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What’s going on you guys so it’s been a while since i’ve done a personal finance related video and these are some of my favorite videos to do so today we’re going to be talking about what you should do if you are broke now i just want to let you guys know beforehand i’m not going to be telling you to go start a shopify store or go buy bitcoin or give you like
One definitive solution because there is no such thing as a definitive solution for what you should do to make more money and not be broke and if anyone out there is telling you a definitive solution they’re telling you to go in go start doing bit connect or go start a shopify store maybe that’ll work for you if you put the effort in but understand that there’s
No one-size-fits-all approach to improving your financial situation and in most cases if someone’s telling you how to get rich then why would they be telling you if they could just do it themselves just keep that in mind i know a lot of people prey on the vulnerability of people who are in a poor financial situation and you know i just want you guys to keep that
In the back of your mind when you’re looking at this that there’s no one-size-fits-all approach to this of how you can improve your financial situation now what i teach about on my channel is investing and yes i do have a course on investing but that is something that does work for most people if you look at the numbers and what i teach people is value investing
Which is one of the most successful forms of investing it’s what warren buffett has followed that’s made him as rich as he is today so i wouldn’t classify myself as one of those people selling some kind of get-rich-quick gimmick but maybe you guys would that’s you know up to your discretion there but i just wanted to make that disclaimer here because a lot of
People if you’re watching this video if you’re in a bad financial situation maybe you’re seeing ads about some business opportunity just do your due diligence do your research and understand that most of those things are gimmicks or they don’t work for most people as it is portrayed but anyways let’s get to the video here guys and talk about what to do with you
Are broke so the best way for me to explain this is with a visual representation okay so if you’re broke you’re in one of these two situations up top this bar in the green is your income and the bar in the red is your expenses so if you’re broke you probably have zero dollars of positive cash flow each month so what does that mean that means that your income is
Equal to your expenses now believe it or not that’s not the worst situation you could be in because if your expenses are exceeding your income then you’re going into debt and my guess is if you’re watching this video you are either paycheck to paycheck or you’re going into debt or you have very little savings and you want to figure out how to make more money or
Save more money with the end goal of improving your financial situation so the way i see it guys there’s three things you can do that are going to help you do this and i’m going to tell you guys which one i recommend in which one i really followed myself and how i’m able to you know invest thousands of dollars every single month and do what it is that i do what
I’m doing is nothing spectacular anyone can really do this if you put in the work and you know are willing to do these things but first of all i have what i call the defensive approach this is very simple if your income is equal to your expenses and you want to generate a positive cash flow whether it be to save more money in your savings account for a rainy day
Fund or have money to invest or start a business the first thing you can do is cut down on your expenses and i call that the defensive approach why don’t i call this the defensive approach because at that point it’s kind of like pinching a penny out of a dime squeezing a penny out of a dime you can only go so far with the defensive approach okay because yes you can
Save money sure you can clip coupons sure you can buy food that’s on sale but you can only go so far i want to share a personal story with you guys about this because when i was 15 years old my parents had just gotten divorced and my mom didn’t have a lot of money and i had to help her do this i had to help her with this defensive approach because we didn’t have
A ton of money we didn’t have enough to buy all the groceries we wanted so what we did is we sat down and i helped her clip coupons and figure out sales and we bought groceries that were on sale because we were following the defensive approach now that worked for us okay we were able to have enough money to you know pay rent to pay the utilities pay the bills but
What i mean is you can only go so far with that okay i mean you can only do so much as far as the saving goes and the way i compare this is i compare this approach to kind of breaking down and hunkering down it’s kind of like there’s a problem but you’re gonna kind of avoid the problem the main problem is your income you don’t have enough income so that’s what i
Want you guys to focus on but the very first thing you should do before you work on your income is to cut down on those discretionary expenses maybe you’re gonna stop buying name-brand groceries and you’re going to maybe clip coupons like i had to do with my mother for a while and it’s just you do what you got to do that’s the first thing you guys should do but
I really want you to focus on the second thing what i call the offensive approach or to run towards the problem rather than shrinking down would be to increase your income and so what that could be for you that could be continuing education getting a better education that could be starting a business that could be starting a side hustle that could be getting a
Part-time job on top of your normal job whatever it is the best thing you can do is to run towards the problem and fix the problem which my guess is for most people it is a lack of income unless you have some kind of crazy spending problem which may be the case i’m not sure but i would imagine the main problem for people is the income okay so am i going to tell you
Guys how to do this absolutely not it’ll be different for everyone some people have the ability to work more hours at their job some people are ambitious they’re gonna start a side business some people are going to start a full-time business some people are just going to get a part-time job and maybe work during the holidays or whatever whatever it is for you just
Figure out how to make more money i’ve done videos about this on my channel in the past so i’m not going to go into much detail about how to go about doing this i’ll do more videos about it in the future but it’s just not the place for this in this video so that’s what you can do number 2 is to increase your income but the very best thing you guys can do is very
Simple do both of these things this is the best approach increase your income while decreasing your expenses because that’s going to increase your positive cash flow that is this dotted line here that is the difference between your income and your expenses that’s going to be your positive cash flow and the best way to do that is to attack it from both sides you
Have two problems here not enough money too much expenses so make more money cut down your expenses and you’re going to significantly increase your positive cash flow okay i mean maybe you’re going to be watching this video and you were hoping for me to tell you the next million-dollar idea or how to go out there and you know make money for very little effort and
Guys if i did that i would be very dishonest i also realized i’m holding my marker i thought i was going to be drawing on this but i was holding this for absolutely no reason so if you guys noticed that and it seemed kind of weird it was kind of weird to me as well but anyway guys this is one of my favorite lectures to do i’ve incorporated it into one of my videos
In the past on what to do if you’re living paycheck to paycheck and it really helps people to visualize the problem because a lot of people don’t even realize what it looks like to be broke this is what it looks like to be broke where your income is equal to your expenses and to be going into debt that means your expenses exceed your income so the very first thing
You guys need to do is figure out these numbers and a lot of people know how much money they make they know what they make it their job but so many people have no idea what their expenses are so the money is just falling out of their account because they have no idea where it’s going so the very first thing you need to do is identify what your expenses are figure
Out what your positive or negative cash flow is and then go how can i improve this and like i said guys the best way to do that is to figure out how to make more money save more money and then what you’re going to do and that’s what i did is i took that positive cash flow and i invested that into stocks and index funds and as a result my money is gonna grow into
More money so the end goal should always be to figure out how to get out from making money in an active way but that gets in the passive income again that’s a topic for another video anyways guys that’s all i got for this this is what to do if you are broke i hope you guys enjoyed it please drop a like if you enjoyed this video if you’re new to my channel please
Consider subscribing to be notified of future uploads and as always i thank you for taking the time to watch this video and i’m tired of holding this damn pen i’m just gonna drop it now thank you guys for watching
Transcribed from video
WHAT TO DO IF YOU ARE BROKE ❌💰 By Ryan Scribner
