Becoming Rich on an Ordinary Income
Lesson 6 from: FAST CLASS: How to Retire Early: The Latte FactorDavid Bach
Becoming Rich on an Ordinary Income
Lesson 6 from: FAST CLASS: How to Retire Early: The Latte FactorDavid Bach
Lessons
Financial Education - Know Better To Do Better
15:12 2Start Early, Start Today
07:02 3The Latte Factor: How It Works
16:31 4FITE - Financial Independence to Transition Early
04:39 5Common Investment Mistakes
01:29 6Becoming Rich on an Ordinary Income
04:04 7How Much do You Need to Retire
01:47 8Retirement Plans & Where to Start
05:23Lesson Info
Becoming Rich on an Ordinary Income
there's a formula to being rich. I'm gonna give you the formula right now. This is a research driven scientific proven formula that ordinary people have used to become a millionaire. Okay, the research comes from Fidelity. Fidelity has the largest for they have 16 million people in their foreign K. Plans In 20,000 companies. They now track how many people have become millionaires in their phone cable. And this is how much money they've saved 14% of their gross income. Typically they've had a match Up to 5% but not always the stock. The way the money has been managed inside that plan 75% stock, 25% bonds. These people became millionaires by the age of 59. It took on average 30 years. I have been saying all day long it's decades, not days. Say it again, decades, not days but 59 is pretty young right Now. Here's the interesting thing about 14%. This is Just a little bit over one hour day of your income. I'm gonna go to the one hour day formula here in a second And again the match up to fi...
ve. But most people had a match on top of this. 14%. Which is very common if you have a 41K. Plan, you're getting matched usually two or 3%. So there it is. I want to know how ordinary people America became millionaires. They save themselves a little over one hour day of their income. Automatic millionaire book. That's basically what jim and Sue McIntyre did they did that? They bought a home, they paid the home off the second home, pay that home off. So it starts with your dad. Financial security is built one day at a time. So this is inside the book. And Henry, the mentor for Zoe Daniels at a coffee shop opens up a moleskine journal, he walks her through her day and what he says to her is what time do you start your day and what time does everybody start their day nine o'clock and he says to her Usually from 9 to 1130, your income goes to taxes and then you go to lunch. He says, it kind of makes you want to come to work after lunch, but you're basically gonna pay for your rent mortgage from about here to roughly two o'clock and then from 2 to 3 it's transportation, there's a car From 3-4, you've got health care and eating somehow at the very end here you're gonna have some money left over and that's what you'll save. This doesn't work. He says, you need to think totally different about your day. You need to carve out the first hour day of your income. He says you need to become financially selfish. What he's really saying to her is like you need to pay yourself first, you need to decide today to keep one hour day of your income. That's the magic formula. That's the formula for all of you, You've been going, what do I do priority wise. This is where you start. A lot of people here create a live heard me hammer on this last time, and a bunch of them signed up for their foreign K. Plans. When I left harpo the first time we did the Oprah show, I think this may be a chase. So many people signed up for their 41 K. Plans. The harpoon went out and bought books for the entire company, Deciding to save one hour day of your income is a life changing decision. If you're saving zero and you don't believe you can save 12% of your gross income, then start with a half an hour day of your income. But don't go to work and save nothing.