This One Page Made Me Financially Free

This page is what allowed me to leave my day job at 24, completely turned my finances around. So today I wanted to show you exactly what that breakthrough was, how to stop working for the government like three months a year, and exactly how the poor, middle class, and rich spend differently and how I was able to go from spending like a poor person to actually becoming a rich person. And once you understand this and actually implement it, you can go from poor or middle class to rich and to being free within just a couple years. So this is super, super powerful. Now the book is Rich Dad Poor Dad and it's actually just a couple of diagrams in here which were the thing that really unlocked it to me, like seeing stuff visually really helps. So I copied it, stole my wife's iPad, and I'm gonna show you visually exactly how this works. Now to start off with here, we need to understand how a poor person spends money and why that keeps them poor and how they do it very differently than a rich person. So a poor person who will never have freedom in their lives probably is going to have a job, which in Rich Dad Poor Dad, he says stands for just over broke. And that's mostly true, like if you wanna reach freedom in 10 years, working a job will never make that happen for you. So pretty much you're gonna have your money come in from your job, that's gonna be your salary, and it's gonna go through your expenses and out of your life. So you're gonna have money come in and then you're gonna pay tax, rent, food, transportation, clothing, impulse buying, Amazon, all that type of stuff. And that's the cycle that most people go through and they have all their money come in through their job, one source, incredibly risky, and then all of it go out through all of their expenses and they never have a leftover money for anything. Like 60 plus percent of Americans, I believe, don't even have $1,000 in their savings account. And that is because they are stuck in this poor person's income statement. And if that is you, I'm gonna show you exactly how to get out of it and how to completely transform your finances by the end of this. So to kind of give you an example of what this might look like, I'm just gonna use round numbers. This can really be any number because people do this at 100,000, they do this at 200,000, they do this at 40,000. But let's just use 40,000 here because really it's all about how much comes in, how much goes out, but whatever. All right, let's just say you make like $40,000 a year. You're gonna pay like $9,000 of that to taxes and social security. Maybe it's less because you're in a low income bracket. Then you're gonna have rent, maybe $1,200 a month. You're gonna have a car payment, maybe $400 a month. You're gonna have food and utilities, maybe $1,200 a month. So just between those things right there, you have all of your money coming in and all of your money going out. 12 months of expenses coming in, 12 months going out. And mostly you're gonna stay in that cycle. For a lot of people, some of these categories are a lot higher. They have going out to eat, they have vacations, all this other stuff. So you can see how money disappears really, really quickly when you're in this money coming in, all expenses going out loop. All right, so let's move to the middle-class trap here. And this is where a lot of people get stuck. This is where I was stuck for a while. But once you understand this, totally changes a lot of things. So again, most middle-class people, you're gonna have a job coming in. Let's say you're making $100,000 a year. That's coming from your salary, right? That's the only income stream you have coming in. But then people say, you know, get a, you might get a nice car now. You're making $100,000 a year, gonna have a nice house. You wanna have a little piggy fence with the kids running around and the dog and the fluffy McGee, whatever. But instead of the income just flowing to the expenses, it actually bypasses the assets entirely. And we'll talk about assets and liabilities in a second. And it goes to liabilities. And then it goes through there up to the expenses and then out of your life. And it's much sadder now. So instead of just having income and expenses, now you have what you think is going to be an asset, right? You have a nice house. For most people, it's their biggest investment, but it is taking money out of your pocket every single month. If we look at my calculator, which I built, it pretty much goes off of how much money do you have going out of your life every single month? And how much money do you have coming into your life every single month? And where is that money coming from? Is it from active, from your job? Or is it through passive, which is gonna be your asset? The simplest way to understand this is assets are something that put money into your pocket every single month. Which means, for me and for this definition of it, that even if you have, let's say, a house, we'll use that as an example here. Yes, your house could be appreciating in value, but since it's taking money from you every single month, you're not gonna have freedom or access to that value. So if this person got a mortgage, then they're gonna have more taxes, they're gonna have more upkeep, they're gonna have all the phantom costs that come with owning a house, they're gonna have maybe a more expensive car, credit cards, all this type of stuff that is now adding onto it because their lifestyle is bigger. So even though they're earning double the income, again, it's all coming from one source, so if that income stream goes away, their job goes away, they lose their mortgage, they lose their car, or at least they rack up a bunch of credit card debt, student loans go, it's really bad news if the job goes away, even for a couple months, it's horrible. And this is the trap that most people live in, paycheck to paycheck, so their money's coming in through their salary, it's going around, they're buying liabilities, which are costing them more and more every single month, and doesn't matter how high the income gets, as long as it goes in this cycle, they will never be free. So let's say, again, this person is earning $100,000 a year. They're gonna pay probably anywhere from $25,000 to $30,000 in taxes and social security. So that means right off the bat, they're working about four months a year for the government, and the rich people don't do that, they don't really pay taxes because they earn money a different way, they don't earn money from their job. When I understood this, and I am not a big fan of how the government uses money, like if you wanna give them more money, feel free to donate, but I would rather keep as much as I want myself and then donate it to people who are not idiots. If you're gonna work three to four months a year, then let's say you have a mortgage, which is $1,800, you got a slightly nicer house, that's another two and a half months a year that you're working to live somewhere, $600 car payment, one month a year, you're working just to pay for the thing that drives you from home to work, and then you got your living expenses, and that could be another three months right there. So with just those basic, basic expenses, you're making six figures a year, and 11 months of your income is just gone just from those very, very basic things, and everybody's gonna have a vacation, they're gonna have some impulse buys, they're gonna go out to dinner, they're gonna have a lot more expenses. So that's why even when you're in six-figure land in this middle-class territory that seems awesome, you got this nice house, nice car, you will never, ever, ever, ever, ever have freedom if your money is following this strategy of job, buying liabilities, and then all of your expenses on top of that. You will just never have freedom this way, and this is why buying assets is really important. We're gonna talk about this in the rich version. One thing I've been getting more into recently is buying stocks with actually the sponsor of this video, Moomoo. If you haven't heard about Moomoo yet, it's what I use personally. It has over 27 million users, and is a great place to get started buying assets. First of all, I can invest directly and get 0% commissions on ETFs, stocks, and even options, so I'm not losing money with fees every time that I trade. For cash that maybe you're not ready to invest yet, you can earn 8.1% for the first three months on your cash, which is absolutely insane. So as you're saving up money to buy another asset, you could always keep it there. And if you're thinking maybe you don't know enough about investing, Moomoo has an AI assistant that is built right in. You can ask it about any stocks or market trends, and it gives you just clear answers. And on top of that, you get free Morningstar research and Wall Street Journal news inside the app, which is free, and those are things you normally have to pay for. So you can just take a few minutes every day, learn a ton of stuff for free, which is awesome. The app is simple enough that you can just get started as a beginner and buy simple things, or if you wanna really get into it and start doing trading, or really just dive deep, it has so much built in. That's one of the things that I really like about it. So here's one of the best parts, is that new users get up to $1,000 worth of Nvidia shares. When you open an account and deposit the required amount. So if you are in starting your investing journey, might as well like start off with some free money and a crazy interest rate, which is awesome. You can check out the link below or scan the QR code, which is right here. And thanks again to Moomoo for sponsoring this video. All right, so next up here, we have how the rich earn money, which is way more effective than anything I did before. And this was like a huge unlock for me. So pretty much while having a job, a rich person will actually take that money, and then they will buy assets that make them money every single month, and then pay for all of their expenses through there. And we'll get to the rich column in a second here. But this is generally how you get to that rich column, is instead of buying liabilities, maybe a mortgage or a car or things like that, you're gonna buy things that put money in your pocket every single month. Maybe that's stocks. Maybe that's investing money into starting a business. Maybe that is something that I did, which was real estate, where I took my first $6,500 that I had saved up, and I bought a rental property, that about $1,000 into my pocket every single month. And then pretty much all we need to do is buy enough assets that they cover all of your expenses. And when you get to that stage, you're gonna be free. So what a rich person actually does is they have stayed in this cycle right here. They've stayed in this middle-class cycle of this, or being creative and moving a little bit past this. And then they get to this where their assets are actually where they drive their income from. So they have real estate, stocks, bonds, intellectual property, which might be YouTube videos, like I make a few cents at least from videos that I made like six years ago. And then of course I have other ways to monetize my online businesses, and I have multiple online businesses, multiple channels that I run, and all of them pay me money years after I do the work. So any type of business that you can start that goes away from a job which is just overbroken to something scalable, because one of the things that they actually talk about in this book a lot is that as long as you're working for somebody else, you're making somebody else's dreams come true, you're making somebody else rich, it's very hard and almost impossible for that to happen to you. So at some point here, in between the middle-class and the rich, you need to start a business. You need to create an engine, and that can be one of the most powerful and fast-acting assets that you can create, actually we'll put it down here, is by starting a business. And of course the one I do personally is YouTube, and we've had five people follow this exact pattern in the past about year and a half, and have been able to leave their jobs through just YouTube, which is the one thing I know, and there's like a billion ways that you can do this. This is just the one thing that I know, the one thing that I teach. Obviously there's a million ways that you can do this through any type of business imaginable. It's just something that you are not directly tied to, so that you can scale back, and just kind of manage it and run it. None of this is actually passive income, it's just income that's not directly tied to your time, so you're no longer trading time for money, you're creating things that pay you indefinitely, and that's why I love YouTube. I'm actually gonna be teaching exactly how to do for the last time in about six months in my five-hour YouTuber program, so if anybody interested, the wait list down below, it's the last time for quite a while, but it literally works. So why is this strategy here? Why is your income coming from assets so important? Well, remember the poor person right here? They're working months out of the year, or the rich person, they're spending like $30,000 a year, $20,000 a year giving it to the government, because their income is taxed more when you're paid as an employee, which sucks. But if your income is coming from real estate, it's coming from assets, it's actually taxed at a lower tax rate, so you're actually giving the government less of your money, and you can even use things like real estate to pay almost no taxes, which is one of the ways that rich people don't really pay taxes, is even if they make a million dollars that year, if they buy a million dollars worth of real estate that's leveraged, they can actually take losses, and that's how I try to avoid taxes and trying to buy more real estate. Anyways, let's say that you're still making 100K over here. If you get it from a job, you're gonna pay maybe 30,000 of that in taxes. If you get it from a business, you might pay like 20,000 of that in taxes. If you get it from maybe dividends of stocks, you might pay like 15,000 of that in taxes. If you get it from real estate, because of depreciation and stuff, you might spend like 5,000 of that in taxes. So as you kind of go into some of these different asset classes, you pay less and less in taxes, which for most people, it's gonna be one of your biggest expenses over your entire life up there with like your housing, is gonna be like paying the government to let you live. As you can tell, I'm not a huge fan of that. And so that doesn't mean that rich people don't have liabilities, but overall, they want their income from their assets to cover all of their liabilities and all of their expenses. And when you get to this point where your asset column is bigger than your liability column in monthly cashflow that it brings in, you are free. So that doesn't necessarily mean millions of dollars. That just might mean that if you have 5K going out per month in your expenses and liabilities between your house, your mortgage, your car, all your living expenses, and you get enough assets that make you $5,000 a month. Now, the pen was, I apologize, the pen wasn't working on the iPad and it's my wife's iPad and it was a whole thing. It took me like an hour to get to here. Anyways, if you get to this point, which if you wanna figure out how far away you are, I have like a calculator that runs this whole thing for you, you will be financially free. And that's all I needed to get to. That's how I left my day job at 24. I bought enough assets that it covered all of my expenses and I kept my expenses really, really low. So then I needed less assets. And now my job money just went as much as possible throughout this whole thing. It was going straight to buying more assets, buying more assets, buying more assets, buying more assets. And almost none of it went to expenses. Almost none of it went to liabilities. I paid cash for my car. I lived in very cheap apartments, never went out to dinner. I didn't like do an expensive travel. I stopped buying clothes. None of it went anywhere besides buying a ton of assets that at 24 covered all of my expenses because my expenses were low. And now I was able to buy nicer liabilities as long as I have kept buying nicer assets that covered those. So like the house that I'm in right now is awesome. I would never be able to afford it if I was working a job, but I'm able to afford it because I have a bunch of assets that pay for this house. And so now because I've restructured this way, I'm able to have all the things that I might wanna have because my only goal when I earn a dollar is to buy more assets and have that dollar make me a dollar every seven years for the rest of my life. Like that's my only goal when I have money. It's not to spend it. It's not to buy a nicer house, a nicer car, more clothes, or like all that stuff can happen. But I will only spend that money if it comes back to me from my asset column, comes up and creates income and then goes out the other way. I never want income to come from a job and then go directly to stuff. So here's like a better example of that. When you pay yourself first, it comes in through your job, it buys assets, and then it cycles through and you have more money to pay for everything. So that's like kind of the idea of paying yourself first is right here. I know I said it was one page, but I'm not gonna go through it, but this is another like visualization of money going through a corporation before it gets to you. That way it's just taxed less. It was like a whole nother thing to jump into, but pretty much controlling your cashflow is literally the name of the game. That's how you get to freedom. More coming in every month through relatively passive things that are not directly tied to time for money, then goes out and you're pretty much free. So keep your expenses as low as possible. Buy as many assets as you possibly can, as fast as you can. And not assets like a house that take money out of your pocket every single month. Assets that pay you every single month, or if you don't have the money to buy them, build them. Start a YouTube channel. Maybe it takes a year to actually run a profit, but then it pays you every single month for stuff that you did a year ago. Keep building up streams of income from assets that you've built until it covers your expenses. Then you just like do whatever you want for the rest of your life, which is kind of where I landed. Hope you enjoyed this. If you wanna buy some stocks, Moomoo, you can get some free money. It's even great. Even if you wanna keep money in high interest savings, pretty cool place to do that. Or if you wanna learn how to build an asset, I'm gonna be teaching how to do that for the last time for about six months because I'm taking some time off. But thanks for watching. I really hope this unlocks some stuff like it did for me. Feel free to check out this video right here. See you next week.