In the world we live in today there's a ton of advice out there and while some
is good most of it is bad luckily boss in this video i'll be sharing with you
five pieces of financial advice that will ruin you financially and if you're
new to the channel then hit the subscribe button below for more
life-changing content advice number one you should save as much money as you can
this is more like unfinished good advice yes you should save as much as you can
but there's more to the story if you stop at just saving inflation amongst
other things will cause your money to wither away over time this erosion of
your money will result in you not having enough to keep up with the ever
increasing cost of living and this is a problem you want to avoid having if you
can so given that saving is just part of the solution what's the other half the
other half of the solution is to invest this is the missing element to this
half-baked general words of financial wisdom you see investing when properly
executed will ensure that your wealth does not erode as the euros roll by in
fact when done right your investments should be getting you ahead financially
as the returns outpace the cost of inflation and the impacts it has on your
money for instance if you are earning a return of seven percent in the market
and inflation is eating your money at two percent per year you're still
getting ahead by a sizeable margin however when you only save and don't
invest you tend to just leave your money in the bank and with savings accounts
interest rates being next to zero your chances of combating inflation are slim
to none also one added benefit of investing that save money is that you
get to employ the magicka compounding which is every investor's best friend
with it the value for your investments continues to grow exponentially as
interest is applied to the principle and interest you already have invested
there's a reason albert einstein called it the eighth wonder of the world and to
avoid missing out on its powerful wealth building abilities you should aim to not
only save your money but invest as well advice number two you should always buy
a home rather than rent people in real estate always push this advice but let's
face it sometimes it makes more sense financially to rent rather than to buy a
home now you may be wondering why this is and i'll explain why right now one
primary reason you should consider renting before you decide to rush into
buying that house is that renting is often less costly and offers more
flexibility for a long time the typical youth crossing into adulthood has been
advised that after graduating college kickstarting a career and starting a
family the next thing is to buy a home for most young adults buying a home just
seems like the next logical step in adulthood and because we are also sold
this life path very few dare to question it however these days more people are
starting to challenge that belief the rate of homeownership in the united
states is in decline amongst millennials it must be said that the dip was
intensified by both the increase in housing costs and of course lower
incomes however that is not the whole story more young adults are beginning to
understand that owning is not always preferable to renting due to the many
benefits renting tends to offer in fact there are regions in the us where
renting is quite preferable to purchasing a home this is due to the
fact that it's challenging to sell a house in these areas in such instances
renting a home may serve you better you see in many markets selling a home is
easy and right now it's definitely a seller's market however this isn't
always the case and many times houses sit on the market for months and
homeowners are forced to sell prices below what they wanted as a renter you
avoid the headaches that come with the buyer's market and provide yourself more
overall liquidity given that you don't have thousands of dollars tied up in
home now to some financial advisors it is more expensive to rent than to buy
however this is always case dependent generally this decision comes down to a
few important criteria for instance you need to assess your space needs the
area of town you want to live in and of course the opportunity cost of putting
money into a house versus other lucrative investments therefore you
shouldn't blindly follow the advice that buying is always better than renting
because it truly depends on your own wants and needs advice number three the
best way to get rich is through good education you hear it all the time that
you must get a good education but believe me a good educational loan will
not unlock the door to financial success in fact i believe that as every year
passes the value formal education declines especially when it comes to its
ability to help you get ahead financially if you ask me there's no
better example of how formal and informal education impacts financial
success like the story found in the book rich dad poor dad in the book rich dad
poor dad author robert kiyosaki compares his two fathers his rich dad and his
poor dad his rich dad dropped out of high school yet he managed to become
successful as a businessman his poor dad on the other hand was
highly educated however he always struggled with his finances these
results have led robert to believe that schools can only teach a person how to
be a good employee and they will ultimately end up trading their time for
money for the entirety of their lives while there is nothing wrong with
working within this money-making model it must be stated that it's definitely
not a path most people can take to become rich in fact if we study most of
the richest people in the world trading time for money and relying on formal
education has a little to do with their ability to
accumulate significant wealth let's now take a closer look at the correlation
between financial freedom and education first among the millionaires on the
forbes 400 list six percent of the individuals have only completed their
high school diplomas and have zero post-secondary education this proves
that it is entirely possible to succeed financially without a formal education
now you could argue that the majority of them have some college education under
their belts and you'd be right however just because these individuals are
college trained doesn't mean their time in college was a major factor in their
ability to succeed financially many people on the forbes 400 list of
wealthiest people succeeded financially in their endeavors that were outside of
their fields of study moreover one thing you will notice is that none of them
became uber wealthy by working a nine to five job which is generally a path that
college and university grooms you for therefore yes education is important but
it must be masterfully applied in order to offer you the greatest financial
returns possible advice number four you should always avoid debt some consider
the fear of debts as the beginning of wisdom but what would you say about
robert kiyosaki who has over a hundred million dollars worth of debt according
to the investment guru they pay almost nothing in taxes and as you well know
him and his wife are very rich they are part of the one percent of the world's
population that get the masses worked up about economic inequality now you may
think that having all this debt stops robert and his wife from sleeping at
night but as he said in many interviews the opposite is the case you see taxes
and debts are two words that get most people feeling anxious and leave them
sleepless at night this is because a lot of people including highly educated
individuals earning six-figure salaries lack financial understanding the
understanding they lack is how to use debt to generate more money and use
their debts to avoid paying taxes all in ethical and legal means of course one
example of someone whose leverage is understanding a debt to its upper limits
is former u.s president donald trump love him or hate him donald trump
understands almost everything there is to know about taxes and debt he knows
that debts can be used as a tool to grow your real estate portfolio and can be
used to finance new and existing businesses so the real question to ask
is why is that the financial doom bringer for some and the savior for
others i'll explain now so keep watching while most people place the blame on the
wealth gap that exists in the world today on the rich's greed the true
culprit for this phenomenon is the disparity in financial education
children in schools are not taught about money and many people grow up never
getting the financial education they need as a result they never learn how to
use debt to their advantage or at the least know how to manage it to
ensure it doesn't drain them financially as you can guess those that do obtain
this financial education are much more likely to prosper financially
sidestepping harmful debt and maximizing the leverage of low interest debts that
are extended to them therefore take caution the next time you're told that
you must avoid debts at all costs advice number five your main goal should be to
retire early even as the world is yet to recover from the great recession caused
by the pandemic many people still have early retirement dreams a survey
conducted in 2019 by the american advisors group revealed that 52 of
americans hope to retire before they're 61 years old of course not everyone will
be able to achieve this when life plays out as you know unforeseen circumstances
such as health problems family responsibilities and job losses can put
even the most thought out retirement plans to shame however if fortune is in
your favor and you are able to retire early this doesn't mean that life will
be perfect in fact there are many downsides to retiring early that most
people are unaware of and i'm going to get into some of those things right now
first a 2008 study conducted by the nber or national bureau of economic research
disclosed that early retirement could be bad for your health the study revealed
that early retirement may lead to a decline in your mobility and mental
health moreover it could also worsen other health issues that you might have
and leave you more susceptible to strokes and heart disease another point
of caution is the fact that early retirement reduces your social security
benefits when you dip into your social security early your benefits begin to
drop for instance if you were born in the 1960s and retire at 62 and begin to
take advantage of your social security your benefits will be 30 lower than what
they would have been if you waited until age 67. this is because 67 is considered
the official age of retirement now you would also do well to remember that why
saying it is essential to retire not from something but to something there's
no nobility in being idle and one way to sidestep these health issues and a
decline in your overall quality of life is to take on new challenges in
retirement to keep both your body and your mind stimulated however these are
just some of the retirement issues people face but if you want to know
which mistakes stop 99 of people from retiring early then make sure you watch
this next video trust me it may be the difference between retiring early or
never retiring at all