I hear some people saying that it's too late for them to get started
investing.
So today's video is how we should be investing if we are in our
forties and we want to retire in our sixties.
I am Tiffany Thomas, a financially free millionaire.
If you're looking to become one of those, make sure and hit that like
button and hit the subscribe button and we're going to dive right in.
I feel like there are a lot of videos about how to get rich when
you're in your twenties.
Well, I'm not in my twenties and a lot of my friends are not in their
twenties either.
They're usually in their thirties or forties, so I wanna make a video
for them.
All right?
If we are in our forties, we really need to focus on investing so that
we can retire in our sixties.
One of the easiest ways to do that is to invest in the stock market.
It is very, very passive.
So you can get started with just $5.
And if you want the details on exactly how to get started with just
$5, I have another video for you.
I will leave a link above.
But now that we know we can start with a very small amount, there is
no reason for us not to be investing.
And the other thing is, if we are in our forties, we want to invest a
lot more than $5.
So while yes, we can start with $5, we want to increase our income so
that we can have more money to invest.
And being in our forties, we are probably more established in our
career.
So hopefully we are making a decent salary and we can figure out ways
to increase that salary.
For example, if we haven't asked for a raise in a while, we can
definitely ask for a raise.
It doesn't hurt to ask.
And when you are asking, make sure you are coming with facts, things
that you have done to help the company to improve their bottom line,
to increase their sale, whatever part you play in that company, you
wanna make sure that you are doing the best job possible so that you
have the data to back up why you should be getting a raise.
And maybe asking for a raise isn't the right thing to do right now.
Maybe it's time for us to switch jobs.
Maybe we are going to make more money at a different company.
When people switch companies, they usually have an increase in pay.
And if nothing else, if you get an offer from another company, you can
take that to your current company and ask them to match that offer or
even go above the offer.
Be thinking of different ways that you can increase your income so you
can have more money to invest.
Another way to have more money to invest is to decrease our expenses.
Take a look at your three largest expenses and figure out how you can
reduce those expenses.
Do we really need all of the space that we have now?
Do we need to live in a really large house or could we downsize for a
while?
And it doesn't have to be a permanent thing, we can always change
later, but we need to invest as much as possible right now.
So all of the changes that we can make right now, we need to put that
extra money toward investing.
And the quickest way to make more money or have more money is to
decrease our largest expenses.
Think about it.
If you are paying two grand in rent every single month and you find a
different place for 1500 a month, that's an instant $500 every single
month that you could invest.
That's a lot more than switching your internet company and saving $10
a month.
And for me, I have definitely been able to keep my housing expenses
very, very low because I've always had roommates.
And the place I was living in before, I actually had three roommates.
So there were four of us total, and I had all three of them living
upstairs.
And then I was downstairs in the basement.
So I did have my own space down there, which was nice, but I made sure
to fill all three of those rooms upstairs.
And honestly, the way the math worked out, my roommates were paying me
about $300 to live there because the rent money they were paying
covered all of my mortgage.
It covered my taxes, my insurance, the HOA, utilities.
So it was a pretty great setup.
So if you were thinking there is no way I can find a less expensive
place, well do you have an extra bedroom?
You could put a roommate in there.
And like I said, it doesn't have to be permanent.
These are just changes we can make now to have more money to invest to
make sure that we can retire when we want to.
Transportation is usually the second largest expense.
So take a look at your car.
Do you have a car payment every single month?
And is it super high?
Maybe you can downgrade.
You can sell your car and buy a less expensive car and get rid of that
car payment and put that extra $500, how much ever it is toward
investing.
And for me, when I paid off my car, I had looked at my insurance,
which was full coverage, and then I switched that to liabilities.
So that decreased the amount of insurance that I was paying.
And then food is usually the third largest expense for people.
So take a look at where you are spending money on food.
Are you eating out every single day?
Are you going out to lunch with your coworkers?
Are you going out to dinner with friends every night?
Are you stopping at McDonald's every single day for breakfast?
And on top of that, are you buying groceries that you are not eating?
Take a look at those food expenses and figure out where you can make
changes to save a significant amount of money.
I took my lunch to work 99% of the time.
I would make my lunch the night before so it was ready to go.
I knew if I didn't do it the night before then I would not pack a
lunch in the morning.
So plan ahead.
If you know you're not going to make time in the morning to pack your
lunch, pack it the night before.
Another thing I'd like to do is keep my food items pretty simple.
I will eat a lot of spaghetti or I'll make a big thing of taco soup
and freeze half of it.
I don't need to be experimenting with a lot of different things,
buying a lot of different ingredients to make a lot of different
recipes.
I can keep things very, very simple and still get all of the nutrition
that I need.
Since we want to invest our money as quickly as possible, A really
easy way to do that is just to invest in one fund that follows the
total stock market.
If you want more details about that, I have another video.
I'll leave a link above for you.
But that way we aren't analyzing a bunch of different individual
stocks, individual companies, and then trying to decide which ones to
invest in.
We can just get our money invested and still get really good returns.
If we have a nine to five job and our employer does a 401K and has a
401K match, that is where we want to start.
We want to start with that 401k match.
We want to invest up to that match so that we are getting the free
money from our employer.
The next thing we can do is set up a Roth IRA.
This is an account that you set up on your own.
If you have more questions about that, I have a video.
I'll leave a link above.
But we can set up that Roth IRA.
I personally like using Vanguard.
They have been around for a really long time.
And in 2023, we can invest up to $6,500 inside of our Roth IRA every
single year.
And if you qualify for an HSA, a health savings account, you can also
invest your money in the stock market through your HSA.
Most of the time.
If you're setting up your HSA on your own and not through your
employer, make sure and choose a company that allows you to invest
inside of the stock market.
I personally use Lively, so I will leave my referral link below
because they are completely free to use their HSA and it's completely
free to invest inside of the stock market.
And then another way that we can invest our money in the stock market.
And a lot of people don't utilize this one because they're afraid of
paying taxes, but we can just set up a brokerage account and invest
our money that way.
That does not have any limit whatsoever.
You can invest as much money as you want to inside of a brokerage
account.
And one thing I will say, you want to make sure and hold those
investments for at least one year because then you will pay less in
taxes, when you sell your investments.
But because we want to retire very quickly, we want to be investing as
much as possible as soon as possible.
And if you want the benefits of using a brokerage account, I have a
video breaking those down.
I'll leave a link above.
And now that I've kind of given you the tactics on how to invest in
the stock market, I want to bring up our mindset because this is going
to be key.
If we are in our forties, we want to retire in our sixties.
So that is a pretty quick timeframe.
So we really want to be putting all of our extra money towards
investing.
So we need to believe that the stock market is going to help our money
grow exponentially.
And it is definitely going to be better than putting our money in a
savings account because I know when I first started investing, I
thought I was going to lose all of my money and I had a bunch of money
sitting in my savings account.
But once I switched over and started investing my money, my net worth
grew exponentially.
Coming from personal experience, we wanna make sure that we keep our
emergency fund and our savings account unless we are saving for
something very specific.
Then once we have that amount saved up, we get that item or invest in
that item, and then all of our extra money needs to be going to our
investment accounts.
So figure out whatever that emergency number is for you and make sure
that all of your high interest debt is paid off.
And then you can funnel all of that money into your investment
accounts.
And like I mentioned, we can invest in a total stock market fund,
which is a pretty safe investment, but it has enough risk associated
with it that it is going to give us good returns.
And then think about different ways that you can increase your income
and decrease your expenses.
I know for me, when I set a specific goal to become financially free,
I was so focused on that goal that I didn't want to be spending my
money elsewhere.
I knew I needed to save up for a down payment on a house, purchase one
more property, and I would be financially free.
So that is what I did.
I didn't spend a lot of money on clothes.
I didn't go out to eat all the time.
And it's not that I wasn't doing anything fun, but I was very specific
that I wanted to save up for a down payment and become financially
free.
I knew what my priorities were and that is where I was spending my
money.
If you haven't figured out what is important to you, what your
priorities are, take a few minutes and sit down and write those out.
What is important to you?
What lights you up?
What will make you super happy?
And is it aligned with your values and where you want to be in five
years, in 10 years?
I'm not about deprivation, I'm about prioritization.
And going along with this mindset, I see a lot of people that aren't
really taking any action.
They kind of just complain about their job that they aren't making
enough, but they aren't doing anything about it.
So it's important that we do something about it.
What are our long term goals?
Do we really want to become financially free?
Do we really want to retire?
If so, what action do we need to take today to get us there?
Work backwards from that time that you want to retire and figure out
where you need to be today and in six months and in a year and in five
years, and set some small goals right now and take some action to help
you get there.
That is what worked best for me.
Once I figured out exactly how much I was going to need to retire,
then I thought, okay, how can I do that?
And for me, it was buying one more property, but for you it maybe
investing an extra thousand dollars a month in the stock market.
Once I knew that I needed that one more property, then I saved up for
the down payment.
And I started looking at properties.
I talked to my amazing real estate agent, my sister, and I told her
where I wanted to purchase a property.
And so she got me set up with the mls and I drove around different
neighborhoods and I looked online every single day for properties.
Right?
I took the action.
I didn't just think, well, I guess I need one more property.
I don't really know where I wanna buy it or how many bedrooms it
should be, right?
Like I set my goal, okay, one more property.
It needs to be a four bedroom.
I need to make this amount.
Where am I gonna find that?
And I found it, and it wasn't the first property that I put an offer
in on.
Things like this don't work out perfectly and we have to take the
action and sometimes we have to redirect or we just have to do the
boring things consistently.
So don't give up.
It is totally possible to retire in your sixties if you're starting to
invest in your forties.
So tell me one action step you re going to take today.
and if you found this video helpful, please hit that like button and
share it with someone else who needs to hear this information.
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Thanks so much for watching.
I'll see you in the next video.