[0:00] I want you to imagine
[0:01] that you suddenly became rich overnight.
[0:03] Maybe one of your
investments went to the moon,
[0:06] a side hustle you started took off,
[0:08] you got a large inheritance,
[0:10] or you won the lottery.
[0:11] Believe it or not, many
of you will find yourself
[0:13] in one of these scenarios,
[0:15] so this video was recommended
to you for a reason.
[0:18] I mean, let's take the
most unlikely option:
[0:21] winning the lottery.
[0:22] This channel's had over 1.5 billion views.
[0:25] Statistically, that's
enough that a few of you
[0:27] have already won the
jackpot on the lottery,
[0:30] and the odds say
[0:31] at least a couple more
of you watching right now
[0:33] will win in the future.
[0:34] So that's a good thing, right?
[0:36] Well, actually, when
you suddenly get rich,
[0:39] you're far more likely to
lose friends and family,
[0:41] have a greater risk of substance abuse,
[0:43] and finally, divorce.
[0:45] Most people who get rich fast
[0:47] have never actually built wealth before
[0:49] and have absolutely no idea
how to manage everything.
[0:52] So here are the seven
things you need to do
[0:54] when you suddenly get rich,
[0:56] from a millionaire businessman.
[0:58] (rousing music)
[1:01] I know it might be tempting
[1:02] to go screaming it from the rooftops
[1:04] and rubbing it in your enemy's faces,
[1:06] but the absolute best move is
staying as quiet as possible
[1:10] and telling no one.
[1:11] Privacy is really your main
priority at this point.
[1:14] You want to be what is
known as stealth rich.
[1:17] A guy called Jack Whittaker
won $314.9 million
[1:21] from the Powerball in 2002.
[1:24] At the time,
[1:25] it was the largest jackpot
ever won by a single ticket.
[1:28] He was the opposite of stealth rich.
[1:30] He went around telling everyone
[1:32] and even became famous for
giving money to strangers
[1:35] that asked him for help.
[1:36] He gave away millions to the church
[1:38] and even bought his friends
new cars and houses.
[1:41] Now, you're probably thinking
he sounds like a lovely guy,
[1:44] maybe a bit silly, but he had a good heart
[1:47] and good things come to kind people.
[1:50] Well, that couldn't be
further from the truth.
[1:52] His wife divorced him,
[1:54] friends abandoned him,
[1:55] and his granddaughter,
who he spoilt with money,
[1:58] tragically died from an overdose.
[2:00] He later admitted that
being too much of a nice guy
[2:03] destroyed both his fortune and his family.
[2:05] So now you understand the
importance of being stealth rich,
[2:09] how do you actually do it?
[2:10] Well, even if you keep
this as quiet as possible,
[2:12] some people will still suspect you.
[2:15] It's like those TikToks that say,
[2:16] "I won't tell anyone when I become rich,
[2:18] but there will be signs."
[2:20] This means you'll become far
more likely to get robbed,
[2:23] sued, blackmailed, or scammed.
[2:25] Once people know you have a bit of money,
[2:27] they descend like vultures.
[2:29] Trust me, I've experienced it.
[2:31] They say this is because
money changes people.
[2:33] However, over my years,
[2:35] I've realized that money
actually just reveals
[2:37] who that person really is.
[2:39] The only person you should
tell is an attorney.
[2:42] Make sure you get a good one
that specializes in trust
[2:45] and estate planning.
[2:46] A trust can save millions in taxes
[2:48] and provide a healthy layer of privacy.
[2:50] (light upbeat music)
[2:53] A lot of people will tell
you not to quit your job.
[2:56] However, I disagree.
[2:58] If your job isn't
bringing you satisfaction,
[3:00] then quit the job.
[3:01] Don't quit working, but quit that job.
[3:04] You could even wait for the perfect moment
[3:06] when your boss is pulling
a power trip, like,
[3:08] "You need to step up your game
[3:10] if you want to continue working here,"
[3:11] and then quit gloriously.
[3:13] But please go and find another
job that you actually enjoy,
[3:16] at least for a bit.
[3:17] When people quit working entirely,
[3:19] all they have to think about 24/7
[3:22] is how they're gonna spend their money.
[3:23] Many end up starting a random business
[3:26] they know nothing about
[3:27] because they're bored and
now have the money to do it.
[3:30] Some people even buy restaurants
[3:32] and end up on Gordon Ramsay's
"Kitchen Nightmares."
[3:34] Being rich and bored
[3:36] is a really dangerous situation to be in.
[3:38] The way I've always thought of it is,
[3:40] if you're working, then
you're not spending.
[3:43] So keep your life as normal as possible
[3:45] for at least six months.
[3:46] You need to process having all this money
[3:49] and not give in to the
temptation of spending it.
[3:51] (suspenseful music)
[3:54] You might think this doesn't matter.
[3:56] You're rich now,
[3:57] why worry about a few little debts
[3:59] when you could pay it
off if you wanted to?
[4:02] Well, these debts can quickly start
[4:04] eating into your fortune,
[4:05] and before you know it,
[4:06] you'll be left with nothing.
[4:07] Focus on paying back your highest
interest rate debts first.
[4:11] The main culprit here is credit cards.
[4:13] These often have 20 to 30% interest rates,
[4:16] which eat away at your money
[4:17] faster than almost anything else.
[4:19] Then you have car loans
and personal loans.
[4:22] These are worth clearing
if the rates are high.
[4:24] Finally, you have mortgages.
[4:26] Paying off their house
[4:27] is often one of the first things people do
[4:29] after suddenly becoming rich.
[4:30] However, this might not
actually be the best idea.
[4:34] If it's cheap debt, I'm talking 2 to 3%,
[4:37] it might be smarter to
keep it and invest instead.
[4:40] This is because you should be
able to get a better return
[4:43] from your investments,
[4:44] and that will offset the amount
that debt is costing you.
[4:46] So focus on clearing
that high interest debt.
[4:49] It's a guaranteed return,
[4:50] unlike investing which can go up and down.
[4:53] Paying off debt
[4:54] is the same as earning that
interest rate risk-free.
[4:57] So use this as a reset button,
[4:59] and once you're out of high interest debt,
[5:01] promise yourself never to
fall back into that cycle.
[5:04] (dramatic upbeat music)
[5:07] When you become rich all of a sudden,
[5:09] the people closest to you
[5:10] often feel entitled to a share of it
[5:12] because in their mind,
[5:14] you didn't earn it with honest hard work.
[5:16] They'll start asking for loans
[5:18] that they often don't intend to pay back
[5:20] or even come up with genius business plans
[5:22] they need you to invest in.
[5:24] Trust me when I say
[5:25] the fastest way to lose family and friends
[5:27] is to lend them money.
[5:29] Just don't do it.
[5:30] They may resent you a
little in the moment,
[5:32] but they'll get over it.
[5:33] That's far better than
getting into a messy situation
[5:36] where everyone falls out.
[5:38] But what if you want to
help out family and friends?
[5:41] Well, I have a simple rule:
[5:42] If someone I know asks me for help
[5:44] and they genuinely need it,
[5:46] then I give them the money
[5:48] and don't expect to ever be
paid back on one condition.
[5:52] They never ask me for money again.
[5:54] - [Staff] Can I have
some money then, Mark?
[5:55] - No, you're joking in. I pay you plenty.
[5:57] I recommend you do the same
[5:59] because you don't want people using you
[6:00] as their emergency fund.
[6:02] If you help them out once
[6:03] and they know they can come back for more,
[6:05] they're less likely to be
responsible with their own money
[6:08] because they know you just
bailed them out again.
[6:10] I know this point sounds quite heartless,
[6:13] but it's really the opposite.
[6:15] Sometimes you have to be cruel to be kind.
[6:18] This will save you far more friendships
[6:20] than just being someone else's piggy bank.
[6:22] (tense upbeat music)
[6:26] When most people get rich quickly,
[6:27] they still have a consumer mindset.
[6:30] They look at the money
sat in their bank account
[6:32] and think about all the
ways they're gonna spend it.
[6:34] My son's friend's family
[6:36] actually won the lottery
when he was younger,
[6:38] and his parents went out
[6:39] and bought a new house
worth over $10 million,
[6:42] a couple of sports cars,
[6:43] and sent all their kids to private school.
[6:46] Only two years later, the dream collapsed.
[6:49] Curtis' friend was yanked
out of private school,
[6:51] sports cars were sold off,
[6:53] and their $10 million home
was desperately listed
[6:56] for $6.5 million after bad improvements
[7:00] and crushing debt forced them to sell.
[7:02] This all happened
[7:03] because they didn't
understand the golden rule:
[7:06] Never spend the principle,
only the interest.
[7:09] You should be trying to grow a money tree
[7:11] that produces new income every month,
[7:13] not cutting it down
for temporary firewood.
[7:15] That's where your freedom figure comes in.
[7:18] Work out exactly how much
income you need each year
[7:21] to live the life you want,
[7:23] then multiply it by 25.
[7:25] So if you want an income
of $200,000 per year,
[7:28] you'll need to invest at least $5 million
[7:31] of your new wealth.
[7:32] The idea is that you'll
never actually have to dip
[7:34] into the 5 million
[7:36] and be able to live on the
$200,000 of interest every year.
[7:40] Even if you haven't received
a large sum of money
[7:42] and become instantly rich,
[7:44] it's still worth working
out your freedom figure
[7:46] as it's a great target to aim for.
[7:48] The rule of 25 is based on
a 4% safe withdrawal rate.
[7:53] I personally aim to grow my
money by more than 4% though
[7:56] just to be safe.
[7:58] That brings us on to...
[7:59] (smooth upbeat music)
[8:02] The most common thing I hear is,
[8:04] "Where can I find those
kinds of interest rates?
[8:06] My account only gives me 0.5%."
[8:09] The truth is,
[8:10] you're not likely to find
the kind of interest rates
[8:12] you need for the rule of 25
[8:14] in an ordinary account.
[8:16] You need to open an investing account.
[8:18] So let's say you somehow got your hands
[8:20] on that $5 million we
talked about earlier.
[8:23] How could you invest it?
[8:24] Well, at this stage,
[8:25] it's way more about
preservation and growth.
[8:28] Of course, this does depend on your age
[8:30] and how much risk you want to take.
[8:32] But here's an example
[8:33] of how I would consider splitting it up.
[8:35] Remember, I'm not a financial advisor,
[8:38] and this isn't financial advice.
[8:40] First of all, I've put $1 million
[8:43] into a low cost total
stock market index fund,
[8:46] just like this one.
[8:47] It includes over 1,300 different stocks,
[8:50] so it's very diversified.
[8:52] Its top holdings are big
companies like Apple, Microsoft,
[8:56] Amazon, NVIDIA, and Alphabet.
[8:58] This is your long-term growth engine
[9:00] and has averaged about 9% per
year over the last 20 years.
[9:05] But future returns could
be higher or lower.
[9:07] On $1 million, that's
around $90,000 a year.
[9:12] Second, I'd put $1 million
[9:14] into a low cost total
bond market index fund,
[9:18] such as this one.
[9:19] A bond fund is a pool of loans
[9:21] you give to governments or companies.
[9:23] Instead of owning one bond,
[9:24] you own a basket of many,
[9:26] which pays you regular interest
[9:28] and is generally considered
safer than stocks.
[9:30] This should help you with stability
[9:32] in the event of a market crash.
[9:34] Broad bond market indexes have
averaged 4% returns per year.
[9:38] On $1 million, that's $40,000 a year.
[9:41] Third, I'd put half a million dollars
[9:44] into residential real estate,
[9:45] like single-family homes,
[9:47] and another 500,000 into
commercial real estate
[9:51] like warehouses.
[9:52] I like this split,
[9:53] as residential real estate
[9:54] is great for property appreciation.
[9:57] US housing has historically
grown at about 7% annually,
[10:01] so on 500,000, that's $35,000 a year.
[10:05] Commercial real estate is
great for steady cash flow,
[10:08] as tenants normally stay for years
[10:09] and also maintain the property.
[10:12] If you buy right,
[10:13] then this historically gives
returns of around 8% per year.
[10:16] So on $500,000, that's 40k a year.
[10:20] Fourth, I'd put half a million dollars
[10:22] into blue chip crypto
like Bitcoin and Ethereum.
[10:26] Bitcoin has been one of
the best-performing assets
[10:28] of the last decade,
[10:29] so it makes sense to have it
in an investment portfolio.
[10:33] However, it is highly volatile
[10:35] and can go down just
as fast as it goes up,
[10:38] so treating it as a 5 to
10% moonshot allocation
[10:42] makes sense.
[10:43] Bitcoin's last decade saw
explosive gains of 49% annually,
[10:48] but past performance
doesn't predict the future,
[10:51] so let's normalize it
to a 10 to 15% range.
[10:54] $500,000 could average
roughly 62.5k per year.
[10:59] Fifth, I'd put $1 million
[11:02] into a high interest savings account
[11:04] such as this one from SoFi
that offers up to 4.5%.
[11:08] On $1 million, that's 45k a year.
[11:11] Altogether, that example portfolio
[11:13] could generate around $312,500
per year in passive income
[11:18] if markets perform like
their long-term averages.
[11:21] But remember,
[11:22] past performance is no
guarantee of future results.
[11:25] If you want to get started
building an investing portfolio,
[11:28] I actually reached out to Trading 212
[11:31] to see if they wanted to sponsor
this portion of the video.
[11:34] They agreed and are actually giving you
[11:36] a free fractional share
worth of up to 100 pound
[11:39] when you use the code TILBURY
[11:41] in the promo code section of the app.
[11:43] Don't wait to win the lottery
to get started with this,
[11:46] just get it set up now.
[11:47] And trust me, you'll thank
yourself in the future.
[11:50] (dramatic jazzy music)
[11:52] The ones paying very close
attention will realize
[11:55] that I missed out 500k
[11:57] from that $5 million
investment portfolio example.
[12:00] That's because you should spend that 500k
[12:03] on whatever you like.
[12:05] Call it fun money.
[12:06] I went through this stage and
realized that having money
[12:09] isn't about Lambos or mansions.
[12:11] It's about never having to do
things you don't want to do.
[12:14] Real wealth is waking up and
deciding how to spend your day.
[12:18] Don't be like those lottery winners
[12:19] who blow it or chasing possessions,
[12:21] not freedom.
[12:22] The rich that stay rich
[12:23] are the ones who buy back their time.
[12:25] Once you secured yourself,
[12:27] think beyond yourself and leave a legacy.
[12:29] If you want to learn exactly
how to invest for beginners,
[12:32] then I'm gonna leave that
video right up there.
[12:33] But don't click on it just yet,
[12:35] make sure to subscribe if
you wanna grow your wealth.
[12:37] Okay? (tongue clicks)
I'll see you over there.