Name: How Much You Should Invest By Age (from $0 to millionaire)
Uploaded: 2025-07-19T22:11:26.000Z
Duration: 15 min 8 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

Gerund

The average American makes around $45,000.

Future simple

After taxes, it will leave him only with around $38,000.

However, by the age of 35, most Americans or the average American has a net worth of around $16,000.

Despite making around $45,000 a year, by the time the average American gets to 35, he first gets into the college and anchors a student debt, and then he needs a car to get around which means that he will get an auto loan, and by the time he gets a mortgage, he's filled in debt, which means that his net worth at this point is entirely negative.

However, as he starts paying off a portion of his mortgage, he starts building real equity and his net worth after the age of 35 gets into the positive side, which allows him to build real wealth.

Buying a house is the ultimate way to build wealth.

Since house prices grow on average between 3-5% if you take out 2020 and 2021 when they have been growing by over 20% annually.

Which means that by the time the average American retires at the age of 50, 60, or 70, he will end up with a house that's worth around $500,000 up to a few million dollars which can potentially make him a multimillionaire by making the right investment of buying that house as early as possible.

However, house prices have grown so much that the median house today is around $416,000 which is 11 times the average income.

The vast majority of people simply won't be able to buy a house.

But because we usually consider the household income, and that means that two people are working to be able to buy one house, it makes it a bit much easier.

In fact, house prices have grown so much, or in other words, the dollar was devalued over the last 2-3 decades to the point where somebody with a $45,000 income can only afford a $200,000 house.

And let's be honest, what can you possibly afford with that $200,000?

And that led a lot of people to ask the most basic question, what if there is an alternative way to build wealth?

How do these top 1% build their wealth that they end up with millions of dollars while the average American barely gets a $200,000 house by the time he retires?

What if there is a much better way to build wealth instead of the one that Americans have been using the last 100 years by buying a house.

Now let's take a hypothetical example and imagine that instead of buying a house, or income into investing in the stock market.

Let's assume that we have 4 people and all of them plan to retire at the age of 65.

The first one is John who just recently turned 20 and he has plenty of time to start investing.

The second one is Peter, he is 30 years old and he finally came across our channel and realized the importance of investing and he is like, yes, I will start investing.

Our third friend is Mike who is 40 years old.

He is far behind everyone else but as they say, the best time to plant a tree was yesterday and the second best time is today.

And our final person is Alex who is 50 years old.

He knows that he doesn't have plenty of time but he has plenty of experience behind him.

All of them will be investing the exact same amount, $500 per month.

John will be the longest in the market for over 45 years since he is 20 and by the time he will be 65, he has an entire life to live in.

Over the course of 45 years, he will be investing $270,000.

While that seems like a lot of money, that's the kind of money that you can put for a down payment for a decent house, he will be investing all of that money through a period of 45 years into the stock market.

All of them will be investing in the most safest investment possible in the stock market.

We are not talking about one particular stock.

All of them will be investing into the S&P 500 that proved to be over the long run to provide you with a return of investment of 10% annually.

By the time he is going to retire at 65 years old, he will be sitting on 3.5 million dollars.

Yes, he has invested $270,000, but now this investment has turned into 3.5 million dollars, which gave him an investment growth of over 3 million dollars and 170 thousand dollars.

So with just $500 investment per month, our friend John can simply retire.

Even if he withdraws 5% annually from his investment portfolio, his money is not going to deteriorate year by year, in fact, it will continue to grow and will still provide him with at least $150,000 of annual income.

And if you check that income and compare it to how much the average American is making today which is around $45,000 and after taxes $38,000, that probably puts him at the top 5% of the highest earners.

Our second friend, Peter, who is 30 years old, who also will be investing $500 per month.

Now he will be in the market for a slightly shorter period of time of 35 years.

Do you see that the difference between these two people investing is very small because both of them are investing $500 per month.

However, if you look at the difference, at the final value, you will be shocked.

John will make 3 times the amount that Peter is going to make.

Yes, Peter will also end up with over a million dollars in his portfolio, but now compare a million dollars with 3.5 million dollars.

However, one started in his 30s while the other started in his 20s.

That's the kind of difference that it can possibly make.

But what about Mike who is 40 years old and he will be in the market just 25 years.

He will be investing over the course of his career $150,000.

Which seems like a lot of money to be honest.

But again, if you compare it to how much Peter is investing, $150,000 compared to $260,000 or $10,000 isn't that big of a difference.

The final value at the age of 65 for Mike will be $400,000.

He won't even make half a million dollars, simply of a 10 years difference.

Now compare how much Mike is making to John at over 3.5 million dollars.

And his investment is going to grow by $259,000, again a third of what Peter is making.

Now let's go to our final friend who is Alex in his 50s.

He will be 15 years in the market, since he is 50, he will retire at 65, he is 15 years in the market.

Now $90,000 might seem like a lot of money, but what is $90,000?

Most people can make that in a single year.

His $90,000 are probably almost going to double over this period and he will retire with $158,000.

I want you to pay attention how much of a difference does it make when you start early.

The exact same $500 per month is going to make John a multi-millionaire with over 3.5 million dollars in his portfolio while Alex will retire with less than $200,000.

In fact John can even sell a portion of his income and buy a house.

Or maybe even John can probably buy a house or take a mortgage when he is 25, 30 or 35 years old and end up with 3.5 million dollars and a house.

The only difference is that one person thought about it very early and started investing even a small amount of money into the market as early as he possibly can.

Einstein called compound interest as the 8th wonder of the world.

Because it allows your money to earn more money.

Now if $500 in the beginning doesn't seem like a lot of money, because it's not a lot of money, over time your $500 will earn $1.

And over time it's going to compound and compound and compound.

And based on the rule of 72, if you are making 10% annually, every 7 years, your money is going to double.

So when $1000 doubles, it's not a lot of money.

When $10,000 doubles into $20,000, it's slightly more meaningful but it's not really a lot of money.

When $1 million doubles, it's already $2 million.

It's the kind of money that can change your life.

So the longer it's in the market, the faster it's going to double and the wealthier you're going to get.

And that is the fundamental difference why the rich people keep getting richer while the vast majority of people look at the top 1% and cannot possibly realize what exactly is happening.

Now let's try to answer a very basic question.

How much of monthly investment is it required for anybody to retire with a million dollars assuming that they will retire at the age of 65?

If John wants to retire with a million dollars at the end of the day, he will have only to invest $165 per month.

That's basically not buying a Starbucks coffee every morning and instead of taking that money and investing into the stock market.

And you will retire with a million dollars.

I'm not telling you that you should stop buying Starbucks coffee, but I simply want you to imagine how much of a difference it's going to make.

If Peter wants to retire with a million dollars, he will have to invest triple this amount at $440 already per month to be able to retire with a million dollars.

Simply because John started much earlier, he has this huge advantage.

And in his thirties, he will be able to continue simply investing $165 and still retire with a million-dollar portfolio.

If Mike decides to retire with a million-dollar portfolio, he has to invest $1200 per month.

That is 8 times the amount that John has to invest.

And finally, Alex will have to invest triple this amount at $3200 to be able to retire with a million dollars when he is 65 years old.

And the only difference between these four people is that the longer you are in the market, the more money you are going to make.