7 Lies About Wealth Building You Probably Believe
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- čas přidán 2. 07. 2024
- In this video, Chelsea debunks several myths we carry about wealth-building, from thinking we’ll get rich from one lump sum to thinking you need a “traditional” bank to do it.
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That’s why the rich loves capitalism
1:07 Myth number 1: Wealth building requires a windfall of cash
3:07 Myth number 2: You need to be hands-on in order to build wealth
5:00 Myth number 3: If you work hard and are loyal to your company you will be rewarded
7:22 Myth number 4: You need to own a home in order to build wealth
9:47 Myth number 5: You need to time the stock market in order to make money
11:45 Myth number 6: You need an advanced degree in order to build wealth
13:56 Myth number 7: You can build wealth by keeping your money in savings
THANK YOU! THANK YOU! THANK YOU!
Thank you!
Thanks for putting a timestamp too
Thank you !
Thanks 😊
I agree with job hopping! I doubled my income by changing jobs when I was 26 even though a lot of people told me it’s too risky. Best decision of my life and it completely changed the trajectory of my lifestyle and finances.
you are right, i also want to take a bold step this year but currently looking for a genuine platform to invest on🙏🏻
@@valerieelfriede4789 i will advice you reach out to Vivian Klaine Morgan, she is God sent to us
I'm surprised you are talking about same lady? i've been making a lot of profits investing with her for a month now
A CNBC news host spoke so highly of the💕 woman Vivian Klaine Morgan and her loss prevention strategies been trying to get to her ever since didn’t know she was so easily accessible
@@davidhudson3001 thanks, i just look up her name and currently on her webpage🙏🏻
As a female working for the same company for 30 yrs., I realized too late about being under paid. Something to consider -- it affects your social security benefits as well since the amount you receive is based on your earned income.
Oh thanks for the insight as a younger person
This is wonderful wisdom. But don’t worry, almost zero companies will keep the same people for 30 years anymore… 👀 (that’s a whole other conversation)
@@rixatrix well i think they do want to keep people for longer but they dont know how to retain ppl bc nobody wants to stay stagnant at a company when theres better options. And if the company you're at isnt giving you a yearly raise, job hopping is the best route. Companies need to do better with benefits and maybe ppl won't leave them.
I guess, the amount of benefits we will be receiving is relatively dependent on our contributions when we are still able, so I hope people get to realize that as early as possible.
Not only willI not be receiving an inheritance, I have begun supporting my mother financially at age 40. I’d love to hear advice for elder care when your parents aren’t financially stable and will need to be supported, potentially for decades. And separately, how to unlearn poor financial habits we “inherit” from our parents based on what they modeled as their money mindset when we were young. I’m still struggling to overcome some of these bad decision making values.
Same here . I am a mother of eight and am paying half of my father's rent after he squandered most of his wealth. Crazy thing is we are all living in San Francisco, imagine the pain!
I’d love a video about taking care of parents too + finances too!
Be sure to check out all government, community, church resources to make her lifestyle as comfortable as possible. Take advantage of all senior discounts etc. Best wishes for your success. 👍💰💐💐💐
The habit one was a subject of a recent video
As Judy said, (and assuming you're in the USA) look into government senior care programs, AARP, Section 8 housing, etc. Services like Tracfone, Meals on Wheels, free or reduced transit through Lyft, and The Ride may also be useful. Benefits vary by state, so if your mother is physically and mentally well enough, she may consider relocating to a city or state with a better standard of living for low-income seniors while she is still well enough to make such a transition.
My husband's grandma(87) told her kids she's not doing inheritance for them to fight over. She's spending her money on the family as she pleases while she's alive and can enjoy it. She off loaded the sentimental furniture and piano on the right family and downsized to a senior apartment. She doesn't want to have tons of strings to deal with in her old age.
"Why is Congress still allowed to trade stocks?!" Amen Chelsea.
Because they make the rules.
The solution to this is just trade stocks following them.
@@jcorey333 As much as I wish it were this simple its not. The market moves on information, so when soon as information breaks publicly, the market will react according to that information and you lose any meaningful arbitrage since everyone has that info. The average retail investor will not make money by trading stocks like a Congressperson. Problems lie with the hypocrisy and inevitable cheating of the system that is occurring through politicians using non-public information. Employees of publicly traded corporations are forbidden from buying and sell shares based on material non-public information as a way to make the market more fair, whereas members of Congress are exempt from that. Again, when news becomes public you get movements in prices as people trade on that information, so by that point you've lost the window to make significant amounts of money in the short term. If you're trading on non-public information, it essentially acts as as head start. If you're a retail investor trading stocks following members of Congress is not a solution.
@@jcorey333 Not exactly. Nancy Pelosi didnt even beat the S&P500 index
We need a video about what careers you can jump into without a college degree. Pretty Please :)
That would either be a trade or an apprenticeship.
You can climb the ladder at an organization sometimes without a college degree.
If you're interested in tech, I've seen some folks succeed with code bootcamps.
Agree tech is a great way to go because a lot of the information is new and you can learn skills online before there are even college courses for it. Also, most of the people in tech are young and more progressive when it comes to hiring and work culture. Tech isn't just coding but anything involved with computers and the internet, lots of options. I started in digital marketing almost 5 years ago and make just under $90K a year, with no degree. A more ambitious person could easily crack $100k in the same time frame.
Google will give you mor answers then a single video could. Unless it is days or weeks long
I’m 53 and have worked in 11 different companies from age 18, without a university degree. Starting at minimum wage, I soon increased my salary by 20-25% per year. Twice I changed job not for the money, but for the opportunities that pushed me forward. I always knew what my value is on the market, and never hesitated to negotiate. Even today, my salary has increased by 20% over the last two years. So I totally agree that staying in the same company for 30 years isn’t the way to increase our income.
And you probably had a family home to go back to if that didn't work out.
Both my parents died before I was 24, and I had no inheritance. Job hopping is a privilege.
What is your career trajectory without degree? Did you start with sale and climb the corporate ladder?
@@jenjones90 Wrong assumption, and poor judgemental attitude. I left home at 17 with a garbage bag to hold my stuff.
Honestly videos like this are really refreshing. A lot of financial advice videos are very guilt tripping but I come back to the financial diet because these videos are not.
God, that third point hit home.
I know a girl who has been working with the same retail employer for a little under 10 years. She has a major role in the employer's marketing for the region we live in: she oversees multiple stores in our city, and often drives to stores in nearby cities to oversee them. She also manages employees at her home location. It isn't unusual for her to work well over 40 hours a week.
Her employer pays her less than $2 over our province's minimum wage. TEN YEARS of faithful service, and that's what they think she's worth.
All her friends keep telling her to quit her job. I really hope that she works up the courage one day.
7:05 "These ho's ain't loyal".... 🎶 no they aiiiiin't 🤣🤣🤣🤣
I am so dead 💀💀💀💀💀💀
amen!
🤣🤣
FACTS!🤣🤣🤣
It's pretty messed up that college has become a purely economical proposition. When I was a teenager, I went away to college to escape my bad neighborhood and messed up home life at the time. The "cost/benefit analysis" there was to finally live in a place where I didn't have to hit the ground when the shooting started anymore. Idk, the debt seems like the cost I would otherwise pay in healthcare for the stress and lack of healthy choices around me.
Edit: No shade on Chelsea here, I was just lamenting in general
Yeah, I was escaping an abusive household and didn't want to sign up for the military. Being alive in America costs money and you can't usually buy back your physical/mental health once it's gone. 💜
Amazing perspective. Thanks for sharing!
I felt the same way about college. My degree is in art. I got out and made new friends. I can't say my education has earned me extra income, but it gave me peace of mind and a fresh start. My loans are paid off now.
Super interesting point. I also kind of disagree with TFD about this one as well. I think if you can fund your education; find someone or an entity to fund it for you (i.e., grants, scholarships, or even subsidies if you're studying abroad); or are knowledgeable about the loans you plan to take on *if* you choose to go that route, then go get the degree you want. For example, it doesn't really matter if getting a PhD in history doesn't have a great ROI if the college you went to paid for you to attend the program and complete your dissertation. I don't think *everything* about education has to revolve around whether or not it's going to generate you the most money over the course of your lifetime. Sometimes people do just want to learn about things that interest them lol.
Yes, I went to college and moved away from home for a safe and better life, or and attempt at a better life. Best choice I ever made, worked and took out loans but only needed 24 thousand for school. Worth it. More than half paid off, not bad at all.
Investing in the stock market is the best option to make a passive income.
Virtually all the markets are crazy, most people pay more attention to the shiniest position on the graph, I’m keeping a diversified portfolio.
To manage investment risk, consider maintaining a broad diversification of your investments that reflects your personal risk tolerance, time horizon, and the nature of your financial goal.
Remember, diversification is an approach to help manage investment risk. It does not eliminate the risk of loss if security prices decline.
Because investing can be complicated, consider working with a financial professional to help guide you on your wealth-building journey.
who would you endorse? I've been in the shadows for too long
@@dannyvera8475 My consultant is *PRISCILLA DIANE AIVAZIAN* I found her on a CNBC interview where she was featured and reached out to her afterward. She has since provided entry and exit points on the securities I focus on. You can look her up online with her name if you care about supervision. I follow her trade pattern and haven’t regretted doing so
@@danieljamal3709 thanks for the info. Found her website and it was really impressive
The only thing I would add about your house only being worth money if you sell it: you can sometimes get a home equity line of credit or cash out refinance to use those funds in other areas. I've personally used the equity in my first home to buy my second. Then I used the equity in my second home by way of cash out refi, to pay off the first one and keep as a rental, consolidate to one mortgage with a better rate. And now I have the option to use the equity in my second home to leverage another investment property. All without selling a home.
Company loyalty is such BS... been laid off 3 times from 'loyal' companies who tried to move tech jobs offshore to go cheap. Needless to say I found out later it didn't work well for them. Moving around and controlling your own 'promotion' is the best route and steadily stack 401k's has proven to work for us.
It's funny how "you don't need to buy a home, renting is fine" seems to be something rich people tell poor people, while at the same time buying homes to rent out...
I mean it’s true. It’s not for everyone…
I fully approve bringing that sweater back. Both because, it pops lol, and because there's nothing wrong with repeating outfits. Something Chelsea has spoken on, so she's walking the walk too
It was 80 bucks she better wear it 80 times lol
@@kreed3494 Oof, perhaps a bit high for my pockets to spend that just on a sweater, but I really love how it looks and it looks so comfy :) I was just thinking last night as I struggled to get my portable heater going in my cold bedroom that I could use some more sweaters for a moment like that, when my heater is being stupid and not starting. Took several try's to get it to kick on.
@@BewareTheLilyOfTheValley eeeh, now I feel indulgent for looking at a $250 sweater yesterday. Wish I had a gift card to help me pay for it like Chelsea did lol
My father always compared investing in the stock market to riding a roller coaster: just because it’s going down doesn’t mean you should try to get off the ride yet.
Holy crap that's amazing advice
and just like a roller coaster you shouldn't try to get on at the top
I thought the main benefit to home ownership is that in retirement years your monthly costs will be reduced if you live in a paid off home, not necessarily a wealth benefit.
That's perhaps the only reason I would want a house. I'm not planning to pass it down to anyone (at least, no ome off the top of my head right now. We'll see what happens if I ever get married and maybe my husband has a young family member who could use the house). But not having to worry about rent in my older years would be good.
Granted, I wonder what the cost of property taxes usually looks like. Is that still cheaper than rent?
Edit: Have gotten some great answers and now have a better idea on this, thank you, guys!
@@BewareTheLilyOfTheValley My property taxes are currently about 2000 dollars in a year, mortgage about 800 a month, plus utilities. They will likely be higher when I'm old enough to retire- maybe 5000 in a year. That's about 416 dollars a month, plus I still have to pay for utilities. It is still cheaper than renting, for the amount of square footage I have.
@@BewareTheLilyOfTheValley why would you have to let them use the house while you’re still alive?
@@BewareTheLilyOfTheValley 2k a year for taxes vs 1000-1500 a month for rent (current market rate in my area for an apartment) makes ownership a no brainer in my book. My mortgage payment is only 1,000 per month for a 5 bedroom good sized house. Meanwhile I hae family members living in a 1100 ft 2 bedroom apartment for 1300. My property taxes are about 1500 a year right now. I would take that over the 2-3K per month retirement community living. But that's me. When we get older and look at retiring, I would rather have the security of owning my own home over worrying about my rent being too high to pay on a fixed income, and going up any time the management needs to or feels like raising it.
In my neighborhood, homes the size of mine rent for 2,000 or more per month. Meanwhile, mymonthly payment is half that. Yes it comes with obligations like I am responsible for my own maintenance, but here's the thing... I can PAY someone to do certain tasks that I am unqualified for with all the money I SAVE by not renting.
@@aimemaggie I meant for when I'm gone. I don't want children, my brothers currently don't have children and might not, and what younger cousins I have already have wealthy parents so they're likely alright. If I get married and if my husband has a younger family member who might could use a house, might as well gift it to them upon my death.
As the “boomer” who is 59 and still working my 16 cent raise was an insult. As the first raise in over 2 years for a nurse working during Covid I could not believe it. However, to change jobs at this age and economy I would lose serious $. I am not going to be able to walk into a job with 35 years of experience and get paid at the top of the pay scale . Not to mention changing health insurance with pre existing conditions... You are spot on about real estate. We bought our first house in 1988 at the height of the market at 11.5% interest and after 10 years we actually had to pay for someone to take it off our hands. We have bought and sold houses multiple times over 30 years and only once have we actually made a profit. Once upon a time you used to be able to deduct the interest from your mortgage, state taxes, union dues etc from your taxes. All those people in bidding wars are CRAZY! Take it from someone with who got caught with their pants down in 2008.
I one hundred percent agree that real estate is pretty iffy as an investment (unless you are specifically buying it to rent it or flip it, and even that comes with risks). The main reason to buy a home should be because you want to own a home, not because you think it will make you wealthy. But there is one financial perk of owning real estate, which is that you can potentially borrow against it. It's not quick, liquid money, but if I ever suddenly needed a large chunk of money, I could refinance my mortgage and use what I have in equity on my house. I don't love the idea of doing this because I dream of someday not having a housing payment. But emergencies happen, and it's nice to have that option in the tool kit.
While I agree with you on most of the above, I disagree on refinancing your Mortgage as a “financial perk”. It is more so a temptation to go into more debt, not a tool. An emergency fund is what you might be more interested in should you suddenly need money.
Don't refi just to tap equity. Get a home equity line of credit instead. You only pay interest on the amount outstanding. It is great to have in your back pocket for easy access to money in an emergency or for an unexpected repair. Interest rates (currently 3-4%) are low compared to credit cards and you don't have to use up all your cash reserves.
Plus a Heloc has no closing costs as long as you keep the account open for 3 years.
If the reason you need money is job loss, it may be difficult to qualify for a home equity loan.
Real estate can lose you money too because the landscape is so diverse in the US. So many unique characteristics which already fits the appetite for different needs. Plus it’s not as liquid as cash or stocks.
You need to be able to negotiate where in stocks you just seek to sell it at the best price by watching the charts
To a European such as myself the statement that one should treat higher education primarily in terms of an economic decision is such a heresy. 🤯🤯 Seriously messed up.
Lol. When I moved to the USA from Europe, I was shocked that middle-high school subjects, such as music, art or PE are treated like luxuries in the American school. Pretty much only wealthy areas or private schools should waste money teaching students art or music. If you go to poor area school- math and reading is priority, no extras.
Lol. In the USA your medical treatment doctors also based on your financial situation.
Forget your socialist mindset when you're talking about the USA.
seriously messed up indeed
It is messed up. Higher ed is treated as a business here. Late stage capitalism at its finest.
It is the truth. School costs money here. It is unfortunate but it is true.
Idk why Europeans go on social media and say shit like this, leaving Americans to think that we all live in some sort of a socialist utopia. First of all, all of Europe is different so it'd make more sense to specify where you're from, and second, in my country it's kind of the same and unless you major in a more "lucrative" field you might be looked down on and struggle finding a stable or well-paying job.
I'm from Bulgaria.
LOL I love how she went from super cool and calm to clapping some sense into Congress @11:34
Oh the timing of this video in re. To not being loyal to your job is so true!! Be loyal to yourself!!
In my early 20's I received an inheritance of $6000. I bought a very cheap rural block and a house that was being knocked down (which I moved on a truck) which cost me $10000. I have done this 12 times now, am in my 50's debt free and have never been employed due to a disability. Never let anyone tell you that you can't build wealth. I only shop once a year, (never retail) do not spend on 'impulse' buys and grow a lot of my own food. I now live on 100 acres in a newly renovated house and just put in a pool.... all from $6000. It can be done.
Impressive!
Just want to point out, if you need regular medication access or get any kind of unexpected expense, that's not a great strategy. I would be physically crippled from pain for a week and a half every month without birth control, not to mention the asthma meds that enable me to walk to class and work without struggle. I have a necessary monthly expense that adds up to be around $400 extra a year at least. And I'm not physically disabled.
Small disagreements: 1) depending on area and background, owning a home CAN help with wealth, in terms of relative stability for PITI payments, and the (reduced but very real) deductions in taxes. Owning a home in the USA is a real step forward for minority people here. Rent has gone insane in so many areas of the USA- even in rural areas rent has become expensive- but buying, with the help of various programs, can be a long term way to establish wealth. Just paying down the loan helps with wealth! 2) I absolutely agree with job hopping when you can- I was laid off but given notice- enough time to freshen up my skills and land a new job that pays more. 3) The potential of a Roth IRA or a 401, once you are stable enough to invest in it, is huge.
Definitely agree with your first point. I found myself, essentially, forced into buying a house because of the astronomical increases in rent. A rundown, 1,000 sqft 2bd apartment is going for 1,700. Sometimes buying makes more sense.
Chelsea this is one my most favorite financial diet video ❤️ thank you
All this seems like basic info that your regular viewers should be familiar with. You probably need an explainer on the phrase "born on third" (0:43) instead because some viewers may not be from countries that play baseball (a sport that is so uncommon that it has been removed from the Olympics, twice). "Third" means third base in baseball. To score a point, you have to go from home base, 1st base, 2nd, 3rd, and back to home base. If you start from 3rd base, it's much easier for you to score. So "born on 3rd base" is metaphor for those who have a big headstart that gives them an unusual (and maybe unfair) advantage over others. "Nth base" is also a phrase used to describe dating: "I've been dating for 3 months and I haven't even reached 1st base."
Thank you for the explanation!
I would love to see a video of what to do in a market crash. There's been some pretty negative signs recently and I would like to know what people did in 2008 and even the 1930s to weather the storm.
Informative and always love a good baseball reference, you steeped up to the plate and hit it out of the park.
I love this but I want to point out too that I think there needs to be a discussion as to the benefits of pursuing higher education. I feel like there’s so much of this online these days, all this talk about how we don’t need education and just go to trade school. Education is more than its potential for higher wages. It teaches discipline, patience and persistence, humility and reasoning. Yes, you probably don’t need a college education to land a good job but I would surmise that most of the time, it still yields better wages and more opportunities. I have a bachelor’s degree from a foreign country and in the US, they treat me as if i only finished high school. I’ve had difficulties finding a job because of this.
Also, I find it really off that the people pushing some sort of anti-education agenda are these billionaires who would be the first to scoff at anyone who dares apply to their companies without a degree. Makes you wonder why they’re pushing it too. All i can think of is, it’s in the wealthy’s best interest to have an undereducated population.
I'm half way through my degree and went from working casually having to save as much of my wage as possible not for wealth but so when shifts didnt come through i could still live, to coordinator. I think university education is important but you also have to have goals on where you want it to take you. For example, i want to be a director or project manager. I'm building experience as well as a degree at the same time. I am a big believer that your resume needs to match your career goals
I got my bachelor's in a STEM field and still work at Walmart. College is useless unless you're going to be able to afford to get a masters or PhD
don't know about the boonies in usa but in canada with high job demands have real estate that is going up at insane levels. the cost of home ownership is one of the only ways to have a reliable asset. rent is insane. and now cost of home ownership on a freehold property requires 2 full time earners to squeeze by.
That is a 1 year trend for most of Canada, and only 5 years for Vancouver/Toronto. Don’t base your financial philosophy on such a short term trend, this will likely have a correction in the next few years based on markets or policy with a new government.
@@sarahgaines8027 where have you been. vancouver has been getting super expensive for the past 10+ years. in Toronto prices shot up after 2015. and there are no signs of slowing down. plus in the last 30 years canada hasn't had a down time in real estate prices.
Also property is increasing as it is now a place that large corporations in some regions are buying property as if it is a commodity, often over paying market values and this drives up rents and property values.
@@shawnaford5540 yes there those companies that are buying now. so many of the small to medium companies that are 90s or older mostly own their office. actually it sucks that canada insists on not creating new food production factories in other parts of the country. this keeps the population focused on the metropolitan areas.
@@asadb1990 lol not me thinking we’re still in 2020. Yes, Toronto and Vancouver are totally ridiculous, but the country wide trend of 25% increase in house valuation is more what I’m skeptical of. Some markets (like me in rural northern Ontario) have seen huge gains in the past year, which I unfortunately failed to capitalize on due to insane bidding wars. But it’s not worth forgoing home inspections or over leveraging yourself to “get into the market” at this point in time.
I do want to say this about home ownership though. If you purchase a home that you can afford on the income of one person, it does still give you a place to live as long as there is that one income. So if there are 2 incomes, it allows for more savings. Also, if the market artificially inflates, your contribution doesn't really go up by much.
The risks of renting are HUGE:
1) Your rent can go up by hundreds of dollars per month when you renew your lease.
2) A mortgage in my area is often less than the average cost of rent
3) Income of 3 x the monthly rent requirement can price an apartment or rental home out of range for many people.
4) A rental home can be sold out from under you forcing you to move without ample time to secure new living arrangements.
5) A rental home can be seized by the IRS for unpaid taxes, leaving the renter on the hook (this actually happened to us)
6) A rental home can be foreclosed and auctioned off despite the renter never missing a payment
7) If you purchase a home for 200k, and the average home in your neighborhood goes up to 350k within 4 years (again, this happened in my current neighborhood) The higher home price makes homes harder to sell. Then if the market drops, people are on the hook for high mortgages on homes they can't sell, while you are secure in your home that you CAN afford, regardless of what the housing market does. If you are a renter, your rent could double in that same 4 years that the home value increases on paper.
8) If you live in an apartment, the complex can force a renovation that will increase the market value of your unit, also making your rent go up by 2 or 3 hundred dollars a month at lease renewal time. This can be affordable for many people.
These are all ery real things that happen to people.
I say home ownership is far more secure than renting. Many of us consider our home OUR HOME. The value of having a place to live that can't be taken from you or priced out of your range without your consent is HUGE. It means that when the rent on a 2 bedroom apartment is higher than my 5 bedroom house, my payment doesn't go up with market value. I still have a place to live.
I have a family member who was renting for all of the reasons Chelsea discussed. That family member and their roommate we notified when it was time to renew their lease that their rent was going up $300. They agreed to this and signed the lease. A week later, they were told that their unit was marked for renovation and they would need to move to an already renovated unit for an additional 200 per month. They ended up having to find a different place to live in a very short period of time. Fortunately they both made enough to qualify for the rent in another complex in their area. This is NOT true for many people. This is something that will never happen to you if you own your home.
If you own your home, you will be well aware in advance of any changes to your interest rate (ARM) or if your income drops making it hard for you to pay yur current rate. There are a lot of ways ownership is more secure, outside of the investment arena. You are not just investing in your finances with ownership. It's insurance against being suddenly displaced.
OMG- so much of this is true. My rent went from a affordable $765/month for a one bedroom apartment to $1100/month- no new carpet, with no real justification. My PITI mortgage payment for my 3 bed house is $1200. When I had a housemate I charged $550- making my costs $650. With that difference I was able to start contributing to my Roth. And there is an emotional investment that comes with having a home that one owns.
House prices are inflated everywhere right now though, it's a terrible time to buy. I bought a house in 2006 for $236k and it immediately depreciated; held onto it for a long time and finally sold for $190k in 2017. This isn't unusual and I worry that people buying homes right now will end up in the same situation.
@@missellienora I agree that now is a terrible time to buy. But when it becomes affordable again, it definitely adds a level of security that money can't necessarily account for. People buying a home right now probably WILL end up in that situation. The other problem with buying in an inflated market like now, is that it's an investor market. Investors and flippers buy them, put a few dollars into minor improvements and resell them at an even higher inflated price that people can't afford. When the houses do't sell, the investors bankrupt the investment or lose them to foreclosure. I've seen this before. And if the investors do get the houses sold, the people buying end up in exactly what you described. The best way to win at this, is to not worry about the potential increase in property value, and base the decision on what you can afford, and what it's worth to not be displaced with little to no notice.
And I mean also, when you buy your own house and pay off you debt, you pay this money into your own pocket, since you are financing YOUR house. If you rent, well, that money is just gone. Even if you have to sell your house for some reason, you will get some money for it - unlike when you are forced out of your rental, cause your landlord won't give you your Gent back,u know.
@@missellienora Oh yes- buying a home is NOT risk free. Buying at the height of that housing bubble proves that! Plus buying into certain developments like Co-ops and condos can also see slow rising appreciation or depreciation! However, even during that housing market burst, rents were not stagnant- they went up.
I first taught myself business accounting when I was 16, got a degree in project management and programming and am currently working on my MBA. And I'm so glad for videos like this.
Most people that love business get into professional investing or entrepreneurship, only to find that the most successful orgs are actually pretty conservative and boring. Most money managers sell mutual funds all day and invest in index funds at night. Most CEOs get rich off a high salary, not off investing in the stock (people paid in stock ownership are still being paid, not investing their own money). As someone who has made mistakes, gotten into MLMs and literally had a business partner leave town without telling me, I appreciate the down to earth advice and grounded logic here.
Loved this video! So informative and I loved the account comparison at the end
And Chelsea really does seem to walk the walk it comes to how she acts as a boss. I can't imagine many founders/CEOs would willingly want to earn less money than their employees
Always invest outside of your job, so that whilst you are working, your money is working for you.
This is the most realistic and very doable advice I have seen today! I hope people can see your comment and will start doing it 😊
Thanks so much for your effort 🌹
I agree with the point on job hopping. I almost doubled my take home pay after changing jobs from the one I had for 2 years. I'm sticking where I am for 3-5 years then I'll see if there's anything good out there. Changing too often also might not be the best look either.
After four to five years I typically start hopping especially if I reached max growth in that position. I would stay longer if the pay increases are good and I like the job.
I’d like to add something about homeownership. I disagree that a home will only pay off when you sell it. What about when you have your home, well, paid off? Many people count on living in a paid for home in their retirement and not renting or having a mortgage payment forever. Many people also pay off their home early to free up that cash for investing. There are ways your home equity can benefit you that don’t involve selling your house.
I previously owned a home and now rent. I much prefer renting and have no intentions of going back. All the extra money I was spending on upgrades, repairs, and property taxes is now extra money I put into my IRA. I prefer having clear and predictable payments and can plan long term knowing my housing cost will be consistent
Simpler is best for most people. I agree. my parents are like own a home the financial institutions will like you...saving 30-50% of your salary and putting it in diversified accountS...is the best bet. As a single person focusing on my career and stress-phobic this is the way!
I don't know where you live but in my country if someone gets older, people aren't willing to rent their houses. Usually elders (60 or 70+) can't get a home to rent
@@pikachupikachu97 I’m the US, there are many apartment complexes and neighborhoods that are specific age __+ often at a lower rent rate than for regular housing options. I live right next to one at my current place
@@CaitlynGoesHiking oh that's nice😶
I would love to hear your ideas about how to save when you're self employed. I'm a graphic designer and my income fluctuates every month, sometimes by a lot! Just when I feel like I'm getting somewhere with my cc debt, I have to use them to buy groceries, gas and other necessities because I only had a few projects one month. It's very frustrating! I wish you could speak on fluctuating income and how to save/pay off debt better. Thank you for your info!!!
You could apply to work at a salaried position at an agency as a graphic designer ( as well as your current projects), or do independent contract work with *more* agencies, or work part time in the evenings at a entry level job. More income could not hurt regardless right now.
When your projects do pick up and you make more one month, build that emergency fund so credit cards are not your fall back the following low project months.
Additionally can you lower your cost of living in any way? Have room mates? Live in a cheaper city? Could you move in with family for a year while you build a substantial emergency fund and or market yourself more for more projects? Can you sell anything?
I am self employed too and I did the math to find out what I need each month. Now based on that numbers I have three accounts: Checking, where my regular money goes, savings, where my emergency fund is and which is not to be touched and the account which I call: payment rollover. It houses a months worth of income in case that my projects are low in some months. As soon as I have more income it needs to be stocked again so that I can add what I need for my budget to be full, in case I have a low income month. I hope it is understandable, it might be a way to help you too.
First you need to work out what you need to basically live each month groceries bills minimum debt repayments a twelfth of all annual expenditure, first you need to have this figure saved so you always have a minimum of one months expenses as a cushion, being self employed this needs to be 6 months really, but one month should always be in current account in case one month you don't even make, e minimum, then every better month you pay the minimum living into your current account, the minimum you need to set aside for taxes into a medium savings account, then you allocate rest to short term savings and debt repayment once you have 6 months saved then you can start thinking about other savings goals retirement business investment etc
But the crucial thing is knowing not only what you need to live on monthly but yearly and be honest about whether you are actually making enough.
I think that the “budget by paycheck” method might me good for you? There are a ton of small youtubers that are on the same boat as you, and i have seen a lot of “bare bones” budgets that yes, are very restrained, but can help you in the long run. I have also seen them create their budgets assuming that they will receive the smallest amount possible… so idk, maybe look into those? The budget mom is good
I've heard people discuss a method where essentially they build up a month's surplus and therefore should always have a month's worth of expenses in their account even if they have quiet months, I think Aja Deng has videos discussing this budgeting technique (I forget the name sadly)
Ok I love this video and actually have digit but didn’t know about this option 🏃🏾♀️🏃🏾♀️🏃🏾♀️
Can you make a video about investment accounts? Perhaps a things to know type video and how to go about choosing the right one?
Would it be possible to get options or recomendations for resources that do something similar to the TFD for Europe??
7:57 And this with why California and Prop 13 are so weird. My parents haven’t moved since 1976 and while their house is worth significantly more than mine, they pay half what I do in property taxes.
This video needs to be broadcast everywhere. Shout it from the mountains.
So, the thing about homeownership, is that it is something you should deliberate on. Financial positives that I didn’t hear you say:
1) A stable monthly payment for decades, which can be negotiated down. 2) You can borrow against a home. 3) Tax deductions 4) You own a valuable asset that you can sell, or bequeath even if it’s not for a sky high price. 5)You can be kicked out of a rental within days of not having payment, you usually have months to get out of a home if things get dire. Some negatives, 1) You may have a nice home in a bad school district 2) You may have a neighbor from hell that you can’t get away from 3) The economy can drop like 2008 and you’re stuck in what you thought was your starter home.
"Hamburger University..." LOL
It is real...my general manager went and Lorded her professional higher education over us McFlippin plebs. SHE WAS PULLING IN A MASSIVE $54,000 ! A massive sum compared to my $16,000 from 39hr per week wage. She was what we considered middle class along with half our customers bossing us around for dollar menu items they claim is wrong. 😭
7:00 hahaha great reminder! I’ve been laid off twice in only a 6 year career so I’ve learned that lesson the hard way. But I’ve also gotten to switch jobs for much higher pay like you mentioned 👍🏻
Let’s be honest though. Wealthy people do what Martha Stewart did every day and will never go to jail for it.
Offered sound like they say would you like this amount?
Most companies however, make it seem like "this is what the job pays" like you don't get an opening for negotiation.
Fantastic lessons.
Good info, thanks.
Not having a house or a rent payment when you are retired is good. But people tend to forget that homes require maintenance, and the elderly are often not as spry as we once were.
Hiring someone to do what we've always done ourselves is an actual cost.
So make certain that bank account earmarked "Home Maintenance" is really healthy. And buy the house with your retirement in mind (no staircases or front steps, wide doors to allow wheelchair access, etc.)
Also, taxes can shoot up out of the blue when our properties are rezoned because of economic shifts that couldn't've been predicted 20-30 years ago. I've driven by many an old farm house surrounded by newer retail complexes.
Or the opposite happens. Your older, charming, wonderful-for-raising-children, thriving little community becomes a ghost town, or a slum. You want to move to a newer, more suitable home to be closer to family or medical facilities. This was always your plan, and you counted on selling your current house to make it happen. But there's no work there, or it is too dangerous there, and no one wants to buy....
Buy a house because you want to buy a house. Not because it makes your elder years secure. Because it doesn't really do that.
That part about student loans and the lowest decile? I'd love to know more about that and would click a deep dive on that from TFD in a split second.
I work at a gas station and the lottery players give me the you can’t win if you don’t play line. I’m not totally down with that logic.
Listen Hamburger University is real. I have a degree from a state school but when I was in management at McDonald's we took trainings from HU.
And Clown College is real- I have friends who were performers in Cirque de Soleil and yes, they went to Clown school!
According to wikipedia, "More than 5,000 students attend Hamburger University each year and over 275,000 people have graduated with a degree in Hamburgerology."
ROFL
I’m a graduate of AACC. Took me 5 years plus working ft. Don’t ask how long it took to get the bachelor 🙄. It’s all with what you do with $. Start early and do automatic investing, match employers retirement contribution and leave it alone.
Wow... Almost 1 MILLION Subscribers !!!
Everyone should play around with a compounding interest calculator now and then. It can be eye opening to what is possible.
Love when you say "Look I have employees, I am different"
Brilliant.
Good video too :)
This was a great practical video. My only disagreement is that most employers only give on average a 3% raise not 5%, and some employees aren’t always eligible for bonuses.
Chelsea Fagan deserves her own TFD playlist! She's a co-founder and has a great personality
Hey, I went to hamburger university. It's what McDonald's calls it's manager training course. You can actually get transferable credits, although I didn't.
What are your thoughts on UBI or a negative income tax?
Excellent video.
Not a criticism, just a curiosity!
I'd love to see an explanation on the "bottom 50% average inheritance of $7900" that's a tricky phrasing to me as a data person. Is it if we take the average of the bottom 50% or is it the Q1 number, the median of the bottom 50%?
Hey Chelsea, I was trying to advise a friend just today on how to lower his taxes as it takes half his new 6 figure income. The only thing I could think of was to invest in 401k, traditional IRA and HSA as well as a one time trip to a well vetted financial advisor to uncover more tax incentives.
Would love to see a vid of how to keep some of your earnings once you've made it. As it is, his quality of life has declined as a medical professional in state taxed Vermont.
Can you make some videos considering Indian subcontinent , like food prices here and Indian sharemarket
Liked for the baseball metaphor in the first 60 seconds!
Thank you for this! Usually, ppl hate on me because I have no ambition to buy a house. Not knocking the idea of people at all, but I just do not see why I, who have no intention of marrying & having children should plus it sounds like more work if anything.
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This is a shocker seeing Genevieve Glen Rogers being mentioned here. I always had mixed feelings about hiring a lnvestment advisor. For the record, I started working with Genevieve in 2018, and she manages about 70% of my lnvestments, while I manage the other 30%. My philosophy is that I care more about my own money than anyone else, but she made me accept that they have wealth of information on current conditions and future trends
After this year's expose from Hbomberguy about plagiarism I've been thinking more youtubers need to have their citations credited properly and thankfully your 2 year old vid was already ahead on that point. Great video. I "knew" 6 out of these 7 ideas but just explaining them well is not easy to do.
Your vid and with the backing sources makes my job easier explaining this to other people. Thanks.!
I love your videos!!
This video soothes my psyche. Being part of the sandwich generation where I’m building wealth for myself, my parents, and future children can feel daunting at times. But we can do it and it can be done by being a lazy investor.
I love this and your sweater chelsea
You’re from Maryland? 👀
And of course, great video!
Maybe it's the cultural difference, but I have always viewed homeownership as a safety net. Down the line, when you're 70 you'd want to live somewhere that's fully yours and nobody can evict you on short notice. Of course, renting vs buying debate depends on where you live, and sometimes it makes more sense to rent.
But I could never see a house simply be an investment, to me it's a base where you can go to even if everything else fails. But then again, I live in a country where 90% people own the property they live in.
70 is average human lifespan. Might be dead by the time you fully own the home
@@luxurybuzz3681 with that logic, we shouldn't be doing anything in life because tomorrow i might get hit by a bus so what's the point?
I just love you Chelsea. You embody such empowerment!
Correction: Insider trading is illegal unless you're a member of congress, if you're a member of congress it's a normal part of your compensation package
At 14:56, an 8% interest account is mentioned. Where do you find that?
@11:54 Now I feel like crap for going back to school in my 30s. Please don’t rub in the fact that you didn’t have to in our (my) face. 🤣 But really, I tried the “alternative route” and wasn’t going anywhere in my career. I got to a certain level and stayed stuck for years. I think either way, it like playing a game of chance.
For the digit link could I still invest in small increments if I can't afford large ones?
Invaluable content.
Great video Chelsea
I work in a field that has somewhat of a salary cap around the median average income. I don't plan to switch careers because I like the work, any tips for folks like me?
13:20 - So glad to see a CZcamsr talking about college the right way. It's first and foremost an economic decision and a college and a degree should be judged on that merit. It's an investment and like any other investment, risks should be clearly understood and the reward should be judged on that.
Once again very informative. Thank you!
I love her so sassy and cute with so much good info
I would like to know where I can find an investment account that pays back 8%??
We need a video about how healthcare is more affordable outside of USA for Americans, even when that requires money fot flight, hotel etc still cheaper than here
Don't be loyal to your company, brilliant advice!
There has been many times in my family when someone passed and it has caused huge bills, never and inheritance. Very sad.
She says that social mobility is lower in the US than in other countries. I am inclined to believe it, but would like data to back that up. What info is she using to support her claim ?
A link would be really useful.
Is it possible to invest ethically without choosing which companies to buy stock for? is it possible to ethically invest at all? (apologies if you have a video on this, couldn’t find one)
The sound could be better, hope you can improve the clarity and level. We have to ramp up the volume to listen to the video and then we go to another video afterwards the volume is too high.
U dropped knowledge I wish I knew this 30yrs ago
And we need your monthly budget and updates and all w real numbers ❤️😂 do it man do it