How to Manage Money even if You’re Broke

So when I was broke and I mean broke, making $60 a week total, there was only one thing that helped me, that was a new budget I created. And that budget took me $60 a week to now making 23k per month.

How To Invest In Your 20’s to be Wealthy In Your 30’s

Let's get started: First thing: If you invest $100 today at age 20 and get an average return of 7% plus 2.35 in dividends for a total 9.35%: Well that $100 by the time you turn 39 will be worth $546, so basically double more than money. ( and that’s how we are going to win )

1. If you have a Full-Time Job:
- Take advantage of your retirement plan: Contributing up to 19k per year for a 401k or 6k per year for a Roth IRA ( depending on your Income)

- An entrepreneur that is self-employed: their something called a solo 401k or solo Roth where you can contribute (56k per Year)

Why:

a- This allows your money to grow tax-free
b- Some Employer actually do contribution matching for every dollar you invest they will also invest $1 in your retirement ( ask your employer ) – they do this because it's tax-deductible
c- If you did this for 19 years until you were 39 and only contributed half of 19k which 9.5k(791 per month): that would give you around $ 496,580.64 ( 9.35% return)

And: Just like that we are halfway there, and make sure to have your employer take that money out automatically.

2. Keep a minimum of 20% of your main Income ( notice I didn’t say Save)
- Now the Average Salary is $56k per year but if you're in your 20s, you won't be making that much: so lets lower it as if you will be making 40k over the next 19 years ( which you will not, you’ll earn more over time )

- And for people that don’t have Fixed Income ( notice I used a percentage, so it doesn’t matter )

Why:

a- This is going to be your nest egg to invest
b- The Math: Taxes 22% at this tax bracket ( but let's add an extra 8% for the government = total of 30%) = you keep 28k of your money
Keeping: 20%(5,600) of that over 19 years is: $106k
C- That’s going to be the money we are going to use for Investing

How: are you supposed to live only on: $22,400 Per year
No fancy Car
No Fancy House
No fancy anything
( no bad debt)

3. Invest in the Stock Market ( I prefer to invest in index funds that track the market )
- If you don’t know anything about investing ( read the little book about investing ( picture of it) )

Tip: What I do is: I only invest in Index funds and I use Acorns for investing

Why?

a- I track the market
b- This allows me to be diversified for risk

Math Shows this: If you invest 100 bucks per month for 19 years: that’s an extra:

4. Have More than One Income Steam:
You’ll use a percentage of your extra money for this

- Do not start a hobby ( they cost money ) and make sure to look for these three things
You like it
You’re good at it
It can make you money

How :
- Experiment
- Take Courses
- Reading more books

And once you find it then The key is finding what excites you and then working towards automation and finding something else that exits you

- You don’t want to be the head
- You don’t want to be the Ceo
- You don’t want to be the entrepreneur,
- You want to receive the checks in the mail and work less than 4 hours a week

Examples: Creating a product
Ebook
Course: Udemy, Skillshare or teachable
Program workout

The point: Create a business, that doesn’t need you

5. Diversify in other Investment/Business
By this point, you will have Savings, Investments, and also multiple streams of automated passive income streams.

- Some examples:
a- Buy Real Estate ( again take the course if you don’t know how to) – with the same concept of the market ( buy and hold forever, and collect rents)
b- Invest in cash Business with little work ( laundromats )
c- Barbershops
d- Peer to Peer lending ( lending club and so On )

- Buy and Hold people, every single market downfall has turned into a + overtime.

Conclusion: that’s basically it, if you do this correctly, step by step and don’t get panic when the market goes down, you will become successful.

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