Here’s Where Wealthy People Put Their Money
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Why do wealthy people focus on buying back their time and how can you start doing it?
If you want to be wealthy, do what wealthy people do, right? But where do they put their money and what assets do they actually own and what investments do they have?
Brian, I am so excited because today we're gonna reveal where wealthy people put their money to help them not only preserve but also grow their wealth, and we're gonna talk about the strategies that you can copy to apply to your own financial life.
So I'm Brian. He's Bo, and this is the Money Guy Show, where two financial advisors show you there's a better way to do money. And with that, let's jump right in.
Yeah, Brian, according to the Federal Reserve, if you want to be in the top 10% of wealth in this country, you need to have a total net worth of about $1.9 million. And obviously, you may be asking, okay, if if folks have that kind of money, what is it that they spend their money on? Or where do they actually put their assets? And it might not be what you think.
Come on, Bo. I've seen enough episodes of cribs. Uh-huh. I mean, we're we're probably talking yachts, Rolexes, supercars. I've seen enough on my social media feed to have this figured out.
Yeah. Well, when you actually look at the numbers, what's great is the Federal Reserve actually tracks this data. They look at, okay, well, where do wealthy people put their money? It's not in the places that you would think. And while you may not be in the top 10%, you may not be at that $1.9 million net worth stage yet. I would argue there are a lot of things that wealthy people do that you can copy even today. Just start putting yourself on that path.
So before we get into the yachts and supercars that I was talking about, you're probably gonna start me off with number one, which is they buy back their time. That's exactly right. Wealthy
people, they figure out that there is a way to actually exchange their dollars to buy back their time. This doesn't always mean luxury things. Sometimes it's outsourcing low-value tasks they just don't want to do. So they can focus on using their time for the things they actually care about.
Now, it looks like the content team had to dig deep on this one, but they did find research that shows that millionaires were nearly three times as likely as the general population to outsource many of the tasks that they don't enjoy.
That's right. This can be things like cutting their lawn or cleaning their house. And so when you're at this level of wealth, you recognize that your time becomes more valuable as your financial circumstances change, as your income increases, as your responsibilities increase, and as your complexity increases, your ability to buy back your time as those things happen become more. Yeah.
Now, I I think it is important to put an asterisk on this and say this is not actually what they did to become wealthy. It's just something to note that once they have actually built up a base level of assets that they do outsource so they can use their time as they please. In a sense, they are actually turning their money into time saved.
That's exactly right. They recognize that time is money and money is time. So what's the strategy that you can copy? How can you begin to emulate that today? Recognize that right now you are going to trade your time for money until ultimately you get to the point and you build up assets to then where you can start trading your money for time. Okay.
Surely
the next one is where Alex is.
Right.
Sure, obviously. We got to have fancy watches. No. Wealthy people, when it comes to where they put their money, they actually put their money in the stock market.
So if if we compare and contrast typical Americans to wealthy Americans, it is interesting to note that 58% of all Americans own equities. I think a lot of that's probably in retirement plans, like their 401k. But if you actually compare that to the top 10%, 96% in that top 10% of Americans do own equities.
Yeah, and what's interesting is when we say own equities, I don't think that has to mean individual stocks. It's exactly what you said. They're participating in their employer-sponsored retirement accounts that are low, they're owning low-cost index funds, that are owning mutual funds.
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