Wealth Hacker Jeff Rose: 8 Things That Keep Poor People Broke

Jeff Rose used to be just like many people — making the same money mistakes and always asking why he was broke. Then, he found a way to hack through and obtain wealth, passing along his knowledge and wisdom via his YouTube channel and educational courses.

Does it feel like you are in an endless loop of not being able to save, invest and get out of debt? In a recent video, Rose covered eight “wealth killers” and his advice for how to avoid them.

Here are his eight things that keep poor people broke.

Rose calls an “IUL” — which stands for “index universal life” insurance — disgusting. He said that insurance brokers often try to pass it along to unknowing individuals as the safe alternative to traditional retirement savings plans, such as 401(k)s or Roth IRAs. 

While you might have access to your funds at any time, Rose warned that this kicks in only after a certain amount of time because it requires prepayment of the insurance cost to get the policy. Even as an IUL offers market protection, Rose called out how the cost of the insurance diminishes the returns and how no IUL is free from a market cap.

This isn’t limited to just the entertainment streaming platform Netflix. Rose name dropped TikTok, YouTube and any other form of entertainment that takes away time and money from your pockets. 

Rose highlighted how most people spend 3.2 hours a day on Netflix, which adds up to 1,100 hours a year, compared with the 16 minutes a day most people spend reading a book, or 97 hours a year.

Rose said he believes that reading will increase your personal and professional development in ways that “numbing out on Netflix” will not.

We all have places to go, but how we get there might be keeping us broke. Rose cited a statistic that the average new car payment is $735 a month, adding that “you are investing into an asset that depreciates 20% after the first year.”

In his opinion, Rose said that there is no need to opt for luxury in a car and no one should be looking to buy a new car in general when most used vehicles are better in terms of price and value.

Rose said that when it comes to whole life insurance, it is typically mismarketed and misrepresented to the general consumer. The people who do not need whole life insurance but are targeted for it are usually single, don’t have dependents, are not investing in a retirement plan and have a large portion of debt.

Rose argued that these kinds of people do not need whole life insurance — or even term insurance — as it is just a waste of money.

Rose acknowledged that for the modern age, DoorDash, Grubhub and other food delivery services are easy and convenient for when you and your family are hungry but don’t feel like cooking or going out. But that could cost you in the end. Not only is there price hiking on the food but there are also extra fees for delivery, tip and service charges.

Save your money by going to the grocery store and trying to find some no-hassle recipes to cook up at home.

Rose said he knows that everyone wants to find the next big stock to cash in on and get rich quick. However, he cautioned that most of the time, the market does not work like that. Looking at the numbers, Rose said, “On average, day traders, 90% of them are going to lose money.” 

Unless you are a professional day trader who does this for a living, Rose advised looking at blue chip dividend-paying stocks and other less chic ways of investing in the market that pay off dividends in the long run.

It sounds kind of crazy to opt for renting instead of owning a place to live, though Rose highlighted how this might not be as out there of an idea as we’ve been taught to believe. Rose said the real estate market is “insane” and that “prices, in some areas, more than double.” 

“We have mortgage rates that are the highest they have ever been. So for the same house you could’ve bought three years ago, you’re now paying two to three times more for the exact same house,” Rose said. 

Knowing that this is not a blanket statement that can be applied to everyone everywhere, Rose pointed out that in some cases, it makes sense to buy a piece of property, but in others, it might just be better to save your money and spend it on rent. Rose noted that it usually takes about eight years to start to see equity in a home you own and that up until that point, most owners are simply working to pay off the interest.

Mortgages are just the start, in Rose’s opinion. Then there is the property tax, insurance and repairs, none of which are cheap. Bottom line: “You are not always throwing money away if you choose to rent,” Rose said.

Rose said that if you have only one income stream, then you “are one income stream away from being broke.” Should you lose your job and you do not have a partner who is also earning income, you could find yourself in dire financial straits. 

With this in mind, Rose explained that you could work overtime for the one income source you currently do have or you could pave your own way to create a stream of earnings that you control. This is a side hustle that “complements your current job … your current salary,” Rose said. 

“Essentially, what you are creating is an insurance policy for your income,” Rose said. It might not replace your income entirely, but it could supplement part of it should you lose your job or be hit with a big expense.