How To Build Wealth On A Low Income (Investing + Retirement + Saving)

The most realistic wealth building video you will ever see with ideas you can actually implement in your life!

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Chapters

00:00 Everyone Can Build Wealth
01:11 What Is Wealth?
02:28 Building An Emergency Fund
04:22 Developing A Basic Investing Strategy
06:54 Employer Sponsored Retirement Accounts
09:21 Individual Retirement Accounts
12:53 Brokerage Accounts

Many people think that having and build wealth is only achievable to people of high income; however, regardless of your income level, if you can develop basic knowledge in financial planning, investing, and the stock market, then you can build wealth in your life. In this, in this video I discuss wealth and various forms to build it in your life.

1. What Is Wealth?

Our view of wealth is often distorted because we believe that a wealthy person is someone who is a big spender and has a bunch of nice material possessions; however, this is false. Real wealth is having financial knowledge, assets that make you money, limiting your liabilities, avoiding debt, and having a long term mindset. Wealth is about creating a financial plan where money doesn't hold you back. In order to build wealth in our own lives, we must see wealth for what it is and focus on building real wealth.

2. Building An Emergency Fund

I personally believe that before you start investing in the stock market, outside of 401k plans, it is extremely important to build your emergency fund. An emergency fund is a financial safety net to protect you against life's emergencies. Ideally, this should be 6-12 months of living expenses. And the reason I believe it's important to build your emergency fund first is because you never want to be pressured to take your investments out at a loss. Before focusing on really growing your money, it is important to make sure your emergency fund will protect you against life's surprises.

3. Developing A Basic Investing Strategy

When it comes to the stock market and investing, I believe in following the Warren Buffet approach, which is invest in index funds and dollar cost average. Index investing is a passive form of investing that has historically had an average return of 10 (though not guaranteed). Dollar cost averaging is an investment strategy where you spread out your investments over time. In the long term, over the course of many years, this basic investment strategy should help you build your wealth. It is not a "get rich quick" strategy, but has shown to produce long term results.

4. Employer Sponsored Retirement Accounts

Once you develop your basic investment strategy, you can now invest in the stock market. The first account you should consider getting to help you build your wealth over time are 401k accounts. These are a pre tax investment accounts where your employer takes out a percentage of your pay before it is taxed and puts it in an investment account where you can invest in index funds and grow your money in the long term. In addition, employers often have matches with 401ks that will help you grow your money quicker. And although you don't pay taxes when you contribute money to these accounts, once you are eligible to withdraw, you will have to pay taxes. It is also important to know that if you withdraw money before you are eligible, you will have to pay early withdrawal penalty.

5. Individual Retirement Accounts

Another retirement account that can help you build your wealth over time are individual retirement accounts commonly known as the Roth IRA and the Traditional IRA. In this video, I focus on the Roth IRA. The Roth IRA is a retirement account you can open through broker like Schwab, Vanguard, or Fidelity. In this account you can contribute money that can grow over time and when you reach the eligible age to withdraw, the interest you gained isn't subject to tax. These accounts are extremely good to have because they have high tax advantages. These accounts are also subject to high early withdrawal penalty if you withdraw before you are eligible.

6. Brokerage Accounts

The final account that can help you build your wealth over time are basic brokerage accounts. Brokerage accounts are investing accounts where you can invest in stocks, bonds, mutual funds, ETFs, and CDs. In this video, I do not go in detail on these various investment; however, the stock market is a great tool to invest and grow your money over time.

**This video is intended for entertainment purposes only, none of it should be interpreted as financial advice. Links above are affiliate links where if you click and order, I will receive a commission at no cost to you. **

[ElAgustin]

What's another way to build wealth on a low income?

[cyrilmilton]

If you are planning for retirement Here are some key pointers. Firstly, kick-start your savings early to benefit from compounding. The longer your money has to grow, the better. Secondly, make the most of retirement accounts like 401(k)s and IRAs, especially if your employer offers a matching contribution – it's essentially free money. Thirdly, diversify your investments across different assets to mitigate risk. Think stocks, bonds, and real estate.

[Raymondjohn]

40 now, and everything is paid for. Fortunately, I had a college economics teacher who taught me a lesson when I was 18 years old. That lesson was: you can't buy something else for every purchase you make. Having multiple sources of income is prudent, as is living within your means. I have a 13-year-old vehicle because it is all I need, I like it, and I can do whatever I want with it. My net worth is $4 million, and I can pay my bills without stress, but I don't live like I have that. I have no complaints.

[cathyspiegel]

Not making up to a million before retirement is unfulfilled retirement.!! I’m 50 and my husband 55 we are both retired with over $3 million in net worth and no debts. Currently living smart and frugal with our money. No longer putting blames on FED for our misfortunes. Saving and investing lifestyle in the stock market made it possible for us this early, even till now we earn weekly.!!.

[BigPhilly]

I didn’t take any business classes in college but got a sales job at Vanguard. I learned so much in the years I worked there. Not just the principles you shared here, but I spoke to thousands of millionaire clients and I’ll tell you right now 90% of them became millionaires by doing the steps in this video. The only caveat I’ll add is I also noticed about 60% of them started their own businesses rather than working a job. Also important to note none of the businesses were sexy. I talked to barbers, house cleaners, painters, roofers, chemical suppliers, etc.

[mikeflair]

One of the best financial presentations of all time! And I am a 35 year career finance professional. Austin is 100% correct, he has some real wisdom here. Use time, compound growth, dollar cost averaging, low cost, diverse, etf or index funds. FYI - I used Vanguard VTI as my main asset 401K / IRA engine. Look at it in 3 or 5 year terms. Do not fear the stock market, but accept it's ups and downs. Remember, you only lose when you sell, don't be frightened by all these negative commentators. It worked for me, as I am in the retirement stage now, and still investing for the long term 100% in VTI (for heirs).

[Michaelwilliams]

I was really hopeful of my investments this year, but all my plans have been disoriented, I've been studying the market crashes and I realized some investors made millions from the recent 2008 recession and I was wondering if such success rate could be achieved in this present market. and the Federal Reserve taking a more hawkish approach to interest rates and bond purchase tapering. Any recommendations?

[jameswalker]

If you don't find a means of multiplying money, you will wake up one day to realise that the money you thought you had, has finished. Investment is key.

[francescadelight]

I’ve got four traditional brokerage accounts. One earmarked for retirement with growth funds, one for medium term goals (think new car or house) with growth funds, one for swing trading, and one for shareholder perks (cruise line stocks so I get my on board credit). I was lucky to come across the ads of a company called "ferrochrome securities" They organised my wrecked finances and made me set priorities. Cumulative now I'd say I've grown over 220k with their help and still growing. Next goal now is owning my first rental property. The journey becomes exciting once you start. My advice is to anyone who thinks they're too old is to start today, right now. It's never too late trust me.

[daviddean]

Good morning, Mr. Austin Wiliams! No grass grows under your feet and I can't wait to watch this new video of yours as I'm 64. Thank you and have a great day and let it be known I appreciate all your videos.

[AnnMitt]

If possible, live with your parent(s) until at least 25 yrs old. Help them around the house/apartment in exchange for rent. Then save 80% of your paycheck for your emergency fund and invest in a Roth IRA. Doing so will help set you up for success.

[r.dinesh]

Make a video on how to retire in 7-10 years with low income 💯. Great content 👍🏼

[stevebubar]

Outstanding! Thank u for the Roth info .

[tracynorman]

Thank you! Loved this, I wanted clarity and this was perfect!

[diane.moore-]

Creating wealth entails establishing positive routines, such as consistently setting aside funds at regular intervals for sound investments. Financial management is a vital subject that many avoid, often leading to future regrets.

[jaga]

...and he knocked it out of the park again!
Great video
Thanks

[robertdavila]

Excellent video, dude. The presentation was comprehensive, helpful and so easy to understand. Each segment was great, but perhaps the best for most people was the explanation of the term "wealth." Great job.

[poupeth]

New subscriber here, Austin! Please keep uploading great financial content like this one. Thank you.🙏🏽

[marias]

yusss!!! looking forward to watching this one!!! thank you

[santavictorio]

Your videos are so helpful. Thank you for sharing your knowledge. 🙂 I started watching your videos a few months ago and I am already seeing positive shifts in my finances. Muchas gracias!