Jaspreet Singh Shares How the 1% Builds Generational Wealth
Written by
Laura Beck
Edited by
Maria Concepcion
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Jaspreet Singh is a lawyer turned entrepreneur who shares financial education on his YouTube channel Minority Mindset. In a recent video, Singh offered insight into how the wealthy elite perpetuate their fortunes across generations.
According to Singh, here’s how the 1% builds generational wealth.
They Master the Capitalist System
“Our system is designed to benefit people who understand the capitalist system,” said Singh. This means leveraging capital, not just labor, to make money. Singh explained, “In a capitalist system, there are two ways you can make money — from your labor and from your capital.”
But schools never teach about earning from capital. “Our entire education system is designed to teach you how to make money from your labor,” remarked Singh. While hard work is important, the wealthy focus on making “money from your capital.”
They Own Appreciating Assets
Singh said the wealthy derive most income from appreciating assets like real estate, stocks, and businesses. “If you want to win in this economic system,” he advised, “the way you win is by owning assets.” Singh added, “When you’re earning money from your job, you’re working to earn money, but there’s a limit…to how much you can work. But there’s no limit to how much your money can work.”
They Use Debt Strategically
“Our system welcomes debt,” noted Singh. While the middle class avoids debt, the wealthy utilize it to acquire income-producing assets. “For Europeans moving to the US, it is key to understand that the finance system here is structured to welcome debt,” Singh stated. The wealthy borrow strategically to invest and grow their wealth.
They Retain Equity
Singh defined equity as assets that keep paying even if you stop working. Equities like stocks and real estate keep producing income when you retire. Singh said, “If you can’t go into work anymore, your company is not going to keep paying you.” But with equity, “You can continue to keep getting paid without you having to continue going into work.”
They Take Calculated Risks
The wealthy focus on high-return investments, which often come with higher risk. According to Singh, “Our system is designed to benefit people who…understand how to take risks.” The wealthy mitigate risks by diversifying. Singh invests in stocks, real estate, gold and cryptocurrency to spread risk. “With their Investments, they also have the potential to earn lower tax rates and higher deductions,” said Singh.
They Make Money Work for Them
Rather than spending raises frivolously, the wealthy re-invest profits. “This is not a time for you to reward yourself for making more money,” advised Singh. He invests income, so his money “works” for him. Then, assets like stocks and rental properties generate cash flow to fund the wealthy’s lifestyles. “I like buying an asset and knowing that I’m going to get paid month after month,” said Singh.
They Maintain Perspective
Building substantial wealth takes a long-term focus. Singh noted poor decisions stem from short-term thinking and emotions. Avoiding “shiny object syndrome”, resisting the temptation to time markets and tuning out fear-driven media noise are key to the wealthy’s success. “Building wealth is a marathon, not a sprint,” Singh remarked.
They Leverage Expertise
“Our system benefits people who understand how to invest,” stated Singh. The wealthy lean on financial advisors and education to improve their money skills. Singh believes every American should be a business owner, if not actively, by owning stocks. The ultra-rich also hire others to do tasks that don’t use their time best.
Bringing It All Together
To generate and preserve vast fortunes, the 1% masters the drivers of wealth, from asset appreciation to risk management. Following Singh’s tips — putting capital to work, retaining equity, re-investing income, taking the long view, educating yourself and outsourcing — can help anyone build wealth.
More From GOBankingRates
