Zoey's cost of living went up higher even if she made more
People think you need more money to save more or make a retirement plan. More income doesn't help money problems. Its habits change.
The problem is in keeping money, not making money. Making money is easy!
Pay yourself the first hour of each days income
"When you go to work, you trade your time for money. Why would you work all day, every day," he said as he sketched," and not keep at least an hour of that income for yourself? Yet here's how most people operate: When they're paid, the first thing they do, after the government takes its slice, is pay their bills and buy stuff. If there's anything left over - and that's a big if - then they save something to keep for themselves. Maybe. In other words, they pay everyone else first, and themselves last. If at all"
Whole life building someone else's wealth
Every two weeks or when you get paid, set it up with your employer that 401k contribution automatically comes off the top [before withholding comes out for taxes] and balance of paycheck is deposited into checking account
"The government had this figured out years ago. Up till World War II, all us good Americans collected our paychecks in full and didn't pay Uncle Sam his chunk till the following year. Problem was , all us good Americans didn't plan so well. We didn't budget." He chuckled. "So they tried spending a bunch on campaigns to teach us how to budget so we could pay our taxes. And son of a gun - that didn't work, either! So Uncle Sam said, "The heck with it,' and set up a simple system that pulled out his chunk...automatically," Baron repeated, "before it even reached our undisciplined little hands"
Uncle Sam gets paid first
Can't get a 10% return anymore? Since 1926, the stock market has been showing an average annual gain of over 10 percent. How much you actually earn in a given year depends on the year and what you invest in. Big picture, it averages out. Markets go up and down always
Even most conservative stocks and bonds would have earned you an 8% return historically but the point is to save and let the number compound for you
You get taxed when you take it out but it's better to put it in pre-tax so that time and compound interest have more to work with. Don't have to pay taxes as it grows each year
Money grows really fast when it isn't being taxed
Roth IRA allows you to pay taxes first, then your money grows tax-free forever
Better choice is to keep all the money and pay the government later than giving it to them now
Smart saving and investing, not more income. It doesn't take money to make money.
"Everyone spends money every day, and as they do they're building wealth. Everyone builds wealth. The only question is: For whom?"
Zoey really wants that photography print which costs $1,200. By not buying coffee which costs $5 or another thing that she buys that costs a similar amount, she can put it into a Zoey's Photograph Account for five days a week for a year. In one year she would have $1,200 thanks to compounding interest
Find a long-term interest calculator online. Zoey's first hour cost $29.75 in coffee and lunch. She calculated what it would add up to, five days a week times 55 weeks, deposited into a pre-tax account earning 10 percent annual interest over forty years. This $30 is her whole latte factor. Zoey came up with 4 million!
Retirement account set up first, then DREAM ACCOUNT [automatically deposit $100 dollars a month or $3.50 a day]. In 6 months, she will achieve her dream of attending her $600 Photography Course lessons
Zoey doesn't just want photography lessons or take a trip. She wants a feeling of freedom! Feeling freedom brings her adventure which Zoey wants. The freedom to adventure. Zoey isn't really wanting the excitement of adventure. She wants the beauty of adventure.
People don't save because they don't see the point. The point are these things that Zoey wants and what those things bring people
Figure out what matters to you. That's how you live rich now and today
Have someone walk you through setting up a 401k
Set up savings accounts with your bank and label them. Set up automatic transfers into two accounts
Working hard for hours a day to pay for thing that aren't bringing you any closer to the life you genuinely want