. On one hand it feels like someone is going to tell me that I shouldn't be counting the FICA or my IPERS because they are mandatory, but on the other hand there's only so much I can put in retirement before I have to destroy what little fun we have with our remaining income. More is always better, but when is enough, enough??
Great show. So glad I found your channel. Between watching you two and Dave Ramsey shows getting educated on money matters I've woken up to manage my money better and save for the future.
I know that you mention 'if you screw something up" but would have liked a bit more on being low earner while having big depts. Just your thoughts and tips around that as some one in their 20s or 30s or even 40s.
I was and still am a low earner. I studied so hard and for so long full-time at university for 8 years. While I was studying, I didn't work:((. But I got two degrees, BA and MA in International Administration. And I graduated as a straight A student with $60000 of student loan debts. And for almost 20 years after graduation, all I found was small part-time jobs that paid me a total of $8000 ANNUALLY. Then I slowly moved to $10000 annually, combining two or more jobs. Thanks to food stamps I didn't starve! But I was desperate for a better job. Imagine having a $60000 debt while earning under $10000 annually! I learned not to trust universities' pitch anymore. I became so anti-debt....I hated my student loan, but when I signed for them I didn't know it would actually be a loan😣. After graduating, I defferred my loans for as long as I could - up to 3 years due to financial hardship. For those 3 years of deferment government paid the interest since the loans were federal and I qualified for that favor due to being a straight A student. Then, after 3 years passed, I started paying my loans but barely covered just the interest. I managed to save an emergency cushion of $3000 while living from paycheck to paycheck and covering just the interest of my loans and not the principle for nearly 2 decades. But that emergency savings was so worth it. It saved me from going homeless several times. I would put away 10 dollars a month, or 50 dollars, or even 5, away no matter what just to have that emergency cushion... The living itself got ok - I didn't feel too deprived. But the student loan scared me to death. I'm a minimalist at heart and my biggest dream was to get rid of that debt. Also, I had no health insurance and one time when I got very sick, I lied on the ground waiting to die. I was so afraid of getting further into debt that I preferred to die than to get unknown doctor treatment only to further my debt and to become a debt-slave for life to some hospital corporation. I had severe pain and I simply decided to wait it out or die, but I was determined not to go to a hospital without health insurance. That was the most humiliating moment for me. . . Also, I had to live with roommates and often move and relocate.. In 20 years of desperate job search though I found a decent janitor job, which paid (instead of $8 per hour) $16 per hour. What a luck! At that same time I also had a boyfriend who offered me to live with him for free for about 6 years. Second luck! I didn't have to pay rent for 6 years - wasn't that luck? Then I got super cheap Obamacare coverage for my health insurance - luck again! Well, living with a boyfriend turned out to be not much better than living with roommates. I could not get quality sleep as he would turn on TV and music whenever I slept. It was a lot of headache causing noise and stress and dirt too. Arguing over those things would cause only more headaches. Talking didn't work. Boyfriend let me know it would be his way or the highway. But I decided to tolerate it since it gave me a chance to pay off my student loans as my income went from $8000 annually to $20000. I was so used to living on $8000 annually, I just kept living on it. While the rest $12000 I would put to student loans, which I managed to pay off in 4.5 years. The other things that helped me is not luck but discipline. I never got a car. Instead I used bike.( I could not even afford a bus ride. ) I also never got into any other debt. Credit cards I use only to get the bonuses and not to get in debt. And I never got children - that takes lots of discipline to avoid getting pregnant! While paying of my student loans, I got my credit score well above 800's. By the time I became debt free, when I was 35 years of age, I immediately opened a robo ROTH IRA with $6000. I started paying some rent to my boyfriend but decided to break up with him and just stay as friends. Right now at my 36 years of age I live with him as a roommate and he still makes loud noises when I ask politely to make it less loud, although I pay small rent. I'm looking for a new place to move while maxing out my ROTH IRA and living below my means. Also, I increased my emergency cushion from $3000 to $13000 and started looking for job in my field again. It felt like a nightmare what I went through. But I got myself out of this rut with the help of BOTH: luck AND discipline. Food stamps was luck, student loan deferment was luck, obamacare was luck, and a chance to live rent free( although in a crappy and very unpleasant way) for 6 years was also luck. I still ride a bike and live like a minimalist while earning far below $30000 annually. Hopefully, I'll get a higher income soon....... My biggest dream for most of my life was NOT how to live off of investements but how not to become homeless by next paycheck. Today I can start dreaming about how to never become homeless and secure my future old self. Life is HARD as f**k, but it is still beautiful. Good luck to all those who struggle. Don't give up. I was inspired by those people, who had worse times and situations than me yet persevered. One was the one I learnt from a book by Eugenia Ginsburg "Journey into the Wirldwind". Her life turned to a living hell - she was supposed to die in a death camp, but she survived and found a way out where there was no way out. Second book was by Fredrick Douglas "From my bondage to my Freedom", where he also describes how he found a way out of living hell (as a slave with no rights), even though there was no way out. People can do amazing things in horrible sometimes life-death situations and they (Eugenia Ginsburg and Frederick Douglas) inspired me to persevere a lot more than those who earn $30000+ a year and think they are not lucky enough or earn too little. . .
All these incomes are high, high wages are flat in this country who's making $45k at 25 years old?. And where is the student loan drag, health insurance, rent increases ect. Save 25-30% of income easier said than done.
I know it probably accounts for less than 1 percent of your audience but I am active duty Air Force. I am someone in a slightly different position than most financially and can't seem to find meaningful guidance on finances. Anyone have any recommendations for advice aimed towards my particular situation?
That study about millenials saving 7.5-8.5% annually was probably made in a pretty wealthy area because most people I know don't even have a saving account.
That's not true, many millennials save way above that average saving rate (30-50%) which compensates for those who don't save anything and brings up that average rate
@@euenfheiejrj It likely depends on the wealth of the people you are referring to. Working in fast food lots of people do not have savings accounts but it is likely the same or cheaper not to have one. A Canadian checking account is about 3 USD but all the us larger banks charge between 7 and 10 so for many lower income it is just not affordable.
I absolutely love watching you guys. I’m 50, and have household income of 100k, and a net worth of 1.3M But 700k of that is in various before and after tax accounts. The rest is farm land, or houses we sell on contract 4 deed. Should those non-liquid assets be included in net worth formula?
Guys, you aren't using low paying jobs for examples at 20:10 even for young people at 20 & 25 years old are very high incomes. 25 years old and making $45k? I looked up average incomes and the _highest_ average income for women in the US is $47060, and in my state a whole family's average income is $56k. Most states average between that and $63k. If you are going to do a low paying job video, please focus on that, please.
If it was me, I would first make sure the emergency fund/deductibles fund was fully funded, make sure you're getting the maximum employer match for 401k if that's available to you, then invest in the index fund. I'm in Canada and just starting out, so I'm building up my emergency fund and then I will max out my RRSP and TFSA. Someday I'll also invest in an index fund, but I have a lot of catching up to do.
@@radukeban9123 No rentals are bad for the renters. Think about it how is anyone supposed to buy a home if they are already paying rent to live elsewhere? If the house can be rented at super cheap prices that is different but otherwise....
Ok... When I clicked on the video i thought they would speak about people making in the 20k's. Like $44k a year is not bad in many places in this country. I wanted to show this toy friend who is currently working a $15/hr as a security guard in NYC. Thankfully he lives with his family and his living expenses are low but with the low wage, there isn't much left after he pays for all his stuff. I was hoping this could have given him an idea as to where to start
Depends what you can get - more is probably better. You can probably look up average or median incomes by age in your country, it's common in census type data
The amount per month to make that car payment robs you of a certain amount of the army of dollars that could be used to start building wealth. Pay cash for a car.
Yes! My 2002 Honda Accord is still going strong! Instead of financing, pay cash for a reliable used vehicle. Those would-be car payments (and any others) will turn into MILLIONS over a few decades.
@@MoneyGuyShow I think of people like the garbage man or butcher at your local store and so on. Jobs that we all need to be done but will top out around 40k to 45k. If someone in their shoes doesn't start until 40yr old, even saving 20 to 25%, they will never make enough to truly be comfortable in retirement. If they start at zero at 40 with those career paths they will barely get by. But I guess they will be use to barely getting by, by then.
Everybody in their 50's aren't making $52,000 a year some people are at $43,000 a year at 50, but they can retire at age 52 thru a government retired plan. Yet, wants to keep building more for a ROTH for age 65 working a part-time job. Any ideas to help?
Thanks for the video I already started to put $8500 of mu saving into an investment with a rate of return around 10 percent. That is my dad's company 401k benefit. I am 19 years old am I being too aggressive to invest $2000 a month? I am still living with my parents.
maybe most of those of us with one,two,maybe three M didn't inherit it but I think a lot of the really big money families did inherit much of it--like 20 M,100 M ? also-inherit 50 thou? Use it wisely,don't blow it
When you guys say you have to save x amount of money a month what exactly do you mean ? I'm assuming its not put X amount in your savings account a month. Sorry for the stupid question I really don't know anything about money , I just stumbled upon your channel a cupel days ago.
Can you differentiate between liquid net worth and accounting net worth please. I normally dont include our house in our net worth, because you cant eat it and it takes months to sell it. Is this the wrong mentality?
Not wrong at all. We have this exact conversation with clients approaching retirement. In the episode we focus our discussions on building liquid/investment assets.
I include it. Try living without a house. You still need shelter. Whether you rent, own or pay a mortgage. Owning a house is imputed income. Now, owning a $900k house in an area where equivalent rents are say $1500 /month wouldn't be too smart, but that's more of a lifestyle question then. Typically the more desirable the area, the more you pay for housing.
Kids don’t listen until it’s too late. We plan on teaching our kids, have started teaching them already. Every dollar they get, 50% gets saved, 10% gets given away, and they can spend the other 40% on whatever they want.
Recessions are part of the normal growing economic process. Don’t let the fear of something that happens 20% of the time keep you from making money in those up 8 out of 10 years.
I think it would depend on your income. If you make $50k your not going to hit the max on tax differed investments, max on 401k being $19,500 and $6k for an IRA. This is where 25% of your income is only $12,500. If you have employer matching then that number is even going to be more difficult to meet. I have profit sharing and a match, so my personal contributions doesn’t actually get close to 25%. If your married then those numbers double, but income doubles too.
Okay so I am an overseas contractor so I do not have to pay taxes due to working overseas. With that being said, my wife and I have roughly $118,000 left over a year after our living expenses (she stays in the US while I am gone due to me working in combat zones) our condo is paid off and we do not know where to go from here. My job or life is not promised; so with that being said we are unsure if we should just pile up cash, invest in rental properties, or invest in the market. I just want to make sure she is taken care of if I am no longer here. Any financial advice would be greatly appreciated.
Josh I can relate to this being a military officer with a wife and son. It sounds like you are looking to be able to replace your income in the event you die. First thing get 10-20 times your Annual income worth of term life insurance. So 1-3 million in insurance . That covers your wife for 1-3 decades at current income you make. After that max out 401ks and IRAs. Then invest in passive index funds in your taxable brokerage. If there money left over you can look at diversifying into real estate. In the unlikely event you die your wife will be more than set if she is a good steward of your assets.
How much should I save? I'm just about to turn 22. At the moment I am saving for the future but only in small amounts. I'm currently trying to save for a wedding and a home too.
Hi Natalie, I'd try to eat only one elephant at a time. For example, determine the total amounts you'd like to save for the different goals (example: 5K for a wedding), then order the priorities and tackle them one at a time. Having a finish line in sight might also help you stay motivated. Congratulations and good luck!👏
A lot of the process is realizing that you have to live within your means, and live well within your means. That means that if you make $50k you only have half of that to live off of. You don’t even see the other $25k. If you use their numbers it’ll be less, but if you can do half you’ll kick start everything. But realize that their 15-20% is for retirement, if you want to save for other things on top of that, wedding, car, etc. then that’s where the other 25% of that half is. So when you buy a house or rent an apartment your not asking what I can afford, your asking what the cheapest way you can do it.
I’m confused. If you save say 200 a month that only comes out as 2400 a year. Times 40 is 96,000. Even if you increase the amount you save it’s surely not anywhere near millions?
Wdeemar Wdeemar you can have a Roth IRA in addition to your tsp. As long as your income allows. If you make to much for Roth IRA, look up back door Roth IRA
You can open a Roth and/or traditional IRA, but it seems you’ve already hit your max contribution limit. If you have any self employment income, open a SEP IRA, you can contribute up to $56k/year. There are some caveats there tho. Got to pay yourself a salary and can only contribute up to 25% of your taxable salary from that self employment. And have to do the same for all the employees you have.
How much you make is irrelevant, if you saved 25% of 27k from when you were 20 and retired at 65, that’s $562/mo for 45 years you’d have $2.1 million dollars when you retire at 65. Agreed, $562 for someone making $27k a year is a lot. But you’d still have $1 millions if you had saved $251/mo for 45 years. That’s with a 7% return, not the 10% they’ve estimated.
There are things that you can do like get a roommate and take that $300 that your saving from having a roommate and invest it. I don’t believe that anyone saying it will be easy, but it can be done. You could take your free time and learn a skill and sell stuff on Etsy. If you’re starting at 50 it is going to be much more difficult and you’re probably not going to do it on $27K a year.
@@a1970gto Roommates have to have both the ability to and willingness to pay otherwise it might cost more not less. Skills and selling stuff in theory is simple but in reality it is multiple times more difficult than you are making it sound. But I do give you credit for "If you’re starting at 50 it is going to be much more difficult and you’re probably not going to do it on $27K a year."
Absolutely not, but you do have a lot of catching up to do and it will require a lot more sacrificing. Your goals will probably need to be different from a 20 yo as well.
Congrats! You’ll be a millionaire by the time you’re 59.5 if you just stick with that Google search “compound interest calculator” to play with some numbers
This video title was pure click bait. I was looking for good tips to share with my friends. When I read the title, I was thinking you were going to give tips about people who earn $15 or less an hour, but your first tip is get a better job. Followed by go to college or get a certificate, which isn't always possible .
We took government income averages and provided the tips and guidance on how to turn that into seven figures. Good luck on your journey, but we are far from clickbait 🙄
The Money Guy Show the title of the video is low income,not average income. So think about the people who are burger flippers, not everyone can get a $50k+ job.
@@MoneyGuyShow Great! So you would know that the advice, beyond your job sucks - do better, wouldn't be applicable to your former self. There are 30+ year old burger flippers, some don't have initiative to get a better job, others can't. 4 states are have a median income of $46.7k or less. Bump that up to $55k or less, you are up to the median income in 18 states! So 36% of the states are essentially being told do better. Some teachers are at or below the 45k mark even. I largely like your guy's content, but I would have enjoyed if you covered the topic actually from a low income perspective.
rguy84 I make $45K now, but mostly made $30K. I started investing at 26, and am right on track to seven figures when I retire despite a pre-existing medical condition and plenty of doctor bills. With perseverence, it can be done. 🙂
If your employer gives you a match. Take advantage. If you are young. Max out a Roth IRA every year. Could be worth $6 million TAX FREE at retirement. We are near the lowest taxes in history. It's going to get worse.
I started at 25. I put $200 aside every month into an Roth IRA and then gradually increased as I got older. now I’m 39 but I’m not even at 100k at investment. So how will I be a millionaire w this acct?
![How to Build Wealth With the 3 Bucket Strategy [By Age!]](http://i.ytimg.com/vi/Hb5CCFUFbHg/mqdefault.jpg)
![How to Build Wealth With the 3 Bucket Strategy [By Age!]](/img/tr.png)
wow...ok, I'm 17 and I'm going to start saving now! Thanks so much! This should be a mandatory watch in schools!
You lucky bastard🤣🤣😅
Love this comment!
Start young and you’ll retire early
Take advantage man, and keep in mind this is exponential, meaning that if you can save 2x the amount that will get you 3 mil, you'll have 6 million plus in retirement. This video is over a year old, have you been able to save? Congrats on learning this early man!
17? Sheesh I wish I had known this 13 years ago. It can be hard to make all these changes at once, especially at your age. Take it slow. Any step in the right direction is a good step.
25 year old, got my first real job last year. I was putting 33% of my income towards debt payment [only $10K left now]. I recently started side hustle to go aggressive towards debt payments. It sucks right now to work like 60-70hrs a week, but in a year's time it is going to be so peaceful.
I needed to read this
@@chimairoegbu2263 If it helps you, I'm done with paying all that debt as of now.
Keep it up I'm 37 in the same boat. You're future looks bright
Eating out more is for retired established people who paid their dues in the kitchen for decades. At work, a minimum cafeteria lunch is 7.00; but plenty order more. That’s a minimum of 140.00 a month, and you can at least cut that in half bringing a lunch. That extra $70.00 a month comes in handy when you have a car expense. Right now I have some bananas blackening so I made banana muffins. I will also make dinner with meat and veggies, I at least buy meat from Sprouts. I have organic hash browns, cheese and eggs for breakfast, all from Grocery Outlet. I’m waiting for the peppermint tea my sister gave me to soak in a teapot with a tea holder inside...got the whole thing for free at work during a cleanup, no one claimed it. Put everything to use, use it up, do what you can yourself, save and invest. Even if you make mistakes it’s better than supporting a selfish user.
My 20s have been a total mess. I fought depression throughout high school and college, the support I received was ineffective in many ways. Life shortly after college was hell on earth due to insane family events and circumstances; I often felt like I was playing an ugly game of cat and mouse while running for my life. Without God I probably would have committed suicide. I'm now 28 working a job I don't like and praying that I can see the truth of what this video presents as I sit with a net worth of less than $20,000 (including expensive stuff like my car). I really want to make the most of the money I earn for personal reasons so that I can become wealthy in ways unimaginable. Thanks Money Guy team and keep it up.
@@benchoflemons398 yeah. It's a slow grind, but God is supporting me and slowly building me up.
You can do it, sounds about where I was at 28. I had student loans and some credit card debt and had been saving some money, my net worth was negative.
For years I have only made $30,000/yr then I got a ~$50,000/yr job 5 years ago and now have a net worth of over $90,000 and I think I am on track for a decent retirement (no house yet though). I've also had periods of unemployment where I made basically no money. In fact, I look back and think that I made so many mistakes, I can list about 10 of them, I could have had $300,000 by now and yet I am still somehow on track.
So just know that it can be done, even though it feels bad at the moment. I don't know your situation but I focused on investing, then paying off debt once my income increased, and then built up better savings and put more into investing. I probably saved about 10-20% of my income
Keep at it! Most people in their 20’s have a negative net worth so, you’re probably doing better than you think!
Time in the market is more important than timing the market. The simple rule always remember that.
you don't need to time the market anyways, if you implement a trailing stop-loss on your positions
This is really interesting. Here in the UK the "big lie" seems to be that wanting to be wealthy is in some way immoral. We don't talk about money, we don't share and raise each other up.
I work for a UK based company and the only clown who talks politics consistently is super liberal who won't take a full time job because he wants to be a contractor to pay less taxes. You can fill me in on that one, he constantly boasts about it and some 2 year rule. But his narrative is always greedy corporations are the problem and those of US in the without state run healthcare are demons.
If you attain financial freedom you have options . I get to see the lives of the wealthy , middle class and poor it’s the mindset and habits that set them apart. Money is only a tool at the end none of us will take it with us. If done right the next generation of your family will do better also you can help people with your money. You can still be kind and generous toward man kind. If you don’t talk about financial literacy other people will control you.
Well why is that? Perhaps wealth inequality going to levels we haven't seen since the guilded age has some play? 🤔
I’m in my mid 20s .... one thing I’m learning the hard way is delaying gratification Jesus take the wheel ! The video I accidentally stubbled upon that I nvr knew I needed god is good! God bless y’all 📝📝
Amen
I hope things are going well for you! Be grateful you figured this out in your mid twenties! I just turned 33 and finally figured it out about a year back. You're ahead of the game my friend!
10/10 content. Thank you for the free knowledge! Much appreciated from a 20 y/o who’s working on to build his wealth.
As someone who doesn’t make much, this really helps a ton. I wish I would of been putting way more in when I started my current company 9 years ago. Still working out awesome - but even during Rona here putting in way more due to not spending much has made a huge impact on just the last 2 years - if people start in their early 20’s they will be set even by mid 30’s like me. Keep up the great work
He said 45k for your first job. I'm already failing. I'm 37 and just finally got 41k.
Ya that's rough, God bless
Brian and Bo are always talkking aboout how they get Danny to do their homework for them. They're not the nerds, they're the jocks!
I love that you guys talk about how hard it is having young children. Something always happens. Someone is always sick, or teething, or opening up the front door wearing only a diaper and going for a walk-a-bout.
I dont plan to have children but I am looking out for my mom who hasnt been able to save as much for her retirement. It's sort of worse, I guess 😖
Could you do a video on people who earn below average income please not government averages. We don't all expect to become millionaires but it would be good to get some helpful advice all the same.
This! Most people I know do not earn the sort of 'averages' these guys were talking about, and most of the jobs advertised are for well below that (even manager level). I'd like to know the median salary and advice based on that.
LDT7Y it’s the same advice.
I agree. There are many people who earn less than these averages working full-time and with college degrees.
Don't spend more than you make.
@@LDT7Y I made half of 20k in my 20s. 40k was a dream
Thanks for the well thought-out content! I'm a physician who won't finish my subspecialty training until my mid 30's so it's unfortunate to be so far behind the 8 ball getting an 'army of dollar bills' to work in my favor. Hoping to be able to save 40-50% of my income at that point to start catching up, though. Look forward to seeing more from your channel!
I'm about to turn 45 your fine. The bright side double the income figures and can be 3x in 5 years.
After watching so many videos abt you guys comparing your life experiences being diff cz of your generation difference, why am i noticing today that one of you prefers monitor screen and another one paper notes . Makes me realize how honest u guys are in sharing each of ur experiences and perspectives 😅 good work guys- i am sitting in Canada but even then all this is still very helpful.
I came to this country in 1988 with NOTHING. Graduated with a HS Diploma, served in public service ever since. I started investing $50 per paycheck at 22 yrs old, increased a couple dollars every raise. Now at 40 yrs of age, I have 300K+ and make 150K annually. GOD BLESS AMERICA and Capitalism. I WILL RETIRE A MILLIONAIRE by MY OWN DOING/DISCIPLINE!
You have done well but it sounds like you had an income that outpaced your expenses. To me that was the single more important point.
I’ve been driving my Impala for the last 9 years. When I get a different vehicle I plan on getting a 20k car max. I’ll put down 20% and invest the difference assuming the interest is lower than what I’d make in the market.
I do agree that all wealth is not inherited and amassing wealth in USA can be attainable! But I must say that all wealth transfers is not inherited by death of relatives or lump sums of money given to children. What we and the data don’t discuss is In vitro wealth transfers between parents, grandparents to children such as did your family pay for any of your college education, did you grow up in good neighborhoods with good schools, did your parents ever pay your rent or car note or any of your bills, was a car ever given to you, did you ever have to finically support your parents, did your parents help you get your job (since a lot college graduates get their jobs by social capital in other words connections), did your parents help you with down payment on home or live at home basically rent free, so yes with investing you can attain wealth but also don’t leave out the many ways people are passed down wealth and how they are given a leg up in life. Because when people say they were poor and saved millions, they may not have received an inheritance but they were helped out in other ways! Wealth is built by having access to opportunities first and then requiring the skills to take advantage of those opportunities!
This is all true, but intangible. The point is just look at the numbers. I wish they wouldn’t have used averages, and would have used the lowest wages. The fact is that at if you saved $250 a month for 45 years at a 10% return, you’d have something akin to $2 million at 65 and you’d be able to withdraw $70k per year without ever drawing down your $2 million.
I’m currently at 11%now saving for taxes after taxes I’m bumping my 11% to 25% in my Roth 401k with company match plus I am putting in my personal investments
How should we consider household income? Double the amounts?
How do things change for couples if these number are for individuals? Might be worth a podcast segment.
Also the title says "low income" but then you use average income...
Half of us make less than average so these numbers are high to many people.
I'll just save as much as I can for as long as I can.
The numbers don’t change, just use percentages. If both of you are making $25k a year then that’s 15-20% of $50k instead of the individual $25k. You will be saving double the amount, but it’s still 15-20%. I think the whole point is, you don’t need to be making a six figure salary in your 20s to become a millionaire.
If you are a couple that's two individuals. Each person should strive for the 15-20% range. Yes many of us make way less than the average income. That's really not relevant. Saving 15-20% means that by retirement you should have enough wealth to maintain your lifestyle. Retirement is really more about maintaining your quality of life after you are unable to labor anymore, being a millionaire isn't really that big a deal by today's standards anyway. If you are living on a low income now it will take less to stay at that level than for someone with a higher income who's lifestyle is above that. If you want to live as a wealthy individual later you must invest a high percentage when young so it has time to compound over the years. When you are old compounding interest just doesn't happen as time is limited.
A 30-year-old from Chile here! I love your content guys, I'm trying my best to follow your money tips.
Hola desde los estados! 😊
You guys nailed it...again!
The scenario with taking the red pill in your 40s is 100%!!
This channel is so underrated, love you guys!
I’m sharing this with everyone that I can. Knowledge is so important.
Is there a compilation video of all of the best and most convincing advise for teenagers/young adults? You guys should mash all of your clips that would be inspiring and profound facts/figures into one video!
i guess im asking the wrong place but does anyone know a trick to get back into an Instagram account??
I was stupid lost my account password. I love any assistance you can give me
I'd like to see this redone in 2023, where inflation is making it next to impossible to get ahead for most people. Even a "high" salary is now just "average."
Pay has gone up since high inflation. Also inflation isn’t causing your problem. You’re spending is.
Good info, but just some constructive feedback: Y’all comment too much on the “show notes,” visuals, and gestures, etc. Those are tools to deliver your message. They should not be something you comment on. Your show notes should be completely “behind the scenes”; your audience shouldn’t even be aware that they exist. The gestures and visuals should work by themselves without needing to verbally take notice of them or comment on who made them or how much effort or time they spent on them.
Your show will be smoother and more effective if you let them work for you without drawing audience attention to them unnecessarily. Just my 2¢.
I have never made more than $15 an hour and still don't, and my net worth went up from negative $81,000 in 2008 to now over $650,000, I am 57 years old
awesome dude
Oh crap! I’m 40 and just last year climbed out of student loan debt & credit card debt. I maxed out my Roth this year, but I only have $18k in savings :/
Not as easy as a 20 year old, but still plenty of time to build wealth and your Army of Dollar Bills. Thank you for watching and the comment 👍
Thanks Money Guy(s)...Working on saving 25% each month to become a “Prodigious Accumulator of Wealth”!
I like how Ryan opened this up so gangsta and pumped lol
Why would a late 30 year old want to cut back on their return so young? It just seems like 25 years still allows for tons of risk capacity. Why not step down your risk in you mid to late 50's when you are within 10 years or so?
I'm 39... I'll be fully in stocks for another 10 years. No point in slowing down at such a relatively young age
A lot of really good information here, but the title is misleading. "Low paying job" is less than the average, but it seems most of the calculations were based on the national average.
This makes me feel great! Thanks for being great guys:)
When I was 20 I made $190/week. This is not as realistic as they make it sound. Not everyone is a middle class erinie.
My first care was a 626 as well! I was also sold on the swinging vents hahahaha XD Small world!
I’m 12 and I know what do with my life now so helpful
Ok- So I keep hearing that I should be saving 15 - 20% of my gross income and I would like to know how that is being figured. I am a local government employee with a state umbrella retirement plan (IPERS). In this my group has to contribute 6.29% of gross which is matched by 9.44% from the employer. This alone makes 15.73% of gross. Above this is the FICA system takes 6.2% of my gross which is matched by 6.2% from my employer for a total of another 12.4% of my gross. I then have been contributing to an individual IRA at the post 50 y.o. max rate of $7k/yr. which currently amounts to another 12.3% of my gross. We just sold a small rental house and that is being converted into 457b funds. As I figure things this amounts to over 40.43% of my gross income. We have at least 5 of the 7 Baby Steps covered with #3 & #7 still in progress. On those two we have about 3 months reserve, and we give between 14 - 17% to 501c3 entities. The word wealth seems ambiguous and elusive, but I think we are on our way.
On one hand it feels like someone is going to tell me that I shouldn't be counting the FICA or my IPERS because they are mandatory, but on the other hand there's only so much I can put in retirement before I have to destroy what little fun we have with our remaining income. More is always better, but when is enough, enough??
Talk to a fiduciary about your retirement plans and figure it out.
This was extremely helpful! Thank you ❤
Great show. So glad I found your channel. Between watching you two and Dave Ramsey shows getting educated on money matters I've woken up to manage my money better and save for the future.
I know that you mention 'if you screw something up" but would have liked a bit more on being low earner while having big depts. Just your thoughts and tips around that as some one in their 20s or 30s or even 40s.
Working on our annual net-worth by age update. In those shows we do discuss debt in greater detail 👍
I was and still am a low earner. I studied so hard and for so long full-time at university for 8 years. While I was studying, I didn't work:((. But I got two degrees, BA and MA in International Administration. And I graduated as a straight A student with $60000 of student loan debts. And for almost 20 years after graduation, all I found was small part-time jobs that paid me a total of $8000 ANNUALLY. Then I slowly moved to $10000 annually, combining two or more jobs. Thanks to food stamps I didn't starve! But I was desperate for a better job. Imagine having a $60000 debt while earning under $10000 annually! I learned not to trust universities' pitch anymore. I became so anti-debt....I hated my student loan, but when I signed for them I didn't know it would actually be a loan😣. After graduating, I defferred my loans for as long as I could - up to 3 years due to financial hardship. For those 3 years of deferment government paid the interest since the loans were federal and I qualified for that favor due to being a straight A student. Then, after 3 years passed, I started paying my loans but barely covered just the interest. I managed to save an emergency cushion of $3000 while living from paycheck to paycheck and covering just the interest of my loans and not the principle for nearly 2 decades. But that emergency savings was so worth it. It saved me from going homeless several times. I would put away 10 dollars a month, or 50 dollars, or even 5, away no matter what just to have that emergency cushion...
The living itself got ok - I didn't feel too deprived. But the student loan scared me to death. I'm a minimalist at heart and my biggest dream was to get rid of that debt. Also, I had no health insurance and one time when I got very sick, I lied on the ground waiting to die. I was so afraid of getting further into debt that I preferred to die than to get unknown doctor treatment only to further my debt and to become a debt-slave for life to some hospital corporation. I had severe pain and I simply decided to wait it out or die, but I was determined not to go to a hospital without health insurance. That was the most humiliating moment for me. . . Also, I had to live with roommates and often move and relocate.. In 20 years of desperate job search though I found a decent janitor job, which paid (instead of $8 per hour) $16 per hour. What a luck! At that same time I also had a boyfriend who offered me to live with him for free for about 6 years. Second luck! I didn't have to pay rent for 6 years - wasn't that luck? Then I got super cheap Obamacare coverage for my health insurance - luck again! Well, living with a boyfriend turned out to be not much better than living with roommates. I could not get quality sleep as he would turn on TV and music whenever I slept. It was a lot of headache causing noise and stress and dirt too. Arguing over those things would cause only more headaches. Talking didn't work. Boyfriend let me know it would be his way or the highway. But I decided to tolerate it since it gave me a chance to pay off my student loans as my income went from $8000 annually to $20000. I was so used to living on $8000 annually, I just kept living on it. While the rest $12000 I would put to student loans, which I managed to pay off in 4.5 years. The other things that helped me is not luck but discipline. I never got a car. Instead I used bike.( I could not even afford a bus ride. ) I also never got into any other debt. Credit cards I use only to get the bonuses and not to get in debt. And I never got children - that takes lots of discipline to avoid getting pregnant! While paying of my student loans, I got my credit score well above 800's. By the time I became debt free, when I was 35 years of age, I immediately opened a robo ROTH IRA with $6000. I started paying some rent to my boyfriend but decided to break up with him and just stay as friends. Right now at my 36 years of age I live with him as a roommate and he still makes loud noises when I ask politely to make it less loud, although I pay small rent. I'm looking for a new place to move while maxing out my ROTH IRA and living below my means. Also, I increased my emergency cushion from $3000 to $13000 and started looking for job in my field again. It felt like a nightmare what I went through. But I got myself out of this rut with the help of BOTH: luck AND discipline. Food stamps was luck, student loan deferment was luck, obamacare was luck, and a chance to live rent free( although in a crappy and very unpleasant way) for 6 years was also luck. I still ride a bike and live like a minimalist while earning far below $30000 annually. Hopefully, I'll get a higher income soon.......
My biggest dream for most of my life was NOT how to live off of investements but how not to become homeless by next paycheck. Today I can start dreaming about how to never become homeless and secure my future old self. Life is HARD as f**k, but it is still beautiful. Good luck to all those who struggle. Don't give up. I was inspired by those people, who had worse times and situations than me yet persevered. One was the one I learnt from a book by Eugenia Ginsburg "Journey into the Wirldwind". Her life turned to a living hell - she was supposed to die in a death camp, but she survived and found a way out where there was no way out. Second book was by Fredrick Douglas "From my bondage to my Freedom", where he also describes how he found a way out of living hell (as a slave with no rights), even though there was no way out. People can do amazing things in horrible sometimes life-death situations and they (Eugenia Ginsburg and Frederick Douglas) inspired me to persevere a lot more than those who earn $30000+ a year and think they are not lucky enough or earn too little. . .
@@user-ee5om8wy7u I read your entire comment. Just wow. 👍💪
Great content! I shared it with my young adult children hoping they will start saving early.
Nice work William 👍
44
Title says low paying job, but the referrenced tweet says he has a $2M business.
All these incomes are high, high wages are flat in this country who's making $45k at 25 years old?. And where is the student loan drag, health insurance, rent increases ect. Save 25-30% of income easier said than done.
I know it probably accounts for less than 1 percent of your audience but I am active duty Air Force. I am someone in a slightly different position than most financially and can't seem to find meaningful guidance on finances. Anyone have any recommendations for advice aimed towards my particular situation?
Jacob,
Completely understand and you are not alone. I’ll talk to the content team to see what we can do 👍
@@MoneyGuyShow That's amazing. Thank you for your quick response and consideration!
That study about millenials saving 7.5-8.5% annually was probably made in a pretty wealthy area because most people I know don't even have a saving account.
That's not true, many millennials save way above that average saving rate (30-50%) which compensates for those who don't save anything and brings up that average rate
Fucking hell , it's impossible in your 20s. How to not save money in 20s?
Jesus people don’t have a saving account? I’m 34 and I don’t know anyone like this.
@@euenfheiejrj It likely depends on the wealth of the people you are referring to. Working in fast food lots of people do not have savings accounts but it is likely the same or cheaper not to have one. A Canadian checking account is about 3 USD but all the us larger banks charge between 7 and 10 so for many lower income it is just not affordable.
@@donaldlyons17 online banks are free though.
I absolutely love watching you guys. I’m 50, and have household income of 100k, and a net worth of 1.3M But 700k of that is in various before and after tax accounts. The rest is farm land, or houses we sell on contract 4 deed. Should those non-liquid assets be included in net worth formula?
They should be Fred! They are assets, making you money and increasing in value. Congrats on being a millionaire 😉
Guys, you aren't using low paying jobs for examples at 20:10 even for young people at 20 & 25 years old are very high incomes. 25 years old and making $45k? I looked up average incomes and the _highest_ average income for women in the US is $47060, and in my state a whole family's average income is $56k. Most states average between that and $63k. If you are going to do a low paying job video, please focus on that, please.
Sirena Spades the answer is to save your money and work a side hustle. You don’t need these tards to tell you that.
$250/mo from when your 20 is all you need.
So quick question. Where should I put that $158 a month? Just regular bank savings or to like an S&P 500?
If it was me, I would first make sure the emergency fund/deductibles fund was fully funded, make sure you're getting the maximum employer match for 401k if that's available to you, then invest in the index fund.
I'm in Canada and just starting out, so I'm building up my emergency fund and then I will max out my RRSP and TFSA. Someday I'll also invest in an index fund, but I have a lot of catching up to do.
I’m 25 and save 17k a year. I’m looking to put that money into a multi-family property.
I think is good investment mate!!!! You'll get your money back is 5-8 years and after this you even can sell that property. Good luck , good thinking!
@@radukeban9123 No rentals are bad for the renters. Think about it how is anyone supposed to buy a home if they are already paying rent to live elsewhere? If the house can be rented at super cheap prices that is different but otherwise....
Fantastic advice! I really enjoy this channel , iam also on the email list now
Ok... When I clicked on the video i thought they would speak about people making in the 20k's. Like $44k a year is not bad in many places in this country. I wanted to show this toy friend who is currently working a $15/hr as a security guard in NYC. Thankfully he lives with his family and his living expenses are low but with the low wage, there isn't much left after he pays for all his stuff. I was hoping this could have given him an idea as to where to start
I agree the average median income of 30K is not a lot unless people have few bills.
that's crazy as a security guard he only getting paid minimum wage in NYC 😟😟
I wish these guys would give numbers. Like what kind of paying hob should you have by what age?
Depends what you can get - more is probably better.
You can probably look up average or median incomes by age in your country, it's common in census type data
Thanks guys
The amount per month to make that car payment robs you of a certain amount of the army of dollars that could be used to start building wealth. Pay cash for a car.
Yes! My 2002 Honda Accord is still going strong! Instead of financing, pay cash for a reliable used vehicle. Those would-be car payments (and any others) will turn into MILLIONS over a few decades.
This is what I wished school had said to me when I was a teenager
I wish I knew about dividends back when I was a teen, I would've had free car insurance and the some.
I earn only 27K per annum but save 93% into my work place pension - thanks to a successful other half,
Awesome!!!
So if you didn't start saving until 40 you're dead in the water. Got it.
Not sure you watched the same video that we created... still possible - money just doesn’t work as hard through compounding 👍
@@MoneyGuyShow I think of people like the garbage man or butcher at your local store and so on. Jobs that we all need to be done but will top out around 40k to 45k. If someone in their shoes doesn't start until 40yr old, even saving 20 to 25%, they will never make enough to truly be comfortable in retirement. If they start at zero at 40 with those career paths they will barely get by. But I guess they will be use to barely getting by, by then.
Don’t forget the value of Social Security for someone that makes $30k-$50k over their working career. A little bit of savings can go a long way 👍
Saving $100 a month, in one year that’s $1200 a year.
$12000 in 10 years.
$36000 in 30 years.
Fk that compound interest bullsht
Why would you ignore compound interest?
@@jackjack4412 sure let’s put in that -10% compound interest
yeah my sister know a lady with a few thousand and she is just hood-rich. Yeah that is super scary for real.
Im 18 and Im so glad I am intersted in this topic. I will have little to no problem with money in my life :)
Everybody in their 50's aren't making $52,000 a year some people are at $43,000 a year at 50, but they can retire at age 52 thru a government retired plan. Yet, wants to keep building more for a ROTH for age 65 working a part-time job. Any ideas to help?
Thanks for the video I already started to put $8500 of mu saving into an investment with a rate of return around 10 percent. That is my dad's company 401k benefit. I am 19 years old am I being too aggressive to invest $2000 a month? I am still living with my parents.
maybe most of those of us with one,two,maybe three M didn't inherit it but I think a lot of the really big money families did inherit much of it--like 20 M,100 M ?
also-inherit 50 thou? Use it wisely,don't blow it
This only works if you use compound interest. You'll have barely $100,000 or so unless you use compound interest.
And why wouldn't you use compound interest?
When you guys say you have to save x amount of money a month what exactly do you mean ? I'm assuming its not put X amount in your savings account a month. Sorry for the stupid question I really don't know anything about money , I just stumbled upon your channel a cupel days ago.
I appreciate the video, but you say “low paying job” and use average incomes.
What type of job and what state ppl make that much money as an average jo , cuz in Oklahoma a warehouse job we dont make that much
I drive Box truck local home every night and my take home is 63k a year in vermont moving produce
How is savings rate calculated?
Can you differentiate between liquid net worth and accounting net worth please. I normally dont include our house in our net worth, because you cant eat it and it takes months to sell it. Is this the wrong mentality?
Not wrong at all. We have this exact conversation with clients approaching retirement.
In the episode we focus our discussions on building liquid/investment assets.
I include it. Try living without a house. You still need shelter. Whether you rent, own or pay a mortgage. Owning a house is imputed income. Now, owning a $900k house in an area where equivalent rents are say $1500 /month wouldn't be too smart, but that's more of a lifestyle question then. Typically the more desirable the area, the more you pay for housing.
@@ATLFUNKCARTEL Why would you not mention liquid assets and total net worth separately?
What job can I get 800 bucks a week at 20??
Something I wonder about is why don't people who figure out how to become rich can't/don't teach their children about money?
Kids don’t listen until it’s too late. We plan on teaching our kids, have started teaching them already. Every dollar they get, 50% gets saved, 10% gets given away, and they can spend the other 40% on whatever they want.
Will this number matter if we have a recession ?
Recessions are part of the normal growing economic process. Don’t let the fear of something that happens 20% of the time keep you from making money in those up 8 out of 10 years.
Simple: max out your 401k at work and your IRA each year.
When these studies say savings rate, is it strictly into retirement accounts 401k/IRA? or would this include taxable investment accounts as well?
I think it would depend on your income. If you make $50k your not going to hit the max on tax differed investments, max on 401k being $19,500 and $6k for an IRA. This is where 25% of your income is only $12,500. If you have employer matching then that number is even going to be more difficult to meet. I have profit sharing and a match, so my personal contributions doesn’t actually get close to 25%. If your married then those numbers double, but income doubles too.
First buy a new Nissan and the newest phone on a monthly plan and go out to eat 3 times a week this will make you rich guaranteed..
Thank you
🙂😏😐
Okay so I am an overseas contractor so I do not have to pay taxes due to working overseas. With that being said, my wife and I have roughly $118,000 left over a year after our living expenses (she stays in the US while I am gone due to me working in combat zones) our condo is paid off and we do not know where to go from here. My job or life is not promised; so with that being said we are unsure if we should just pile up cash, invest in rental properties, or invest in the market. I just want to make sure she is taken care of if I am no longer here. Any financial advice would be greatly appreciated.
Josh I can relate to this being a military officer with a wife and son. It sounds like you are looking to be able to replace your income in the event you die. First thing get 10-20 times your Annual income worth of term life insurance. So 1-3 million in insurance . That covers your wife for 1-3 decades at current income you make. After that max out 401ks and IRAs. Then invest in passive index funds in your taxable brokerage. If there money left over you can look at diversifying into real estate. In the unlikely event you die your wife will be more than set if she is a good steward of your assets.
How much should I save? I'm just about to turn 22. At the moment I am saving for the future but only in small amounts. I'm currently trying to save for a wedding and a home too.
Hi Natalie, I'd try to eat only one elephant at a time. For example, determine the total amounts you'd like to save for the different goals (example: 5K for a wedding), then order the priorities and tackle them one at a time. Having a finish line in sight might also help you stay motivated. Congratulations and good luck!👏
A lot of the process is realizing that you have to live within your means, and live well within your means. That means that if you make $50k you only have half of that to live off of. You don’t even see the other $25k. If you use their numbers it’ll be less, but if you can do half you’ll kick start everything. But realize that their 15-20% is for retirement, if you want to save for other things on top of that, wedding, car, etc. then that’s where the other 25% of that half is. So when you buy a house or rent an apartment your not asking what I can afford, your asking what the cheapest way you can do it.
I’m confused. If you save say 200 a month that only comes out as 2400 a year. Times 40 is 96,000. Even if you increase the amount you save it’s surely not anywhere near millions?
I think that’s not including the yearly return of 10%
@@PrinceJayMoriarty yeah. I think this is back before I started saving into investments instead of into a savings account
What do you mean when you say “Monte Carlo”?
Ok i am 50 in a few months now I max my TSP @ 19 k and Roth TSP at 6 k. What else can I do? Can I also open a Roth IRA?
Wdeemar Wdeemar you can have a Roth IRA in addition to your tsp. As long as your income allows. If you make to much for Roth IRA, look up back door Roth IRA
@@jefferydoherty7368 Traditional is also an option.
You can open a Roth and/or traditional IRA, but it seems you’ve already hit your max contribution limit. If you have any self employment income, open a SEP IRA, you can contribute up to $56k/year. There are some caveats there tho. Got to pay yourself a salary and can only contribute up to 25% of your taxable salary from that self employment. And have to do the same for all the employees you have.
Bo on that No Shave November haha
I was wondering about that, thinking, please shave!!! lol Not a good look!
You can't! PERIOD! You need to learn more skills that will pay you more .... Stop lying to ppl!
Yeah so stupid. The scary part is these guys own at least one business so they should both know better!!!!
🤙🏾Good Info MoneyGuyTeam
50 years old and have never made 30k a year my best is 27k let's get real here I deal those averages are squed by the billionaires
How much you make is irrelevant, if you saved 25% of 27k from when you were 20 and retired at 65, that’s $562/mo for 45 years you’d have $2.1 million dollars when you retire at 65. Agreed, $562 for someone making $27k a year is a lot. But you’d still have $1 millions if you had saved $251/mo for 45 years. That’s with a 7% return, not the 10% they’ve estimated.
@@a1970gto so where are you gonna live while you save that up ?rent in my area for a one bedroom studio appt starts at 600 a month + utilities
There are things that you can do like get a roommate and take that $300 that your saving from having a roommate and invest it. I don’t believe that anyone saying it will be easy, but it can be done. You could take your free time and learn a skill and sell stuff on Etsy. If you’re starting at 50 it is going to be much more difficult and you’re probably not going to do it on $27K a year.
@@benchoflemons398 Lots of people make less than others right? Do you think everyone makes 40K minimum?
@@a1970gto Roommates have to have both the ability to and willingness to pay otherwise it might cost more not less. Skills and selling stuff in theory is simple but in reality it is multiple times more difficult than you are making it sound. But I do give you credit for "If you’re starting at 50 it is going to be much more difficult and you’re probably not going to do it on $27K a year."
So is the game over for you if your are 50 year old preschool teacher making $16.00 an hour?
Absolutely not, but you do have a lot of catching up to do and it will require a lot more sacrificing. Your goals will probably need to be different from a 20 yo as well.
@@a1970gto it's over. Stop kidding around.
Brian S; preston!
who gets the referece?
If I just max out my Roth every year from age 18 is that enough? That’s 6k a year
Congrats! You’ll be a millionaire by the time you’re 59.5 if you just stick with that
Google search “compound interest calculator” to play with some numbers
I think it comes out to around 3.5 million
The math doesn't make sense to me ,I'm 29 if I save 1,500 a month for 30 years ,I'll only have 540,000...Not a million..
You have to invest in stock markets savings are worthless due to inflation
This video title was pure click bait. I was looking for good tips to share with my friends. When I read the title, I was thinking you were going to give tips about people who earn $15 or less an hour, but your first tip is get a better job. Followed by go to college or get a certificate, which isn't always possible .
We took government income averages and provided the tips and guidance on how to turn that into seven figures. Good luck on your journey, but we are far from clickbait 🙄
The Money Guy Show the title of the video is low income,not average income. So think about the people who are burger flippers, not everyone can get a $50k+ job.
Please realize you are commenting with a past burger flipper and bus driver 😉
@@MoneyGuyShow Great! So you would know that the advice, beyond your job sucks - do better, wouldn't be applicable to your former self. There are 30+ year old burger flippers, some don't have initiative to get a better job, others can't. 4 states are have a median income of $46.7k or less. Bump that up to $55k or less, you are up to the median income in 18 states! So 36% of the states are essentially being told do better. Some teachers are at or below the 45k mark even. I largely like your guy's content, but I would have enjoyed if you covered the topic actually from a low income perspective.
rguy84 I make $45K now, but mostly made $30K. I started investing at 26, and am right on track to seven figures when I retire despite a pre-existing medical condition and plenty of doctor bills. With perseverence, it can be done. 🙂
How about non parents
@13:22 "This is probably not a good time to buy a new car"
3 month later: Covid
anybody older than 30 should be familiar with the Matrix.
If your employer gives you a match.
Take advantage. If you are young.
Max out a Roth IRA every year.
Could be worth $6 million TAX FREE at retirement.
We are near the lowest taxes in history. It's going to get worse.
Why not try and get a job that pays super well instead?
I never made more than 50K in my life. Is that low paying?
@Chris67 Wife and two kids put me below the median, if my wife wasn't a school teacher..
How to build wealth with a low paying job? Get a 2nd low paying job!
I started at 25. I put $200 aside every month into an Roth IRA and then gradually increased as I got older. now I’m 39 but I’m not even at 100k at investment. So how will I be a millionaire w this acct?
Let the account keep growing until you're 65.
is the answer... get a new job?
Attitude behavior
slowly! at least you won't be in a high tax bracket as concerns your contribution to your Roth IRA