How to Get RICH Making $50,000 Per Year

This video is for those of you who are making modest salaries and you still want to get rich.

This video is not gonna be a get rich scheme. Instead, I'm gonna share with you how somebody who is only making about $50,000 a year can still play things the right way and get rich. I mean, like really rich, like millions, even tens of millions of dollars. The only thing that it requires is for you to see that it is possible and see that the strategy isn't super hard. When I was growing up, my uncle Tom said to me, you can get rich making $20,000 a year as long as you save $20,000 a year. Now, at the time, I didn't quite get what he meant, but today I do, because I have learned how fast things grow in compound when they're invested well. Now, of course, it's ridiculous to think that anybody can save $20,000 when they're only making $20,000 because you have things like living expenses and emergencies and unforeseen circumstances. But it is true that if you save only a little bit of money, you can get unbelievably wealthy. To put this in perspective, keep in mind that in order to have a top 1% net worth in the world globally, you, you need to have a net worth of about just over a million dollars. And that includes your house, your car, your savings, all of that. And then that's globally. If you want to be top 1% in the U.S. it's more like $5 million. But to be top 1 percenter in the world, you need about a million bucks. And in order to have a million dollars in wealth, all you really need is to save about $800 a month and put it into index funds. If you look at index funds over the last 50 years, specifically the S&P 500, they've gone up on average about 9.7% per year. So if you were able to live on $40,000 instead of $50,000 and you socked away 800 bucks a month and you just put it into S&P 500 index funds over time, you would become a millionaire. If that was all that you did, if you never got a raise, if you never Dr. For Uber, if you never took on a side gig, if you never did, if you never bought dogecoin, if that was all you did, then that would be enough for you to be among the top richest 1% in the entire world. So that's if you don't do everything right. If we go up a little bit more, I want to run some Numbers for you. I would like you to crunch those numbers again. I want you to imagine that you didn't put away 800 bucks a month. You just put away that one year. So you had $10,000 in savings. So you've got $10,000. What we're going to do is we're going to run this through a calculation, assuming that you got 15% per year. Now, some people say 15%. That seems pretty high, actually. If you had just bought Apple 10 years ago or Netflix or any of the, like, big companies that you love, you'd be getting way more than an annual compounded rate of return of 15%. So it's totally possible to get 15%. So $10,000 times 1.15.

Here's what we're going to do here. Year one, it's $11,500. All we're going to do here is go over time. So year two, three, four, five, you've doubled your money. Six, seven, eight, nine, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20. Over 20 years, that 10 grand just became $160,000. So let's keep going. 21, 22, 23, 24, 25, 26, 27, 28, 20, 29, 30. Your 10 grand that you never touched is now $600,000. Now, of course, nobody wants to wait 30 years. Nobody does. There's other things that we can do in order to make it happen faster. Like you can start a business, or you can start a side gig, or you can invest more than 800 bucks a month. You can invest more than just your ten grand. You can do that every year and watch that compound into millions and millions, millions of dollars. But the truth is, nobody wants to change in the short term in order to build for the long term. Let me ask you this question. Why is Warren Buffett one of the richest people in the world? If you look at Warren Buffett's annual rate of return over the life of his career, it's about 20% now. That's good. But there's plenty of people who have gotten a better rate of return than 20% per year. The thing that Warren Buffett has going for him is he's 97 years old. He's been doing it for over 60 years. So this same 10 grand that became $660,000, I'm just going to hit this 30 more times. One, two, three.

Is now 43 million. Of course, once again, nobody wants to wait 60 years. But the thing is, you don't have to wait until you got your 10 million in order to have financial freedom. The strategy and the plan is what sets you free even if you're only making $50,000 a year. Do you understand now that if you're going to be on this planet for another 30, 40, 50, 60 years, that $10,000 that you save over one year can end up being tens of millions of dollars? When you know that you can relax a little bit. When you know that, you think twice before increasing your living expenses. Because you know that whatever you spend now can't be invested for 30 or 40 or 50 or 60 years. When you've got time, you don't need to be in a rush. When you know how the story inevitably plays out, meaning you end up deliriously rich, then you're not in such a hurry to increase your lifestyle because you've got a plan that gets you to the level of financial success that you want. When you have that plan, you don't have to be in a rush. You don't have to stress, you don't have to worry about what other people are buying, what Elon is tweeting, what cryptocurrency is going to be. The next thing you. You don't have to be in a rush to win right now. The plan, the strategy, the long term vision is what allows you to win. So if you're making $50,000 a year and you know that saving 20% of that every year is what makes you worth tens of millions of dollars, how do you feel about life? How do you feel about the amount of money that you make? How do you feel about opportunities? It changes the way that you show up. Then when you start doing other things, like you do something on the side or you start a new business or you take on the extra shift, now you can actually see where this is heading. You can see where this leads to. You can see how good this can get. Cause you got lots of time, lots and lots of time for this to compound into tens of millions of dollars. You can be a little bit more choosy about the opportunities you pursue. You can make decisions based on what you want rather than what is going to make you an extra six or $8,000 per year in salary. Because the truth is, you can have financial freedom making just $50,000 a year. So you can choose to do what you want now. You have freedom, you have control, you have autonomy. Because you've got a plan that's working in the background that's becoming worth millions and millions and millions of dollars. Real quick, the question comes up. Well, where do you get 15% per year compounded over that amount of time? Well, I like to start with dividend paying stock. I wait for them to come down in price and then I buy dividend paying stock because those tend to perform really well over a long period of time. Once I have a decent base of income from dividend paying stock, then I'm looking at growth stocks that I want to be in for a long time, stocks that I buy or companies that I use that I think are going to be around for a lot longer. Apple, Tesla, I like PayPal, Square, those types of businesses. And full disclosure, I own some of these companies, so I'm long on some of these stocks. So that's kind of all you need to start is you develop a base of companies that are going to pay dividends and companies that you know are going to be around for a long time. And that's something that if you're under 35 years old, you should know. You actually have an advantage over your parents generation because you have a better glimpse on what businesses are going to be around, what stocks are going to grow over the next 10 years. Because people who are older than you can't see what you and your friends are consuming that's new and emerging. They're betting on their generation's companies. But every 30 years we have turnover of what new companies run the world. And the ones that will run the world 30 years from now are the ones that your generation decides are going to win. So you have a strategic advantage over everybody who is older than you because you can see what emerging trends are going to be big over the next several decades when you can plan decades in advance. You have a superpower that most of your peers don't have. And yes, super some people will be earning three times as much as you. And you will compare yourself to them, but chances are they're spending all of their money. And when you have a strategy and a plan to become extremely rich over the long term, at some point you start passing them. Not this year, not next year, not even five years from now, but you end up passing them over the long term because you're building up a giant treasure trove of cash, of wealth, of investments. And that's how you get rich. You don't build wealth by making more money, you build more wealth by letting the money you do have compound over a very long period of time. And when you know that, then you're not looking for the money you don't have, you're looking for the money that you do have and saying how can I get this to compound over a billion very, very long period of time that will make you rich. That will make you wealthy. Of course, I think the fastest way to get rich is to build a business and to invest the profits. You can build a business on the side and you can take the profits from that and you can invest it into long term other places of passive income and wealth and compound growth. And if you're like, look, I can't save any more money than I already am and I'm ready to do something else, I suggest you build a business and then you invest the profits. And that's what we talk about here on the channel is building businesses and investing the profits. So make sure you're subscribed to this channel cause that's what we talk about pretty much all day long. And when you're ready to dive in, we help entrepreneurs build the foundation of a seven figure business that they can scale and sell. And we do that in something called the capitalism incubator, which is where we work with people to get clear on their vision and to launch profitably and to have the resources that they need in order to have a seven figure business that they can sell. So when you're ready to look into that, you can find out more@capitalism.com Inc. That's Inc. In the meantime, the best thing that you can do for your financial future is to take a piece of whatever you're making or whatever you have and to put it into a very long term investment that is going to compound for decades. That's all you need in order to be rich. That's, that's it. That's all you need to do. You don't need to do anything else. And when you know that you're free. I'm Ryan Daniel Moran with capitalism.com thanks for watching. I'll see you in the next video.