When people think about getting rich they tend to go straight to driving
expensive cars and taking the fanciest vacations and while these certainly are
perks of having significant wealth no one ever talks about the harsh realities
that come with building a sizeable net worth this is unfortunate because there
will always be roadblocks and obstacles when trying to become successful in
anything you do and in this video I will share with you 9 shocking truths about
becoming rich and if you're new to the channel then hit the subscribe button
below for more a life-changing content truth number one your income is capped
as an employee when you're an employee you typically get increases in
compensation in three ways promotions raises and bonuses while these boosts
and pay are always welcomed the reality is that they will never make you rich
the trouble with being an employee is that you will never be paid more than
someone else decides what you're worth that's why in return for less freedom
less control and less fulfillment every day you work for someone else your
upside is always capped and your downside is always unlimited since at
any moment someone could come and take away your income this is a harsh reality
that all rich people realize early on in their careers which prompts them to
reassess their means of income generation and often leads them to
starting their own businesses where your income is only limited by you
unfortunately or maybe fortunately I too had this realization early on in my
career a couple years ago I was working 50 plus hours a week to management
consulting and from what I could tell I was doing a pretty good job
however when salary increased time rolled around I received an
infuriatingly small raise which I voiced to my manager he calmly said to me that
if you don't accept it then someone else will do your job for less and to just be
happy with the raise I got it was at this point that I knew the Paycheck
lifestyle would never make me rich and like I said wealthy people know that the
only way to become extremely rich is to start a business by writing a business
you get to leverage other people's talents and time and can skill much more
than you ever could as a single employee and the best part is that you're the one
who sets the price and not your employer meaning you can make the money
you want as long as your business is thriving now keep in mind that you don't
have to quit your job to start a business in fact you probably shouldn't
one of the best ways to minimize your risk is to keep your full-time job while
you build your foundation for success then once your business income is
reliable and sufficient you can quit truth number two no one cares about your
success as much as you do whether becoming rich has always been
your dream or if it is just another goal you want to attain during your lifetime
no one will care about you achieving this success more than you sure your
friends and family may offer their best advice at times but when it comes to
people outside your inner circle you need to understand that people are out
to make money from you not for you for instance college isn't there to help
you get a job it's there to charge you X orbiting tuition fees financial advisers
aren't trying to make you money but instead are trying to collect
commissions on the money you give them ultimately during your path to wealth
you need to be the one who is looking out for your best interests truth number
three borrowing is quick repayment is slow if you have good credit and
sufficient income you could borrow a hundred thousand dollars and buy a fancy
sports car if you have no credit and no income you can borrow a hundred thousand
dollars or even two hundred thousand dollars and buy a degree if you have the
right connections you can borrow thousands to start your own business
simply put borrowing money is easy it's paying it back that's hard if you don't
believe me just ask recent college graduates with the average college
student debt in the United States sitting at just over $37,000 the
repayment of this massive amount takes time especially a salaries failed to
raise his fastest tuition rates do the average debt repayment period for a
student alone of between 20,000 and $40,000 is 20 years or five times longer
than it took to get the education in the first place
the rich know that borrowing can lead to financial trouble which is why they
always borrow with an intended return in mind for instance they may borrow money
against a mortgage to take advantage of low interest rates which they can then
invest in the market for greater returns or they will take advantage of
short-term borrowing to free up the cash flow in their
business borrowing money isn't always a bad thing but it can be a scene in the
college tuition example prior to taking on any loan ensure that you have a plan
for repayment of the principal of the loan and the associated interest costs
so that you can make borrowing money as painless as possible truth number four
people will try and over leverage you sticking with the topic of borrowing
money when you were on your path to riches there will be people who will try
and take advantage of your aspirations and one way they can do this is by
offering you more debt than you need many people who suffered dearly during a
2008 recession know this firsthand as the massive mortgages they assumed
became impossible to maintain with thousands of people losing their homes
the same situation can happen when it comes to building the business that will
make you rich lenders will try and offer you more money than you need to maximize
the interest they earn and while this is sad it is a reality that you need to be
aware of only borrow what you need and pay it back as soon as you can
truce number five the simpler the better when investing as I previously mentioned
many people think that those who become rich invest in very complex assets and
use intricate investment strategies but the shocking truth is that the rich
invest as simply as possible even the richest investors in the world practice
the art of investing minimalism as Warren Buffett says the business schools
reward difficult complex behavior more than simple behavior but simple behavior
is more effective this is why people like Warren Buffett only invest in
companies they truly understand for instance it's easy to understand how
coca-cola makes this money given people's love for the drinks however
understanding how a biotech product can cure a newfound disease isn't as easy
therefore don't make investing harder than has to be if you want to realize
the same successes of rich people you look up to truth number six it's all
about assets those who aspire to become rich or have already achieved
significant wealth know that assets are essential to growing your net worth
they understand that while it is good to earn a large income whether that's
through a job or a business it's the items we own that will propel us to new
financial heights this is whether rich focus all their
efforts on building an asset base that will support them over time from rental
properties to investment portfolios these assets will appreciate with some
even providing cash flow at the same time and by leveraging these items you
can ensure that you continue to grow your wealth whether you are working or
relaxing on a beach in Mexico in fact many people consider themselves rich
once they've reached financial freedom and assets are the primary way of
achieving this financial milestone when you're financially free your assets
produce enough cash flow to cover your living expenses and by accumulating
enough assets this can cease being a dream and instead be your reality truth
number seven the most important investment you can
make is in yourself most poor people believe that the rich become as
financially successful as they do through picking wise investments but
these aren't the investments you would typically think of they know that you'll
get the biggest return from investing in yourself through improving your skills
improving your connections improving your health and fitness and the list
goes on consistently relentlessly investing in yourself will produce
better long-term results than any other investment you can make the best part
about investing in yourself is that your results are totally in your control
whereas investing in real estate or stocks is out of your control due to the
volatility of the respective markets when you decide to invest in yourself
you can control your efforts and ultimately your outcome one source have
used many times over for investing in my own set of skills is today's video
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skill today truth number 8 you must capitalize on free money whether you are
using a job or a business to earn the income that will make you rich you need
to make sure you capitalize on free money with 401k matching contributions
make sure you contribute whatever it takes to max out will your employer will
match otherwise you're passing up thousands of dollars in free cash which
only makes it harder for you to become rich the same is true if you own your
own business set up a 401k and match 100% of your contributions that way
you're contributing pre-tax dollars and so is your business as an employee you
can contribute 19 thousand five hundred dollars to a 401k this year or 27
thousand dollars if you're over 50 and total contributions employer match and
profit sharing can add up to more than 55 thousand dollars that's a lot of
money you can sock away this matches yet another reason to start your own
business even if it's just a side hustle designed purely to help you put away
more money for a retirement truth number 9 you have to lay your own path to
riches some of the time it pays to consider what other people think but not
if it stands in the way of living the life you really want to live don't buy a
house just to impress other people buy the house that's right for you don't buy
a car just to impress other people buy the car that's right for you make
spending choices that are right for you make investment choices that are right
for you pick your career your school your business pick everything because
it's right for you not only will you make better decisions
about your money and finances you'll also be a lot happier because you get to
live the life you want to lead which ultimately is what money is really for
thanks for watching if you want to go from the life you have to the life you
deserve then hit the subscribe button now