Jaspreet Singh: 5 Signs You Are Fake Rich
“Would you rather look rich or be rich?” Jaspreet Singh began one of his most popular YouTube videos with this question. Then he shared five signs that you may look rich, but aren’t actually wealthy.
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If these signs apply to you, it may be time to evaluate your finances and look for ways to earn more income through investments.
You Drive a Financed Car You Can’t Afford
“Your car costs you a lot to maintain each year. It doesn’t make you money, and when you go to sell your car, you’re going to sell it for a lot less than what you bought it for,” Singh pointed out in the video.
These are all signs of what Singh frequently calls a “stupid purchase.”
“There’s nothing wrong with making stupid purchases when you can afford them,” he said.
But until you are earning passive income through investments to buy nicer cars, it is better to live within your means and buy a car you can afford. After all, even billionaire Warren Buffett, who could afford to buy any car in the world, drives an 11-year-old Cadillac XTS, according to SupercarBlondie.com.
Learn More: 6 Reasons the Poor Stay Poor and Middle Class Doesn’t Become Wealthy
You Can Afford To Go to Music Festivals, But You Can’t Afford To Invest in Your Life
Whether your joy is taking in music festivals, cruises, or beach vacations, these activities can cost thousands of dollars, between lodging, airlines, food and event tickets. Singh pointed out that you might be fake rich “if you are willing to spend months saving up to go to these festivals, but you aren’t willing to spend half the time, and half the effort, and at least half the money in your own self-education.”
He suggested taking courses that can help you increase your knowledge, increase your income and improve your life.
If You Know How To Shop for Products, But You Don’t Know How To Shop for Companies
“You know how to go to Amazon to buy your Nike shoes so you can go running while listening to Google Music on your Apple Airpods, but you own no shares in any of these companies, [then] you’re product rich, but you’re not investment rich,” Singh said.
These companies are all part of the S&P 500, which has delivered 12.68% returns over the last 10 years, according to TradeThatSwing.
“It’s easy to be a consumer and be product-rich. That’s what we’re bred to do,” Singh said. But unless you’re a sneaker re-seller and making money buying and selling Nikes, you’d be better off investing some of that money in the stocks behind these trusted brands.
You Own a Big House But a Tiny Savings Account
CNBC recently reported that 56% of Americans couldn’t afford to pay cash for a $1,000 emergency. Another survey from GOBankingRates revealed that, although 73% of Americans have a savings account, 36% keep less than $100 in that account.
Experts generally recommend having an emergency savings account of at least three to six months of expenses, but $1,000 is a good start.
If you own a home, it’s even more important to build up that emergency savings for things like home repairs and maintenance.
You Make a Lot of Money, But You Can’t Afford Your Time
“Making a lot of money does not make you a financial genius,” Singh pointed out in his video. “The difference between a fake rich person and a real rich person is that a fake rich person has to find a way to purchase the things that makes them look fake rich.”
If you are always trading your time for your money, you are not truly wealthy. When you begin investing the income you earn, and using that passive income from investments to buy the things you want, that’s when you can claim that you are truly wealthy.
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This article originally appeared on GOBankingRates.com: Jaspreet Singh: 5 Signs You Are Fake Rich
