Month: August 2017

I Surveyed Over 100 Millennials About Wealth

Wealth Survey

The Wealth Survey

“I got 1-2-3-4-5-6-7-8 M’s in my bank account, yeah (on God)” – 21 Savage (Bank Account)

When I first started blogging months ago, I remember having an in depth conversation with a friend of mine about personal finance. We chatted and we chatted, but one question stood out unequivocally. “What’s your definition of wealth?”

At first, I gave the textbook answer of “assets minus liabilities”. Looking back, I’ll remember that moment as a cop out. People work eighteen hour days to acquire wealth. Heck, families are torn apart over money. I’ve seen friends fight over money. And I regret to say that it was over chump change. So, with that context in mind, wealth’s got to mean more than an accounting equation.

My friend looked at wealth as the moment in time that your passive income surpasses your total expenses. That had a bit more meat to it. But maybe we both should’ve gone a bit deeper. Maybe we were both holding back for the sake of intellectualism. Maybe we just hadn’t spoken in awhile and still needed to chisel off the ice a bit. Both answers seemed a bit technical, robotic even.

Months later, after writing over forty blog posts, I set on a quest to find 100 people to fill out a survey and give their opinions about wealth. I ended up with 110. You get some pretty interesting answers when you survey 100 people about money. A majority of the remainder of this post will be dedicated to summarizing these results, but you can find a summary of the responses here.


All people surveyed were between the ages of 19 and 33 years old with a majority within the range of 20-25 years of age. A majority of survey respondents would characterize themselves as “middle class” and roughly 80 percent of the responses were from individuals that would classify themselves as African-American.

The definition of wealth

“I don’t know why I came in this club with you, girl
Don’t know why I came in with these diamonds on my chain
Surrounded by bad b****** I can’t get ’em out my face
Is it cause a n**** handsome and wealthy?” – Migos (Handsome and Wealthy)


When I analyzed over 100 responses about the definition of wealth, a few key patterns solidified.

They fell into the following categories:
  • Generational – money that can be passed down for generations to come
  • Textbook definition – assets minus debt
  • Freedom – the ability to act without concern about money
  • Excess money after paying bills
  • Ownership – investments and control of assets

Ideal Net Worth

Months ago, I watched a YouTube video that changed my outlook on success. “The Strangest Secret” by Earl Nightingale recorded in 1956. It’s a fascinating motivational video if you’ve never checked it out. But more importantly, it presents a pretty intriguing story.

Nightingale opens his speech with a story about 100 25-year-old men. His hypothesis was that if you followed the progress of this group of men from the age of 25 to 65 that you’d be frightened by the end of each journey. Each starts the journey at an even starting point with the belief that they’re going to be successful. By the time that they’re 65, only one becomes rich. Four become financially independent. Five are be working. 54 are broke.

As I sat in my room looking at responses, I couldn’t help but think about the excerpt from Nightingale’s recording. Perhaps a bit pessimistic of me, but maybe as I share results, you’ll understand my angle.

Out of the 110 responses, over 15 people said they wanted a net worth of over a billion dollars. When I asked a very similar question of what each respondent expected their net worth to be at age 50, the responses changed a bit. 12 brave souls planned to be billionaires by 50. For both questions, it was pretty rare to see any person respond with a figure lower than $1 million.

There are currently 10.4 million millionaires in the United States. The total population is approximately 326 million. That means roughly 3 percent of Americans are millionaires. There are 540 billionaires. That means that 0.000165 percent of Americans are billionaires. A much smaller portion of America than the self-proclaimed future billionaires taking my survey. But who knows, maybe there are a few billionaires that like taking surveys.

What do you believe to be the biggest contributor in creating a large net worth?

These responses weren’t really that contrary to my original expectations. But, the results are still worth mentioning. 80 percent of millionaires are “self-made”, so maybe family inheritances may be a bit overstated in responses. But overall, each response isn’t much more or less than what you’d expect.

  • Multiple streams of income
  • Saving and Investing
  • Family – inheritance
  • Character traits – work ethic, charisma, time management,

If anything could hold you back from becoming wealthy, what would it be?

This question was supposed to be pretty introspective. It required respondents to dig deep. Their responses were interesting. I didn’t expect confidence to be one of the most frequent responses.

Here are some other patterns:
  • Being too conservative
  • Confidence
  • Family responsibilities
  • Bad financial habits
  • Institutional powers – white supremacy, glass ceilings, discrimination, lack of resources

Surveying over 100 people about wealth definitely taught me a lot. One of the reasons that I started Ruleur was to fuel more conversations about money. This pretty much fits the bill. I encourage you all to start asking the questions that we never really talk about with friends. You’ll learn much more about people than you’d ever expect.


The Downsides of Investing: It’s Not All Sunshine


“When s*** hit the fan, is you still a fan?
When s*** hit the fan (one two, one two)
When s*** hit the fan, is you still a fan?
When s*** hit the fan, is you still a fan?” – Kendrick Lamar (Mortal Man)

The Truth About Investing

Let’s face facts. There are two extremes when it comes to investing; you either end up becoming an investing whiz like Warren Buffett, or lose it all in the trenches of financial crashes like most of America. When I started researching for this post, I was startled by how few posts talk about the disadvantages of investing. With the exception of a handy article by The Balance, pretty much all of the results on the first page weren’t from 2017. Did all of the cons of investing somehow just disappear? If you invest, are you guaranteed to become a millionaire? Blasphemy.

If you’re like many of my readers, over the past year or more, you’ve been reaching out to friends in your network to figure out how to go about investing. You’re likely asking which sites and apps to use, what books to read, and how much to start off investing with. You might’ve read a post that said that “the earlier that you invest, the better your odds are of retiring comfortably”. Something about compound interest. Money that earns on top of money. Yup, probably something like that.

Investing is a great way to earn passive income. No doubt about it. Putting your money into investments is a better life decision than putting it into a savings account that’s getting its value nibbled away by inflation. Fair enough. Technology continues to lower the barrier to entry, as new fintech startups attack the market share of incumbents.

Personal finance is a hot topic and everyone is looking for a piece of the pie. But what about the downsides? Did the “Great Recession” just not happen? Did America get flashed with a Men and Black neuralyzer? Keep a pair of shades at all times, my friend. Investing has its disadvantages and they’re crucial to know as a fresh investor. For the sake of a constructive dialogue, we’ll keep this post focused on stocks opposed to bonds.

Let’s break this post down with a brief introduction of advantages and then a deep dive into disadvantages.

Advantages of Investing


When you own a piece of stock, you own a piece of that company. You get share of their success. Because you own a percentage of the company, when their earnings growth causes their stock price to rise, you make a profit. If you’re employed at a company, but don’t own any stock, no matter how hard you work, your earnings are not directly correlated to the company’s success.

Easy to buy and sell

With the power of technology, it’s easier to invest that ever. Nerdwallet created a list of the best investing apps. You can invest through a broker, financial planner, or online. The power of technology enables users to get started quicker than ever before. There’s information about different investment opportunities all over the web. Just as it’s easy to buy stock, in today’s age, we’re also able to sell our shares with the click of a button.

Historically good returns

Over the long haul, stocks are considered great investments. Historically, the overall stock market returns roughly 7 percent on an annual basis. This is why every financial expert says to get started early. The more years your money is invested, the likelier that you will accumulate a pretty penny over time, thanks to our friend compound interest.

Less expensive and time intensive than starting a business

Any entrepreneur will tell you that building a profitable business is harder than passing a drug test after hanging with Wiz Khalifa for a weekend. For the average Joe, investing is a way to still get a piece of the action. It’s less expensive and takes far less time. Depending on your investment style, keeping an investment account may only take a few hours of maintenance a month. It’s a small price compared to building a publicly traded company from scratch.

Now that the core advantages are out of the way, let’s dig into the disadvantages.

Disadvantages of Investing

You can lose all of your money

What happens when the company that you invested in ends up losing three of their biggest clients that account for over 60 percent of their revenue? You can guarantee that the financial markets will downsize their stock price considerably. You didn’t do anything wrong, but you’re paying for it. What if it’s not just one company in your portfolio, but 50 percent of them? This isn’t uncommon in times of economic distress. Investing during a rough spot in the economy may keep you in a work uniform for a decade longer. Ask your elders.

If you can’t play the “buy and hold” game, you’re pretty unlikely to make much money

Investors are incentivized to buy stocks and hold them for long periods of time. Not only from a tax perspective (more on this later), but also from a profitability perspective. Companies take time to grow. Investing usually isn’t a quick fix, especially for the average investor. High-frequency trading sounds sexy, but it probably isn’t for you. So, if you need your money for something in the near future, investing probably isn’t the best option for you.

You have limited control over the company’s operations

Not being a company founder has its benefits, as mentioned in the advantages section. However, it also has its disadvantages. Think about folks who invested in Enron. In cases like this, you can’t control what’s going on inside the company. You may get the chance to vote on a few company decisions, but for the most part the day-to-day operations are run by company employees. And sometimes employees do some pretty dumb stuff.

If you sell your investment in less than a year, you pay higher taxes on your profits

One advantage that comes with owning stock is its lower tax rate. If you hold an investment for more than a year, any profit that you receive will only be taxed at 15 percent (20 percent for high earners). This is called “capital gains tax”. But what if you sell your stock in less than a year? Instead of paying capital gains tax, you pay your regular income tax rate. In most cases, it will likely be higher than the capital gains tax. Less money to take home to the bank.

Investing is hard on the emotions

Everything is fun when you have a good stock that’s growing in value year after year. But what about when your company is suffering after lower than expected earnings? What if the whole entire market is down? You can lose most of the money that you invested in less than a year. It’s not that easy to be an investor when chaos ensues. The financial markets reward those with tough skin and stable nerves. That’s why most investors never win big and it’s part of the reason why financial advisors are helpful. It’s damn hard to keep your cool and make sound decisions when bad news keeps coming. But good judgment pays off big in the long haul.

Investing is completely non-intuitive

Buy low and sell high. Sounds easy enough right? But let that statement sink in. If you’re buying low, that means you’re buying a stock with lower demand. Your friends may be talking bad about it, financial experts are shouting about how its price has dived over the past three months. At this point, most investors run away. But this is exactly when you should buy. Most investors purchase high when all of their friends are talking about the company and the market has already swallowed whatever good news that provided the jump in price. It’s damn hard not to follow the crowd.

Even the professionals get it wrong

I would not advise any investor to have a portfolio 100 percent filled with stocks. In fact, the everyday investor should only send a small percentage of their cash into individual stocks (15 to 20 percent). More of their money should go into diversified investments like exchange traded funds (ETFs). Why? Because even “experts” are wrong most of the time. Most hedge fund managers don’t beat the S&P 500 over a ten year period. They have a full staff, resources, and deep relationships in the industry. If you’re playing the long term game, take on less risk and bet on the whole market opposed to individual stocks. Play smart.

You don’t get the same returns as the founder

Investing can give you some pretty amazing returns over time, but probably not as fast as entrepreneurship. There are some advantages that come along with putting in sweat equity. There’s no such thing as getting rich quick, but successful entrepreneurs typically get rich quicker.


Now that you’ve learned about some of the disadvantages of investing, you’re better equipped to improve your investment journey. Stay tuned for Part 2 of this ongoing series.

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