Jaspreet Singh: Follow This 5-Step Plan To Save $500K by Age 45
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Heather Taylor
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Molly Sullivan
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Are you worried your retirement savings amount is not quite where you’d like it to be yet? If you find you’re behind on saving, money expert Jaspreet Singh said it’s not impossible to get caught up.
A video posted on Singh’s YouTube channel explores steps you can start taking today that can help you build real wealth and live the life you want in retirement. Follow these five steps to save $500,000 by age 45.
1. Stop Doing What Everyone Else Does
“If you spend the way everyone else does, you’re never going to have the wealth few people have,” Singh said.
Even if everyone else thinks it’s normal to spend a lot of money, rack up credit card debt, or purchase cars outside their budgets, you don’t have to do it. Singh said he calls his show the Minority Mindset because if you end up doing what the majority of people do, you’ll end up like the majority financially and find yourself broke and living paycheck to paycheck.
You have to decide what is most important to you, even if this decision isn’t popular with everyone else. Do you want a car or wealth? By making this decision, Singh said wealth starts in your mindset. Your mindset controls your spending and what you do with your money.
2. Stop the Financial Bleeding
Right now, Singh said you need to pay down any high-interest debt, like credit cards, ASAP.
Singh uses the example of someone who has $5,000 in credit card debt but only makes the minimum monthly payments. This debt will cost you not just the $5,000 you need to pay back, but another $10,000 in interest. It will cost you three times the original amount to get out of debt.
Paying down high-interest debt, especially on credit cards, requires getting aggressive. This means not spending money and working to earn more money to pay off this debt.
3. Put Your Money To Work
After you change your mindset and pay off your debts, you have the ability to build true wealth. Those who have money left over each month can put it in savings or invest it.
Your savings can protect you in case of an emergency, like losing your job, and keep you from going into credit card debt. At the same time, Singh said if you want your wealth to grow you need to invest your money.
Think the way wealthy people do and do what they do to end up like them. If wealthy people work not for a bigger paycheck but to own more assets, how do you earn more assets? You’ll need investments. Singh said you’ll need to work for good investments, like stocks and real estate, and keep buying good investments to build wealth. Your job should be to learn how to invest your money and how you can get the best returns possible.
4. Adjust the Aggressiveness of Your Investing Strategy
Three factors determine how wealthy you will become. These include how long you invest your money for (time), how much you invest and the return.
Receiving a better return requires learning about different investment strategies. Singh said he uses active and passive investing strategies in the stock market. The active investing strategy is investing in individual companies — something that takes Singh more work, time and risk to do. But the upside is way more. Investing in a good company means seeing 20% to 30% of returns. It takes more risk but offers a higher potential for reward.
5. Work To Earn More Money
Are you prepared for life 10, 20 or 40 years from now? If you’re not happy with where you are financially or feel like you don’t make enough money, Singh said you’ll have to have to work to earn more money.
One possible way you can earn more money is through a side income or by starting a small business. Singh recommends taking advantage of the free financial education available online and reading books. Then, start doing it to earn money.
Remember to ask yourself why you’re working to earn more money. Is it to buy a car or go on vacation? Or are you working to earn more wealth and reach financial freedom?
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