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
How to Earn 10%
So how do I get 10%? Let's talk about the 10% boogeyman. It's not possible to make 10%. You heard me talk about this earlier today, like the stock market since 19-2009, it's gone up over 400% with reinvested dividends in the last 10 years. We're up 20% year today. Now look, the markets go up and markets go down. Do I believe you can make 10% on your money in the markets long term. Yes, I actually do. Um and I'm not some wizard. I just know what history is done and to make this point, I put this chart on the back of the book which warning star, it was the greatest date in the world on investing was kind enough to give me this chart to use in the book. And so it's in the back of the book because there's always critical friends going, you can't make 10% of the market. And then, you know, here's the chart that shows since 1926 to now, Large company stocks of average over 10 Small company stocks by the way, way more aggressive average over 12 Bonds of Average five. So on a worst case basis,...
if I have a blend of bonds and stocks and I end up in the middle, they told me not to touch is too hard. I'm gonna get 78 diversified Buoying portfolio, Let me just say a diversified boring portfolio is going to earn you probably 78% annually. which also works out just fine Because you'll double your money every 10 years. So it's not rocket science, it's just math, but with math, the rate of return matters a lot. Like I have to drill this into your heads here because it's such a big deal. This is just giving you $100,000 example of the difference between 1%,, 4% 8%. Take that in for a moment At 1%, 100 grand goes to in 10 years, 110 At 4%. In 10 years it grows to At 8%. That grows to $215,000. So at eight your money doubles in what 10 years in 30 years your money grows tenfold, Wow right at eight At 4% of just triples At 1%, it doesn't even grow With taxes and inflation at 1% of bank account, you went backwards. So in 40 years It's 20 times greater. This is the second most important charter I have ever seen. The first chart until his most important chart was that $2000 ira chart. This was the chart that made it black and white for me as a financial advisor that I had to get my clients over here. I need my clients to be earning 789%. If I can do that. My clients won't run out of money, you need to be earning 789%. Now there may become a time where you have so much money that you don't, Where four or 5% is fine. But for most of us that are trying to accumulate wealth, you gotta have a diversified portfolio. And again, I talked about this the rule of 72. So want to know how long it takes to double your money. He takes and divided by the rate of return.