10 Money Secrets You Won’t Learn In School
Go to school, graduate, get a job then retire with some benefits, that’s the dream.
Right? Every single school will train their students that this is the right path to take.
The only problem is, this doesn’t work anymore. Fifty years ago, this financial
route would make so much sense. But the entire tax system, retirement system and legal system
have changed so much making what they currently teach in school about money completely redundant.
The main reason we chose this topic is because of the lack of financial
literacy classes in our current education system. Times have changed, and if you don’t
want to be broke for the rest of your life, you better grab a pen and paper right away!
Before we begin, give this video a thumbs up, and tap the subscribe button and the bell icon if you
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Now, let’s begin, shall we?
10) Correlation between emotions and our money Let’s start off with the most important money
secret that only marketers and big brands know about. 30% of what you spend your money
on is tied to a certain emotion. I bet you didn’t know that. Most of the time, what we buy is based
on how we feel. Because of this, brands have capitalised on triggering the right emotions
just enough to get us to open our wallets. I must say that I have been a victim to this,
sometimes I’ll just buy something at the end of a horrible day just to feel better.
The same way sometimes women will go on shopping sprees to feel better. There’s nothing wrong with
doing this occasionally, the problem is when you fall victim to these marketing tricks every other
time. Did you know that the space grey iPhone is about $20 more expensive than all other colours?
Yet, all the phones have the same features. Conversely, as much as our emotions dictate
how we spend money, our financial situation also affects our emotions.
When you are broke, you will probably not be as happy as the rich guy next door.
There are higher depression rates during recessions and financial crises. The correlation
between money and emotions is significant, but no one will teach you about it in school.
Can you imagine the adults we would be if money and finance were taught to us earlier?
I would bet a lot more people would be happier and well off financially.
09) Multiple Income Streams The only way of making money is by getting
a salary, that’s according to our education system. We are hardly taught about alternative
ways of making a living. All the education system preaches is how to apply for a job,
build a CV and get a job. In short, the system trains us on how to be slaves building someone
else’s dream. If you solely survive on your salary then, you will have a problem.
There are several ways you can make extra income aside from your job. You could invest part of your
salary in investments with high returns. You could start a business. Offer services in your
area of expertise after work hours. There’s so much we don’t learn in school that I wish they
would teach us. If you don’t have a side hustle already, you need to find one as soon as possible!
08) How to Build Your Credit Before you get approved for a loan, a credit card,
or even a mortgage, the financial institution offering them has to run a credit check on you.
The decision as to whether you qualify or not is based on your credit score.
And your credit score is determined by your past credit history, such as;
were you paying loans in time, did you borrow money, and so on. And the thing is, this is one
of those things you'll have to learn by yourself. They won’t teach you about this in school.
You may get a poor credit score not because you are a loan defaulter but because you don’t take
any loans. Yes, did you know that? Credit cards and loans aren’t bad at all, what matters is
how you manage them. In fact, the only way to grow your credit score is to take a loan
or use your credit card but make sure you pay it back within the given time frame.
Also, be very careful before you apply for any credit. Ensure your credit is according
to the terms listed. The reason why this is so important is if you get denied a loan,
this will be recorded as a black mark on your profile for the next seven years.
Yikes! I know. So, check your credit regularly and borrow sparingly to ensure you stay ahead.
Also, be on the lookout for errors or fraudulent activities in your statements.
07) Saving When did you
ever hear a lecturer come into class and say, today we are going to learn the importance of
saving money? I’m guessing your answer is never. Well, it’s not your teacher’s fault,
they’re only following the curriculum to the later, but it would’ve been great if
we learnt one or two saving tips along with those complex algebra calculations.
It’s sad that every adult has to learn this the hard way; through experiences.
Or if you were lucky enough your parents taught you how to save. If you want to learn more about
managing your finances you can watch our other videos. We have so many videos dedicated to money
management. For now, we will just brush through the basics. First, before you start saving,
create a budget for everything you spend, reduce the budget and cut off what you can from the list.
The next step is to determine what percentage of what is remaining from your paycheck can be saved.
The ideal percentage is 40%, but if you can’t achieve that yet, start small and
grow it gradually. Once you have saved for some time, which could be as soon as three
months don’t just leave that money in the bank, invest it somewhere. We have discussed compound
interest within the video, so keep watching to learn how you can use it to become wealthy.
06) Haggling
The art of haggling is the language of the wealthy. Notice that we didn’t say the rich,
but the wealthy. I am talking about billionaires and not millionaires. Haggling is one of the
secrets that very few people know about. The golden rule is to never shy away from negotiating.
Negotiate the interest rate, negotiate that purchase point and everything else that you
are paying for. We are not saying you walk into Walmart and bargain the price of juice. But if you
are applying for a mortgage, you can negotiate the rates, or if you are buying the house in cash, you
can bargain till the lowest price. Haggle, haggle, haggle and you will end up saving a lot of money!
And if you ask me, that's worth a like, so if you haven't liked the video yet, give us a thumbs up.
05) Managing Debt No one will teach
you how to manage your debt. Well, unless you take some personal finance classes,
which in my opinion should have been offered in school as part of the curriculum.
But because not all that matters is taught in school, here we are, learning about debt from
a Youtube video. Most people after college end up in so much debt. It is here where in addition to
student loans, they take up multiple credit cards which dig them even deeper in debt. Without the
right debt management skills, they almost always end up depressed surviving paycheck to paycheck.
The key to managing debt is to start by being aware of all the debt owed and the
due dates for repayments. Never miss a payment date as it will implicate your credit score
and there could be additional penalties for delays. Also, never borrow what you can’t
repay. For more information, watch our other personal finance videos.
04) Retirement Unfortunately, you won’t learn how to plan for
retirement from school. Planning for retirement should start as soon as you leave college. Most
people have it all worked out by their workplace’s HR team, but others don't. It’s important to
have a retirement plan in place so that when you stop working, you have something to fall back on
and support you for the rest of your life. If not, you will become a burden to family and
friends. Look out for pension programs as soon as you can, and invest in them as soon as possible.
03) Passive Income
Let's be honest, most of us watching don’t know anything about passive income.
Or if you do, you didn't learn it in school but on some YouTubers video or a blog post, right?
The reality is most of us make money by saving our time in exchange for a paycheque.
Not everyone considers making money in channels that won’t necessarily require you to spend that
much time. We have been trained that we must spend a lot of time and energy to get results;
therefore selling the idea that you can make money as you sleep is often shut down. I bet some of you
are already second-guessing what I am saying, but, I don’t blame you. I blame the education system.
Some of the most common passive income streams include selling digital products which could be
ebooks, courses, apps, buying stocks that pay out high dividends, the list is endless. Just
research on the different channels and select one that would suit your budget, lifestyle and needs.
02) Compound Interest Compound interest is potentially the
most important money secret. It almost works like magic. The concept is quite easy to understand,
but not everyone has wrapped their head around it yet. Compound interest makes it possible
for people to reach their financial goals faster than they could imagine.
For the first few years, admittedly your money will grow really slowly, but in the last few
years, the growth will be exponential. Say you invest ten thousand dollars every year with a
rate of 7% into an index fund, it will take you fifteen years to grow your wealth to three hundred
thousand dollars, but from there your money will grow to one million dollars in only twelve years.
So if you want to retire a millionaire, you better start using the magic of compounding right away!
By understanding how compound interest works,
you will be able to be patient when the growth is annoyingly slow initially.
01) Assets are the key to wealth Assets are important as long as you want to build
your wealth. But the thing is school will never teach you this! There are assets that depreciate
in value such as motor vehicles and those that appreciate, such as land and real estate. You want
to focus more on acquiring assets that appreciate in value as opposed to those that depreciate.
Being wealthy means owning your own time. And the certain way to garner this sort of freedom
is by acquiring assets that earn for you as you sleep. These could be stocks, property
that generates income through leasing, bonds, a website that earns you money and a business.
Once you have enough assets, you will shift into the wealthy category of people.
You will no longer need a day job, and you will own every minute of your day!
That’s it for today. I hope you learnt one of two things about money.
It’s quite unfortunate that the most important things aren't taught to us in school.
So, if you want to learn basic financial literacy skills, such as managing money,
investing, how the stock market works, the basics of taxes and how owning a home is affordable,
plus so much more great content, check out my friend Zack's course:
Compound Confidence - The Finance You Need to Know.
Well, thank you so much for watching. If you’re still here it means you enjoyed the video,
make sure to give it a thumbs up and share it with your friends and family who may need
to learn a few things about money. That’s all from us, and have a wonderful day guys.