3 Science-Backed Strategies To Build Wealth, According to Humphrey Yang
Written by
Chris Adam
Edited by
Amen Oyiboke
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The idea of being wealthy has lots of interpretations in the United States. For some, it may mean having a large amount of money left over after paying the bills.
For others, they may feel wealthy once reaching a certain amount. According to a Charles Schwab survey, Americans thought it took about $2.5 million in 2024 to be wealthy.
Perhaps science has some clues about how to achieve wealth. Financial guru Humphrey Yang explained in a recent TikTok video his three strategies, backed by science, that he’s used in the past year to double his wealth.
Limit Credit Card Use
You may have felt good at some point in the past when using a credit card to make a purchase. According to Yang, that feeling is backed up by science.
“The first secret is to realize that your brain is actually wired to reward you when you use a credit card,” Yang said.
Yang cited a 2021 report from MIT researchers, which found that a reward part of the brain is activated when someone uses a credit card. Consumers also typically think less about the pain of the price when they use a credit card instead of cash.
Pay Yourself
You may be familiar with the second strategy Yang suggested — pay yourself first. One way to do this is to keep a certain percentage from each paycheck in a separate account.
Per Citizens Bank, you may have heard this strategy called “reverse budgeting” — that’s because you put your savings goals ahead of your expenses. One way to make this easier is to work with your bank to automatically have your specified amount pulled from each paycheck and sent to savings.
Invest Early
The third strategy builds on the second one. You take that money you have set aside by paying yourself first and investing it.
Yang talked about the importance of starting to invest as early as possible. One big reason is compounding — where your money builds upon itself. If you start investing at age 20 rather than age 30, you may easily see a great deal more money in the end.
Let’s take an example from Thrivent Funds. Keeping it simple, suppose someone invests $100 each month for a decade. It could grow to $283,973 after five decades. On the other hand, suppose someone else waited 10 years and then did the same $100 a month for four decades. Based on simple calculations and a 7% return each year, the second amount would be $264,012.
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