if you want to be the first person in your family to build wealth and to be able to provide for your family in a way that you've never seen done before there are three things that you have to do number one you have to spend less than what you make you have to have your expenses be less than your income number two you have to invest the money that you're not spending and number three you have to then work to increase your income that way you have more money to invest now while this is very
simple to understand it can get a little bit more nuanced so what I'm going to do is I'm going to break each one of these three things down I'm going to talk about a few things you have to understand about here I'm going to talk about four things you have to understand here and then I'm going to talk about a couple of things that you need to understand here that way you can actually build wealth and live a life that you only thought was possible for other people starting with how do you spend less than
what you make there are three things that you got to do number one is you got to have a system for your money I talk a lot about a 751 1510 plan this is the very easy way to get started which says for every dollar that you earn from here on out 75 cents is the maximum that you can spend 15 cents is the minimum that you invest 10 cents is the minimum that you save and this is where you want to create three different bank accounts One bank account for your spending money One bank
account for the money that's going to be invested and One bank account for the money that's going to be saved for emergencies and the reason why you want to have three different bank accounts is so you do not accidentally spend your investment money on a TV and you don't accidentally spend your savings money on a new vacation these are three different bank accounts for three different purposes your spending money is what you pay for your rent or your mortgage how you pay for your groceries how you pay for your vacations how you buy your clothes
how you do all of that debt your investment money is what you're going to use to buy stocks invest in real estate invest in a business idea maybe pay down your lower interest rate debts and your savings money is there to protect you against an emergency in case you lose your job in case your kid breaks their arm in case your car breaks down if something bad happens you have cash to fall back on so you don't have to go deeper into credit card debt and on that point I do want to make a little
caveat here that if you have credit card debt before you go and do all this pay off your credit card debt if you have credit card debt if you don't have $22,000 save up you are in what I call the financial danger zone and right now your focus needs to be saving $2,000 as fast as possible paying off the credit card debt as fast as possible because that's skinning you alive so before you do any of this before you worry about investing your money pay off the credit card debt and what I like to say
is if you have credit card debt you cannot afford a Netflix subscription why well it's not because it cost $15 a month it's because if you have credit card debt how can you sit there feel comfortable watching TV at night knowing that you got to pay 25% interest to the credit card company you should not be doing that instead spend that time learning spend that time earning spend that time figuring out how you can pay off the debt earning more money and building your wealth once you figure out how to budget your money how to
systemize your money there something like a 75 1510 plan the second thing is no more financing when you have this money that you can spend many people assume that I can afford a $1,000 phone because I can make the $100 a month payments and that's not true if you really want to build wealth you got to stop paying interest on things that don't make you any money it's very common in our society today American society makes a very normal very common and very easy to go into debt nowadays you can check out anything on the
internet and right on the checkout page you're going to have a buy now pay later option you want to buy that Gucci now you can have it just worry about the price later you want to buy our groceries now fine worry about the price later it is a very toxic very financially toxic habit that is keeping so many people broke and if you really want to live free imagine a life where you don't have a car payment you don't have a credit card payment you don't have a student loan payment and now you can start
to imagine well if you're earning the same amount of money and your money is not all going out you can do a lot more things and you can have a lot more Investments and have a lot more freedom and have a lot less stress and in order to do that you got to stop the bleeding you got to stop the spending you got to stop giving your money out to other people that you cannot afford so no more financing things no more 0% APR if does not put money in your pocket do not Finance it
period the only exception to this is your house don't Finance your car either you're going to live a completely different life when you no longer have a car payment it's going to give you the sense of Freedom that you never knew was possible and if you don't have the car payment you'll probably be driving a cheaper car which also means you might not have to worry about the premium gas you might not have to worry about the expensive Insurance you might not have to worry about the expensive oil changes and now all of a sudden
you got a whole new sense of freedom and a whole lot of extra money that you can use to invest into things that will actually make you money get rich first before you make BMW rich and number three the rule of five I don't care if you buy luxuries I don't care if you buy expensive things people assume that I say you should not have nice things that I say you should not have the Gucci or the Louis Vuitton I don't care for Gucci I don't care for Louis Vuitton if you like it great what
I want is I want you to be able to afford luxuries there are certain luxuries that I do like okay I like when I go and travel that I understand nicer hotels I like certain things they're just not the clothes that I wear but the key is I want you to be able to afford your luxuries and one of the rules that I like to follow for luxury things I don't put any money in my pocket is's a rule of five which says if I cannot buy five of them I cannot afford one of them
the simple rule will allow me to be a little bit smarter with the way that I spend my money and now let's move on to number two how do you actually invest your money investing is what builds your wealth and the way that it works is you're going to take the money that you don't spend and you're going to buy this thing this asset this investment for the purposes of making money when you buy clothes you buy them so you can clothe yourself when you buy an asset you buy it so you can make money
and when people think about what do I buy most people think well what stock should I buy or what should I trade or should I buy this trading card or this crypto but that's not the way that we're going to be talking about investing I want to talk about real fundamental real investing that can build you real wealth over the long term if you do it right and there are four questions you have to ask if you want to do this number one what is your strategy number two what is your goal number three what
asset are you going to invest in and number four what is the analysis to actually decide if this is a good investment or not so let me break this down starting with the strategy there are two strategies I generally talk about one is active investing one is passive investing this is not trading I'm not a Trader I'm not a flipper to me that's gambling that's not the game that I play investing is where you buy an investment and you own it for the longterm the long term is at the very least one year but we're
talking generally many years and so when we talk about active invest in this is now where you're managing your Investments yourself so you're investing in individual stocks and now you're managing your stock portfolio or you're investing in individual real estate you don't have to manage it yourself you can hire a property manager but you're finding the properties yourself and you're buying these properties yourself passive investing is now where you have somebody or something managing the investment for you so when I talk about passive investing in the stock market this means investing your money into an
ETF a mutual fund an index fund a fund that is a group of companies that's managed by a computer or a person that way you don't have to manage the portfolio past investing into real estate is you're investing into a fund that's managed by somebody else I'm not talking about having a manage by somebody else I'm talking about investing into somebody else's deal they're doing all the work you just give them the money and it's completely passive for you and you got to decide what is a better investment for you based off of where are
you in your life some people love the idea of keeping up with companies some people like the idea of dealing with property managers and finding properties if that's you well then you can look at active investing if you say I don't have any time I don't really care about reading financial statements I just want to put my money to work and I have to worry about it then passive investing is a better option for you and some of you are going to be like me where you kind of do both I do active investing I
actively invest in stocks I actively invest in real estate but I also passively invest in stocks as well so once you figure out what type of strategy that you want the next thing you have to think about is your goal which means how do you want to get paid would you rather get paid with cash flow or would would you rather get paid with appreciation would you rather see the price of your investment rise now again this is going to go back to what is more important for you for me and I got to give
you the disclaimer because I'm just a random guy on YouTube investing has risks you were never guaranteed to make money when you invest in fact you will lose money at some point so make sure you always do your own due diligence and never blindly trust a random guy on YouTube but I like Investing For Cash Flow and I don't recommend what I do to anybody else but for me I like cash flow because it's the game where I can work to stack the cash flow every month my goal is to increase my cash flow every
year I want to have more cash flow than the previous year how do I generate my cash flow well I'll talk about in the assets but now I can get paid without having to sell my investments and my goal is just to be able to live off of the cash flow because now I know if I spend all my cash flow this month I'm going to get another cash flow check next month some people don't like that the reason why some people don't like that is because when you generate cash flow you have to worry
about taxes and when you generate cash flow you generally don't see the same growth in the the asset price because that means the asset is spitting out the money instead of using the money to grow the value of the asset see if a stock goes up and value from $100 to $10,000 you don't pay any taxes until you sell but if you get paid $10 you have to think about taxes so you got to figure out what's right for you for me the bulk of my investments my total Investment Portfolio are cash flow producing the
third thing you want to think about now is which asset do you want to invest in and the two big assets that are built more wealth than anything else over the last century in the United States are stocks and real estate start there don't start with the speculative assets if you're just starting investment Journey worry about the speculative assets later after you have built a decent amount of wealth for yourself then you can think about the speculative assets for me stocks and real estate out of my passive Investments outside of my own business make up
about 80% of my Investment Portfolio about 18% is speculative and about 2% is physical gold but I didn't start investing into startups or cryptocurrency until I had built a solid foundation with my stocks in real estate now my largest investment out of everything is my own business briefs media but the non my business assets stocks and real estate are the biggest two then I have some speculative and then some physical gold and out of that the majority of my investments are for cash flow now for those of you that are investors and you want to
stay up to date on what's happening in the financial markets Market briefs is a free newsletter that I created in my company briefs media where we publish this breakdown down what's happening in the financial markets every morning we break down what's happening at things like stocks and the real estate market and the crypto market and the global economy and our own economy into a fun read and easy to read newsletter you can read it in less than 5 minutes every morning and it's completely free so if you have not joined Market briefs yet I got
the link to how you can join down in the description below and then once you understand if you want to invest in stocks or real estate now you can start doing the analysis this is where if you're investing in stocks you can do your analysis depending on what you're investing if you're investing in individual companies you want to take a look at is this company overvalued or undervalued how do you do that you look at financial statements look at the income statement the balance sheet and the cash will statement the income statement is the profit
and loss statement the balance sheet is the asset and liability statement and the cash will statement shows you how cash flow through the company every company that trades on the stock market is required to publish these three things and you can learn how to do these things you can learn how to read these things there's a bunch of videos on YouTube on it there are classes there are books on this you can start learning about how to do that if you're investing in ETFs and index funds and mutual funds now you can take a look
at which institution created These funds is this institution reputable or is it a random guy or girl out of the garage then you could take a look at what types of assets are they investing in are they investing in the S&P 500 or are they investing in emerging markets around the world what is the assets under management is there only $10,000 of money invested into this fund or are there 10 billion of assets invested into this fund and what types of things are they actually investing inside of this fund for example you're going to see
that there's multiple S&P 500 funds out there some are going to have more ownership of Tesla than Microsoft some are going to have less of one or the other and you can start to take a look at these things that's the type of analysis you want to be doing when you're now digging deeper into your actual Investments same with real estate when you're investing in real estate you want to take a look at the numbers you want to underwrite the deal for me I like to look for a 7% cash on cash return if I
invest $100,000 in my own cash I want to see $7,000 of cash flow profit hit my bank account after paying all expenses over the year and that's without me having to sell my investment now you're spending less money than what you make and now you take this extra money and you're going to invest it you follow the four-step analysis that we just talked about and you find ways to start investing this money you can make it automatic you can invest this money yourself but now you're putting this money to work and then what's going to
happen to every single person does this is they say wow I like this financial education thing I like this investing thing how can I do more of it well you can either spend less where you can earn more there's a limit to how much you can spend less I mean there's a limit to how many pennies you can squeeze out of your paycheck but there's no limit to how much you can earn which brings us to how can you increase your income but before we talk about that I want to remind you that the reason
why you want to increase your income is you can invest more money it's not so you can just earn more money and drive a faster car that's the mistake that so many Americans are making today is they work to make more money so they can have nicer things but that brings you back into the same Financial mess that you were in in the first place so you want to make more money continue following the same Financial system something like 75 151 that way you can spend more but you're still investing more and saving more that
way you can build yourself and build your own wealth before you make everybody else rich now how do you increase your income and this is where you got to start with what's best for you there's a lot of people on the internet that tell you how you can make $10,000 a month doing nothing well here's the reality starting a business is hard it's for some people it's not for other people most people start a business will fail that doesn't mean you shouldn't start a business that means you got to understand that starting a business is
for people who are made to start a business you got to be willing to put in a lot of work you got to be willing to work on weekends you got to be willing to work on evenings you got to be willing to work on holidays if you're not don't start a business it is hard if you can't deal with the risk if you can't to deal with the stress don't do it there's a lot of ups when you start a business it's very nice to be the person behind the ship that's succeeding but it's
also very stressful and very not fun to be behind that ship to be behind the business when you're the one that's failing so not everybody needs to start a business but what you can do is you can look at can you see more career growth at your own job that you're at today if not do you look for another company if you don't see it in the industry that you're in with the the education that you have maybe you look to get a new certificate that way you can get a new career you get a
whole new career change maybe you work to take on a second job or a third job or a second side hustle and maybe you were to now start your own business there's no limit to how much you can earn when you start your own business but you got to be willing to learn you got to be willing to try you got to be willing to make mistakes I think everybody at some point should try it if this is something that you're interested in but understand that starting a business is not linear there's a lot of
people on the internet that make it seem like it's this easy thing you just got to do X Y and Z and you build this amazing business that's going to make you all this money if it was that easy everybody would be doing it building a business is hard work it's going to take a lot of effort and you got to be willing to risk your time and you got to be willing to risk your money it's not just the money in building the business but now it's the money in learning starting by watching free
content on the internet then by reading some books then you're going to want to take some classes maybe get some coaching and some Consulting all these things can help you scale and grow your business but it is hard work and if you're not willing to do that well start with what's more accessible for you but just understand that there are way free to earn more money there's a lot of free resources that you can start with as you start to find things that you like be willing to invest to learn more to grow your income
because sometimes you got to spend some money to see those returns but as you start to grow and grow your income don't forget now that you want to be investing the extra money because one of the fastest ways to build your wealth faster is when you get a raise increase your investments before you increase your lifestyle if you can do that you're going to have the opportunity to see some real success and one of the things that I talk about is living through that decade of sacrifice the decade of sacrifice is going through 10 years
of spending less and earning more so you can invest like crazy because if you can do that at the end of that decade you're going to live a completely different Financial life and it's going to allow you to have a lot more freedom because once you own the assets they are yours I did a podcast recently where I talked about this that the the reason why there's a lot of similarities between Fitness and money is that it takes a lot of hard work and most people want to talk about how easy it is and you
want the results but many people don't want to go through the effort but the difference between finance and your health is you can build reserves with your money that you can't do with your health see I can go and go on this amazing diet and work my butt off in the gym for 6 months and have the shredded six-pack and have 6% body fat and have all these amazing physical looks but if after those 6 months I then go back and start eating donuts and Ho Hos and sit on the sofa all day watching TV
I'm going to lose my six pack and I'm going to be fat pretty soon again with money is a little bit different if you build your assets you build the cash flow you can spend all the cash flow be done with the cash flow and buy a bunch of nice things and continue to receive that cash flow because you own the assets you can build those reserves with your money and your wealth that you can't with your health and that's why this is so important because you can build this wealth not just for yourself but
for your family and for Generations into the Future Let's assume that you can invest $1,000 a month into spyd now let's take a look at what the numbers will look like over the course of your investing career you invested $540,000 into spyd and now when it comes time for you to retire you are making
