Why the Middle Class are Poor

We are going to break down, why a lot of middle-class people are broke, but also lower class, and also upper class.

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1. Now Lets Use the Numbers
Pew Research
– Low Income: Less than $40,100
– Middle Income: Earned an Income of $40,100 to $120,400 ( family 3)
– Upper Income: More than $120,400

Wealthy and Poor: These are my definitions
– Poor is someone, that has to rely on one source of income, and spends more than or equal to what they make
– Wealthy is someone, with a few sources of income, that has more income coming in than they are spending.
– So if I make 40k a year but only spend need 30k to live, to my the wealthy.
– But we can also define it, as someone with a net worth of over 1-5M

2. Now let’s look at the things that Keep people Poor
– And the biggest factors are debt payments, bills, and lifestyle
– And it doesn’t matter if your upper, middle or lower class
– If you don’t manage this correctly you’re on the verge of being broke

For example: ( here are some things you want to avoid )
– If you go to college to get a degree as I did, get a job, and apply for scholarships. ( while I was in college I made well over 40k in those 3 years and got over 35-40k in scholarships ) – but I still owe 21k ( because I wasted that money – the average student loan payment is $393 a month
– If you want to buy a car, don’t buy a brand new car because the dealer says your credit can afford it. Buy a used car 3-5-year-old car for cash ( the average car payment is $568, not including insurance, parking, and maintenance: more like $700-$800 a month )
– Housing people spend an average of 37% of their income ( not including New York and California that are way more expensive) – $1541
– Keeping up with the jones/ego: spending $1,800 a year on clothes, upgrading your phone each year, making sure you buy a new car all the time.

Quick Math: $50k
– Minus: $400 Student Loans
– Minus Car: $750
– Minus Hounsing: $1,541
– Cloths and ego: $250
– Food, Bills, emergencies ($1000)

3. Thing that keeps people rich
– In the book the average millionaire invested 20% of their income ( 10k invested) – 6.0kroth (1.08M) taxable (723k)
– 97% of them were homeowners ( they don’t live in a fancy house more like middle-class neighborhoods) – and they pay their mortgage in 10.2 years not 30 years bro
– And the average millionaire was 57 ( it takes time to build wealth )
– They spend time on financial Planning

Overall Its pretty simple:
– Spend less than you make
– Buy things for cash and avoid giving all your money away

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*Some of the links and other products that appear on this video are from companies in which Tommy Bryson will earn an affiliate commission or referral bonus. Tommy Bryson is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. I’m an Accountant but I’m not your Accountant, always review information with your Accountant/CPA and your Financial Advisor.

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