If you want to become wealthy or financially free, the first thing you got to do is right now
you need to start investing a minimum of 15% of every dollar that you earn
What's up, everybody? I am Jasper Singh from TheMinorityMindset.com, where money minds rethink
rich. If I told you that I am budgeting my money right now, that way I can live off of $7,000 a
year, you're probably going to think that I'm never going to eat guacamole again, or I'm going
to live in a box, or I'm going to move to a third world country. But here's the thing, about 50 years
ago, if you were living off of $7,000 a year, you'd be living pretty decent. I mean $7,000 a year
50 years ago is like $50,000 a year today. This is where people think about building wealth and
retirement and financial freedom all wrong because people always talk about, okay, when I become
financially free, my goal is to be able to live off of $50,000 a year. But your $50,000 a year that
you're thinking of is today's money. $50,000 a year today is very different than $50,000 a year
50 years from now, just like how $7,000 a year today is very different than what $7,000 a year
was back 50 years ago. So when we're talking about building wealth and investing your money
for retirement or this financial freedom or whatever you want to call it, you got to understand
two things. One, you got to understand how your money works, that way you're using the money right
way. And the second, you got to know how to invest this 15% and why you need to be investing this 15%
But before I get into that, I need you to do me a quick favor and smash that thumbs up button
below because the way the YouTube algorithm works, if you do not, smash that thumbs up button
And YouTube is much less likely to show you and other people our financial news and education
videos. When the majority of people think of money, they relate it to stuff. How much stuff
can my money buy me? If I make $1,000, what is this $1,000 worth? If you ask the majority of people
you relate $1,000 to how many nights can I go out, how many vacations can I go on
how many nice clothes can I buy, how many times can I buy extra guac? So the majority of people
when you think about money is what stuff can I buy? The reason we call ourselves the minority
mindset is because we think differently than the majority of people. When I want you to think about
money, I want you to think about money in terms of how many assets can you buy. An asset is
something that makes you money. And so now when you have a thousand dollars or ten thousand dollars
or a hundred thousand dollars, I want you to ask yourself, okay, now that I have this cash
how many assets investments can I buy, which are things that are going to make you more money
When I was younger and I made money, the question that I had was, how can I use this money to improve my car
I started by tinting my windows, and I got new rims, then I got subwoofers put in, then I got all this other stuff put in
And it was always this kind of like balance of, okay, I made $1,000, what can I do to my car
I made $2,000, how can I upgrade my car? So anytime I made money before, it was, how can I spend this money in a way that's going to better my car or whatever I have
This completely changed when I started investing in real estate because after I bought my first real estate investment property, it was making me something like $250 a month in profit every single month
And once I got it up and running and going, it was $250 a month passively, which means I wasn't doing any work
Every month, $250 was being deposited into my account. Now, all of a sudden, the way I thought about money completely changed because now I'm thinking in terms of houses and real estate instead of cars
cars. Because now in my mind, I'm thinking, okay, if I can make $250 a month for one property
that means from two properties, I can make $500 a month. With 10 properties, I can make $2,500
a month. With 100 properties, I can make $25,000 a month every single month passively without me
having to do any work. As you grow, you'll start to realize that there's easier ways to do this
Like you might not have to buy 100 single family homes. Maybe you can buy an apartment complex
and some properties are going to pay you more per unit than others. But in general, that mindset is true
Now I'm thinking about assets instead of liabilities. I'm thinking, okay, when I make money, what investments can I buy
What assets can I buy? How can I use my money to make myself wealthier
How can I use my money to build more assets? How can I use my money to create more value
instead of just using my money to spend on nice things? You want to have your nice things
I understand that. But when you make money, I want you to think about it in terms of assets instead of liabilities first
Once you start changing the way you look at money, it is gonna be so much easier for you to start investing your money
and put more money aside to investing because before, putting this money aside was a chore
because now you are sacrificing a nicer car, you are sacrificing another vacation
you are sacrificing all these nice things, but now you're not making that sacrifice
Now you're working more towards your goals of buying more assets because that's the way you're looking at money
Now you look at money as a tool to buy you more assets which allow you to have nicer things
But now when you change the way you look at it, it's easier for you to make more of these sacrifices
to buy more assets. That way you can have more freedom, have more wealth, and then ultimately have more of the nice things
the nicer cars, the nicer vacations. Now let's get into the numbers because if you're subscribed to our channel
chances are you've heard me talk about our 75-15-10 plan which says for every dollar that you earn
15 cents is the minimum you should be investing, 10 cents is the minimum you should be saving
and 75 cents is the maximum you should be spending. Now, I'm going to go over that 15% investing. Why 15% and what the numbers actually look like
when it comes to building your wealth? Here's the thing. Investing is the real secret to building
wealth for regular people It is not building the next Amazon It is not finding the next hot stock before it pops It is not winning the lottery It not having a job that pays you a million dollars a year Yes these things can help but they are the exception to the rule They not the rule So if you really want to
build wealth, the secret, secret is investing your money. And the issue here is so many people are
not doing this, even though I think we should know this by now. It's hard because on one hand
we're never taught about money. Like we don't go to school learning about how money works, how budgeting works, how investing works, how to build wealth. And on the second side
we just don't really have kind of a good financial culture when it comes to spending because we live
in this debt culture where it is completely normal to finance your wardrobe. And so this
is kind of the culture that we live in. And the only kind of financial education that people get
nowadays is you go to your job and then your job gives you this packet which says, here's your 401k
information. That's why right now, half of America is not investing any money, not a single penny at
all. And on top of that, the people that are investing, most of them are only investing their
money in their 401k, even though your 401k was never intended to be your sole retirement or
investment plan. So if we kind of diagram this out, if this pie represents America, that's a very
lopsided pie. If this pie represents America, only half of these people, so these people are not
investing any money. Only half of these people are investing any money at all. Now, out of these
people that are investing any money, the majority of these people, so something like this, are
investing their money only in their 401k. This is the only people that are investing their money in
their 401k and out of their 401k. These are the only people that are creating their own wealth
and retirement outside of what's kind of just given to you. Out of these people that are only
investing their money in their 401k, which was never intended to be your sole retirement
or wealth building or investment tool. Out of these people, the average 401k contribution
is just 7% of your income. So you have a huge chunk of Americans that are not investing any
money. And then you have this big chunk of people that are investing their money, but they're only investing their money in their 401k. And the average contribution is just 7%
7%, which means you have only a few percentage of Americans that are investing more than 7
of their income every single year towards their wealth, towards their retirement
towards their financial freedom. If you really want to become wealthy, you got to invest more
than 7% of what you're making. Now, let me show you why investing a minimum of 15% of your income
is so important. Let's assume that now when you're 21 years old, you go out and you get a job paying
you just $30,000 a year. So you are making $30,000 a year, and let's assume that you're investing 15
of your income every single year before taxes. So that means you are investing right around $4,500
So I'm also going to assume that you're working a job where your salary is going to grow over time
and let's assume that your salary just grows by an average of 3% a year. Now I know over time
hopefully, your salary will grow by more than this, but let's assume just 3% a year because
sometimes you're going to get a raise. Sometimes you're going to go to a new job. Maybe you'll get another bump there. Maybe you get a promotion. But every single year, you get a 3% annual bump
And as you continue to make more money, you continue to invest just 15% of your income
If you do that, between the age of 21 and 65, you are going to save. So at 65, you continue to do
this, you are going to put aside $400,000 over these 44 years. Now, if you just save this cash
and you started living off of, let's say, $30,000 a year, then this $400,000 would last you about 13
years. After 13 years, this $400,000 would go away. But you also got to remember that this is
$400,000 about 44 years from now. This $30,000 a year in 44 years is not going to have the same
value as $30,000 today. I mean, by the time you're 65, if you continue to grow your income by 3% a
year, you're going to be making more than $100,000 a year. So if you want to continue maintaining
your lifestyle at 65, that means you got to pull out $100,000 a year here. So your money's only
going to last you four years. By the time you're 70, you're going to be broke. So this saving model
doesn't work, which is why I want you to invest this 15% a year. If you invested this 15% a year
and this $400,000 went into your investments, and you got a below average return
for the course of your life, and you only got a 4% end of return on your money
If you were able to get a 4% average return on your money over your lifetime
then this $400,000 will grow to right around $900,000. Quite a bit more, but you gotta remember
this is still quite a bit below average. If you got an average return of 7% a year
then this $400,000 you invested over your time would grow to $1.9 million on the side for you
to now use however you want. And if you could grow your money by 10% a year, which is just a little
bit above average, especially when you account for inflation, then your money would not grow to $1.9
million It will grow to million But the only way this is going to happen is if you investing 15 of your income every single year Now look this is where you got to really understand money because so many people make this mistake that when they planning for wealth or retirement or financial freedom
they're thinking in today's dollars. They're thinking, okay, I'm young today. I'm hoping
that I can live off of $30,000 a year or $50,000 a year or $100,000 a year because they're relating
that to today's money. But $30,000 a year today is not going to be the same as $30,000 a year
45 years from now. That's why your income is hopefully going to be adjusted with inflation
and go up by a couple percent or a few percent a year. If you're 21 today and you're making $30,000
a year, by the time you're 65, if your income grows by 3% a year, you're going to be making
something like $106,000 a year by the time you're 65. So if we assume that $106,000 is what it takes
for you to keep the same lifestyle as 65 as you do in 21, that means you got to be pulling out
$100,000 a year when it comes time for you to retire in order to keep the same lifestyle that
you have today. Now, depending on how much money you're making, that might seem like a whole lot of money or not enough money. But what you got to understand is that in 45 years, $100,000 a year
is not going to be as much as $100,000 a year today. So you got to kind of plan for that with
your money. And so if we're looking at this kind of income and you're thinking, all right, if I want
to maintain my lifestyle, I got to be pulling out $100,000 a year. If you have $400,000 sitting there
that's not going to cut it. You're not going to have a very nice retirement or financial freedom
because after a few years, you're broke. Now here, if you get the 4% a year, now at least you have
some more money. And what you got to also understand is because this money is invested
you're hopefully going to continue growing it after you start pulling money out too
because you're not going to pull out all $900,000 at once, at least hopefully not. You're going to
pull out $100,000, let the other money grow, pull out another $100,000, let the other money grow
and kind of go on like that. That way this can last you more than nine years. And here, assuming you can just get an average return now you really have money put aside for the rest of
your life because now you got money for at least the next 20 years because even if you're pulling
out a hundred thousand dollars at a time that means you have your money growing for another 18 years
after you pulled this money out so you pull out a hundred thousand dollars your money continues to
grow the next year because you only pull out a hundred thousand you still got 1.8 million in
there and the next year you pull out another hundred thousand you have 1.7 million growing for you so as long as you got money in the account your money will continue to hopefully grow
I want you to be an aggressive investor. Actually, I need you to be an aggressive investor
because Social Security is becoming a thing of the past and pensions are becoming history
And so if you want to be able to take care of yourself and take care of your wealth
and take care of your family and your finances, you got to be the one to put it in place
and you got to be the one to start taking action because you cannot rely on the government to take care of you
because the government national debt is skyrocketing. They have their own problems. it is very hard and very painful to rely on somebody else especially the government to take
care of you which is why i want you to be an aggressive investor that way you can take care
of yourself and take care of your wealth that way you can live your life the way you want not
worrying about what the government is going to give you now there are different ways that you can invest your money that way you don't have to actually sell your assets in order to have money
in your hand like if you invest in rental properties investment real estate now you're
creating passive income cash flow that way you can get cash in your hand every single month without
you having to actually sell a property and if you're investing in dividend-paying stocks
now you're making money every quarter or every year from your stocks and you don't have to
actually sell your stocks to get paid, but I'll get to that in just a second. Now here's the thing
most people don't start investing in money as soon as they turn 21. What you need to understand
is the older you are, the more aggressively that you need to invest. Just because you're older and
have a start idea doesn't mean that you can't start, it just means you got to be a little bit
more aggressive. There's in general two different ways that you can invest your money. You have one
way of investing your money, which is through retirement accounts. This is through things like a 401k or an IRA. And then the second way that you can invest your money is through non-retirement
accounts. This is through creating your own stock brokerage account and investing your money in
stocks or through investing your money in physical real estate, not through a retirement account
And so this is money you're not doing in a retirement account versus retirement accounts that can give you some tax benefits. The whole purpose of a retirement account is literally to
help fund your retirement because when you invest your money in these accounts, you can kind of get
a tax deferral right now, and then your money can grow tax-free until it comes time for you to retire
unless you use a Roth, then you're paying taxes today, and then you don't got to worry about taxes
when it comes time for you to pull your money out. I'm not going to get into too many details on this
but the whole purpose of this is for you to invest your money. That way, it can grow tax-free
but you cannot touch your money until it comes time for you to retire. If you want to learn more about that, I will link a video where I've already discussed this in the description below. The point
that I'm trying to hammer home here is your retirement accounts are typically not enough
because your 401k and IRA has limits. And you got to make sure now
that you're not investing your money based off of what the government limits you at. You got to be investing your money
based off of the way you want to live your life in retirement. That's why I say a minimum of 15% of your money
needs to go towards your investments. Some of that money can go towards your retirement accounts
but if that's not hitting the 15%, then you got to be investing your money on your own too
That means maybe you got to create your own stock brokerage account, or maybe you got to start investing in your own physical real estate
That way you can get passive income. But here, you gotta know what your goal is first
If you wanna see your money grow quickly and you don mind taking on more risk then you should consider investing your money in the stock market especially in growth companies and these kind of more startup companies where these companies are trying to grow as quick as possible as fast as possible There more risk involved because startup companies can
fail and they might not work out, but you have the opportunity to see your money grow a whole lot
quicker because these are companies that are working really hard to grow as big as possible
and as fast as possible. If you just want to see slow and steady growth in your money, then you can
look at investing your money in more blue chip companies. These blue chip companies are your
bigger established companies that have already been there for a long time. They already have
their systems and you're just investing your money in this company. That way you can see your money
grow slowly. The advantage with this is you have less risk because these companies are already
established. You already know how they're making money and you can kind of reasonably predict how
much money they're going to make and how fast they're going to grow. So you have less risk and
so you get lower potential returns. One thing that I do want to mention about investing your money in
the stock market is that the stock picking game is not for most people because picking stocks
requires a lot of work, a lot of research, and a lot of upkeep. If you're not willing to do that
then instead of investing your money in individual companies like trying to find the next Amazon or
Google or Facebook, then what you can do is invest in something called a fund, like an index fund or
an ETF because these funds give you exposure to a whole bunch of different companies and so you
have less risk, you can put in less work, but now you're kind of growing with the stock market. I
I already made a video where I talked about that. So if you want to learn more about how to do that, I will link it for you in the description below
If you're looking for income, where now you can create cash flow or passive income coming into your account
every month or every year, where now you can have money in your hands
without selling your assets, then you want to be investing your money in things like dividend-paying stocks
because dividend-paying stocks typically pay you a check every three months, or you can invest your money in real estate
because now if you own a house or you own an apartment complex, now every single month
the people that are living in your real estate or using your real estate have to pay you rent every single month because they're using your
asset. So now when you own these assets, like a dividend paying stock or rental properties
now you're making money consistently without you having to physically sell your asset
Real estate is also a really good store for your money because if you have a lot of cash
and you want to put it somewhere safe, then real estate is a good place to do it because now you
own something physical and tangible that you can see, feel, and touch, and that's creating income
Now, I know real estate prices don't always go up. You could see a real estate crash
But in general, if you own a property in a good area, then you own something that people need
there's something they want, and that you can see, feel, and touch. The key for any of this to work though is you got to be consistent and you got to keep investing your money because investing is not
a one-time thing. It's not like you can just take $10,000 and throw it in the market or go out and
buy one investment property and say, all right, I'm done investing now. It doesn't work like that
You got to keep investing your money consistently if you want to continue to build your wealth
Yes, if you see a market crash, then come and buy as much as you can then because that gives you the opportunity
to buy assets for pennies on the dollar. But in general, you got to keep consistently investing
if you want to build this wealth because you got to keep putting more and more money towards your investments
Now, for a lot of people, they don't want to be in the game of trying to find the best companies
and do the research and find the best time to come in and buy, which is why I say do it every time you get paid
Just create a system. Anytime you get a paycheck, 15% of that should be automatically invested
That way it kind of happens without you having to think about it, and that way you don't accidentally spend this money
There are apps out there that can automate this whole process for you. That way, anytime you get paid
a portion of your paycheck will automatically be invested into whatever funds or stocks that you want it to go to
That way your money is constantly just going out without you even seeing it, and that way you're not even tempted to touch your money
If you want to learn more about how to actually do that, our team wrote an amazing article on our website
theminoritymindset.com, and I'll link it for you in the description below. Building wealth is really a game
where you got to juggle time and how much money you have to invest. Because the more time that you have on your side
the more your wealth can compound and the bigger your wealth can grow. And the more money you have to invest
the faster that you can grow your wealth. But the tricky thing about this, if we look at it practically
is most of us make more money when we're 50 or 60 than we do when we're 21
And so you kind of get more of your money towards the end of your career, but you have more time in the early part of your career
which is why you got to balance it out. You got to start investing aggressively early. That way you can put more money
and have the time on your side. That way you can kind of grow your money and have more money working for you
And as you start to make more money, you'll continue to keep investing 15% of your income
month after month after month. That way you can continue to compound that wealth and continue to keep growing your money
Again, don't take what I'm saying as the ceiling. I want this to be the floor because right now the average person is investing nothing
or very little. I want you to kind of up the minimum and make it so you're investing a minimum of 15% of
what you make. once you get the hang of that and up it up 20%, maybe 25%, depending on what you're making
The more you can invest, the faster you can build that wealth. And the faster you can build this
wealth, the more assets and income that you'll have. That way you can live the life you want
without worrying about the price because you got your assets producing income, which can fund and
buy you whatever it is you want. Thank you for watching. If you enjoyed this video, here's a
video on investing that I think you'll love. And while you're at it, subscribe to our YouTube channel and join our free finance and business newsletter. And as always, keep hustling
But in the long run, what really affects the stock's price is its fundamentals. That's how
much money is the company making? How are their profits looking? Are their revenues growing? Are
their profits growing? How is the management and are they innovating for the future? So these are
the things that really affect the company's stock price over the long term