How The System Keeps YOU POOR! (Money Myths That Keep You Broke) | Jaspreet Singh on Impact Theory

why financial education is so important is because if you don't understand this you are going to get screwed over by the system because now guess what your gas is going to be more expensive your groceries are going to be more expensive your home cost is going to be more expensive the cost to do anything is going to cost you so much more today next year the year after that well your salary hey you got to raise but you're actually broker now than you were before the race because your raise isn't keeping up with inflation just read over the next hour-ish you and i are going to snatch people from the jaws of poverty you in let's do it man all right so i have a sincere belief that there are habits that keep people poor and that anybody regardless of where they're born what their circumstance is if they do the right things over a long enough time period they can get out of it we are living in horrendously uncertain times yeah what are the things the habits that keep people poor wow well the first one really has to do with understanding money because unless you understand what money is none of the other habits really matter because at its core what is money and when you ask people that you might say it's a 100 bill 50 bill that's what money is but what is that money because that money that we have today is different than what money was 60 years ago the money that we call money today is currency it's really just pieces of paper and when you understand that it's going to change what you do with the money and the reason why i'm saying that is because uh i'm from uh my family smart india a state of india called punjab and over there it's a very traditional thing that when you earn this paper dollars many people will convert this cash into gold because i understand that these paper dollars lose value and it's just paper so they want to convert it to something real something tangible so they will go out and buy gold with it all right really fast explain to people why paper money loses value over time so our paper dollars can be manipulated and controlled by other entities such as such as the federal reserve bank yeah and the government now the interesting thing about the federal reserve bank is it's called the federal reserve bank however it's not federal it says so on their website they're not a reserve they don't keep cash reserves anywhere they're not a bank you and i can't go there to deposit money so what happens is should i hear wolves howling in the background like is there something sinister going on do you think for real or is it just the system and it's just how it works well it depends if you understand the system you can use it your advantage if you don't understand the system it is going to screw you over many many many times yeah this is my obsession so as you and i were talking about before we started rolling camera two years ago i considered myself very good at making money very bad at investing money right and then the pandemic hit and i really started to panic for other people that look i'm gonna make it out of the pandemic fine but i don't know that that will be true for people that don't understand money right and so getting educated like for me to try to help other people i've had to educate myself about what money is right getting freaked out by inflation and i've heard you talk about this so i know you know this well but that the government when you say manipulate the money they literally just make more of it right magically literally and and this is where the rich will become richer the poor will become poorer and the middle class will get wiped out and the reason why is because some people rich people will understand money and they will continue teaching their kids and everybody else the majority of people who have no idea what's happening will continue to become poorer because they don't even see it happening and so what happens is so you have the government and the fed the government spends money now where did they get their money well they get their money from taxpayers people like you me people watching this video through tax dollars now can we hammer that for a second sure the government does not make money the government takes money from people who are making money right now that's not necessarily bad because they provide a lot of amazing things they're not necessarily efficient with their dollars so yeah so we can dive into that for a second so you know you have to understand what someone's role is if you are a company right you you have a company your job is to make a profit because if you don't have a profit you're not going to be in business unless you have some other stream of you know venture capital debt or something but if you don't have a profit you can't continue operating and so your job is to be as efficient as possible as a company the government can actually be benefited by being inefficient because what is the government's job you have to understand what is their role if their goal is to create jobs well then you can be as inefficient as you want and you can achieve that goal because if my goal if i'm the government i just want to create as many jobs as possible i can pay people to pick up this mug and put it from the left hand to right hand i just created the job you're employed you have an income but you're not producing anything of value and this is where you have to understand okay what is that purpose and so now you know if we get away from the politics for a second the government now spends money they get money from taxpayers because the government is not a for-profit entity they don't create a product and sell it for or create something and sell it for a profit instead people make money and then the government taxes your income now just like anybody else there's checks and balances if the government has a million dollars they can only spend a million dollars you would think but that's now how it works so the government has a million dollars and what's happening now is they're going to spend significantly more than a million dollars now if you have a certain amount income and you spend more than that what do you do well you're going to have to subsidize or find that extra cash somewhere and in the government's case what they can do is they can go out and look for a loan it's called a treasury bond for as long as anyone can remember have been considered the safest investment anybody can make well what it is is you're literally loaning money to the government but what happens now if there's not enough people out there to loan money to the government if the government wants trillions and trillions of dollars if there's not enough people out there to loan that money to the government and they keep wanting to spend more money you still got to make up this cost so what do they do they call up their friends at the federal reserve bank and they say hey we need a two trillion dollar loan and then the fed's gonna say okay we got you now remember what i said they're not a reserve they don't have a cash pile anywhere so what do they do they go to the money printer and now they can print out two trillion dollars they loan this cash to the government and now the government got the two trillion dollars the federal reserve printed it out of nothing the government can now take this two trillion dollars and spend it in whatever way that they want it can be inefficient they can try to create efficient products but their goal is to hopefully help people now whether they're inefficient or not is a political debate however you know that that is what they do now really fast before we move on so this is the part that people need to understand about why the rich get richer because i'm super as a rich guy i'm like i'm going to get richer like what great so what happened i never understood how so now what happens you just printed this money right and then which you don't actually print by the way you just increase the database somewhere it's a bunch of digits yep and now this money enters our economic circulation but what happens now when more dollars enter without actual wealth being created because we saw this happen in textbook form in 2020 2021 where nothing was being produced except money well when more money gets produced it effectively reduces the value of each individual dollar this is what inflation is the word inflation comes from the word inflate what are you inflating the monetary supply so you're increasing the monetary supply causing the value of each individual dollar to go down which effectively causes the price of things to go up and so in 2020 2021 no one's producing however the government is spending money like crazy where are they getting this money the fed so the fed's printing money giving it to the government the government's spending it like crazy now people are getting money it's people it's businesses it's corporations um and this money is being spent and now everybody is like wow i'm sitting at home and i'm rich you have some people who are getting big unemployment checks they have some businesses getting millions of dollars and everything is running smooth but and people are spending money like crazy buying things but nothing is being produced so then what happens well now you have a supply chain mess because everyone's buying all the stuff in stores however no business is able to produce anything because the economy shut down so the supply chain issue then you start to see is a byproduct of the inflation because everyone's trying to blame oh the inflation is happening because of supply chain issues but you have to look at what is the real root cause the inflation is what causes the supply chain issues and now we're trying to go backwards but this is where rich get rich and the poor get poorer because as the value of the dollars drop what happens for regular people your salary doesn't stretch as far your savings don't buy you as much and so you're effectively becoming poorer each and every day because for most of us we're taught to save our money that's what i was told to do growing up you know that traditional indian houses save save save and so i was told to save my money and your savings are becoming less valuable each and every day well what wealthy people do is they're not storing cash they're buying assets and so when when we have this sort of economic system can you explain what an asset is and as this we're now getting to the root of how the rich actually get rich right this was the part it took me a very long time to understand but now that i get it one it doesn't need to be the rich that are getting richer anybody can own assets yeah but they have to understand what assets are and then actually buy set assets right because this is how the government pumps the money into the system and this was a part like i'm grateful sometimes that i'm kind of dumb for real but and and this really i had a breakthrough moment back at quest we were dealing with nutritional science and i didn't always understand it and so i would have to keep asking keep asking keep asking keep asking but what i found was if i just totally got rid of my embarrassment over not knowing yeah and i kept asking until i understood it so well that i could explain it to other people sure that ended up propelling me forward because i was no longer just nodding and smiling and going along i was like no no i don't get that i don't understand i don't understand yeah and so by pushing into that then i actually began to understand the biology i began to understand what ingredients made sense and all that right so but i had to be willing to look stupid yeah and so now because i've been willing to look stupid for so long in the world of finance right i finally asked the magic question which is when people because i actually thought they were printing money i thought that hundred dollar bills were coming off of a printing machine that's not how it's done at least not to the vast majority of it it's zeros and ones in a database and when they create that money i was like whose database entry is it like are they actually going into rich people's like accounts and giving them money no what they do is they buy oftentimes government assets i don't want to introduce the word bonds and stuff sure but like they're buying assets from the government right but the question is where did those assets get purchased in the first place and they got purchased by people right who are effectively trying to park their money as they call it yeah so i for years was parking my money in government bonds because the government guarantees it yeah and so the way that the government raises money without having to raise your tax is they put bonds out into the world that then people buy so when they're pumping money into the system they just go buy those bonds so now they're buying them from rich people because rich people were the ones that were educated enough and had the capital to buy said bonds just like the internet changed the world forever web 3 is going to change the world forever as well and if you're interested in learning about the blockchain cryptocurrency nfts and what all of this actually means and how it's going to make for a brighter future i have created web3 university to teach you exactly what's going on and make sure that you aren't left behind registration is free everything is laid out in sequential order so even if you aren't fully sure what a blockchain does or why people are so excited about all of this then you can go through step by step and you'll be well prepared to get started you can go to web3u dot io to register it's completely free and we'll be updating the content there regularly as things change i'll see you guys inside take care and be legendary peace that's correct and it goes actually a little bit deeper because in the pandemic we saw something that we've never seen happen before so the fed has the ability to work with interest rates i'll talk about that in just a second and then they can print money and give it to the government and then when you have an emergency time we saw this happen in 2008 it's not happened in 2020 they can do weird things so what they did in 2020 this is the first time it's ever happened in history is they directly gave money to corporations in the form of purchasing corporate bond etfs so think of it this way the biggest corporations in america can go out and raise money from a bank they can go out and raise investment dollars or they can put out this loan say if you are a regular person you want to loan money to us you can do that and so there's etfs which is a group of corporations that are looking to raise money and it's a way to kind of track those debt investments well in 2020 because a lot of corporations had no cash and now all of a sudden they're like oh we can't sell products we're gonna go under the fed did something that has never been done and they started buying corporate bond etfs in the first time in history and this is where things got really dicey because now how do you decide who gets that money or not i mean they're printing money somebody's got to pay for that who paid who's paying for it regular people average people because now it's a hidden tax because the government can't just spend money without somebody paying for it they have to generate the tax dollars if they don't pay it through tax dollars somebody's still going to have to pay a tax and inflation now is a hidden tax it's a silent tax it affects the people who don't understand money and it disproportionately affects the poor and the financially uneducated and this is why financial education is so important is because if you don't understand this you are going to get screwed over by the system because now guess what your gas is going to be more expensive your groceries are going to be more expensive your home cost is going to be more expensive the cost to do anything is going to cost you so much more today next year the year after that well your salary hey you got to raise but you're actually broker now than you were before the raise because your raise isn't keeping up with inflation and so what's happening now this money gets printed and it enters our economic circulation and now you can own those the assets or what happens is let's say you own stocks you own real estate well the fed can also manipulate interest rates so when interest rates go down it makes borrowing money cheaper well when you make borrowing money cheaper more people and institutions are going to go out and borrow money this also creates more inflation because now when you go to the bank and you borrow a million dollars or a hundred thousand dollars the bank is going to work with the fed to print this money and that's how it gets injected into the economy so lower interest rates create more inflation and if you are somebody who's financially educated you own assets and we didn't explicitly answer what is an asset it is something that gives you equity and at the broadest form an asset is something that puts money in your pocket a liability is something that takes money away from pocket what's an example of an asset this could be owning a business investing in stocks investing in real estate anything that you buy for the purpose of making money right and so when interest rates go down because now the fed working with the government want to create more inflation more dollars are going to enter economic circulation more people are going to want to buy a home well if you have more demand to buy a home where do home prices go up who owns homes well yeah if you're a homeowner but if you are a real estate investor now the value of your assets have just because now you own multiple real estate investments your rents have gone up your stock investments have gone up because now businesses can borrow money for effectively nothing you borrow money for three four five percent and now you can borrow hundreds of millions of dollars to grow the company and if you can grow your company by six percent you just made a profit off of the free debt and so now corporations become wealthier because of asset prices go up and what does this do the reason why it makes rich people richer and poor people poorer is because not only is your cost of living higher but now if you want to go and invest your money well asset prices are more difficult to attain it's harder to buy the same level of stocks it's harder to buy the same level of real estate because now the people who own these have already seen that appreciation and now if you're wealthy and you understand this and you're buying these assets and you've been buying them now you're seeing the real gains and you start to see this divide between the rich and the poor and this is where inflation disproportionately hurts the financially uneducated and the poor and disproportionately benefits the wealthy and that's why the middle class gets wiped out and the crazy thing is none of us are taught this i didn't grow up learning about money i didn't grow up learning about financial education i didn't grow up learning about investing i didn't grow up learning about any sort of wealth my parents are immigrants from a state in india called punjab like i was saying before and in my household success meant go to school get good grades get a good job and then and for me uh that good job was i had to become a doctor i was actually given two options become a doctor become a failure i could choose they let you choose no let me choose right and uh so i saw how hard they worked um for my dad if he had a saturday and a sunday off that was considered a long weekend and so you know i wanted to give back to my parents i knew i wanted to become successful they wanted me to become successful and so i kind of followed that path like doing what everybody says following the system trusting the system right and it just didn't make sense to me because on one hand in my house money was a taboo topic you don't talk about money you don't worry about money you don't it's it's a bad thing but at the same time i see how hard my parents are working to get paid you know to to pay for our our lives now we were fortunate i never had to worry about my next meal and we were never poor or anything like that but i saw how hard they worked and it wasn't until i got to college until i realized something isn't adding up because i was actually studying to become a doctor i was taking the medical college admission test the mcat and as i'm studying for this test i started doing a couple things first i started reading business books because i was just interested by this that was the first english is my second language so i never grew up reading books in um you know my grade school years even english class i almost failed my english class and i think it was middle school because i just didn't understand how to write papers or do all that but as soon as i started reading business books i started reading them for fun because i was interested by it and then i started going on to google and i started researching just random things from things like the richest people in america and you know you see like warren buffett steve jobs mark zuckerberg i don't even know he was on it back then but you had a bunch of people who none of them were doctors none of them went down that traditional path and i was like wait i thought that grades correlated linearly with income like if i got better grades my income would directly correlate with that so that was like my first like wait is something wrong here was was something like it just wasn't adding up and that's when i started to dig a little bit deeper and it's talked about wealthy people investing in real estate now i had no idea what that meant because i didn't know any real estate investors i didn't even know what real investing was i didn't grow up around investors it said however the wealthy people invest in real estate and this was right after the 2008 crash i didn't know what was normal in real estate to me this is all i knew because now this is the first time i'm looking at real estate prices and i said oh i've been running this event planning company kind of as a side hustle because you know i wanted to become successful however my parents didn't want me to do anything except study because to them if it's not related to biology or math it's a distraction even like playing football was a distraction doing all these things that were not uh related to becoming a doctor is just a distraction so i always had this entrepreneurial bug but i always kind of did it in secret because it was never like allowed so in high school i worked at weddings and i got to meet a lot of the indian djs and one of them um a couple of them had this idea to host teen parties for kids in my high school well i was like yeah why not we got to meet one of these little local indian restaurant owners and they were like yeah why don't you throw parties here for free you can charge cover do whatever you want we want the exposure so i kind of did this in secret now i'm in high school hosting these little teen parties became this little event promoter didn't make that much money but it was a little hobby that i started and then i go to college i'm 17. i don't know what colleges like we're supposed to be like in america um and i go there thinking everybody's going to be spending friday nights in the chemistry lab studying i get there everybody's partying drinking i'm like none of you guys have any money how do you afford all these like this this lifestyle and i was like i need something to do on friday nights so that's when i brought this event planning company to college again in secret my parents didn't know i was doing this and i'm 17 and i was like well let's try this so i started knocking on the doors of clubs venues bars restaurants trying to find a place that will let me do it that's not going to charge me a lot of money or really any money because i don't have the the money to put a deposit down for a fancy venue and i found a venue that was like yeah you can do it here we're not going to charge you a penny just give us half of your cover charge i was like all right cool it's not going to cost me a penny and i talked to my dj friends and they were willing to do it they split the revenue with me so i only made 25 of the revenue 50 went to the club 25 into the dj 25 went to me to put everything together but it was a start and i started doing that in college and already i want people to think about how you're thinking differently about money because bringing this back to the idea that there are habits that keep people poor so one of them is living and thinking in cash and so if you're storing your money in cash you're not buying assets like you were talking about earlier things you purchase that give you money the company that you're talking about building now the company that i built those are assets apartment complex and asset potentially there's actually some complexities there um but buying into the stock market right assets right so if you're thinking in cash and the cash supply is being inflated then your buying power is going down so going back to your point about the poor getting poorer so we're pulling down their buying power um and then also just the way that you start thinking like an entrepreneur about like i don't have the upfront capital this is another mistake people make oh that's okay for people that are already rich they can do things that i can't do but you weren't thinking that right so you i'm sure went to people and they said okay cool give us upfront money you didn't have it so you go on to the next person but because you keep going until you find the person that's like okay word like come in throw your party i'll take half up front you even find partners again paying them in equity you're paying them with future money that you don't currently have right like that one thing alone is a huge habit difference between people who think i trade time for money right i go and i work i give you my time you give me that money nothing wrong with that and it's it's the path that most people will take right but for people that really want to understand what we're about to go through because this this could be nothing in a year from now we look back on this video and we think whew thank god that it didn't get as bad as it could right but we could also be headed into a recession like a deep global recession that could last a year or two years or more sure uh so getting people to think more entrepreneurially like you're laying out in the story i just want to to orient people to the fact there's nothing necessarily different about you anybody can think like that and get the kind of results that you end up getting i think it kind of goes back to what you were saying uh it was maybe before we started rolling where you said you were dumb and so you asked a lot of questions for me i said i was dumb because i didn't really care about risk i never even looked at risk for me was opportunity that's all i saw and and it was just a way for me to get started and you know i was called stupid and dumb all the time and nowadays if i'm not called stupid it's probably not a crazy enough idea and so that's kind of exactly what you're saying i started making this little bit of money and it started to grow and had some cash in the bank and now i started reading these books and talk about investing in real estate i was like all right let's try this so i was 19 at the time and i started looking at real estate investment properties and again i didn't know what was normal and i took my mcat on august 22nd on august 23rd i closed on my first real estate investment property it was a small 1 000 square foot condo water foreclosure and i bought it for eight grand as a total price the condo and that's insane that same condo sold for 150 grand just a few years prior and that condo then started paying me 600 a month and now you talk about extending time for money see in the beginning i didn't understand that concept because when i was working in this event planning company it was just me if i didn't do everything nothing was going to happen but then this real estate investment property changed the way i thought about it because now all of a sudden this asset i bought this condo it's paying me money and i don't got to physically go host a party i don't got to go flip pretzels i used to work at auntie anne's pretzels as well i don't have to go and do something it was just there i owned it and now this condo is paying me for just owning the asset and now all of a sudden i started thinking different i started to get a little bit upset because i was like well why was i never taught about this we're not taught about investing we're not taught about financial education we're not talking about wealth and and that's you know talking about now money habits well how the next habit you got to understand is is you got to be able to ask questions because if you don't understand the way the system works you're never going to be able to answer or ask the right questions because the way that the system works in across the board is you know in a company you have the workers then you have the owners it's kind of like a overlap and sometimes the workers are the owners some of them kind of in the center but the workers are the ones that are now working every single day you get your salary the owners aren't working for a salary they're working for equity profits so they're hoping that now the workers will be able to drive up the profit so now the valuation of this asset is higher now when you have the sort of inflation who hurts the most the workers your incomes don't grow to keep up with inflation however the asset value which is now the value of the company disproportionately gets benefited because now this money gets printed it gets created out of thin air it flows into assets and that makes the valuation of companies for example to go up so now you have these two things right you have the workers and you have the owners this is how it goes to work so it it it depends on what companies get that money how did they decide so this is the first time ever that they decide to buy uh company stock how do they pay money to spawn sorry uh so how does the fed decide i have no idea how they decide however let's think of it this way so stimulus checks went out right people get cash you feel wealthier in the short term your bank account goes up some people took this cash maybe they paid off some debt maybe you go and invested this money but a big chunk of people took this cash and then they went out and they spent it well if you need this money well yeah and you had this whole range right some people really needed it some people went to uh walmart they went to kroger they went somewhere and they bought groceries but still the money where do they go they went to walmart kroger and those those companies saw bigger profits because as money was printed it goes into the hands of people and then it flows to the corporation other people went to louis vuitton they went to gucci they went to the apple store they went to lululemon again who does that benefit so the money was printed out of thin air somebody has to pay a price for that the regular person average people they have to pay now higher taxes which is inflation in this case yeah the invisible that's not a true tax they'll be confused by that but invisible tax right it lowers your buying power lowers your buying power the tax and then where does all the money flow it flows now to whatever you buy the wealthy the rich and so now what do you want to do you know go back to that system you're the workers and the owners everybody in america should be a business owner however not everybody should be in the business of starting a company and not everybody should be in the business of operating a company so what does that mean well you can be a worker and an owner right you this concept of equity you have to understand this because wealthy people are working for equity they're not just working for a salary and so what you want to do now is you want to understand okay i'm working every day to get paid now what are you doing with the salary either you can take the salary and go out and spend all of it or you can take some of the salary now and work to build equity maybe that's in stocks maybe that's in real estate maybe that's in your own company so if i buy stocks i'm buying equity you're building equity you're literally buying ownership in companies if you go out and buy a share of say mcdonald's you become one of the owners of the mcdonald's company and now when the mcdonald's valuation goes up you get to share that because the price of your stock the value of your stock goes up what is up my friend tom bill you here and i have a big question to ask you how would you rate your level of personal discipline on a scale of one to ten if your answer is anything less than a ten i've got something cool for you and let me tell you right now discipline by its very nature means compelling yourself to do difficult things that are stressful boring which is what kills most people or possibly scary or even painful now here is the thing achieving huge goals and stretching to reach your potential requires you to do those challenging stressful things and to stick with them even when it gets boring and it will get boring building your levels of personal discipline is not easy but let me tell you it pays off in fact i will tell you you're never going to achieve anything meaningful unless you develop discipline all right i've just released a class from impact theory university called how to build ironclad discipline that teaches you the process of building yourself up in this area so that you can push yourself to do the hard things that greatness is going to require of you right click the link on the screen register for this class right now and let's get to work i will see you inside this workshop from impact theory university until then my friends be legendary peace out do you know the wall street trapper i do i've seen his videos with you dude he's so dope so he talks about if i'm going to wear it i'm going to own it yeah so if i'm going to wear louis vuitton then i'm going to own louis vuitton stock yeah and ah that's so smart like just here's the like i know what this video would have sounded like to me if this was the first video i encountered it's it's so heady it's just like oh my god these ideas are so complicated right so going off of what you're saying let's give people a waypoint here just to help them anchor so we've got a few really important ideas so one there's a saying the hidden tax as you call it which i love that idea so you've got inflation now the government is trying to help you i'm not even going to say that there's anything sinister they really were just doing their best sure we got hit by the pandemic who the hell knew what the way out was going to be they work with the fed they pump just a lot of money into the system so we end up having what was looking to be the greatest global depression since the great depression in 1929 but it only lasts for two months because we end up injecting all this money into the system right so cool the catch is that the way to get that into the system it can be give people money directly which they did but the people that really need it they're going to buy groceries so it doesn't they're they're still trading time for money in essence right because they haven't broken that cycle if the government's not giving them money they don't have anything then you've got people i'm talking averages here you've got the middle class they're going to louis vuitton oh word like i've already got my groceries taken care of so now i can go buy that handbag that i want to do a little instagram flexing whatever so they didn't help themselves out but then you've got the wealthy or the the educated that's probably a better way to think about it you've got the financially educated because they're educated they owned assets already which is the easiest way the traditional way for the fed in the government to pump money into the system is to buy assets right so they're gonna buy these bonds just to keep it really simple this is overly simplified but they're buying these bonds so now you've got people like me who was not a good investor but i can afford a money manager and so the money manager is like yo you need bonds not now this was before so i buy the bond so hey now i'm backed by the government because they know that they can print money out of thin air so now i'm getting this return on my money my money's protected instead of being deflated they're buying my assets so now i want people to know the wealthy some of them myself because i'm i was not financially educated as of two years ago i'm only just now getting that way so i've been a good entrepreneur a bad investor but because of that like the system is i'm learning about it by asking all these dumb questions and i'm really seeing how it works so it's not like i i was doing something nefarious for me to get richer during this time it was just like oh i need assets break the time for money equation i've got all this risky money in building my business i wanted a more sure thing so then the bad thing happens my sure thing gets taken care of by the government and now it's like oh it looks like you know the rich are getting richer it's just education so now getting into money habits the other thing that you talked about is while your friends were spending their money at a party you're spending money on building a business right like that fundamental difference of spending it on fun that goes away yeah or equity in this case your own company is a world of difference yeah so i just want to anchor everybody back around to those like money habits you've got what all my mom would have called pissing money away right literally in alcohol you're just pissing that money away yeah um or putting it into something that's going to go to work for you in your case it was a business it was real estate yeah and if people can just grab that fundamental difference like of hey start thinking about the world in this different way they're going to be a huge step forward and it's all a learning process because i don't drink i don't smoke i never drink but for me it was the only it was it was a hustle right it was the only way that i knew to kind of start making some money um and so it's how you start and you learn and each one of the things that you kind of do you're going to learn something new and you're going to be able to apply that to the next thing and it really is that shift you know i call it the minority mindset thinking differently than the majority of people because it's it's doing something different most of us are taught just to be consumers yeah we're talking about time for money to go buy cool things to flex exactly and that's it we're never taught to do anything else and i mean think about the last time your teachers taught you about the importance of investing your money they don't know how to do it either exactly they couldn't hope to teach me and and so that's where you have to be willing to go out of your way to learn how some of these things work because if you don't you're just going to be a pawn in the system and it's very unfortunate it sucks and you know this is where i'm trying to help provide that education because these are things i never grew up learning these are things that i wish somebody would have told me uh you know i see it i see it in so many people i used to guest teach in detroit public schools whoa and you know these are good kids from rough areas a lot of times don't have two parents in the home sometimes don't even have a parent in the home there were some kids he didn't have or his mom is not around he was raised by a gang just because there's no parents and so they provided him shelter and it's crazy because you get stuck into a system a cycle because you don't have any way of learning or seeing anything else and you know like one of the first times i was there i asked the kids how many guys have a job most of them raise their hand most of them have an income and they're in high school right they're going to school and they're working and next question is how many of you have a bank account nobody not a single person had a bank account jesus man so i was like what do you so how do you guys what do you do with your money they said we get a check we go to the liquor store we cash the check now the liquor store owner is going to take you know one to ten percent of that check oh god and then what are you gonna do you're gonna buy candy you're gonna buy pop you're gonna buy a bunch of dumb stuff on your way out and now you're left with only half of your check and now what do you do is is this i like to call it net zero thinking where if i have cash i need to spend it i have 500 on the bank account i got to make that zero if i have a thousand dollars i got to spend it because we think oh my god if i had 10 grand i would go on this nice vacation if i had 50 grand i would buy this car we think in terms of it's that consumer mindset of if i have this money i need to spend it but this is where we have to break out of that and understand what can we do differently and instead of just spending all of this money and it's much more difficult now because of the higher cost of living but it's so much more important now than ever where you got to create this margin i call it like an equation where you know your wealth is really you take your income minus your expenses and that's equal to your investments plus your savings so you take your income whatever money you make you subtract your expenses your houses your home your clothes your car whatever your expenses are and if you have some money left either this money is going to be saved or it's going to be invested well if you have some money left you're already you know doing something that a lot of people are not doing you're more than the majority of people right now i just read a study yesterday 7 out of 10 americans across the board are living paycheck to paycheck 50 of americans that are making 250 000 a year are living paycheck to paycheck that's crazy it's not how much money you make it's what you do with the money you make that is so important and so now if you have a buffer you're already better than the majority of people now the question is what do you do with it well we're taught save it save all of it so your investments are zero and your savings you're trying to grow that thinking that you're trying to you're gonna become wealthy but you're never gonna be able to out save inflation you're gonna your savings are literally making you poorer each and every day however you don't want to just not save any money you got to be strategic with it what i'd like to say is there are three reasons why you should be saving money you save money for an emergency have somewhere between three to 12 months worth of expenses depending on your risk tolerance save money for a big purchase you want to buy a car you want to buy a house you need some cash to do that save money for an investment if you're not saving money for one of these three reasons you are saving your money the wrong way and it's making you poorer each and every day now you didn't say save for retirement yeah invest for retirement you know you talk about retirement time we're about to face a big retirement crisis because traditionally retirement was what people like to call a three-legged stool you had your social security you had your pension and then you had your own investments or your savings what a lot of people like to do well pensions are something only written in history books anymore they're a thing of the past so those don't exist anymore social security is running into a very very very big dilemma because right now if you are you know under the age of 45 the social security money that you're paying isn't gonna go to fund your social security income it's going to fund somebody else to retire because the social security program has much bigger expenses than income and so it is on the path of being completely dried up of just running out of money is this because the younger demographics are just a smaller cohort than the older or there's a lot of reasons for it it's how the social security money is spent it's it's how many people are requiring social security money how long people are living for how long these social security checks have to go out for a lot of bad calculations bad investing and so in the social security fund is now drying up and so now everyone says well i'm not worried about it because the government can just print more money and do bigger social security checks that's what we're seeing this year we saw between 2021 and now the biggest social security raise ever is between five and six percent something in that range which one is already not keeping up with inflation so yeah you got a bigger social security check but oh no it's not buying you as much as you could of last year but then the second issue is just think about that for a second if the government is going to print more money which means the fed is going to print money give that to the government to give you bigger social security checks what does that mean you got a bigger check great but now the cost of things have grown even faster than the growth of your check you cannot out print inflation it just creates more inflation and so you know so you had the pension that's that's essentially gone for the vast majority people social security is not going to be able to fund your retirement which leaves people with the third stool which is your own investments now traditionally you say i'll save some money save 10 of your income that's not going to do it your savings are going to make you poor each and every day and the second thing is your 401k and you know it's a great start for the average investor because now it is like automatic putting a little bit of money into some investments however your 401k was never ever ever intended to be your sole investment plan the founder of the 401k even came out and said that the 401k has gone awry it is a monster because now so many people are hoping that they're going to be able to rely on their 401k to retire and that's not what it's intended for and it will never be able to be enough for you and so a lot of people have this false hope that okay yeah whatever social security will give me a little bit extra but my 401k will take care of me but that was never the plan and so what does that mean your 401k just think of that like as if you invest in your 401k your ira that is the absolute base your savings are not going to do it this is where you have to go and invest yourself and that's where oh my god how do i do that we're never taught how to do this we're never told how to do this we're never given direction on how to do this so you have to be the one now to go out of your way to start learning this and thank god for youtube because now we've decentralized education but the question is now you have to be willing to do it and you have to understand who your teachers are because there's there's crap on youtube there's also good stuff on youtube and we're never taught how to learn we're usually just taught what to learn so now we have to be willing and go out of our way to become smarter to once start learning and understand how do we learn the right things and then apply it because the the downfall with investing is it's risky you got to be willing to get punched in the face you have to be willing to lose money because it's a part of the process and it sucks it sucks losing money i made a video on uh my youtube channel minority mindset where i went over my worst real estate deal ever and the reason why i made it is so you can see look every real estate investor has got at least one bad deal and to date that's the only deal that i've ever lost money on and i walk you through every single bad thing that i mean because everything that could have gone wrong went wrong plus a whole lot more and it was one of the biggest headaches of my life but my goal is you know yeah you can laugh at me make fun of me but you're going to see like holy cow things can and will go wrong so just anticipate it because that's it's your real life tuition you got to be willing to learn and and you know it's a price to pay and it's one of those things where you know just like with entrepreneurship everybody wants to be successful as an entrepreneur everybody wants to be rich how many people are going to be willing to get punched in the throat and keep going keep getting back up and keep doing it it's very difficult which is why you know what not everybody should be an entrepreneur try it but it's not for everybody but everybody can work to own this equity right this ownership these assets and everybody needs to how much did you pay for your first share of ford motor company two dollars so this is what i want people to hear and i'm glad it's coming from you i was very honored to have wall street trapper on as well because i want people that are i know minority um in the name of your program isn't about being a literal ethnic minority but it's about thinking in a new way but having people that are minorities at least in this country um say like hey if you do the right things you're gonna be able to change your circumstance what do you say to people that either think well it's okay for other people but for me either because i'm poor or i'm a minority it's never going to work for me so i'll kind of give you the story of my family in that sense because the reason why people come to america is because of opportunity you have the opportunity to own something own a home potentially own equity in companies build your own company you have the opportunity to build something which is something that you can't do in a lot of other places in the world my grandparents were refugees they had some land and in 1947 the state of punjab was severed and when that happened if you were sick which is the religion that i am and you're on the west side either you migrate east or you're going to be killed so now my grandparents literally all they had were the clothes on their back and a sword in their hand and they ran during that process my grandfather was attacked and he had to literally fight for his life he saw his uncle get his head chopped open in front of him jesus put him on a horse that was the last time he saw him he got to the new east side of punjab in india and didn't even have shoes on his feet didn't have a place to sleep had literally nothing now from there you gotta start right you gotta you gotta start now all over from scratch and there's a lot of political issues you know unfortunately over there and so that's when my parents my dad you know my mom were like we want to get out of this country we want to go somewhere we have better opportunity to come to america we you know don't speak the language don't know the culture don't know the people don't know how life is i mean india is a very different world it's a beautiful place but it's very different than here and you start over wow as a minority as a minority just for the opportunity because that's all you know you there's risk but you see the opportunity there and do you think looking back now do you think that because it i often think that what we refer to as being an ethnic problem is actually just there is an element of what i call school of fish like you're just you're going to group up with people that look like you it's just so embedded in the the subconscious but i think a bigger thing is just it's either majority or minority right because globally the indian um ethnicity is massive billions but when you come to the us now you're a minority do you think that the trade-off of going from being uh the majority ethnicity i mean everybody in india basically is shares the ethnicity i know there's religious differences but then coming here and being a minority does the opportunity that america provide outweigh whatever detriment there is to being a minority you know again if you're willing to work you have to be willing to work and kind of just break out of whatever anytime you see a majority kind of just group think you have to be willing to question that but you know the opportunity you have here in america is it more difficult now than before absolutely is it more difficult for some people than others absolutely however it's the best opportunity you have in the world and you know that's why literally even till today you have people that are willing to risk their lives to come to this country and i mean actually risk their lives and so you know you have that aspect and i can speak for me where six the religion that i am they are a minority in india and you know there's a lot of issues that come with being a minority anywhere but again where do you know here you have more opportunity than anywhere else and so the way i look at you know for me personally is my parents came to this country with next to nothing so i got nothing to lose and everything to gain right and so this is the place where that opportunity exists but now you have to be willing to work hard but you also have to be willing to work smart i i can't stand what people say work smart don't work hard but to me that's all completely because you have to do both you have to do both because if you're not willing to work hard your smart working is effectively worthless you have to be willing to apply both together and i had none of this you know financial education right for me it was dad i want to go invest in real estate you're stupid go become a doctor you know it's it's i had to do all my entrepreneurial stuff in secret the first my parents didn't even know that i was doing this business stuff until i was on the news i was running a different soccer company and this is now you know a couple years after and uh we were doing well and we got featured on the local news now my parents got a call from a family friend and they said oh we saw your son on the news and my parents were like oh god what did he do now and they're like no no he he has this company he's doing really well they're they're growing my dad was like what and so you know he sits me down he's like what the heck is going on and that was the first time they were like okay you can actually do something with this right and it was like you have to for me it was like i understood what i wanted i knew that i saw this i really i wanted to achieve success and i knew i was doing it for good intentions um i knew i didn't have like bad intentions with what i wanted to do but the question was you know how do i get there because it was like i if i know if i try to convince my parents it is like it's going to be extremely stressful for me i'm going to stress them out it's just not going to work so i'm just going to try to figure it out myself and i'm going to fail well guys i'm in school so i kind of had that up but for me like i like i went to law school as well the problem was i wasn't the best student in school um in law school particularly i did well on the bar exam i loved learning and so for me like you know i knew i needed to pass the bar and so i studied hard and i actually did really well but in the classes i was not very good except for the couple of the business ones because i really enjoyed that but for me it was just like i just need to get the degree that way i can like be done with this because i went to law school because my parents found out that i wasn't going to be a doctor they're like you got to at least become an attorney to keep pride in the family and so i was like all right well if i go to law school i can go to law school part-time and if i go to law school part-time i can work on me and my business full-time so that was my mindset with it and you know but i knew that yeah if i graduate law school and things don't work out i don't even know how i'm going to work as an attorney because i have no idea i don't know how to file a lawsuit i have no idea like what to do so if i graduate like i i'm gonna have to like start all over and figure it out after i'm done and it used to give me a lot of anxiety but i was like you know this is why i have to figure it out it was a mission because one i wanted to do to give back to my family and myself and second i wanted to do it because i wanted to prove a lot of people wrong and i remember when i used to talk about this everyone's like oh you shouldn't do it out of spite don't do things because you want to prove someone wrong i was like you don't understand you don't get some of the you know the the things that you hear the things that you see and sure you know maybe it can't drive you forever but it can take you i mean that pain of seeing the the things that people say to because you know in between i started a sock company and when i was doing the sock business this is when you know people started to be aware that i was an entrepreneur and i wasn't like super successful i was doing okay uh and that's when i got on the news but you know just think about this i was supposed to be a doctor now here i am selling socks on the internet and everybody is like oh so you left you know this idea of becoming a uh doctor now you're just selling socks and you know hearing that for years it is like one day i'm going to have your kid want to work for me that was like in the back i never said that but i was in the back of my mind your kid's going to want to work for me one day and uh it's like that driving force where i knew i'm going to prove this person wrong i'm going to make this person like really like see that hey i i am worthy i can do something but it takes a lot of work you know going back to that but it's it's be with anything being willing to try being willing to take risks being willing to make mistakes and being willing to learn from it because you know like i said you know for me i was willing to be dumb or stupid i never saw that risk until more recently because for me it was just like i know this is what i want and so the risk really was never even on my horizon if i had a business idea i would start it like that same night because for me it was like i just got to i want to do this i want to figure it out books weren't they were kind of giving me an idea my teachers weren't teaching me this i don't know who to turn to my experience was my teacher that's how i learned how to be in entrepreneurs how to learn to start investing that's when i started learning about money because you know the whole issue with the money stuff i mean this is something that we're never ever even remotely talk taught about and it's now becoming a real pressing issue you have to be willing to try learn risk failure you are going to fail i always try to get people to understand that failure is the most information rich data stream that exists it sucks it hurts it can be costly but one in triggering the parts of the brain that have to do with pain you trigger the parts of the brain that have to do with memory and focus so you're more likely to really look at that thing that you don't want to happen again to figure out why that happened right memorize it and then you're going to get better the next time and to your point about having a chip on your shoulder and people telling you that you can't do something and thinking one day you know your kid's going to ask to work for me it probably is a primary driver over an extended period of time like you said it'd be a little caustic to the soul but it's so powerful in terms of so you've got light energy and dark energy right just to be like all star wars about it and if what i have found in my own life is that the hardest times the light energy will only get me so far and then i'll hit a brick wall and i'll want to stop and it's only when i tap into the dark energy of like i will not let this person be right about me i am not going to back down because i know they're just waiting for me to fail yeah that it actually does give me another boost now i try to split it call it 80 20 where i'm spending 80 percent of my time in the light the beautiful things i want to do the people i want to help yeah but dude let me tell you 20 percent of the time i'm thinking that the person that really wants to tap down some of my grades gets you going right yeah 100 and and you know i i found the same way because for me in the beginning it was just figuring it out i went from business idea to business idea to business idea because for me i was just trying to figure it out hop it from one idea to the next but then you know you talk about the light energy for me it was my really driving my passion and my mission and my purpose and that became more of the light energy because now you know after a certain point you're like the money doesn't drive you it just is what it is right it's just like i'm fine like i i'm not a very materialistic person i don't really care you know about brand names designer names first time i made a million dollars i was driving a 500 car right it just doesn't matter uh like sure it provides some sort of benefit more comfort more value but after a certain point that money is not a driver it's now what is my purpose and for me you know that minority mindset where origin started making videos i wasn't doing it to make money i did this as a hobby because i got scammed in that sock company i'm just talking about things that you know i wish somebody would have told me when i was younger like having to do with business having to do with money so i did it as a hobby and people will say you can't just do that as a hobby i'm like dude you don't understand i didn't invest any money into it i was making videos off my phone i bought like a 30 or maybe 35 tripod off of amazon and i was just making videos for fun and like my friend asked me and i think i was around 10 000 subscribers and he asked me like how much money are you making off of youtube what do you mean how much money are you making from your ad revenue off of youtube i don't know what do you mean he goes into my youtube back end with me and this is before youtube had requirements of like you got to have x number of videos x number subscribers every time you anybody could monetize any video he said dude you haven't even turned monetization on click one click and now you can start making money off your videos i was like oh i didn't know that i really enjoyed it for me this was like really fun and something that i loved doing which is why i did it and then minority minds started to grow try to make some money and i was like oh i can actually like do this like i can work on just spreading this this purpose what is it about what you guys publish that people respond to it's one email right it's a newsletter and you know it's coming what time is coming you know where it's going to be every day and so people want to open it we don't need to have a the world is ending you know where it is and then we just break down what's happening in the stock market the real estate market the crypto market what's happening with inflation what's happening in the global economy and then if there's anything else we'll add that in there as well and it's super fun and so you can avoid that headache avoid all that you know spending hours and now here it is in a fun way to read you know what should somebody that in this environment they want to pay attention they want to make the right moves they've listened they know that you bought your first stock for two dollars they know that no matter what they look like they need to be changing their behaviors that they need to find assets like in this uncertain time where should people be putting their money i know there's no one size fits all so so i'll tell you where i invest my money and that's my money in five places my business market briefs and other startups and that's my money in real estate where's my money in stocks invest some money in cryptocurrency and invest some money in physical gold now i don't recommend you go on it to start putting your money everywhere start with one place how did you pick those five and how do you allocate what percentage so i don't giving a percentage will be hard because valuations change all the time but i have been less and less actively before my active investment main one was real estate that was the thing that i loved and i think that i really understood so anytime i had extra cash i would go out and buy rental properties but now i'm doing less and less of that so i can have more money to invest in my own company market briefs um but now what i do is out of my company's minority mindset i pay myself a salary out of that salary pretty much all of that gets passively invested it gets invested into stocks crypto and physical gold so what does that mean right well in stocks i have a system where every wednesday you can pick whatever day it doesn't really matter but for me it's wednesday my money is automatically pulled out of my bank account and it's invested into a few different etfs so an etf is an exchange traded fund and you can think of it like a group of stocks so instead of going out and investing in amazon one company and then hoping amazon grows you invest in a group of companies like some will give you exposure to 30 some will give you exposure to 500 some will give you exposure to thousands there's a bunch of different etfs out there and there's etfs for a bunch of different things like one example that i invest in is the snp 500 etf the s p 500 is a group of the biggest 500 companies in the stock market and so when you invest in this etf you're literally or indirectly slashed directly investing in the biggest 500 companies on the stock market without individually investing in all of them you invest in one ticker symbol and it gives the exposure to all of them so you're in essence investing in the companies that make america america investing in america you can invest in specific sectors technology health care you can invest in uh companies around the world emerging markets and so you can find these etfs you know again google search youtube you'll find kind of the things that you'll see what you're interested in buy what you're spending your money on uh and and so that's the one thing that i do i have a few etfs every wednesday i'm buying that and then i have my cryptocurrencies so uh for me you know i i think cryptocurrency is gonna have a lot of value in the future but i also believe it's gonna be very volatile i think we're gonna see a lot of you know just like anything else there's there's a lot of dumb money in crypto and you know anytime you have all this money that was printed right money's gonna want to go to dumb places and so i think that we're going to see some cryptocurrencies go under and uh again what is that going to do it's going to create panic okay volatility is going to create fear so you know especially when the newer asset class you have to be willing to understand that and withstand that and so you know i understand that you know i'm not the most educated person in crypto but i understand the basics i believe in the value of the blockchain so i invest in bitcoin ethereum and a couple of smaller coins uh the things that i believe in and that's happening every day and then i invest in physical gold every month i have some cash going to buy some physical gold every month and so this has happening on autopilot it's automatic it's passive and it's consistent and it's just a simple way for me to invest because what a lot of people try to do when they invest they say i'm gonna invest in the stock market okay either you know when times are good i'm gonna try to find the next hot stock the thing that's been rallying like crazy everybody's been making a ton of money on it so i come in and buy and that's when it starts to go down and then they get scared they lose money and then they sell or when times are bad they say i'm gonna buy at the bottom i'm gonna wait for that perfect time to come in and buy and this happened again in 2020 in just textbook form because the market started collapsing and it was the fastest collapse that we've ever seen in the markets even faster than the great depression wow and so what i was saying was on youtube i said look here's what i'm doing i'm buying i have the companies that i like because my etf strategy is happening passively but actively i'm also picking and choosing what i want to buy i already knew which companies and stuff that i wanted to own i'm just waiting for a good entry point a good uh price to buy so what i said was look when things fall but 10 to 15 i buy when it falls by another 10 to 15 i buy more and it falls by 10 to 15 i buy more aggressively i just buy the way down in phases because i can't perfectly time the market and anytime i said that i mean it was just a flood of comments people saying why would you want to buy now the whole market's going to implode it's going to go way lower just wait that we can get a better buying opportunity and i said i can't predict the bottom that's not my game i'm not trying to time the market i don't got a crystal ball and then what happened the fed opened up the money printer at and they did something called unlimited quantitative easing which is something you know we've never really seen before and so they just flooded the economy and markets with money and now you had the market the fastest collapse other ever and then you had the fastest stock market rally in the history of time and it was like no i don't i mean i couldn't predict that i don't know who could have but if you were waiting to time the market you missed the opportunity and the people that weren't trying to and you just you know you wait for the good entry point you're buying even when everybody's scared they were the ones that were able to make a lot of money very quickly way faster than pretty much i could have anticipated or anybody could have anticipated just because you understood you know you buying phases this is such a big topic man i am so stoked that you're out there doing this for people tell them where they can follow you where can they sign up for your newsletter it's so important thank you man well you can watch me on youtube minority mindset minority mindset pretty much anywhere and then you can check out the free financial newsletter at marketbriefs.com i love it everybody get financially literate until next time my friends be legendary take care peace so if you're just now a 30 year old in your first job and you've only been earning a you know a salary for a year and a half well you might be able to borrow money but it's going to be a four percent over that whatever the government borrows it at because you're riskier or if you're a startup and you don't have enough cash flow well it's going to be higher than that as well so everything's priced off that

Channel: Tom Bilyeu

Views: 2,014,203

Keywords: Jaspreet Singh, Minority Mindset, Market Briefs, Market Insiders, YouTube Influencer, Tomb Bilyeu, tombilyeu, Conversations with Tom, Health Theory, mindset, how to be successful, entrepreneur, successful entrepreneur, success stories, financial tips, money management, money, investing, building wealth, survive the recession, inflation, the federal reserve bank, the feds, treasury bonds, assets that make money, equity explained

Id: 42k9vH3OXI0

Length: 64min 17sec (3857 seconds)

Published: Tue Jun 14 2022