Grant Cardone, private equity fund manager and real estate investor, acknowledges that young Americans have the deck stacked against them in many ways — but still believes it’s possible for everyone to achieve financial success.
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“Things are more expensive. College debt sucks. Finding a job is hard,” he wrote in a column for CNBC. “But that doesn’t mean getting rich is impossible.”
However, Cardone said Gen Z won’t be able to achieve wealth if they continue to make some common money mistakes.
Borrowing Money for Things That Don’t Generate Income
Many young Americans put nonessential purchases, like dining out, entertainment, luxury items and vacations, on a credit card that they can’t pay off at the end of the month. While Cardone said it’s OK to pay for some things with credit, they should only be purchases that will eventually help you make more money.
“Spending money on a class that will make you better at something or renting office space to run your company out of is smart,” he wrote. “Buying a motorcycle or expensive shoes that will eventually wear out is not smart.”
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Comparing Your Finances to Others
Comparison is the thief of joy — and it can also rob you of time and money that would be better off spent elsewhere.
“Comparing your worth to others is a mental trap,” Cardone wrote. “Stop worrying about how financially behind (or ahead) everyone else is. Stay focused on your financial goals. Stop wasting time. Sit down and crunch the numbers.”
Instead of looking at what others have or have not achieved, focus on what it will take for you to achieve your personal goals.
“Find out what it’ll take for you to reach seven figures,” Cardone wrote. “How many different ways can you collect one million dollars? What mistakes do you need to stop making? Once you have your game plan, take action.”
Allowing Social Media To Influence Your Spending
When we’re inundated with images of people living luxurious lives, it’s impossible to not be tempted to spend. But giving in to these temptations can hamper your ability to build real wealth.
“Letting what you see on social media tempt you into spending money on things you don’t need is a big mistake,” Cardone wrote. “The people you see on Instagram — with their lavish dinners, parties, cars, designer clothes and vacations — aren’t necessarily ‘wealthy.’ They’re most likely just ‘pretender spenders.’ They’re the people who try to impress others by showing off extravagant things that were probably purchased with their parent’s credit cards (or their own).
“An Instagram lifestyle is no way to live — unless being a social media influencer is your full-time job and it’s making you millions.”
Choosing Comfort Over Freedom
Many young Americans aim to be financially comfortable, but this shouldn’t be the ultimate goal, Cardone said.
“Comfort is the opposite of wealth,” he wrote. “The entire middle class is built on seeking comfort; they’re satisfied with a $50,000 income, two weeks of vacation, health insurance and a house. But wealthy people seek more than just comfort. Instead, they strive for an abundance of money because it gives them more freedom and security than they’ll ever need.”
Settling at “comfortable” means you’ll never be wealthy.
“Comfort gives you a middle-class life. Freedom gives you a wealthy life,” Cardone wrote. “Choose wisely.”
Not Making Enough Money
Settling for a job with a low salary will prevent you from achieving real wealth, Cardone said.
“You should always be saving and investing your money, but it’s also important to earn more money,” he wrote. “The return you make from your investments will only increase if your earnings increase. Even if you have a high income, you can always make more.”
Cardone believes that the biggest mistake young people make is not focusing on raising their income.
“Step it up at work so you can get a raise,” he wrote. “Find a new job with an even higher salary. Pick up a side hustle.”
Cardone said to strive for an income of at least $100,000 a year.
“Don’t allow yourself to be satisfied with the status quo.”
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This article originally appeared on GOBankingRates.com: Grant Cardone to Gen Z: These Money Mistakes Prevent You From Getting Rich
