How long do you think you need to make $1 million. If you're a professional lawyer engineer or an
accountant, who makes like 100 dollars an hour. In that case, you need to save every penny you
earn for five years in a row. Which is impossible because you need food on the table and a roof over
your head. But let's just say hypothetically, how long do you need to make a billion dollars. If you
earn 100 dollars for every hour, you are alive, assuming you work 24/7 and don't sleep, eat or do
anything else, you need 1141 years. And you still won't make 1 percent of Jeff Bezos's net worth.
Because to compete with Jeff Bezos, you need to multiply that number by 200.
That really shows you that there is no way to build wealth if your plan to just make
more money per hour. There are other ways, such as making your money work for you, that we have
discussed in previous videos or creating something that brings value to a huge number of people
like most of these entrepreneurs have done. I mean, when you create an operating
system (Windows XP) that 95% of all computers use. You instantly make billions of dollars
since there are billions of computers worldwide. Or a platform that delivers billions of packages
annually to hundreds of millions of people. You make billions of dollars as well. But you don't
need that much money, to be honest. Every extra dollar you earn after paying all of your bills
is just another digit on your smartphone. On my way to financial freedom,
I have realized that habits have played a huge role in my personal success.
If there is one piece of advice I will give to anyone striving to become financially free,
focus on acquiring the right habits. Because if you do not, you will automatically develop
bad habits since we humans are creatures of habits which is why I want to talk in this
video about some of the most important habits that helped me achieve financial freedom.
But before we move, make sure to give this video a thumbs up for the youtube algorithm.
1. The number one habit that I would recommend everyone to start with is tracking every dollar
you spend. It sounds so simple, but it's by far the most important and effective habit
you can develop, and many people take it for granted. They think they can do it in their head,
but it doesn't work, you need to write it somewhere, whether you write in a journal,
use an app or do it through excel, you should set up a system where you can easily
find out where exactly do you spend your money. Some people have so many subscriptions that they
don't use much but waste a fortune. A 10 dollar subscription here, 15 dollar subscription there,
a 12 dollar subscription here, in a single month, they turn to 37 dollars or 444 dollars
a year. Imagine investing that money instead that will turn into a fortune. In 30 years,
that will turn into over 92K dollars. It is a good example to illustrate that that every dollar you
save today will become far more valuable in the future through the power of compounding.
It's so easy to waste money that even if you make ten times the amount you need, you can easily blow
it up if you do not track your spending. I can say that from my personal experience.
2. The second habit I would recommend is - build systems. I try to automate everything in my life
because as you get older, you start to understand that the most valuable thing you ever have
is time. Believe me, time doesn't equal money. Time is far more important than money. The amount
of free time you have is the ultimate sign of how wealthy you are! Because the more free time you
have, the more time you can spend on thinking, studying, and finding more ways to make money.
Take, for example, tracking your spendings. It takes a lot of time to track your spendings,
but for me, I don't spend more than 30 to 40 minutes a month on that because I have
already created a system where I can do that quickly. I use to use excel before,
but now I use Notion. I have created a table with all of my expenses,
subscriptions, income, and everything else. I have fixed expenses and variable expenses.
The moment I get a new subscription or another fixed expense, I immediately add it.
I try to pay for everything with my credit card, and at the end of every week, I just
match my spendings through my banking app with my budget. If it matches, I am doing great. If not,
then I try to adjust my spendings. With minimum effort and time, I keep my spendings in check.
Or let's say I am analyzing a certain company. There are a few metrics I look for in a company.
If it meets my standards, I take an in-depth look into it. If it doesn't,
I just skip it so I don't waste time looking at companies I would not invest anyways.
So, look at your life, your job, your responsibilities and figure out how
you can automate them and thank me later when you realise how much time its going to save you.
3. The third habit is - don't invest in what you don't understand. If there is one piece of
advice I would give to my younger self, then it would be this. This is the mistake that I made
multiple times, and I see people doing it over and over. Investing is risky. It doesn't matter what
you invest in! And when you invest in something you don't understand, it's worst than gambling.
You are almost guaranteed to lose money. Here is the lesson - there is no such
thing called as investing in one thing is better than the other.
Overall the economy is moving forward, so whether you invest in the stock market, real estate,
startups, your own business, an ETF, it doesn't matter! in the long run, they are all profitable!
The challenge is to pick the right real estate, the right stock, or the most promising business
and the only way to do that is to have a deep understanding of that industry. When they say
that you should diversify your investment, keep 40 percent of your portfolio in stocks,
30 percent in real estate, and the rest in different asset classes.
That advice is for people who already have tenths of millions of dollars,
not for the average folk who lives paycheck to paycheck.
So forget all of that, and focus only on one industry or one asset class.
4. Produce instead of consume Our society is divided into two are groups.
The first ones are the producers and the second ones are the consumers. We're all somewhere in
the middle. No one is entirely a consumer or fully a producer. But the question is, are you more of
a producer, or are you more of a consumer? Take Youtube, for example. There are people
who create content, and then there are people who consume that content. the question is - which one
are you? The ones who produce are probably much better financially than the ones who consume.
If you spend most of the time just consuming and consuming, you shouldn't be surprised
if you're doing horrible financially. Start thinking about how you can become a producer.
It's not just about YouTube it's pretty much about everything else.
But today it's really difficult. Because you are constantly distracted by what others produce. The
moment you pick up your phone, you get bombarded by what others are producing,
you end up wasting hours and hours of your time watching YouTube when instead
you planned just to check out what's going on. So start making that shift. If I am spending 4
or 5 hours a day workings and the rest, I spend consuming. How can I at least
spend half of my time producing and what I can produce? The moment you make that change,
you will not just start making more money, but you will start spending less money.
5. The final habit is - think twice before making a decision.
This habit might not seem so important, but it's one of the most important habits I have
ever developed. Often what happens with us is that we take decisions without giving them
much thought and then later down the road, we realised that it was a terrible decision.
You waste a grand to buy a gadget and then realize that it was a waste of money. You take a loan and
then find out that it was unnecessary, but it's too late already. The damage has been done.
I have made that mistake a million times, so despite the importance of being able to make
decisions fast and quickly. I give myself more time. If I can postpone it to the next day and
think about it in the morning with fresh ahead, I would do it. Especially if its spending a lot
of money or a long term commitment. Try not to take instant decisions.
In fact, the fewer decisions you take, the better. That's why habit number 2 is so important, because
the more you can automate, the more time you will have to spend on more important decisions.
If you have enjoyed this video, you will most definitely enjoy this custom playlist that I
have created specifically for you that has our most popular videos on business,
investing, and the stock market that can potentially change your life.
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