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- [00:01]
American Express Representative
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- [00:33]
Omar Zenhom
Head to whole Foods.
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American Express Representative
Market to jumpstart your January during our.
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Omar Zenhom
New Year Boosting event with savings on.
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American Express Representative
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- [00:48]
Omar Zenhom
How much is a billion dollars really? Well, let's break it down. If you earned 250,000 every single month, you'd make $3 million a year. But even at that rate, do you know how long it would take to reach a billion dollars over 333 years? But here's the kicker. You don't need to be a billionaire to live like royalty. I'm here to tell you that $50 million is all you need to live like a king or queen for the rest of your life. And in my opinion, beyond that point, you're really going to be inheriting some new problems you just don't want to deal with. That we're going to discuss in today's lesson. Welcome Back to the $100 MBA show where we help you start, grow and scale your business with our practical business lessons three days a week. Monday, Wednesday, Friday. Today we're going to be tackling a topic that flips the script on wealth and success. Why you don't want to become a billionaire. Yes, you heard me right. We've been sold a dream of becoming a billionaire, especially entrepreneurs. But when you take a closer look, when you actually do, the numbers really understand it's not as glamorous as it seems. But instead, I think the real goal for most of us should be $50 million. What does that actually mean? We're going to break down all the numbers so that you can see for yourself why being a billionaire is not really worth it. I want to take a quick time out and just say, I'm not here to crush anybody's ambition. If you want to become a billionaire just so you can say you're a billionaire, go ahead. But I don't think that's a good enough reason to go for it. Because it's a lot of work, it's a lot of sacrifice, and your life A billionaire is not as fun as it may seem. If you don't believe me, read any biography or autobiography of any billionaire. It's really a cautionary tale. But the first thing I want to do is actually break down how much is a billion dollars really? When we say billionaire, what does that mean? Now, when somebody is called a billionaire, really, it's their net worth, how much their assets are worth. If they sold other assets, would it be equal to a billion dollars? Yep. That means they're a billionaire, but it also means that they would have to earn enough money to become a billionaire. And I gave that example of what it looks like to earn $250,000 each month. It would take 333 years to become a billionaire at that rate. But let's just even say you make $1 million a month. Right. It would still take 83 years to get there to become a billionaire. Now, remember, we're talking about a million dollars in profit a month. Because if you're making a million dollars in revenue doesn't really mean you're making that money or keeping that money. So it's not really an asset until you actually can liquidize it or you can actually account for it. Now, I know a lot of people are going to say there's a lot of other things to consider, how much the actual business is worth and other assets. I get it. But the numbers are here to illustrate that most people don't understand how much a billion dollars actually is. In all honesty and fairness, it's kind of hard for people to comprehend because it's such a big number. Because, of course, a billion is a thousand million, which is kind of hard to kind of square in somebody's head. And this is where I want to say that we have to remember, what is the point of money in the first place is for us to be able to buy really our time, our life. At the end of the day, money affords us to do what we want or get things done for us so we don't have to do it ourselves or be able to afford opportunities, whether it's education, whether it's travel, whether it's luxuries like a car or a home. The point here is, is that at the end of the day, somebody's got to make that car spend the time, the effort, and instead of you doing it, somebody else is doing it, and you're paying it with money. So really, it's a unit of time, and you only need a certain number of units of time in order for you to be satisfied and in all honesty, a billion is just way too much for the headaches you're going to actually endure. So let's get into that. It's the second thing I want to cover, which is the problems of becoming a billionaire. I don't think people understand the extreme pressure and responsibility the founders or the leaders of billion dollar companies are under. Most billionaires have billion dollar companies that have shareholders and people that are constantly scrutinizing what this person is doing in all their decisions. One of the two entrepreneurs that come to mind. Most people think about the richest people in the world. They think of Elon Musk, they think of Jeff Bezos. So if you read any of their biographies, you would know that the amount of pressure they're under every single day. They wake up to so many fires, so many criticisms from the public, so many issues they have to solve. Their life is not fun because these people are not only responsible for their money, but the money of their investors. Hundreds, Thousands, even millions of people. Number two, public scrutiny, loss of privacy. The second thing I want to talk about, the second downfall of being a billionaire is a ton of public scrutiny and loss of privacy. Yes, in some places, sometimes billionaires are seen as heroes and are celebrated, but for the most part, they're vilified. And for the most part, they're held to an impossible standard. People forget they're human beings. Every move is public. And your privacy as a billionaire is practically non existent. The amount of security that these billionaires have to walk around with, not just them, but their family members or children. They really can't go to school, really, because there's a lot of dangers involved. They can be held captive. They could be ransomed. As a billionaire, you can't just walk into a department store and buy some gifts for your kids, birthdays or your anniversary. It's not that simple. Your life is no longer yours. And the crazy thing is, is that when they do spend their money, they're scrutinized and criticized on that too. So if they buy anything, it's in mainstream media, it's all over social media. Why this person buy a yacht? How obnoxious. That's so gross. And they don't get any credit for any of the philanthropy they do. No one mentions, you know, that Bill Gates is trying to solve malaria, you know, trying to cure malaria for the world. No, no, no, that's not important. Let's talk about, you know, what car he's driving or the holiday he took with his family to Italy. This is gotta be really frustrating. You work so hard all your life. You're under so much pressure. You've done everything you can. You sacrifice pretty much everything so you can become a billionaire. And then when you start trying to spend that money, you get criticized for that too. What if you can make your New Year's resolution automatic? ACORNS makes it easy to start automatically saving and investing so your money has a chance to grow for you, your kids and your retirement. And listen, you don't need to be an expert. Acorns will recommend a diversified portfolio that fits you and your money goals. You don't need to be rich. Acorns lets you invest the spare money you've got right now. You can start with $5 or even just spare change. You don't need to feel like your financial wellness is impossible. Acorns gives you small, simple steps to get you and your money on track. Basically, Acorns does the hard part so you can give your money a chance to grow. Head to acorns.com mba or download the Acorns app to start saving and invest for your future. 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- [08:33]
Intuit QuickBooks Representative
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- [09:03]
Omar Zenhom
Third thing I want to point out, and this has been studied over and over and that's diminishing returns on happiness. Studies have shown that happiness plateaus after a certain income level. Now these studies have been done some time ago and the study shows around 75,000 to $100,000 annually. But let's just call it $200,000. Maybe the study's outdated now. While wealth can buy you comfort, it doesn't necessarily give you fulfillment, especially when it comes to an extreme level. In my experience. I do believe that the million dollar mark is very interesting. When you start making a million dollars in profit where that's your income every single year, your life really changes and you really don't have much of a different life than Somebody who's really, really wealthy. If you're making or keeping a million dollars every single year, what can't you do that a billionaire can? Okay, there's only, like, a few things. Like flying private maybe is a little expensive. You actually could do it if you want to. But, okay, I mean, business class and first class is pretty nice. What else can't you do? I don't know, buy a bunch of houses, you know, in one day. What are you going to do with that? You can still experience that house by renting these houses and Airbnb. You really have to rack your brain. What else can't you do? Not much. And the punchline is, the bigger your wealth, the bigger your headaches. As Biggie said, more money, more problems. Why do I believe $50 million is better? Why not 100 million? Why not 20 million? Well, I actually came up with this number because I think that is actually possible. It's quite attainable for many entrepreneurs. A billion dollars, a different story. It's like winning the lottery twice. Really tough. I heard Mark Cuban say that once about being a billionaire is like winning the lottery twice. Really difficult. But 50 million is doable. I mean, if you create a business that makes $10 million in annual revenue, that business can be worth 50 million and be exited. And there you go, 50 million. Some businesses don't even need to make that much revenue to be evaluated for 50 million. But again, why the 50 million mark? Well, with 50 million, you can live off the interest alone at a conservative 4% annual return. I'm just saying put the money in the bank. We're not even saying investing in crypto or investing in, you know, stocks or bonds or, you know, angel investing. No, we're just putting the money in the bank. And if you did that, you would earn $2 million a year. That would be your return for just putting 50 million in the bank. That's like 166,666amonth. That's a lot of money. And that's without ever touching the principal. That's enough for you to live a life of luxury where you could do pretty much anything with an income of 2 million a year. Now, there's other considerations. We know you're going to pay tax on that interest and all that kind of stuff, but this gives you a rough estimate, gives you an understanding that 50 million is really a good sweet spot because it will take care of you, take care of your lifestyle, a really nice lifestyle, and the lifestyle of your loved ones for pretty much forever. The second reason why I love the 50 million mark is that it gives you financial freedom without the chaos. You're free to live wherever you want. You can travel, you can take care of your family without worrying about work, but without the immense pressure and responsibility of managing billions. You know a lot of rich people, and I've met them and know them. A lot of my friends, they have rich people problems. And a lot of us, we don't understand that because it's kind of like woe to me. I'm rich, look at my problems. They don't really talk about it because it just sounds obnoxious. But there's real problems like, what do you do with that money? How do you not mess it up? How do you not waste it? How do you make sure that you are also giving back? How do you make sure that you're allocating your money properly in terms of investments, how to make sure you have the right account and bookkeeper and lawyer and all that kind of stuff. Number three, privacy and balance. You can enjoy your wealth. You can go out in the world without being in the spotlight. You can afford the luxury and the great lifestyle, but not be so high profile that you're constantly under scrutiny. You can go on holidays, you can go to the south of France, you can go and have a luxurious holiday in Japan or whatever it might be, wherever you want to go. And no one's going to know who you are. You're not going to be bothered. You're not going to be bombarded nothing. This is the absolute perfect scenario for you to be able to enjoy your wealth. One of my favorite stories about this is Tom Anderson. Do you know who Tom Anderson is? Probably not. And this is the whole point. He's the founder of MySpace. Tom Anderson's net worth is $60 million. He gets to enjoy his. He gets to go out there and he's got everything he needs. Compare his life to Mark Zuckerberg, right? The founder of Facebook and Meta. He can't go anywhere, okay? He can't enjoy a moment of peace. And you. Makes you wonder. It makes you wonder who won? Did Facebook and Mark Zuckerberg actually win or did Tom Anderson actually win? Number four. One of my favorite ideas is you'll have the freedom to pursue some passion projects now that you've got 50 million in the bank. You can now reinvent yourself. You can have new hobbies, build a new business if you want to and just have fun with it. Or you can start a charity or give back to some causes that you really believe in. And really want to support. You could do this without being tied down to shareholder expectations or demands from running a massive corporation or having to like uphold the billion dollar status. The fourth reason why you don't want to become a billionaire is because now you can focus on what matters, what really matters to you. Here's the kicker. Having more money beyond a certain point doesn't automatically mean more happiness or fulfillment. I'm the first one to say that money can buy you happiness to some point, right? Once you're out of worrying about where your bills are going to be paid for the next 40 years, you're taking care of, now it's about the quality of your life, not the quantity of the dollars in your bank account. Here's the bottom line. It's better to live a rich life with less stress than an exhausting life with a bank account with endless zeros. You don't need that, okay? You don't need that kind of stress. You want to enjoy life. Remember what this is all for, right? You only get one shot at this in life, and you want to make sure that you don't waste it worrying about adding another zero to your bank account. Many millionaires find more happiness because they have time, they have energy, they have resources that they can use in their lives, and they can live intentionally, while billionaires often find themselves trapped in their wealth. So in my opinion, you don't want to become a billionaire because life is about balance. It's about freedom. It's about fulfillment. It's about understanding what you're doing this all for, right? Chasing a billion dollars often equals sacrifices you will regret. The very thing that makes life worth living might be sacrificed. And let's get real for a moment. $50 million is a lot of money, okay? And you could do a lot of great things with that. That level of wealth, in my opinion, is the sweet spot. There is such a thing as too much in anything in life, whether it's too much food or too much excess time on your hands or too much money. Thanks for tuning into the hundred dollar MBA show. Don't forget to hit subscribe whether you're on YouTube or any podcast app. So you get our next episode automatically three days a week, Monday, Wednesday, Friday to make sure we help you. We hold you by the hand to start, grow and scale your business and give you a few mindset tricks, some mindset hacks that we'd like to give you. Like today's episode. I'm Omar Zenom and I'll see you in the next episode.
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Dr. Horton Representative
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