It seems very straightforward; even with a basic salary, if a person invests a little bit every month in the stock market and other assets, most people would not need to work after 10–20 years.
A lot of people, especially the middle class, are obsessed with money; hence, it makes even less sense that they haven't figured this out.
Some reasons I can think of are:
1) The vast majority of people think that certain liabilities are actually assets. For example, they purchase cars or houses with money they don't have, paying interest and mortgages for decades. This slows them down significantly.
2) Brainwashed to work till 65. I believe that a lot of people already have a plan to work until they are 65, and so they make their calculations based on that. Very few people seem to tell themselves, "Wait. Why do I need to work till 65?"
3) Lifestyle inflation. Most people, when they receive a salary increase or bonus, instinctively increase their expenses (they buy a nicer car, move to a bigger house, etc.) instead of continuing to live as they were and using the extra cash to keep building their net worth and passive income.
4) Overreliance on social security. Most people are happy with a job, an 'emergency fund', and knowing that they will get SS when they retire or if they are fired, which makes them even less likely to think about alternative ways to build significant net worth over time.
5) I noticed that a lot of people in the middle class think that you either work or become rich overnight (through winning the lottery, building the next Facebook, etc.). Very few realize that there's also a realistic middle ground: to acquire those millions patiently over the decades.
With so much information nowadays online, it really amazes me that this is not widely known. Or do people really spend most of their time online watching teenage girls dance on TikTok?
Thoughts? Maybe someone can also add more to the list of mistakes so that we all become better investors overall?
A lot of people, especially the middle class, are obsessed with money; hence, it makes even less sense that they haven't figured this out.
Some reasons I can think of are:
1) The vast majority of people think that certain liabilities are actually assets. For example, they purchase cars or houses with money they don't have, paying interest and mortgages for decades. This slows them down significantly.
2) Brainwashed to work till 65. I believe that a lot of people already have a plan to work until they are 65, and so they make their calculations based on that. Very few people seem to tell themselves, "Wait. Why do I need to work till 65?"
3) Lifestyle inflation. Most people, when they receive a salary increase or bonus, instinctively increase their expenses (they buy a nicer car, move to a bigger house, etc.) instead of continuing to live as they were and using the extra cash to keep building their net worth and passive income.
4) Overreliance on social security. Most people are happy with a job, an 'emergency fund', and knowing that they will get SS when they retire or if they are fired, which makes them even less likely to think about alternative ways to build significant net worth over time.
5) I noticed that a lot of people in the middle class think that you either work or become rich overnight (through winning the lottery, building the next Facebook, etc.). Very few realize that there's also a realistic middle ground: to acquire those millions patiently over the decades.
With so much information nowadays online, it really amazes me that this is not widely known. Or do people really spend most of their time online watching teenage girls dance on TikTok?
Thoughts? Maybe someone can also add more to the list of mistakes so that we all become better investors overall?
