2021 was probably the best year for billionaires in the 21st century.
They have made more money than ever.
The world’s 10 richest people added $402 billion to their fortunes.
The 10 wealthiest individuals in the world are all worth more than $100 billion, according
to Bloomberg.
A couple of years ago, in 2019, just 2 people had a net worth of over a billion dollars,
Jeff Bezos and Bill gates.
So it seems like the last 2 years weren’t as bad as we imagined.
We can even call them the golden age of the stock market.
We might never experience that in the coming future.
Tesla stock, for example, rose from January 2020 to its peak in November 2021 by over
1200 percent.
That’s why Elon Musk dominated the Forbes list with over 200 billion dollars.
237 billion dollars net worth is not a joke.
He can buy entire countries.
He even was ready to purchase Twitter, but it seems like it's not going as planned, or
maybe he just wanted to troll Twitter and wasn’t serious about it in the first place.
At some point, his net worth crossed the 300 billion dollar mark.
He added $121 billion to his net worth in 2021 — just shy of the $140 billion he added
in 2020.
If he continues growing at this rate, in 5 to 10 years, we will see headlines such as
Elon Musk is the first trillionaire or Elon Musk - the person who crossed the trillion
dollar net worth.
Even Saudi kings will envy him.
It might seem like only tech billionaires made so much money, but it’s not true.
Take a look at Bernard Arnault.
He is in the clothing business.
And yet he has dominated the Forbes billionaire list with a net worth of 176 billion dollars.
Almost every luxury brand you think of belongs to his LVMH conglomerate.
Sometimes it's difficult to make sense out of all of this because we are talking about
numbers that most people will never achieve.
I mean, even if you make a million dollars a year, which will put you at the top of the
highest earners, you will still need a thousand years to cross the billion dollar mark.
So, let's take a look at how many people crossed the million-dollar mark.
The number of Americans with $1 million or more in investible assets surged to a record
14.6 million in 2021, up from 13.3 million in 2020.
If you think about it, there is plenty amount of money to be made, especially in the US,
where the size of the economy is over 20 trillion dollars.
So the question is - how do people make millions of dollars while the vast majority are struggling
financially?
How do people make so much money when over 60 percent of the population can’t come
up with an extra thousand-dollar emergency fund?
There is, of course, not a simple explanation for that.
However, if you pay close attention, you will realize that anyone who has passed the million-dollar
mark has followed these 4 rules.
They are so simple that it's easy to ignore them.
That’s probably why most people end up financially mediocre.
So, if you are ready, give this video a thumbs up and let’s start with the first one.
The rule of 20 percent.
Take a look at any company.
The vast majority of their sales or profits come from a few products, even if that company
has a lot of products.
Apple, for example, which seems like the most successful company in the world, has plenty
of products, from gadgets to services.
But almost half of its revenue comes from iPhone, and the other 30 percent comes from
another two products, and it’s remaining products and services only account for 10
or 20 percent of its revenue.
Take a look at the athletes.
When you hear the news that they are paid millions of dollars just to play a single
game, it blows your mind.
You feel like you should have become an athlete.
But the truth is, there are millions of athletes all across the globe, and only the top 1 percent
of these individuals earn 80 percent of the money that's earned in this industry.
The remaining 20 percent is shared by everyone else.
And the vast majority can't even make a living by playing sports.
The same goes for youtube.
The top 1 percent of YouTubers make millions of dollars, and the rest barely survive.
Often you will get a much higher ROI (rate of return) by working in a McDonald's than
making youtube videos.
Most YouTube videos get fewer than 50 views, only 2% gett 1,000 views or more, and 0.3%
of the videos gett at least 500,000 views.
This means your odds of becoming famous via YouTube aren’t huge.
Even if you end up getting half a million views, trust me, you are not going to make
a lot of money.
The 20 percent rule or the 80/20 rule states that 80% of consequences come from 20% of
the causes.
20% of drivers cause 80% of all traffic accidents, 20% of employees are responsible for 80% of
the results, 20 percent of the drinkers drink 80 percent of the alcohol.
The ratio isn't always exactly 80/20, but it's somewhere close to that.
80% of wealth is accumulated in the hands of 20% of people Because 20% of people are
solving 80% of the problems.
Twenty percent of what you do, earns you 80 percent of your income.
The point is, if you stop doing all these things that do not make your life significantly
better, you will have more time to focus on the things that will maximise your productivity
and income.
That's why you realize that it took some people 20 or 30 years to make their first billion
dollars and just one or two years to make their second billion.
2.
Speculation is most dangerous when it looks easiest
The last 2 years have been some of the greatest years ever for crypto.
People made fortunes trading crypto, but last year also, Crypto scammers took a record $14
billion.
Imagine how much money people have lost.
This is not the first time.
Back in 2017, the exact story was repeated.
Not to say that crypto or NFTs are scams, but they are filled with scams since they
are relatively new and volatile assets.
Youtube ads are filled with ads telling you how you can make fortunes just by buying their
crypto coin, downloading their app, or just following whatever they are saying.
It’s easy as that, but that's how people usually end up losing their barely saved earnings.
So, whenever it seems super easy to make money by speculating, be aware because you will
most likely step into a trap that will take a long time to get out.
3.
Stop reacting emotionally
If you have ever invested in the stock market, you know how strongly emotions come on the
way.
Especially when everything is rising.
It’s not easy to watch everything from a side.
But the last 6 months proved that just because everything is rising, it doesn’t mean it's
going to be like that forever.
Despite high inflation, holding cash now is better than stocks or crypto since both markets
were crippled when the fed raised the rates.
We have explained in previous videos why the markets have crashed even though inflation
is at the highest level in 4 decades.
I will leave the link in the description.
But you get the point.
Always do your research, and never rush into the market excited watching how others made
money because it's much easier to lose money than to make.
4.
Self-reliance
This might not look like a financial rule, but it's probably the most important skill
that every rich person keeps in mind.
If you are relying on others for your income, you aren’t going to go far because no one
cares about you as much as you care for yourself.
If you have a job, your financial future is at the hands of your employers.
Nothing wrong with that.
Your boss isn’t going to work hard to make you a millionaire.
Your goal in Every Aspect of life should Be - ownership.
Working to build up what will remain yours at the end and not fade away in the hands
of others.
When it's yours, you are more motivated and more creative to build it.
In a world that's governed by self-interest, where everyone thinks of themselves first,
you cannot depend on others for your own success.
That’s for today, thanks for watching and see you in the next one.