Millionaire Habits You Need to Start In Your 40s

it's Brian Preston the Buddy Guy let's talk about our 40 year olds man what is the mindset for the decade for 40 year olds and this is now you get into my sweet spot I've been through the 20s I've been through the 30s I'm in my 40s so I feel like I get the love on you and talk about what's going on for this age group and let's first set the table for for what's going on at this time you're finally at the point and we talked about this when we did the what your net worth should be by mindset an age group I'm in a previous show but this is actually a point where a Millionaire Next Door formula the wealth index comes into play and let me share that formula if you just take your age okay multiply it by your gross income as before deductions times 10 percent or divided by 10 I know ethanol it's true both ways in the book it's actually it's divided by 10 but it's the same age times gross income by 10 percent multiply about 10% says 2 times as to complications built into there that is your average accumulator of wealth you're a aw ratio but-but-but our money guy listeners are not average no nobody's average who's listening to the money gotcha you want to be a prodigious accumulator of wealth up ha ha P aw a PHA is at least two times a aw an average accumulator of wealth you want to be twice as good as an average accumulator and that's your paw ratio so that's that that's the number I want to know so go take your age multiply it by your total income times 10% and then multiply it again by 2 it's perfect and that's gonna give you your Paul your prodigious accumulator of wealth and let you know if you're ahead of the curve and what you should be doing so now that you know the number let's get you motivated and tell you about these wealth habits you should be doing so this is at the point where you need to make sure you've spot checked where you are in retirement are you on the path to where you ultimately want to be is retirement age 75 is it 60 is at 55 you need to kind of know where am I going and am I on the path to get there this is the last you know we shared and went for their 20 year olds the 25 year old saver the 35 year olds you still let your money 92% for the 25 year old 84% for the 35 year old is still coming from raw growth right 40 year old is kind of the last stop on the train to where you let your money do more work than you do this right so let's get serious about making sure you're spot checking and in setting up your financial future this is also the stage let me get to number two point number two of saving of wealth habits is don't take your help for granted yeah that's a big I think that um you know warren buffett if you go watch becoming warren buffett on HBO he starts off the entire documentary talking about you get one vehicle what if somebody came to you and offered you any vehicle in the world what would you want but the catch is you only get that one vehicle to make it through all stages of life in a lot of respects I mean he made the analogy cuz he was talking about your health your mind your body don't take it for granted I had a pastor who told me something pretty profound when he was 43 years of age his father had kind of approached him and said you're at the age now where if you're not exercising if you're not focusing you'll never get it back yeah and and I see people because you start and I'll tell you it happens when you get in your 40s I could always lose seven pounds by almost just thinking about it yeah yeah I mean I really could if I started picking off weight I just okay I'll trim back what I'm eating I'll go walk a little bit our exercise seven pounds melt off you get in your 40s guys it doesn't melt as easily I don't know what's happened but the body is like you know what I'm getting out I put in I've burned the midnight oil in the 20s and 30s I'm gonna take a little bit of a break on the metabolism so it's hard to get it back but the pastor shared with me that his father said you got to choose there's a fork in the road choose if you want to go down the path of keeping your mobility keeping the exercise train going or are you just going to account of let life happen it doesn't mean you're not going to be happy but it just means that you might not have the the same flexibility the the muscles and everything else just that you want it to be so focus on your health at 40 Plus this is when you need to be getting physicals and other things cuz I'm in this phase right now I have a dot right now you'd probably notice my mug my I love my Star Wars mug and I love drinking a cup of coffee while we do this show I've got to go get a medical test nothing alarming but I have to fast why do I do that cuz I'm I'm in my 40s so I'm just telling you guys focus on your health because you don't want to take it for granted so that's why you don't see the coffee mug and I think you know obviously we're talking a lot about physical health but I think it's very important that you also kind of focus on your mental health as well think about those things that help you relieve stress is there a hobby you need to pick up or are there things you need to do to make sure that you're keeping your mind kind of in tune that sounds really really granola with your body it makes you understand what are those things that bring you happiness what are the things that you find truly fulfilling in life and that's a great segue into the next one because this is this is such a stereotype but I've gotten old enough and had a little experience that I think I understand it a lot better is how do you avoid that midlife crisis oh yeah I mean guys this is the age where unfortunately in your 40s is when the midlife crisis and and if you want to talk about wealth building habits you know the first way probably we ought to put this as number one if you're looking on scale of what actually impacts if not getting divorced yeah is going to protect your wealth more than anything else Gizzi we have people all time when they're filling out their best and worst decisions a marriage can be the best but if it doesn't work out it will cut your net worth in half one could potentially be very much be the worst financial decision and I have found from my experience I'm not I'm not licensed I'm not a psychologist this is just Braun trying to love on you and give my my wisdom of looking at the world around me and my that what I've seen and experienced from people okay midlife crisis comes from two points okay man I'm really on shaky ground giving this I'm a financial guy but underachievement I think there's two versions there's underachievement where I think unfortunately the people who didn't pay attention to what brings fulfillment on in their 20s and 30s and get in a career that they just love coming to work they they wake up one day in their 40s and go what am i doing how did I get here yeah because I think you have this coping mechanism when you're in your 20s and 30s back well I'm young I got plenty of time but you get to your 40s you know I get here I'm just not where I thought I would be so those people almost are grasping for I've got to make yourself feel younger to make your a coping mechanism for the underachievement that's where I think one version of the midlife crisis comes from the second version comes from having success and that success creates the ego that is the creator of I okay and I use the I with the rabbit ears is because these people think that I deserve better I'm entitled to more because I've had this success look at how my own I have a car and theirs and it goes back to that that high school all the football players in my high school wore t-shirt on game day well no actually that's not true they wore a jersey on game day but I guess throughout the rest of the week they wore this shirt that on the back and I loved it it had it said it had big team little me and then I that's that's what there's their set but the actual saying that I want to make sure I draw attention to for the eye is that there's no I in team right there's really not and realistically if you're successful you didn't completely do it I'm in this stage right now and I think that a lot of what and it's a great segue into the next point is that I look back and I can't believe all the people who gave me breaks and I think if you can always keep that humbleness if you can keep that gratitude in your heart this is the same advice I'm giving my 20 year olds when I say make sure you're saying thank you I think 40 year olds need to pivot and let's go to the next point is is have a thankful heart and try to figure out how you can be more generous dare I say brawn that neither you nor I would be right here doing this the way that we're doing it without the money guy family yeah and how thankful we are for that I am the mr. Magoo of success guys this whole thing started as a passion project just because I wanted you to be successful I want to share the good news I always want to be a schoolteacher and this was my way to essentially set up an educational classroom to share the good advice of trying to make good financial decisions and and you guys have loved on me a lot of you have helped me I mean you've come out I mean even like we did this 30 minute financial plan giveaway that we're doing right now you guys already sent us some incredible feedback I love you for doing that I mean that is just I you don't have no idea how connected we feel when you guys are loving on us but that but I do bring it back on point though I do want to share that have that thankful heart that that eye towards generosity because ego can limit the growth of your success if people start feeling like you have this whole eye towards how awesome you are I don't think they want to help you I think they almost start rooting against you and you it says something the knowledge is beautiful Brian you were talking about you know if you are someone who's had a lot of success or there's something that makes you very unique and you have a specific talent you want to find a way to pay that forward yeah both to those around you as well as the future generations and I thought that was so interesting to approach it from that line is the epitome of the abundance cycle you know you've heard us talking about if you're new to the money got family and beau you told them how much we love them that's why we do have this abundant cycle where here's what happens at the money got you you come here and for free we love on you I want you to learn I want you to take this I want you to soak it up like a sponge invest and grow and then with the thought that we're this the the one that the far the gardener who kind of tilled the land put the seeds in and you grew this beautiful live oak tree we're hoping that you'll come back and say yeah I'd like to have somebody look over my shoulder and I don't love those guys to be the ones that we consider working with that that's really is the abundance mindset and the abundance cycle and implement that in your life too I think you'll find it the reward is more than you would have ever anticipated and then the last point we had for our 40 year olds on success habits and wealth building habits was just update that estate man maybe you've moved I mean beau we both of us have moved to a new state we had to update our estate plan so you've had children you got children that are getting older your life situation has changed you got to update that as state playing it's not just the money it's also what is what happens if you can speak for yourself both financially and helped related do you have a plan sure that's built into your estate plan you know so often we have we have a state plan when we first have our young children that say if something happens to us this is the person that we want to take care of our kids and that's kind of our soul and and and and big focus well now that we're getting into our 40s and our kids are getting older and we've built some wealth and we have some ass established can a 17 18 19 year old child really inherit that wealth well so you kind of just shift even the focus of what your state plan is so if you are in that stage it's something to start thinking about very seriously so let's get into the numbers because I want to see what's happened to our 40 year olds all right so if you are a 45 year old and getting this from the Bureau of Labor Statistics and both let me add this this is a 45 year old hasn't saved a dime that's right I've been partying it up so we're starting off for a 45 year old who has 0 so the average income according to the Bureau of Labor Statistics at 445 is on the low end forty nine thousand four hundred dollars if you begin saving then and you're gonna save all the way until you get 65 and you say you know what I've listened to these money guys I am gonna start saving 20 percent of my income starting right now all the way through by the time you get to 65 assuming a 10% rate of return you will have just over six hundred and twenty five thousand dollars and that's what 20 percent of your income you end up with six hundred and twenty five thousand dollars what that means is that you've actually put in a little under a little over a hundred and ninety seven thousand and the account is worth six hundred and twenty five thousand so that means that instead of it being 80s and ninety percent growth it is sixty eight percent of your total value is from your dollars working on this so the army of dollar bills is still providing over half of the gross right more than half it's 68 percent I mean that's still a pretty phenomenal rate of growth I think it is one of those things a lot of people are probably looking at this and go okay Brian you got 20 years of savings if I was saving 20% 6:25 sounds good and especially with a great growth rate of 10% like this assumption is built-in but what if I want to have a million dollars what if I won't have that two million or three million what what are those numbers look like yeah so if you want to have a million dollars need to start saving thirteen hundred dollars a month okay you want to have two million dollars you need to start saving twenty six hundred dollars a month and if you would have three million dollars you need to start saving three thousand nine hundred and fifty dollars a month again I think it's really interesting the 35 year old who was saving thirteen hundred dollars a month got to three million the 45 year old saving thirteen hundred got to 1 million it just shows how important those early savings can be and just because I don't know if everybody is paying attention because maybe you were waiting for your age group to pop up but the 20 year olds if they saved little less than 5 million dollar five hundred dollars yeah had 3 million dollars I thought it was very cool that the the same thing kind of just happened you see how mathematically this all works is that to get to 3 million they only had to save like $1300 and now I mean you're going to we're probably going to see this play force but it really does show how the earlier you can start that savers mentality the more you'll be rewarded so let's it really I love the excitement I hopefully you've got your walking papers if you're a 40 year old and you know to get energized and make it happen but let's transition and let's talk about what the next stage is

Channel: The Money Guy Show

Views: 97,989

Keywords: Millionaire Habits You Need to Start In Your 40s, habits in your 40s, millionaire habits by age, millionaire habit you should be, millionaire habit you should be doing, millionare habits, millionaire habits, habits of millionaires, how to become a millionaire, become a millionaire, how to be rich, how to become millionaire, habits of successful people, secrets of millionaires, how to become rich, millionaire habits you should be doing now, how to be a millionaire

Id: 6MbcJA-J1JY

Length: 14min 48sec (888 seconds)

Published: Mon Apr 30 2018