George Kamel - Why “Finance Experts” Want You to Stop Saving Money

Episode Date: August 28, 2023

In today’s episode, I’m looking at viral videos out there of “influencers” and financial “experts” who are discouraging people from saving their money.   EveryDollar Budget Deal: I love a good deal, when you sign up using this link, I’ll hook you up with a 14-day free trial and $15 off your first year of the premium version of EveryDollar. Learn more about your ad choices. Visit megaphone.fm/adchoices

Today I want to share with you a lesson I've kept near and dear to my heart through life's ups and downs. And here's the lesson. Everything not saved will be lost. I learned this golden nugget on the same battleground where many of you also faced your own adversities, the Nintendo Quit Screen. That's right. Even as a kid, I understood how crucial saving was. And I also understood the regrettable consequences of failing to save. It's just been a long fight. It's been a long fight, and I just had to have a warrior spirit. And if kids get how important it is to save, then why on God's grief?

earth is it on trend for grown adults to boast that not saving money is some kind of financial wisdom. So in today's episode, I am looking at viral videos out there of influencers and financial experts who are discouraging people from saving money. But before I break down their bloviations, there is one final task I need you to complete so you can save my bacon. And that's hitting the like, subscribe, and share trio. All right, let's get to it. This is why saving money is so stupid. Now, don't get me wrong. You should ideally be spending less than you make each month. But if you want to become financially independent, by saving a little bit extra each month, it's literally going to take you decades.

What you need to do is instead focus on actually bringing in more money each month. And if you're in a job that has a low income potential, I really recommend sorting that out first and looking for ways that you can make more money. All right. Thank you, Mr. Passive income. You're welcome, Lester. This idea, he's so fatalist. And he's like, if you're going to save money, he's going to take decades, man. and just go make more money.

That's the solution. We have stats that show people making six figures are living paycheck to paycheck. So the answer is not always more money. And it's very deflating for people who are making 35 grand going, okay, so I can't save anything because I don't make enough money?

Here's the idea behind all of this, and that is lifestyle creep. The more you make, the more you spend. If you can learn to keep living on less, like he did mention, I'll give him credit for that, then you have some margin to actually save and put away money or investing for your emergency fund, for savings goals, whatever it may be.

So building wealth is a marathon, not a sprint. I'm like Forrest Gump, except I am not an idiot. Saving little by little can compound overtime dramatically as you invest over your working lifetime. So don't listen to that guy. He's full of something and probably an online course to go with it. All right, let's get to another one. Saving money is stupid. It is ridiculous.

The only thing that ever happens to people that save money is they end up losing it isn't up getting lost, it ends up getting stolen, or it ends up going down in value. But it's never going to get bigger. You save money at the bank. It ain't getting bigger. We've all been told, save your money, save your money, save you money. Who does that really benefit? Remember, I read the Blackjack book, How to Play Blackjack.

I knew every card to hit. And then I realized everybody at the table had read the same damn book. Everybody's staying on 16s. And this freaking guy's banging 16s against 9s or 16s against 7s. Everything he shouldn't do, he's doing. And he's making all the money. He was the only one not playing by. the book. Everybody should buy a house. Maybe not, because the wealthy guys never talk about the house

they bought. Orn Buffett owns one house. So I got a lot of those little things that I have just observed in my own life. They're just not true, man. Period. Okay, that was Grant Cardone, who is very well known. You know him because of his 10x hat. He's all about just 10x everything. And apparently he thinks saving money is stupid because it doesn't grow. Okay. Where does Grant Cardone think that we're saving our money? The purses of elderly tourists and Tijuana? I mean, we're putting these in FDIC insured banks. Our money is safe. And yes, it's not meant to be a growth investment vehicle.

It's meant to keep the money safe to cover emergencies and hit our savings goals. We do our investing for investing. We do our savings accounts for saving for emergencies. It's that simple, Grant. Get with it, bro. Moving on. Yo, stop trying to save money. Do this instead.

This is advice of people who want to get rich. Want to make real money. If you're cool with poverty or being middle class, thing for you. There's a lot of people online telling you save money. I make my own coffee. I've been wearing the same jeans for 12 years. But that's not going to get you rich. You don't have a spending problem. You got an income problem. What I did when I was struggling is I just got more jobs. At one point I had four jobs. I was working 12 to 14 hours a day, seven days a week. And I was able to make more money. Then I invested that money into my businesses and now making multiple seven

figures. But it started with just getting more money. Whatever that means is that's a business. if that's another job, if it's multiple jobs, it's actually easier than clipping coupons, making your own coffee, flying economy. Stop being lazy, even if you're a janitor. Start doing some other janitor's shit after work. Get more money.

I actually like this guy. I want to hang out with him. He's very entertaining, even though what he's saying is kind of ridiculous. But no, I'm not cool with poverty, just for the record. If you guys were wondering, do I wish I worked out as much as he did?

Yeah, I mean, he looks fantastic. All right, the keto king right there. And there is something I like about what he said, that he's like, hey, you can go make more. Go get some extra jobs. He's not scared to work. And for that, I commend him. But this idea that we shouldn't save and we should just go make more, it doesn't make sense. Because if you

just make more, you're going to spend more. We've got to learn to build that savings muscle. That's on natural, baby. Something that I have that maybe he doesn't. That might be the one muscle. We did a study here at Ramsey Solutions on millionaires, over 10,000 of them. And here's what's wild. These people didn't have crazy income, and they didn't wear the same

jeans for 12 years, but they did to have reasonable lifestyles. They drove used cars. They didn't wear designer clothing. They just lived on lesson they made and they saved and they invested. And they had an emergency fund and they stayed out of debt. Building wealth is about really simple habits over a long period of time. So that big income won't matter if you got bad habits like not saving. You want to see another one? Oh, hey, your choice. Let's go. When you believe money is scarce, you try to hoard it and the issue is when you try to pull something in by force, it just pushes it away.

Huh? Instead of trying to pull in money by force, instead you must attract it. You've been taught your entire life, you know, money is this very scarce items. You have to be very careful around it and all the stuff when unequivocally, that's not true. All you need to do is look at the money printing they've been doing the past couple years. Okay, that went a lot of different ways. He started with this kind of like Socrates Aristotle, very philosophical vibe of don't try to hoard your money.

But then he ends with like, and they're printing all this money, man. What do you think that's about? That's your boy, Iman Godzi, and he's a super, super rich young guy, clearly with a cool accent. I don't have any of that going on for me. But what I do have is savings, and there's a huge difference between hoarding money and then having some money and savings. I mean, he's telling me not to hold on to money, but attract it like a magnet. Magnets. Okay, making magnets, collecting magnets.

Playing with magnets. Just magnets. You know what? I've never given that a try. Don't knock until you try it. You could be on. He might be onto something, okay? All right, let's do one more for good luck.

I don't know anyone who has saved themselves to success and wealth. It just doesn't happen. You look at the most successful and wealthy people. What have they done? They've built their wealth through property, businesses, investments. The average person struggles to save, don't they? They're over-leveraged with credit cards, loans, debts. Most people don't save.

There's 34% of adults in the Ukraine right now with zero savings in the bank. Imagine if something happens, you've not got that money to support yourselves. There's 300 million Americans with less than $1,000 in their check-ins account. This is just crazy. Why? Because we're all taught to save and that's the way to do it. Yes, I believe in saving. I believe you should have six months in the bank, six months of living expenses. So the worst happens, you've got cash there. You can support yourselves. I've got a lot of different things coming in, different streams of incomes. If one gets knocked out, I can still say.

Love the accent. First of all, let's just start there. I think that really helps. Second of all, she said there's 300 million Americans with less than $1,000 saved. I guess that includes babies? Because there's only like 330 million Americans total. So, uh, you got, uh, you got my money? What is going on it? Where is she pulling the staff from? But hey, that's the UK for you. They have pounds. They're in the metric system. It's very confusing. So she's conflating two different things. She's saying that you can't say, save your way to wealth, but also you should have a six-month emergency fund, but also wealthy people have all these businesses and investments.

But it's just not true. In our millionaire study, we found these are normal people working normal careers who weren't all entrepreneurs and investors. And I think an emergency fund can save you from financial ruin and protect the wealth that you're trying to build. So all of these videos, they're confusing because they're saying, don't save, it's impossible to save. You need to be building wealth and make more money. I think we can invest for the future while having an emergency fund to protect us. from life along the way. You have saved our lives.

We are eternally grateful. We've heard a lot of thoughts on saving money today, but here's the truth. When you save, you win. Having money puts you more in control in almost every area of life. When you have that control, you make smarter decisions,

and you sleep better at night. What do you say we get you in your PJs and we hit the hay? So there are three big reasons I recommend you save money. The first reason? Emergencies. It makes you ready for those times when life hits you upside the head.

You can deal with an emergency and be done with it and not let it hold you back by going into debt to cover it or worrying about payments in the future. So if you have savings when your microwave explodes due to a tinfoil mishap, you've got the damage covered. Once you get out of consumer debt, I want you to up that emergency fund from $1,000 all the way up to three to six months of expenses. That's going to be that barrier, that force field between you and life. The second reason to save is for large purchases.

You see, most people buy now and pay later. And that's why they call it, Buy now, pay later. It's like a credit card, but shadier. But that just brings on fees, interest, overdraft charges, and poor financial management. No thanks, Tom Hanks, not falling for it. So the right way to do it is save for it. Think about this. If you want to buy a $500 couch to replace that crusty Craigslist fine,

try saving $100 a month and do that for five months. Then you'll have the cash to buy it. That's called delayed gratification. Plus, it's a good test. You find out how much you really want an item when you know you've got to wait for it and you've got to save up for it over time. So to do this the right way, I recommend using a sinking fund

to save up a certain amount every month in your budget to hit your goal. And the every dollar budgeting app makes this super easy to set up and track. All right, the last reason to save is for retirement. That's right, the future's coming, baby. Time keeps on slipping, slipping, slipping,

slipping into the future. Future's now, old man. Listen to these numbers. If you invests just $100 a month for 40 years, that's a normal working lifetime, You could have well over $1.2 million saved up for retirement. That's right, $100 a month. Most of you are spending $100 a month on soggy postmates tacos.

Hey, yo, you know this, boy, he's got his free taco. So millionaire or overpriced mid-tier Mexican food. The choice is yours. You see, when you save, the process itself makes the money work for you. You don't spend extra things to interest and overdraft and fees. You discipline yourself, and you've got a big reward coming when you finish. In the meantime, I want to know what are your short and long? term savings goals. What are you saving up for? What are you investing for? Let me know below in the

comments and I'll jump into the conversation with you. And be sure to share this with your friend who's likely to fall for one of these gurus courses or 10x summits. They need some help getting talked off some get rich quick ledges. Thank you guys for watching. We'll see you next time.