level 3 - it's ,, Parkinson's law ", which says the more you earn - the more you spend. And thats so true, basically all of my friends,relatives etc - lives like that. Great video, great attitude - Subed
nope, i use my will power to fight the urge to spend more, living like a college student despite having a good income, maybe thats why im still single lol. i mean i am still young, i can put those money in better use.
NO STUDENT LOANS!!!! Yessss!!! I know the feeling. =D You realize how crazy it would be with the mortgage paid off? The money required to spend drops so much while your feeling of security sky rockets which in itself would make you smile everyday.
I'm so glad to be enrolled in the UNIVERSITY OF BEAT THE BUSH this particular clip I find very enlightening because it's inclusive of all brackets like I'm in with team# Humble Beginnings!
BeatTheBush Absolutely! good stuff indeed. I'm recommending the younger PPL in my community that are driving for financial Independce or baller status also! ty!
As a single mom, I've had to max my credit out more than once over the years. Pay it off during a good "season", then do it again. Life cycles. UGH. After watching a few of your videos (I think my first comment was a few months ago somewhere), I'm up 36 pts in the last 4 weeks. I think I went up another 6 points this week. I wait till at least two of my reports agree my FICO score is up before I feel confident. :D It's hard getting ahead when you live under the poverty level to begin with, but it's not impossible! Thanks for the vids. :)
I imagine it would be pretty difficult. I cut my expenses pretty aggressively without sacrificing quality of life. But sometimes it might seem a bit spartan to some, I think of it more as training to see if I could do it. Sometimes I fail and I must go back to something more expensive. Here are some ideas to help you save more: ruclips.net/video/itEnEGeoG3Y/видео.html
=D Thanks for finding my channel. I keep all the financial videos under my 'Advanced Finance' playlist here: ruclips.net/p/PLAffnc1joZvaVAUewyWIustcKgh5coR8o
Once I got to level 6, wealth started to accumulate pretty fast. The next 15 years of working allowed me to accumulate a lot of wealth. This guy speaks truth. It takes time but it is truth.
Thanks! 7/8 is pretty high up there. Like another comment said, you don't always have to wait until the last stages of financial independence to start a business. To me, it's just a lot riskier when you do not have a stable base to work off of.
Thank you for telling me im not as close to financial independance than i thought i was! I came in to this thinking id be higher up, but sitting at a 3 right now. i just started a business recently so im climbing my way to level 5 hopefully by the end of next year.
Lol... financial independence? You just need a positive networth of owning your own place to live PLUS about $500k as a start. $1-2 million more realistically.
Have just discovered your channel today. This was really beating the bush, not beating about the bush in your financial independence analysis and presentation. So simple and clear. Thanks.
If a person rents, and avoids plunging hundreds of thousands into the negative investment that is a house (unless you have a family... and then maybe a house is a good idea)... and has no debts.. you can automatically jump to L7? Well that raised my happiness level instantly!
BeatTheBush, one more thing. Because of your motivational videos I started moving my 33K earning .75% at Capital One savings to a credit union checking account paying 3% and I only have to use their debit card 10 times each month. They can only do that on up to 15K. I also found a good savings account paying 1.25% with a minimum balance of 10K. So Thank you for all your wonderful motivational and educational videos.
I'm sort of on the fence about the accounts that requires usage of the debit card. $15,000*(3-1.05)% = $292 more compared to a do nothing savings account. 10 times each month means you need to use it 120 times a year. $486 spending a month 5% cash back using credit cards * 12 months = $292. So I recommend to use your debit card for very low priced items to satisfy their requirement and no more. Still, I wish there was a more automatic way.
Break even for me , but looking to move on up soon! I noticed that life throws things in your way to make sure you are dedicated , I had to wipe out my saving for my air conditioner and I just rebuilt it and still going! Great video !!
You're welcome. =D I hope spelling out the levels really gives perspective of your own financial situation. Just knowing these different stages makes it a more tangible milestone so that you can work towards each level.
You are the man! Awesome video. It is very clear and well presented, and provides a nice overview to determine what level you are in and what you should be working towards. Obviously you can go into a ton of more detail about each level, but that's not the point of the video. We are at Level 6, no CC or Student Loan debts, and working diligently to pay off the mortgage. Life is good and it's a great feeling to wake up every morning knowing we have no consumer debts and that there is nice chunk of excess cash every month.
Most people are at level 3 and its going to take some concentrated effort to get to level 4. Interestingly, most people can get go from 3 to 4 in 6-12 months if they really attack the problem.
Currently working on Level 6. Paid off the loans a few years ago. getting rid of the mortgage is going to take Much longer. Nice, simple breakdown of the financial steps.
very informative video! I liked the way you have put it down into steps which is clear. It triggers motivation towards the ultimate freedom of life - the FI. Looking forward to more from your info-pedia!
I am currently at Level 3, I have of course, been at Level 2 and unfortunately at Level 1 also. I am working on Level 4 by EOY and Level 7 by 2019. This is an excellent way of seeing this path goal. Thanks for this video.
BeatTheBush you are great! Your explanation of 8-10 was confusing to me after watching it twice. I think I'm at 10. I secured my retirement in 11 1/2 years at my blue collar job. I had NOTHING at age 54 but household goods and my 96 Nissan truck. I started saving 10%, quickly jumped it to 17% and the last two working years I was saving 56% of my income and rarely missing it. Now I am retired and loving my time and still saving 44% of my retirement income (SS and pension). I feel very grateful because I worried so much as to whether I could afford to retire.
That's really good! Wow. I'm certainly not at 10 myself as I have some ways to go. SS and pension really brings the finance aspect much closer to reality. When you are Financially Independent which you seem to solidly be in, then all your income is more than your expenses. Expenses includes food, clothing, medical, housing costs, everything. So why watch a Financial Independence video when you are already? I'm grateful for the view though. =D
I basically wanted you to read my message and I have been interested in the definition of financial independence vs financial freedom. I enjoy your attitude so most of your videos are good. :)
I'm between level 9 and 10. I'm currently 33 years old and I have passive income more than double my expenses. Just because I am financially independent does not mean that I have stopped working . I do have that choice but the fear of retiring and doing nothing does not seem as attractive as it seemed when I was striving to get financially independent. In short, one needs struggles in life to make it good and worthwhile. While not having to worry about working to solely earn is the greatest joy of passive income, life and troubles do not stop there on
Once again great video. I just started watching 3 days ago and I've already learned so much. Also the mistakes I have made. I'm probably on level 3 keep up the great work! Will recommed to friends.
=D I'm glad! Looking at your financial status this way gives it some perspective and target. Otherwise if you do not know where you are going, you'll likely just spin your wheels.
Entering level 5 this month (we finishing my wife's student loan, finished mine about 2 months ago)... Will enter level 6 in about 4 years as we decided to save up and buy an apartment cash In fact will simultaneous enter level 7 when we enter level 6 Entering level 8 will take a bit more time... I love this break down! Thanks BeatTheBush! :)
Ok, I have to say.. I love watching your videos, because obviously you teach a lot of very pertinent information that I only wish we all learnt in high school, and you teach in an easy to understand and concise manner.. however, quite often I listen over and over again to the same videos because I love the sound of your voice !! :0)) There you go, you have a wonderful, strong voice and great speech.. you deserved to know ;0)
I'm almost done with level 4. I have $1700 in credit cards and then I'll be able to move on to my student loans. I plan to be done with my credit cards in 6 months, get a more satisfying career to help pay for my student loans, instead of a house I'd like to refurbish an apartment complex Or buy a large tract of land and build an entire subdivision. I like your perspective on this and I hope it helps keep me focused on getting this accomplished! :D
That's a good starting point. Although that credit card debt is sort of burning a hole right now. I think the 6 month goal is a good one. You really want to pay those off as if they are on fire. The interest is just burning money... about $28/month evaporated! gone! Lots of better ways to use it than burning it. =D
Hi! Thanks for the video/sharing. It's a very useful reminder/insight. I've been planning/budgeting my personal finance for almost 2 years now, ever since I started working after i graduated from university. I just use excel spreadsheet. I try to live as frugal/minimal as i can and i found it to be very liberating. I used to hoard things, and always prone to impulse buying. But over the past 6 months or so, i try to increase the quality of my consumption rather than quantity - and it has been great. For example, i will spend extra money to buy 3-4 good clothes, that are wearable for every occasion so that i don't go out and buy more clothes out of impulse buying or just to hoard. I tracked down every items purchased/bill paid (except for food) on the Note app, and really think through how i felt after each purchase. So far it helps because i can visualize where my money go. Sometimes you spend spend spend, and at the end of the month, you try to think back where did all your money go, and you can't remember a thing hahaha. I've been there and i think enough is enough.
Was at level 5 for a while and am back to level 4 this year as we brought in two foster children and had to upsize to a minivan, which we didn't have money saved up for, so we had to get a car loan for the first time in almost eight years. Lesson learned in not being smarter with our money. Never another car loan, and it's time to start investing beyond our 401Ks!
I was at Level 5 when I was 24 way back in 1999. Paying off student loans, car loans and credit card bills is such a huge step in financial success. I am now at Level 7 and possibly Level 8 with a house in the Bay Area fully paid off. I drive a beat up 2005 Corolla instead of a fancy BMW. I still wear t shirts I bought 10 years ago from Old Navy. I stopped wasting money on non-essential stuff like cable TV so I can have plenty for the important things.
One observation....the pevels are great for saving money. Your last step you say that you can now start your business. I would say that businesses can start at any level. It can be a catalyst to get you through levels faster. I am learning and doing this as i go. I was determined to save save save. While that is a great habit, saving is limited to your income level minus your necessary expenses. Even though i am at level 5, per your scale, i am trying to hustle to increase cash flow to be able to save more faster. Other than that, I enjoyed your video
Oh yes, I agree. You can start at any level but the finances backing your business may be a bit shaky. I view this more of a type of freedom where you can concentrate on your business more if you are at higher levels, allowing to experiment more and take risks you would not otherwise.
I live in hawaii and the average cost of housing is $595,000 not to mention high cost of living (gas, food, utilities) The average rent is $2200 a month. Looks like I have to move to the states just to get to level 6! Awesome vids by the way.
I'm in Bay Area, CA where average housing cost is $712,000 O_O. So... don't move here for level 6. It's an interesting point you hinted at which is to actually pick up and move to a lower housing cost area. It's easily a matter of $300-400k difference. This difference translates to many years of reduction in the number of years you must work before retirement. Of course, the flip side, would be how much you like the area and if you have family and friends there as well that makes it difficult to leave.
Imadafied I live in Southern California. A 3 bedroom home in the ghetto here is $500,000. Lame. So I’ve been investing my money rather than saving it for a down payment.
I am between Level 4 and 5. I am 90% done paying my student loan. Living in living rooms in my college years taught me a lot about just paying for basic necessities and not overspending.
This was very motivating. I'm currently at level 3, like 90% of Americans. However, it's time to really go at it this year and work my hardest to make larger steps toward financial freedom. When I get to level 6, I'll be extremely satisfied. Somewhere between level 7 and 8 is where I'd like to end up. I'm still somewhat young (32), so the opportunity is there waiting.
Ha ha ha! You have fallen trap to my ultimate goal of tricking people to think about their financial situation and thereby waking up and starting to work towards higher levels. Very glad you're starting to think about it as that's all I wanted to do. =D Cheers!
Yep, I've been thinking on it for quite awhile now and very recently stumbled onto your channel since I'm trying to raise my credit score. (currently at 740-ish all across) I need to tackle my expenses in increments instead of trying to knock it all out at one time, which sometimes makes things a little difficult and stressful. My goal right now is to finish paying off my car, personal loan and start making double payments on my mortgage. I keep a pretty low balance on my credit cards, so that's no issue. Keep up the videos because you have a new subscriber!
UrsaMajor I agree with cutting expense a little at a time. You need to cut one thing out and sort of feel it out and see how comfortable you are with it before moving onto another. You might realize after cutting something and perhaps replacing it with a low cost equivalent alternative that hey! it's not that bad and not all that different! You mean you keep a low running balance I assume on your credit cards. Good to have a high total limit and a low balance.
Yes, low balance, my fault. I generally keep it between 1-5%. At the current rate, I have another 1.5 years on my auto loan. Aiming to cut that in half after the first of the year. Financial freedom, here I come...lol
UrsaMajor Awk... auto loan. I only had one for about 6 months. It was on fire to me so I put everything I could while cutting expenses to do it. Good luck with your auto loan, depending on the interest rate, I would speed it up via the increasing cash flow method in my other vid.
Thank you for the video, got me to think about level 8. I knew I will be in level 9 around 45, left level 6 at 36, currently at level 7 at 38, but I did not think much about level 8...now back to excel spreadsheet I need to go :) thanks again
Oh wow... I am stressing myself with money every day, worried about not meeting my criteria, but... according to your table, I've made it to somewhere between 8 and 9... So I guess I don't need to worry all that much. :D Thanks for that!
Luckily not. I guess I am very privileged. The prices are low in my country and I am able to earn money outside my country over the Internet (graphics, programming...). Also, I don't have a student loan because education is free here - just like it's supposed to be everywhere! I really don't get why you should pay for your education. It's in the best interest of the state to have educated people - if not for problem solving in general, it's the uneducated people who destabilize the state (such as by being easily manipulated by demagogues).
This is a great video, thanks to your channel, I've iterated on all my expenses to see what extra savings I can squeeze from them, and just this month I've reduced my monthly burn rate by $100 dollars. Just this savings, rolled back into my mortgage, is going to take months off my estimated date of level 7 financial independence. Thank you and keep up the great content!
Thank you for creating this video. Your analysis about financial independence is extremely insightful and helpful. Could you make a video about asset appreciation? An analysis of which assets have the highest appreciation over the long term? Thank you!!! Your channel and your willingness to share your knowledge is a true gift to the public.
I'll make a note of that. However, asset appreciation over the long term is sorta like having an educated guess. You can get more appreciation with more risk and no matter how safe the asset, there is some level of risk. There's also the case of if you want to do a lot of research or you just want to plop the money down and set and forget. If its the ladder case, the general knowledge of the world is just plop it in a low fee index fund.
You know what will make you want to pay off you student loan sooner? They are usually at a lowish rate so you are inclined to just pay the monthly. Just add up all the interest payments you paid over the life of the student loan and that'll make you realize the enormous amount wasted that could've been in your pocket.
I'm between 8 and 9, plan to be level 10 at age 43 though living in Luxembourg (Europe) with very high housing prices, but having a few side incomes and invested in real estate at the age of 25 it was possible. The key is saving and buying assets that grow over time. Thanks for the great channel!
You don't need that many side income sources to make it work IF your spend rate is low. Well... if you get it to say $1000/month of profit then it become pretty meaningful.
I really like listening to your videos, somehow your voice is very reassuring and nice to listen to, of course what you talk about is really interesting and so helpful. I have always followed my dads advice to never spend more than i have, my lifestyle though is very unstable, since i'm a designer i struggle to find well paid jobs and i have to move around alot. I always manage to save up for 'bad times' but those happen quite alot. having no loans, car loans etc. is what keeps me sane., but i worry about getting older....i should be building wealth but i just don't know how..... I will move from germany to bangkok very soon, which will take a big slice out of my current savings but i will try to be as minimalist and frugal as possible...... anyway i love your videos, keep on doing it!!!
Thanks for watching my vids! I sounds like as a designer, you might have to be more aggressive in pipelining your jobs so you get more of them stacked in a row. Of course I haven't done much of this contract to contract type of work but that is my guess.
BeatTheBush :) i'm actually moving to thailand to work as a design lecturer, i will have a relatively low workload and just 9 months of teaching so my plan is to do other jobs on the side and also do projects during the term breaks. i started watching your videos to get some ideas on how to manage my income since i will have just 9 months of steady income. thanks for your quick reply! its nice to see that some people care and read! i feel lucky to have stumbled over your videos!
Having an intermediate term goal is important to get remind yourself of the big picture. Equally important it to realize why you're trying to obtain higher and higher levels.
Glad you mentioned the fact that people shouldn’t just pay off their mortgage. Having cash on hand is very valuable. I think of it like this: The extra mortgage interest I pay is an insurance premium that gives me instant access to cash on hand. Further, the money never loses value (aside from the interest costs) because one dollar in my bank always equals one dollar of my mortgage balance.
Holding on to that money is good until you can fully pay off your mortgage plus your emergency fund. But if you do not plan to do anything with that extra cash, then better just put it in the mortgage. It's a personal choice.
I would love to hear your candid opinions about the affordable care act and possibly a video about maximizing savings on health insurance. It would seem this is some of the highest unavoidable expense for people who do not get it through their employment.
this video was very informative on how you broke down the different levels. Right now I believe I'm at the wealth building level, i own 4 investment properties with no mortgages but I rent my house so I'm trying to change that scenario. My Credit card debt isn't that high but I'm planning on have it all paid off in the next 60 days... Good video thnks
How cool! You can just sit on your but and all your living expenses are taken care of with your rentals? That must be very nice. =D I think not many people achieve this. How much time per week do you keep your rentals in running condition or just do managing?
BeatTheBush I'm hands on with the management side.... its unreal because I haven't been in this situation long... I was one of them guys who saw gold when everyone else saw a lump of coal.. I bought at the bottom 3 multi-unit properties and rehabbed them. It took some time but they all are starting to come online. My train is picking up steam 👍👍
Age 26, living in Vancouver Canada, moved here 5 years ago, able to be around 8.5-9/ I live frugal like BTB but yet I spend money on things I enjoy, Etc Ps4 games, going out with friends// Thanks BTB great VDO
I am just about almost level 9 I think. work 1 day a week, but don't have to. own houses etc. Not making enough to start a family unless I worked more. I am 29, why am i not happy? but I am happier than I was 7 yrs ago... Love your videos man
@@BeatTheBush probably you're right. also big list of goals, motivation is very uneven. slowly increasing wealth+income, but feel like i waste alot of time. wish learning new skills was gratifying short term
Nice! But I think you should separate personal loans (i.e. general loans, business loans, etc.) into its own category, because those things can happen whenever you want pretty much. For example, you could be level 9 yet have a loan out (not necessarily mortgages, just some kind of loan), and yet somehow you'd be considered level 4 again even though you already reached 9. Does that make sense? :)
level 6 & 7 is a grey area. personally i chose not to clear my home mortgage but removed some equity in 2013 and put down as a deposit on an apartment to rent out. on paper i am mortgage neutral because the rental property equity would not only clear my home mortgage but would also provide some cash if i chose to sell it.
You can indeed do that and you will be at that level as long as you CAN pay it off even if you do not do it. Of course, all of that can change in a flash if prices drop and you can no longer sell the second property to cover the first. That's the risk by holding your assets that way.
Very good Video, Makes me look at my level and want to work harder to the next level. I do notice that in life you are always moving up and down considering many aspects that can affect your life. If you plan it right with emergency funds and your standard of living with in your means then you will do well. You are always looking at the different aspects of Money / Wealth and how it can affect you. Thanks again for the explanation on the different levels.
I'm in a weird loop between level 4 to 6, I have no mortgage because I inherited my house after my father died and no student loans because my father paid in cash for my education in college but I have credit card debt that I'm paying off which I hope to get rid of at the end of the year.
You could take a line of credit out of your home and pay off the credit card debt to get a much lower interest rate. This could get dangerous though if you are not responsible with the line of credit where you could use up the line of credit and make yourself homeless. BUT, if you do it responsibly, you can reduce the interest you pay to the cards if it happens to be high right now.
no Mortgage could either mean you did not buy a house or you paid off your mortgage. Keep in mind that its easy to get to level 6/7 without buying a house but it'll be very hard to get to level 8 because without a house fully paid for, your expense rate will be very high due to the requirement of paying for rent.
I think the east and west’s attitude about money is very different. Of course it varies from family to family as well. I can be super frugal and save a lot of money. I won’t allow myself get into debt. I grew up in a family where my mom is super frugal and no money was spent when absolute necessary. Our family sure missed a lot of fun though. It’s very security oriented.
Level 5, but sneaking in plenty of level 7 stuff before I'm at level 6. Paying extra into your mortgage is a horrible idea when you can just make that extra money work for you.
The lower level you are, the higher the risk because you cannot even support yourself fully yet. It has been done for the big risk takers who sell their house to start a business.
No too young to retire. Im only in my mid 30's. RUclips is like a treasure trove of information. How can anyone not use youtube for information these days. :)
level 3 - it's ,, Parkinson's law ", which says the more you earn - the more you spend. And thats so true, basically all of my friends,relatives etc - lives like that. Great video, great attitude - Subed
Certainly, life styles inflate to match your income is another way to put it. It appears to me that doing so is the norm.
Yes it is, sadly, and people by the age of 50 wonders - what did they missed on this journey called life . Ironic :)) - , best of luck man ! :)
Thanks! =D
nope, i use my will power to fight the urge to spend more, living like a college student despite having a good income, maybe thats why im still single lol. i mean i am still young, i can put those money in better use.
Danceographic Ocean damn that sounds like a great show. I’d watch that if there’s was one here in the US
I am at level 5. Paid off my student loans. Husband and I are about to roll up our sleeves and attack the mortgage next
NO STUDENT LOANS!!!! Yessss!!! I know the feeling. =D You realize how crazy it would be with the mortgage paid off? The money required to spend drops so much while your feeling of security sky rockets which in itself would make you smile everyday.
I think I'll cheat with 401k to get to level 6 rapidly
Nice me too
I'm so glad to be enrolled in the UNIVERSITY OF BEAT THE BUSH
this particular clip I find very enlightening because it's inclusive of all brackets like I'm in with team# Humble Beginnings!
A sort of financial life level broken into steps makes trying for each one a bit more manageable.
BeatTheBush Absolutely! good stuff indeed. I'm recommending the younger PPL in my community that are driving for financial Independce or baller status also!
ty!
=D No prob. =D
As a single mom, I've had to max my credit out more than once over the years. Pay it off during a good "season", then do it again. Life cycles. UGH. After watching a few of your videos (I think my first comment was a few months ago somewhere), I'm up 36 pts in the last 4 weeks. I think I went up another 6 points this week. I wait till at least two of my reports agree my FICO score is up before I feel confident. :D It's hard getting ahead when you live under the poverty level to begin with, but it's not impossible! Thanks for the vids. :)
I imagine it would be pretty difficult. I cut my expenses pretty aggressively without sacrificing quality of life. But sometimes it might seem a bit spartan to some, I think of it more as training to see if I could do it. Sometimes I fail and I must go back to something more expensive. Here are some ideas to help you save more: ruclips.net/video/itEnEGeoG3Y/видео.html
Thank you for your words. I’m also from a single parent family so I know how hard the struggle is. What kind of work do you do?
Man, I'm so glad your channel exists. So many helpful pointers in such a short duration of time!
=D Thanks for finding my channel. I keep all the financial videos under my 'Advanced Finance' playlist here: ruclips.net/p/PLAffnc1joZvaVAUewyWIustcKgh5coR8o
Once I got to level 6, wealth started to accumulate pretty fast. The next 15 years of working allowed me to accumulate a lot of wealth. This guy speaks truth. It takes time but it is truth.
I am at level 7 or 8 barebones... no debt, or loans. And contemplating on starting a business soon. Great video!
Thanks! 7/8 is pretty high up there. Like another comment said, you don't always have to wait until the last stages of financial independence to start a business. To me, it's just a lot riskier when you do not have a stable base to work off of.
Thank you for telling me im not as close to financial independance than i thought i was! I came in to this thinking id be higher up, but sitting at a 3 right now. i just started a business recently so im climbing my way to level 5 hopefully by the end of next year.
Lol... financial independence? You just need a positive networth of owning your own place to live PLUS about $500k as a start. $1-2 million more realistically.
Have just discovered your channel today. This was really beating the bush, not beating about the bush in your financial independence analysis and presentation. So simple and clear. Thanks.
You're welcome! =D
I guess I never even imagined being able to get out of paying mortgage forever. This video forced me to imagine beyond that. Thanks!
This video should be 1 mil+ views, golden content
Sharing this with my children. They don't teach this in school. Thank You.
They don't actually. Sometimes they have community college classes on financial literacy though.
If a person rents, and avoids plunging hundreds of thousands into the negative investment that is a house (unless you have a family... and then maybe a house is a good idea)... and has no debts.. you can automatically jump to L7?
Well that raised my happiness level instantly!
BeatTheBush, one more thing. Because of your motivational videos I started moving my 33K earning .75% at Capital One savings to a credit union checking account paying 3% and I only have to use their debit card 10 times each month. They can only do that on up to 15K. I also found a good savings account paying 1.25% with a minimum balance of 10K. So Thank you for all your wonderful motivational and educational videos.
I'm sort of on the fence about the accounts that requires usage of the debit card. $15,000*(3-1.05)% = $292 more compared to a do nothing savings account. 10 times each month means you need to use it 120 times a year. $486 spending a month 5% cash back using credit cards * 12 months = $292.
So I recommend to use your debit card for very low priced items to satisfy their requirement and no more. Still, I wish there was a more automatic way.
I agree. Thanks!
Break even for me , but looking to move on up soon! I noticed that life throws things in your way to make sure you are dedicated , I had to wipe out my saving for my air conditioner and I just rebuilt it and still going! Great video !!
Thanks! Having the next somewhat smaller step is great rather than just look at the peak. Gives you more concrete goal to work towards.
Thanks for making your videos short and simple.
You're welcome. =D I hope spelling out the levels really gives perspective of your own financial situation. Just knowing these different stages makes it a more tangible milestone so that you can work towards each level.
We're working on level 6! It's going to be hard, but we know it will be worth it!
You are the man! Awesome video. It is very clear and well presented, and provides a nice overview to determine what level you are in and what you should be working towards. Obviously you can go into a ton of more detail about each level, but that's not the point of the video. We are at Level 6, no CC or Student Loan debts, and working diligently to pay off the mortgage. Life is good and it's a great feeling to wake up every morning knowing we have no consumer debts and that there is nice chunk of excess cash every month.
Security is important to have as a life companion even if it's for the purpose of feeling warm and fuzzy all the time. Sleeping money I call it.
I really appreciate this way of looking at financial independence. It does indeed make it seem like its doable!
You're welcome! One step at a time is a lot easier than save $1 million. lol.
interesting and helpful! Currently at level 3, working to pay off CC and then car debt.
Most people are at level 3 and its going to take some concentrated effort to get to level 4. Interestingly, most people can get go from 3 to 4 in 6-12 months if they really attack the problem.
I like the way you divide the steps to financial independence into 10 levels.
=D
Great video and useful information as always. You have a great way of presenting the information.
Thanks!
i usually don't like videos, but you really break it down well.
Thanks for your comment!
"How's it going everybody this is beatthebush"
-The start to a great next 10 minutes
Currently working on Level 6. Paid off the loans a few years ago. getting rid of the mortgage is going to take Much longer.
Nice, simple breakdown of the financial steps.
very informative video! I liked the way you have put it down into steps which is clear. It triggers motivation towards the ultimate freedom of life - the FI. Looking forward to more from your info-pedia!
Each step is still huge but a least its divided a little bit more than just one single step.
I am currently at Level 3, I have of course, been at Level 2 and unfortunately at Level 1 also. I am working on Level 4 by EOY and Level 7 by 2019. This is an excellent way of seeing this path goal. Thanks for this video.
Yeah, paying off debts is a slow process but it snow balls as you free up the interest you pay. You're welcome. =D
I just found your channel from viewing similar content yesterday and you are instant no1 favorite!
BeatTheBush you are great! Your explanation of 8-10 was confusing to me after watching it twice. I think I'm at 10. I secured my retirement in 11 1/2 years at my blue collar job. I had NOTHING at age 54 but household goods and my 96 Nissan truck. I started saving 10%, quickly jumped it to 17% and the last two working years I was saving 56% of my income and rarely missing it. Now I am retired and loving my time and still saving 44% of my retirement income (SS and pension). I feel very grateful because I worried so much as to whether I could afford to retire.
That's really good! Wow. I'm certainly not at 10 myself as I have some ways to go. SS and pension really brings the finance aspect much closer to reality. When you are Financially Independent which you seem to solidly be in, then all your income is more than your expenses. Expenses includes food, clothing, medical, housing costs, everything.
So why watch a Financial Independence video when you are already? I'm grateful for the view though. =D
I basically wanted you to read my message and I have been interested in the definition of financial independence vs financial freedom. I enjoy your attitude so most of your videos are good. :)
I'm between level 9 and 10. I'm currently 33 years old and I have passive income more than double my expenses. Just because I am financially independent does not mean that I have stopped working . I do have that choice but the fear of retiring and doing nothing does not seem as attractive as it seemed when I was striving to get financially independent. In short, one needs struggles in life to make it good and worthwhile. While not having to worry about working to solely earn is the greatest joy of passive income, life and troubles do not stop there on
You have that right. Level 10 is not the end. There is a secret level most people never traverse.
I love streamlined frameworks from which to take action - and yours rocks! Thank you for creating and sharing this video :)
Fantastic video! Congrats on your subscriber and viewership count!
Once again great video. I just started watching 3 days ago and I've already learned so much. Also the mistakes I have made. I'm probably on level 3 keep up the great work! Will recommed to friends.
=D I'm glad! Looking at your financial status this way gives it some perspective and target. Otherwise if you do not know where you are going, you'll likely just spin your wheels.
Entering level 5 this month (we finishing my wife's student loan, finished mine about 2 months ago)...
Will enter level 6 in about 4 years as we decided to save up and buy an apartment cash
In fact will simultaneous enter level 7 when we enter level 6
Entering level 8 will take a bit more time...
I love this break down! Thanks BeatTheBush! :)
You're welcome! Each level is a whole new level. =D
Ok, I have to say.. I love watching your videos, because obviously you teach a lot of very pertinent information that I only wish we all learnt in high school, and you teach in an easy to understand and concise manner.. however, quite often I listen over and over again to the same videos because I love the sound of your voice !! :0)) There you go, you have a wonderful, strong voice and great speech.. you deserved to know ;0)
I'm almost done with level 4. I have $1700 in credit cards and then I'll be able to move on to my student loans. I plan to be done with my credit cards in 6 months, get a more satisfying career to help pay for my student loans, instead of a house I'd like to refurbish an apartment complex Or buy a large tract of land and build an entire subdivision. I like your perspective on this and I hope it helps keep me focused on getting this accomplished! :D
That's a good starting point. Although that credit card debt is sort of burning a hole right now. I think the 6 month goal is a good one. You really want to pay those off as if they are on fire. The interest is just burning money... about $28/month evaporated! gone! Lots of better ways to use it than burning it. =D
Wow I've learned a lot with just 3 of your very, very informative videos. I'll keep watching and better yet learning!
You're welcome! Glad you might actually think about your finances in a totally different way.
A new outlook on my financial goals ! Awesome video
=D Gives you smaller steps slightly more manageable. But each level might take many years to complete anyhow.
I love watching your videos. They really do teach me about money and finances. Thank you
=D It's important to have an overall picture, sort of a map, so you can work towards a goal. Otherwise, without a goal, you just do whatever.
Hi! Thanks for the video/sharing. It's a very useful reminder/insight. I've been planning/budgeting my personal finance for almost 2 years now, ever since I started working after i graduated from university. I just use excel spreadsheet. I try to live as frugal/minimal as i can and i found it to be very liberating. I used to hoard things, and always prone to impulse buying. But over the past 6 months or so, i try to increase the quality of my consumption rather than quantity - and it has been great. For example, i will spend extra money to buy 3-4 good clothes, that are wearable for every occasion so that i don't go out and buy more clothes out of impulse buying or just to hoard. I tracked down every items purchased/bill paid (except for food) on the Note app, and really think through how i felt after each purchase. So far it helps because i can visualize where my money go. Sometimes you spend spend spend, and at the end of the month, you try to think back where did all your money go, and you can't remember a thing hahaha. I've been there and i think enough is enough.
I'm glad you started this which sounds pretty early. Good going!
Was at level 5 for a while and am back to level 4 this year as we brought in two foster children and had to upsize to a minivan, which we didn't have money saved up for, so we had to get a car loan for the first time in almost eight years. Lesson learned in not being smarter with our money. Never another car loan, and it's time to start investing beyond our 401Ks!
Wow... congrats on your children. So generous of you to accept them into your family! =D
I really like your modest and simple approach! Very informative and actionable information. Keep it coming buddy!
Thanks much! =D
Great video! One of the best I’ve watch.
I was at Level 5 when I was 24 way back in 1999. Paying off student loans, car loans and credit card bills is such a huge step in financial success. I am now at Level 7 and possibly Level 8 with a house in the Bay Area fully paid off. I drive a beat up 2005 Corolla instead of a fancy BMW. I still wear t shirts I bought 10 years ago from Old Navy. I stopped wasting money on non-essential stuff like cable TV so I can have plenty for the important things.
Looks like you do almost the same things I do. Except I drive an old fancy car lol. Now time to look to quit the day job! =D
Level 5.... thank you for motivation to push myself further
You're welcome! =D
One observation....the pevels are great for saving money. Your last step you say that you can now start your business. I would say that businesses can start at any level. It can be a catalyst to get you through levels faster. I am learning and doing this as i go. I was determined to save save save. While that is a great habit, saving is limited to your income level minus your necessary expenses. Even though i am at level 5, per your scale, i am trying to hustle to increase cash flow to be able to save more faster. Other than that, I enjoyed your video
Oh yes, I agree. You can start at any level but the finances backing your business may be a bit shaky. I view this more of a type of freedom where you can concentrate on your business more if you are at higher levels, allowing to experiment more and take risks you would not otherwise.
made a similar list myself, I like yours better, thanks for sharing.
You're welcome! =D
sparkstarter what was your list?
I live in hawaii and the average cost of housing is $595,000 not to mention high cost of living (gas, food, utilities) The average rent is $2200 a month. Looks like I have to move to the states just to get to level 6! Awesome vids by the way.
I'm in Bay Area, CA where average housing cost is $712,000 O_O. So... don't move here for level 6. It's an interesting point you hinted at which is to actually pick up and move to a lower housing cost area. It's easily a matter of $300-400k difference. This difference translates to many years of reduction in the number of years you must work before retirement. Of course, the flip side, would be how much you like the area and if you have family and friends there as well that makes it difficult to leave.
Imadafied I live in Southern California. A 3 bedroom home in the ghetto here is $500,000. Lame. So I’ve been investing my money rather than saving it for a down payment.
Good video. Shows that it can be done in smaller steps.
I am between Level 4 and 5. I am 90% done paying my student loan. Living in living rooms in my college years taught me a lot about just paying for basic necessities and not overspending.
You're almost there! Go for it! =D
This was very motivating. I'm currently at level 3, like 90% of Americans. However, it's time to really go at it this year and work my hardest to make larger steps toward financial freedom. When I get to level 6, I'll be extremely satisfied. Somewhere between level 7 and 8 is where I'd like to end up. I'm still somewhat young (32), so the opportunity is there waiting.
Ha ha ha! You have fallen trap to my ultimate goal of tricking people to think about their financial situation and thereby waking up and starting to work towards higher levels. Very glad you're starting to think about it as that's all I wanted to do. =D Cheers!
Yep, I've been thinking on it for quite awhile now and very recently stumbled onto your channel since I'm trying to raise my credit score. (currently at 740-ish all across) I need to tackle my expenses in increments instead of trying to knock it all out at one time, which sometimes makes things a little difficult and stressful. My goal right now is to finish paying off my car, personal loan and start making double payments on my mortgage. I keep a pretty low balance on my credit cards, so that's no issue. Keep up the videos because you have a new subscriber!
UrsaMajor I agree with cutting expense a little at a time. You need to cut one thing out and sort of feel it out and see how comfortable you are with it before moving onto another. You might realize after cutting something and perhaps replacing it with a low cost equivalent alternative that hey! it's not that bad and not all that different! You mean you keep a low running balance I assume on your credit cards. Good to have a high total limit and a low balance.
Yes, low balance, my fault. I generally keep it between 1-5%. At the current rate, I have another 1.5 years on my auto loan. Aiming to cut that in half after the first of the year. Financial freedom, here I come...lol
UrsaMajor Awk... auto loan. I only had one for about 6 months. It was on fire to me so I put everything I could while cutting expenses to do it. Good luck with your auto loan, depending on the interest rate, I would speed it up via the increasing cash flow method in my other vid.
Thank you for the video, got me to think about level 8. I knew I will be in level 9 around 45, left level 6 at 36, currently at level 7 at 38, but I did not think much about level 8...now back to excel spreadsheet I need to go :) thanks again
=D Is there a level 11? Sure. I think if you're at level 10 you wont be watching RUclips videos to get there though.
Thank you, this video gave a good reference point about my financial situation and what goals I must stablish
=D It's always good to see where you are and where you want to go. Then you set your goals and set mini milestones to reach it.
Yay Level 7. VTI and chill.
This really opened my eyes.
=D Many of those steps is a road block that slows you down in accumulating wealth. Like shackles.
Nice advice.. 39 yrs old. may be 8- here.. work as hard till now to get my goal in the ages of 55 but i think i do it in a yr or two.
Sometimes the goal is just so far off, you have to enjoy the journey going there.
Oh wow... I am stressing myself with money every day, worried about not meeting my criteria, but... according to your table, I've made it to somewhere between 8 and 9... So I guess I don't need to worry all that much. :D Thanks for that!
8 or 9 means you have very l little to worry about. You don't have creditors knocking down your door chasing you for money.
Luckily not. I guess I am very privileged. The prices are low in my country and I am able to earn money outside my country over the Internet (graphics, programming...). Also, I don't have a student loan because education is free here - just like it's supposed to be everywhere! I really don't get why you should pay for your education. It's in the best interest of the state to have educated people - if not for problem solving in general, it's the uneducated people who destabilize the state (such as by being easily manipulated by demagogues).
What a great video!!!!! Very insightful!!
This is a great video, thanks to your channel, I've iterated on all my expenses to see what extra savings I can squeeze from them, and just this month I've reduced my monthly burn rate by $100 dollars. Just this savings, rolled back into my mortgage, is going to take months off my estimated date of level 7 financial independence.
Thank you and keep up the great content!
Thank you for creating this video. Your analysis about financial independence is extremely insightful and helpful. Could you make a video about asset appreciation? An analysis of which assets have the highest appreciation over the long term? Thank you!!! Your channel and your willingness to share your knowledge is a true gift to the public.
I'll make a note of that. However, asset appreciation over the long term is sorta like having an educated guess. You can get more appreciation with more risk and no matter how safe the asset, there is some level of risk. There's also the case of if you want to do a lot of research or you just want to plop the money down and set and forget. If its the ladder case, the general knowledge of the world is just plop it in a low fee index fund.
Currently on level 4 (no car) working to pay off student loans. This video really helped me. (:
You know what will make you want to pay off you student loan sooner? They are usually at a lowish rate so you are inclined to just pay the monthly. Just add up all the interest payments you paid over the life of the student loan and that'll make you realize the enormous amount wasted that could've been in your pocket.
such great information! im loving your videos!
Thanks! Hey I know a Vanessa Castro long time ago. Did you drive a black mustang long time ago?
Good stuff! Enjoy every second of your video!
Glad you liked it. =D
Level 2 here. Got a long way to go, man. I'll hopefully get there one day though. Cool video by the way.
Oh man. There's always a good place to start. Try my cashflow video to help you get started: ruclips.net/video/H4nt1gNjxIU/видео.html
I'm between 8 and 9, plan to be level 10 at age 43 though living in Luxembourg (Europe) with very high housing prices, but having a few side incomes and invested in real estate at the age of 25 it was possible. The key is saving and buying assets that grow over time. Thanks for the great channel!
You don't need that many side income sources to make it work IF your spend rate is low. Well... if you get it to say $1000/month of profit then it become pretty meaningful.
I enjoyed this. Watching it again!
=D Thanks! =D
I really like listening to your videos, somehow your voice is very reassuring and nice to listen to, of course what you talk about is really interesting and so helpful. I have always followed my dads advice to never spend more than i have, my lifestyle though is very unstable, since i'm a designer i struggle to find well paid jobs and i have to move around alot. I always manage to save up for 'bad times' but those happen quite alot. having no loans, car loans etc. is what keeps me sane., but i worry about getting older....i should be building wealth but i just don't know how..... I will move from germany to bangkok very soon, which will take a big slice out of my current savings but i will try to be as minimalist and frugal as possible......
anyway i love your videos, keep on doing it!!!
Thanks for watching my vids! I sounds like as a designer, you might have to be more aggressive in pipelining your jobs so you get more of them stacked in a row. Of course I haven't done much of this contract to contract type of work but that is my guess.
BeatTheBush :) i'm actually moving to thailand to work as a design lecturer, i will have a relatively low workload and just 9 months of teaching so my plan is to do other jobs on the side and also do projects during the term breaks. i started watching your videos to get some ideas on how to manage my income since i will have just 9 months of steady income. thanks for your quick reply! its nice to see that some people care and read! i feel lucky to have stumbled over your videos!
somewhere close to 9 have only handful of things to pay to be level nine, but i would like a better standard of living, financial freedom from a 9-5.
Good video, level system is a great way to teach
=D
I definitely know I have a wonderful framework to be wise and save.
Having an intermediate term goal is important to get remind yourself of the big picture. Equally important it to realize why you're trying to obtain higher and higher levels.
Glad you mentioned the fact that people shouldn’t just pay off their mortgage. Having cash on hand is very valuable. I think of it like this: The extra mortgage interest I pay is an insurance premium that gives me instant access to cash on hand. Further, the money never loses value (aside from the interest costs) because one dollar in my bank always equals one dollar of my mortgage balance.
Holding on to that money is good until you can fully pay off your mortgage plus your emergency fund. But if you do not plan to do anything with that extra cash, then better just put it in the mortgage. It's a personal choice.
Woohoo, level 9 baby!!
I would love to hear your candid opinions about the affordable care act and possibly a video about maximizing savings on health insurance. It would seem this is some of the highest unavoidable expense for people who do not get it through their employment.
It is expensive indeed and if you are in the lower income tier you will get some discounts. Your idea is noted. Thanks!
this video was very informative on how you broke down the different levels. Right now I believe I'm at the wealth building level, i own 4 investment properties with no mortgages but I rent my house so I'm trying to change that scenario. My Credit card debt isn't that high but I'm planning on have it all paid off in the next 60 days... Good video thnks
How cool! You can just sit on your but and all your living expenses are taken care of with your rentals? That must be very nice. =D I think not many people achieve this. How much time per week do you keep your rentals in running condition or just do managing?
BeatTheBush I'm hands on with the management side.... its unreal because I haven't been in this situation long... I was one of them guys who saw gold when everyone else saw a lump of coal.. I bought at the bottom 3 multi-unit properties and rehabbed them. It took some time but they all are starting to come online. My train is picking up steam 👍👍
just started watching your videos. They are awesome man. Great info! I'm at level 4!
That's better than most. =D
This video is absolutely amazing
Thanks! =D
I'm between level 9 and 10
That's really cool. Just sitting about and enjoying life then? =D Retired and happy? =D
Alpha SQUAD official How did you get there?
I am level 2 and I am going to level 9 and 10, because my grandma gave me a lot of money.
hahhaha
and I am your new friend
Nice break down of financial levels.
=D
Age 26, living in Vancouver Canada, moved here 5 years ago, able to be around 8.5-9/ I live frugal like BTB but yet I spend money on things I enjoy, Etc Ps4 games, going out with friends// Thanks BTB great VDO
You need some outlets and some entertainment.
I am just about almost level 9 I think. work 1 day a week, but don't have to. own houses etc. Not making enough to start a family unless I worked more. I am 29, why am i not happy? but I am happier than I was 7 yrs ago... Love your videos man
Not sure, what are you doing with your free time? Are you getting enough social interaction?
@@BeatTheBush probably you're right. also big list of goals, motivation is very uneven. slowly increasing wealth+income, but feel like i waste alot of time. wish learning new skills was gratifying short term
Nice! But I think you should separate personal loans (i.e. general loans, business loans, etc.) into its own category, because those things can happen whenever you want pretty much. For example, you could be level 9 yet have a loan out (not necessarily mortgages, just some kind of loan), and yet somehow you'd be considered level 4 again even though you already reached 9. Does that make sense? :)
im really enjoying informative vids like this. Sure most of ur vids are random, but they really go in dept with the knowledge we need to know
Glad to hear! I feel most people do not know what they need to know. Because if you do not know about it, you wouldn't be looking for it. =)
Such an excellent explanation, thanks so much!
You're welcome! =D
you haven't even mutated yet at this level 10, this whole thing is level 1 in life... give us the good stuff!!
I don't understand. Mutated? This is in reference to a game I assume?
Thanks for the Break Down 👌🏾
Thank you.
You're welcome.
level 6 & 7 is a grey area. personally i chose not to clear my home mortgage but removed some equity in 2013 and put down as a deposit on an apartment to rent out. on paper i am mortgage neutral because the rental property equity would not only clear my home mortgage but would also provide some cash if i chose to sell it.
You can indeed do that and you will be at that level as long as you CAN pay it off even if you do not do it. Of course, all of that can change in a flash if prices drop and you can no longer sell the second property to cover the first. That's the risk by holding your assets that way.
Very good Video, Makes me look at my level and want to work harder to the next level. I do notice that in life you are always moving up and down considering many aspects that can affect your life. If you plan it right with emergency funds and your standard of living with in your means then you will do well. You are always looking at the different aspects of Money / Wealth and how it can affect you. Thanks again for the explanation on the different levels.
Sort of gamify life. You know where you are, now time to get to the next one. =D
I'm in a weird loop between level 4 to 6, I have no mortgage because I inherited my house after my father died and no student loans because my father paid in cash for my education in college but I have credit card debt that I'm paying off which I hope to get rid of at the end of the year.
You could take a line of credit out of your home and pay off the credit card debt to get a much lower interest rate. This could get dangerous though if you are not responsible with the line of credit where you could use up the line of credit and make yourself homeless. BUT, if you do it responsibly, you can reduce the interest you pay to the cards if it happens to be high right now.
Thanks for your list. Military pays for school. Level 6
no Mortgage could either mean you did not buy a house or you paid off your mortgage. Keep in mind that its easy to get to level 6/7 without buying a house but it'll be very hard to get to level 8 because without a house fully paid for, your expense rate will be very high due to the requirement of paying for rent.
Where have you been all my youtube life !
=D Thanks for your support!
I'm at 6&7
I'm trying to buy multiple homes.
I like this channel real talk
8 is my goal by 2020
No consumer debt... much more ahead than most already. Congrats!
Well thought out..... great video
=D
Oh wow, I thought I was in a bad place but number 7 is pretty good!
7 IS a very good place to be. Most do not even get past being in debt.
This was awseome i loved it
I think the east and west’s attitude about money is very different. Of course it varies from family to family as well. I can be super frugal and save a lot of money. I won’t allow myself get into debt. I grew up in a family where my mom is super frugal and no money was spent when absolute necessary. Our family sure missed a lot of fun though. It’s very security oriented.
Level 5, but sneaking in plenty of level 7 stuff before I'm at level 6. Paying extra into your mortgage is a horrible idea when you can just make that extra money work for you.
thanks for sharing
You're welcome! =D
this is a very good content i don't think much people have discussed this, however i think you absolutely can start a business at any level
The lower level you are, the higher the risk because you cannot even support yourself fully yet. It has been done for the big risk takers who sell their house to start a business.
I guess I would be a 9. Fun chart. You are teaching a lot of good stuff on your channel.
That's crazy! What are you doing watching RUclips vids? Or I guess you retired to watching YT vids? =D Ha ha. Thanks for your support!
No too young to retire. Im only in my mid 30's. RUclips is like a treasure trove of information. How can anyone not use youtube for information these days. :)
It really is. You really have to weed out the bad stuff though which wastes your time because sometimes its hard to tell before you watch it.