How to be poor for the rest of your life

[00:00] If you don't want to

[00:02] then you have to avoid the

[00:04] that nobody talks about.

[00:06] Take a look at this chart,

[00:07] it shows how the average person

[00:09] spends their money each month,

[00:11] and believe it or not,

[00:12] one of these categories is

[00:15] of building wealth.

[00:15] So let's uncover it together.

[00:17] First up, housing.

[00:19] This is the biggest slice of the pie,

[00:21] so it's definitely the

[00:23] Well, although paying rent

[00:27] at least it provides you

[00:28] with a place to live.

[00:29] Next, taxes, nobody likes these.

[00:32] Well, unless your name

[00:35] but let's not get into that.

[00:36] Next, utilities and household expenses,

[00:40] they're not fun to pay,

[00:42] but you can easily get

[00:44] for the best deals.

[00:45] How about all of these?

[00:47] There are so many of

[00:49] but most of them are flexible,

[00:51] so that leaves us with one section left.

[00:53] Can you guess what it is?

[00:55] Transportation; car payments,

[00:58] insurance fuel repairs parking

[01:01] all for something that goes

[01:05] The average new car costs nearly $48,000.

[01:09] It's not an investment, it's

[01:12] and in most cases

[01:13] it's just a financial

[01:15] That's why out of all of these expenses,

[01:18] transportation, specifically your car,

[01:21] is the number one wealth killer

[01:23] and it's only getting worse.

[01:24] (eerie music)

[01:27] There's been an absolute explosion

[01:29] in the amount of money

[01:31] It's honestly getting outta control.

[01:34] Let me show you what I mean.

[01:35] In 2005, total auto loan debt

[01:41] Five years later it reached $850 billion.

[01:45] Fast forward to 2020,

[01:47] it's rocketed all the

[01:51] and in 2025 we're sat at an all time high

[01:54] of $1.62 trillion.

[01:57] This has led to more people than ever

[01:59] being what I like to call car poor.

[02:02] This is when you're making just enough

[02:04] to cover your car payments,

[02:05] but not enough to build

[02:08] It's like you're trapped on a treadmill

[02:10] that never slows down,

[02:11] but why get on this

[02:14] Well, more people than

[02:17] and driving a nice car

[02:18] is one of the quickest ways

[02:21] The car industry spends billions

[02:24] that a new car is gonna

[02:27] confidence and maybe even your love life.

[02:29] They don't show you

[02:31] on a rainy Tuesday after getting slapped

[02:33] with a $600 repair bill.

[02:35] Clever marketing makes you

[02:38] but really it's a liar being

[02:41] Look at the cyber truck

[02:43] that wasn't sold on

[02:46] It was sold on the image of power

[02:48] and looking like you're

[02:50] Social pressure fuels this too.

[02:52] Nobody claps when you drive

[02:55] and running smoothly,

[02:56] but if you roll up in a

[02:59] people tend to give you approval

[03:01] and assume you're doing

[03:03] I see so many young lads these days trying

[03:05] to look successful rather

[03:08] to be successful, especially in cultures

[03:10] where car ownership gives you credibility.

[03:13] This need to look rich, it's

[03:16] It makes people stretch

[03:19] that the car actually ends up owning them.

[03:21] This car poor trap gets

[03:24] as they borrow more than

[03:27] It sounds silly and you might be thinking,

[03:29] why would anyone do that?

[03:31] But it's actually very common

[03:33] and it's called being in negative equity

[03:35] or upside down on the loan.

[03:37] In Q4 of 2023,

[03:39] nearly one in four people

[03:42] so this could result in

[03:45] that's only worth $30,000.

[03:48] This means your $10,000

[03:51] I've actually had a lot of people email me

[03:53] after reading my free weekly newsletter

[03:55] saying it helped them

[03:58] and even make a bit of extra money

[03:59] with some of the strategies I share.

[04:01] Is something I just do for fun

[04:03] and I really enjoy reading the replies,

[04:05] so if you want me to send

[04:07] I'll drop a link in the description.

[04:09] Anyway, if you want to

[04:11] like most people,

[04:12] then you need to

[04:14] that so-called affordable

[04:17] (eerie music)

[04:20] I feel like a lot of

[04:22] that the sticker price of a

[04:26] of owning that car.

[04:27] Let me explain.

[04:28] Take a look at this Honda Civic.

[04:30] It's the most commonly purchased car

[04:32] by people aged between

[04:35] and on the surface it looks

[04:38] The sticker price is $27,867,

[04:44] which seems reasonable.

[04:45] However, let's dig into the true cost

[04:48] to own this car over five years.

[04:50] First up is depreciation,

[04:52] and on this car that's $10,999.

[04:56] This cost starts the second

[04:59] off the lot as it drops 10 to 15% in value

[05:02] before you even make it home.

[05:03] Over five years,

[05:05] you'll lose nearly $11,000

[05:08] Think about that.

[05:09] $11,000 just gone

[05:12] all because time passed

[05:15] It's like paying $2,200

[05:20] of watching your money evaporate.

[05:21] Next is insurance.

[05:24] This is nearly $12,000 over five years,

[05:27] and that's a conservative estimate.

[05:29] This figure is based on a 40-year-old

[05:31] with a perfect credit

[05:34] If you are a young guy,

[05:35] then this number is actually much worse.

[05:38] You are probably looking at double that.

[05:39] Sure, you can get this down a bit

[05:41] by calling them every

[05:44] and never staying loyal to one company,

[05:46] but it's still gonna be a high cost

[05:48] even if you do manage to get

[05:51] Then there's fuel.

[05:53] $6,415, just to keep the thing moving.

[05:57] This is actually getting so expensive.

[05:59] Now for financing.

[06:02] This is the cost of not

[06:04] $4,719 over five years

[06:08] assumes you've got a decent

[06:12] but if your credit score is bad,

[06:14] then you could be looking

[06:18] instead of the six to

[06:21] That's why I always

[06:23] of building up a good credit

[06:26] and putting small monthly expenses on it

[06:28] that you pay back in full

[06:31] This means you avoid paying any interest

[06:33] and prove that you're

[06:35] Next up is maintenance.

[06:38] $3,224 over five years

[06:42] for oil changes, brake pads,

[06:46] However, you can do this a lot cheaper

[06:48] if you learn a little bit about cars.

[06:51] I used to race in car championships

[06:52] so I know the ins and outs of

[06:56] This has saved me

[06:58] I mean, if you learn

[07:00] you'll save 30 to $50 every single time,

[07:04] and if you buy a basic OBD

[07:07] you can diagnose most problems yourself

[07:10] instead of paying the

[07:12] to plug it in and tell you what's wrong.

[07:14] Then taxes and fees.

[07:17] This is just the

[07:19] registration and inspection fees

[07:21] will come to around

[07:24] Finally, we've got repairs.

[07:27] We'll budget $1,790 for

[07:31] These surprise expenses are killers

[07:33] if you're not prepared for them.

[07:35] Even reliable vehicles

[07:37] will eventually need repairs

[07:40] This is exactly why you

[07:43] of three to five months

[07:45] Without it, a single

[07:48] your entire financial plan.

[07:50] With cars, it's not a matter

[07:53] it's when.

[07:54] So let's add all this up.

[07:57] Drum roll please.

[07:58] Your affordable $27,867 Honda Civic

[08:04] actually costs you $46,821

[08:09] over five years,

[08:10] but it gets even worse than this

[08:12] as this doesn't even

[08:15] (eerie music)

[08:17] This is where it gets really painful.

[08:19] Let's look at a five year comparison

[08:21] between someone that chooses the car

[08:23] and someone that chooses to invest.

[08:25] If you decide to choose the

[08:28] then after five years,

[08:29] you'll only be left with $19,295.

[08:35] This is, of course,

[08:37] at its current market value.

[08:39] That's assuming it's been well maintained

[08:41] with minimal damage.

[08:42] That's a loss of over

[08:45] No wonder it's such a wealth killer.

[08:47] However, if you choose to take

[08:49] that same $780 monthly payment

[08:52] and stick it into an S&P 500 index fund

[08:55] based on the historical average return

[08:57] of around 10% per year,

[08:59] after five years, you'd

[09:05] Of course, past results can't

[09:08] However, if it followed the

[09:11] then that would be gain of

[09:15] That's a price difference of $40,721.

[09:21] That means by choosing

[09:23] you could be giving up $40,000 of wealth.

[09:26] Most people repeat this

[09:29] for their entire work in lives.

[09:31] This is just one example of

[09:33] You could choose to invest

[09:36] buying a rental property,

[09:38] or even launching your

[09:40] The key is getting your

[09:42] instead of against you.

[09:43] That's not even mentioning

[09:47] although they are riskier investments.

[09:49] But to put it into perspective,

[09:50] if you'd invested that same $46,821

[09:54] in Microsoft stock five years ago

[09:57] instead of the Honda Civic,

[09:58] you'd have seen a 224% total return.

[10:02] Turning your money into

[10:06] Think about that for a second.

[10:07] The same money that bought

[10:11] could have bought you a small fortune

[10:13] in one of the world's

[10:15] The point isn't that you

[10:18] It's that every financial

[10:21] Every dollar tied up in something

[10:23] that loses value is a dollar

[10:25] that's not compounding in your favor.

[10:27] You might be thinking, "If this is true,

[10:29] then why aren't more people investing?"

[10:31] And to be honest, I think it's

[10:33] because they don't understand

[10:35] Back in my day, it used

[10:37] as you had to phone up a stockbroker.

[10:39] However, now you can use

[10:43] right from your phone.

[10:44] You can set up an account,

[10:47] and then search for S&P 500

[10:51] if you want to keep it

[10:53] As I was planning on talking

[10:57] I reached out to see

[10:59] in sponsoring this portion of the video.

[11:01] They agreed and are also

[11:04] worth up to 100 pound to

[11:12] in the promo code section of the app.

[11:14] (eerie music)

[11:16] Now, look, I get it, in many places

[11:19] not having a car means

[11:22] A study by Capital One actually

[11:26] said owning a car opened

[11:29] they wouldn't have had without a car.

[11:31] So that shows that sometimes

[11:32] there is a clear opportunity

[11:36] So I'm not against getting one,

[11:38] but if you're smart about it,

[11:40] you can still free up

[11:43] So if you want to buy a car and invest,

[11:45] then here are the three steps

[11:48] Step one, buy in the sweet spot.

[11:51] This is when you buy a car

[11:54] with 30 to 40,000 miles on the clock.

[11:57] This is great because you dodge

[11:59] the brutal first year depreciation hit,

[12:01] but still get modern safety

[12:05] and often remaining warranty coverage.

[12:07] A car that costs $35,000 new

[12:12] so that's $11,000 in instant

[12:17] Step two, follow the 15% rule.

[12:21] Your total transport costs,

[12:24] insurance, fuel, and repairs,

[12:27] should never exceed 15%

[12:30] If you earn $3,000 per month,

[12:32] that's a maximum of $450

[12:37] Push past this

[12:38] and you're getting dangerously

[12:41] Step three, keep it

[12:45] This is where you actually build wealth.

[12:47] Most people trade in their

[12:50] which is financial madness.

[12:52] Instead, buy once and maintain it

[12:54] like your financial future

[12:58] If following these steps

[13:01] compared to buying new,

[13:02] that's $3,600 every year.

[13:05] Invested at 10% annual returns,

[13:08] that becomes more than

[13:12] That could be the down payment on a house,

[13:14] all funded by making smarter car choices.

[13:17] If you want me to walk you through

[13:18] how to set up an invest in

[13:21] then I'm gonna leave that

[13:23] but don't click on it just yet.

[13:25] Make sure to subscribe if

[13:27] Okay, I'll see you over there.