How to become a millionaire with 5 dollars a day
This graph from the congressional budget office illustrates why millennials are financially
screwed.
It shows how much inflation-adjusted GDP per person grew during each generation’s 15
years in the workplace starting at age 18.
The GI generation had the highest level of growth at 60 percent.
That's when America, as we know it today, was formed.
Even the FED was created during that period.
They are followed by the boomers and generation X by a huge difference.
However, that's still significantly higher if you compare that to the millennials, us,
those who are born between in 1981 to 1996.
It is supposed to be the other way around because we live in this technologically advanced
society that people just 50 years ago couldn't imagine.
We have things like the internet, cyptoes, online banks, overnight shipping, youtube,
and a thing called google that can literally answer any of your questions in a few seconds.
In fact, if you take a look at the pre-pandemic employment rate.
At the beginning of 2019, millennials became the largest generation in the United States'
full-time workforce, surpassing Gen X.
But yet, 60 percent of American adults don't even have an extra thousand dollars in case
an emergency happens.
If you take into account that the student debt has exceeded 1.5 trillion dollars, which
makes it $37,584 per student.
It becomes crystally clear why millennials are totally screwed to the point where we
can afford nothing.
Even if You want to buy a budget car just to be able to drive around, you have to get
into debt that will take you many years to pay off, and you will be lucky if you pay
it off.
Even judging by the comments you guys write where you say that you are working day and
night at two jobs and you still can't save a thousand dollars a month.
I truly understand your circumstances because I have been in such a position in my life,
and it took me years to get out.
And you know what?
Saving money isn't the solution.
In fact, saving enough money to retire is a horrible strategy because it will never
make you rich.
So let's find out why you will never become rich by saving money?
What is the ideal strategy for financial freedom?
And how can you become a millionaire with just 5 dollars a day?
Yes, you heard that right, with just 5 dollars a day!
So give this video thumbs up, and let's get right into it!
Saving money - a path to misery
The most famous financial advice your probably
heard is - save as much as you can!
Or save for the rainy day!
Unfortunately, this is horrible advice.
Every dollar that isn't spent today is a dollar worth less tomorrow.
Suppose you do your best and save a million dollars for your retirement.
In that case, that million dollars isn't going to worth a million dollars but rather much
less, especially if we are talking about a long period such as 20 or 30 years.
Have you paid attention to how prices rise every year?
Well, over 20 years, for example, that small difference is going to compound and reduce
the real value of your money by a third or half.
Retiring with a million dollars might seem great today, but 20 or 30 years from now,
that's not going to be the case.
The federal reserve targets the inflation rate of 2 to 3 percent in the US, so you need
to grow your money by at least 2 or 3 percent to maintain your savings' real value.
The ideal place is a saving account, right?
The bank is going to pay you interest for keeping your money in that bank, and on top
of that, you can withdraw your money in case of an emergency.
Let's take a look at how much interest you can expect from the banks.
You are not getting even close to 1 percent, especially since the fed had lowered interest
rates last year.
Let's assume hypothetically that you could get 1% interest on your savings.
The inflation is 2 percent, you are still losing money every single year.
Of course, not as much as if you kept your money under your mattress, nonetheless you
are still losing money.
So, what should you do?
The only reason that makes sense to save money is to create an extra source of income.
Instead of saving a million dollars, how about buying real estate worth a million dollars.
Of course, house prices don't rise as much, but they steal coupe up with the inflation.
The interesting part is, they provide you with a constant passive income of 6,7 or 8
percent, assuming it's not a mortgage.
Since rent prices also rise together with inflation, you don't have to worry about it
since your rental income will keep rising as well.
So, let's try to answer the question of this video, can you become a millionaire with just
5 dollars a day?
At first glance, it seems like a dumb idea.
Five dollars is the price of your Starbucks coffee.
Even if you cut your Starbucks latte and make your own coffee at home to save 5 dollars
a day, that's 150 bucks a month.
Nowhere close to a million dollars, nor is it going to provide you with a decent retirement.
Or is it?
Let's do the math.
Five dollars a day is $150 a month or $1825 dollars a year.
According to our YouTube analytics, most of you are between 18 and 35, so Assuming you
are 24 years old and you plan to retire at 67.
If you save 5 dollars for the next 43 years, you will save a total of 77 400 dollars.
That's not impressive as impressive as you thought, right?!
especially if you consider that $77K will be worth a lot less 43 years down the road
than today.
I guess spending five bucks on a Starbucks coffee is a better option.
However, instead of saving that 5 dollars under your mattress, investing it the sp500,
for example, that grows at an average rate of 10 parents in the long run, through the
power of compound interest, it will grow to over a million dollar during the same period.
To be specific $1,066,321.24.
That's just with 5 dollars.
Imagine what you can do with more than 5 dollars.
So, can you become a millionaire with 5 dollars a day?
Theoretically yes.
It's going to take you a long time, but it's impossible.
I can already smell how some of you are typing down there - “what is the point of becoming
a millionaire at 67?
I wanna enjoy my life today!”
The point is to show you how you can build wealth even with small amounts if you invest
consistently and plan long term.
You can build wealth if even if you have your daily Starbucks coffee, travel, buy the new
iPhone every year as long as you invest a small amount of your income.
But if you cut your unnecessary expenses and save more, you are going to do that much sooner.
Of course, The faster way to build wealth is to start a business, invest at least 50
percent of your income, or spot a great opportunity and jump in!
But remember, you have to be ready for that opportunity.
What I usually do is invest around 3K dollars into the sp500 every month regardless if the
market is rising or falling to rip the rewards of compound interest in the long run,
but at the same time, I am growing my businesses and trying to spot the next great opportunity
which I share with my Patreons, by the way, the link to my Patreon is in the description
below.
The problem with most people is that they don't have a clear idea of why they should
save.
They look at their income, even if they save a thousand dollars a month, that's $12K a
year, in 10 years, that's $120K, in 20 years, that's $240K.
That will last you a few years at best.
So before saving any money, do the math and make sure it works for you.
If you are 20 years old, for example, and you invest 1K a month in the sp500.
By the time you are 44, your investment will cross a million dollars, you can sell your
shares and buy a bunch of properties that will provide you with rental income every
month.
Or you can just withdraw a certain percentage of your investment like 5 percent every year,
which would equal to $50K a year and pay the bills and your investment would still be growing
since the average rate of return historically have been ten percent.
I have explained how that is possible in a previous video, which link I will leave in
the description.
And now its time to get some free stocks from Webull if you use the link in the description.
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Thanks for watching and until next.