Latest / Money Grows on Trees / #221 - The Best Financial Strategies by Income Level: $50k, $100k, $250k+

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#221 - The Best Financial Strategies by Income Level: $50k, $100k, $250k+ · Money Grows on Trees

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More income definitely gives you more options, but not more discipline.
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This is how I'd build wealth if I was in the $100,000 to $150,000 a year income
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bracket. Live lean, save fast. Don't
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try and look rich, just focus on getting ahead.
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Every big snowball started with a little bit of wet snow and a
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really long hill. Like, button down the hatches, live like a pauper, eat
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baked beans on toast, not forever, just for like 90 days to 180 days. Just
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really do what you need to do to get ahead. I'm Lloyd James Ross,
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seven-figure investor and entrepreneur, and I've helped thousands of business owners
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and professionals turn financial stress into success. If
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you're stuck in old money habits, overwhelmed by investing, or unsure where
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to start, this is for you. I'll give you the mindset and
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strategies to take control, grow your wealth, and achieve financial
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freedom. It's time to make your money work for you. Most
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people think making more money automatically solves their
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problems, but it doesn't. I've lived on
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$50,000, $100,000, and over $250,000 a year, and I've also
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made millions in a single year. And here's what I've learned. The
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principles of wealth don't change. But the strategy you
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use absolutely must because what gets you ahead at
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50k will keep you broke at 250k. If you
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don't upgrade your money moves with your income, you'll quietly fall
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behind, even while earning six figures. So today, I'm
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going to walk you through the exact steps that I took at
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each income tier to build real wealth and not just
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look rich. So whether you're getting ahead, just starting out,
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scaling your business, or sitting on multiple six figures, this will
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show you exactly what to do next. Tier one,
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50,000. This is what I call just starting out.
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It's all about getting ahead. So that's the goal, to get
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ahead. We're going to create some breathing room, some momentum. So
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here's exactly what I did to do that. I was living in
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Dubai at the time, and I was living paycheck to paycheck. And
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I was spending way too much money on where I was living in Abu Dhabi. I
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couldn't room share there. I couldn't really do too much. And I had everyone in
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the office telling me that I should buy a nice car, because I had this income
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now, even though it wasn't much. And so I had all these external pressures suggesting
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I do all these things with my money. Thankfully, I didn't listen to them exactly,
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so I went off and decided to implement some of the money strategies that I teach, which
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is what I'm gonna teach you right now. The very first thing I did was I
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moved house. I remember I had to get
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one house in Dubai, which is about an hour and a half drive from Abu Dhabi and
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get the house before I was allowed to leave my other house. So I remember
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at the time I broke my lease. It took money to do
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that, but I knew it was a good investment because I had to reduce my rent. And
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I remember on the day I was locked out of my Abu
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Dhabi apartment and I was got the key to my Dubai apartment and
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I had to chase. our removalist up the highway and
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be in front of them before they hit our Dubai apartment just to
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actually make that move. So it was pretty horrific. It
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wasn't an easy process, but I knew it would be worth it. And the reason I did
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that is because, one, the rent was cheaper in Dubai than Abu
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Dhabi by about half. And the reason I did it was because
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you can't actually room share in Abu Dhabi with other guys.
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So I was like, all right, I need to change that. So I got
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a three-bedroom apartment in Dubai, and I then moved
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in with two other guys that I work with. So there was three of us paying the rent, so
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that cut my rental costs way down, like to a quarter of
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what I was paying. But then I didn't also buy a brand new car like
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everyone else was doing, like Range Rovers and Porsches and so on. I
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decided to... You know, look like a bit of
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a poor person. So I didn't even buy
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it. I rented a Toyota Yaris. It was just cheaper to
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rent a car because I was driving like four hours a
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day to and from work. decided
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that I didn't want to buy a car and depreciate it to zero. So
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I thought, you know what, what if I just rented one? And over there you could do like
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long-term rentals. So I'm like, you know what, I'll get, what's your cheapest car?
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Because I wasn't attached to it emotionally, even though it made me kind of look a
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bit weird driving a Toyota Yaris. So
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I decided to lease it. So I started like protecting my capital
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and leased that car instead. And of course, before
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I knew it, I had gone through seven rental cars because every time I drove back
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and forth, it just destroyed the car. So if it got destroyed, I'd
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take it back, get a new one. It didn't cost me any money, but it was fun to
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just lease these new Toyota Yaris. I've got a soft
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spot for 280 Yarises. By the way, they go 180 kilometers flat
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chat, pedal to the floor. That's as far as they go. I
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took a friend of mine down to work in it one day and by the time we got
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to Abu Dhabi from Dubai, he was white as a
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ghost. So there you go. All right, what else I did? I cooked at
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home. I didn't eat out a lot. Now, it's easy to do that in Dubai, eat out a
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lot. Let me tell you, if you've never been to Dubai, it's easy to eat out. It's also easy
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to get home delivery. So we always cooked at home. And
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of course, I split all the expenses of the house with my friends. So we split
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a cleaner, we split the body corporate fees, we
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split pretty much as much as we could. And we also decided to lease out our
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media room to a fourth tenant. And we
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released that to a few people, so we tried to leverage the space available to
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us, right? And then of course, I personally delayed having
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a family and having kids. Just at the time, I was like, if I have that,
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that's not just a time burden for me, it's a cost burden. I wasn't ready,
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I was only 23, 24, and I actually on
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purpose delayed that. So I made decisions not to have kids too early,
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that was a decision. Right. And of course, I actually skipped
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big holidays and fancy stuff. I remember my roommates would
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go on holidays to Brazil and all these cool places. And I was actually at the time studying
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for my CFA charter. So I was actually investing in myself, which is
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also a clue as to how to get ahead. So I saved money on
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holidays. didn't go to anywhere fancy. I'd come home
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for holidays, stay at my mum's house, and that helped me to really get
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ahead. And then, of course, I didn't really buy any flashy clothes. I
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could have bought nice shoes and a nice watch and easily done in
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Dubai. But I actually wore the same clothes. day
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in, day out, because I was going to a building site. It didn't really matter what I looked like. I
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was already driving a Toyota Yaris anyway. How far down below could
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I go? And so that's really how I got
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ahead. And so with the savings that I made by reducing my expenses like
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that is I built my first $10,000 emergency fund.
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And that's really the first big step you've got to take to get breathing room is
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aim for your first $5,000 or $10,000 in emergency fund. Like
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button down the hatches, live like a pauper, eat baked
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beans on toast, not forever, just for like 90 days to 180 days.
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Just really do what you need to do to get ahead. Imagine you're
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drowning and you just want that breath,
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that space in between you, the water and the roof. You just want to You
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gotta put your head up and just breathe. I needed that because I needed to get
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this paycheck to paycheck off my back because the reality is living
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paycheck to paycheck is so stressful because if I had have got a speeding ticket,
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an unforeseen cost, an emergency of course, I wouldn't have
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had any money. Like how do people live like? How do people live like that?
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So I paid the price early to do it quickly. And I'd encourage you
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to do exactly the same thing. So the main strategy here
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is live lean, save fast. Don't try
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and look rich, just focus on getting ahead. All
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right, that's tier one. Just quickly, if you're ready to take control of your finances
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but feel stuck on where to start, I have a solution. My
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book, Money Buys Happiness, simplifies investing and
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wealth building with practical steps to help you achieve financial peace.
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Get your copy via the link in the show notes and let's get your money working for
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you. Now back to the episode. So once you've done that... You're
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ready for tier two. And this is where perhaps you've had a bit of a pay rise at work. You're
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starting to earn a little bit more money. But you may have realized, like me, that
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your income is capped in a job. So tier two, at
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around the $100K mark, to considerably increase your
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income, this is what we call the income growth phase. And
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the whole goal is to, of course, amplify your income. Because
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if you stay in your job, your income is capped. It's called active income.
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Your money can't detach from your time and you keep hitting a ceiling. Boom,
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boom, boom, boom, boom. So I discovered this. I'm like, ah, I'm hitting a ceiling. So
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what am I going to do? And that's when I decided to take
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matters into my own hands and develop a side hustle.
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Yes, it's on the side of your job. And yes, you've got to hustle. That's
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why they call it a side hustle, not a side sit on your butt. So
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I was like, what am I going to do? So I discovered, actually, I got into network
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marketing as my first side hustle, which is really fun, with my wife. And
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I decided that I was going to, I had a 9 to 5, and I then wanted
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to have a 5 to 9. So that's where you turn
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your 5 to 9 into your dreams, right? So every time I pick my wife up
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from her work, we'd go home by 6 o'clock, and
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we'd sit in the car outside the house. We didn't go in home straight away.
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We sat in the car on the road. And
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what we would do is from six o'clock in the night till about 730, before
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we left the car, we would work for an hour to 90 minutes in
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our car on our side hustle. Because we knew if we had got out of
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the car and gone upstairs with TV and food and
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our dog. you ain't getting anything done. And if you've got
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kids, it's even harder, right? Like, ah, so either stay at
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your work for an extra hour or stay in the car at your house for an
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extra hour before you go inside. I know it's hard, but this is what we call the
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hour of power. And there's so many incredible things you can do in
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that hour of power to build a little side hustle in your business. But of course, we didn't just do
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that. We engage mentors. I remember we paid like $2,000 to
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a mentor to sit with them for like an hour and show us some things as
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well. So we invested in mentors, we invested in courses, we
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did social media courses, we did business courses, we did programs, and
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what we wanted to do was we wanted to build our skills. So in this section of
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building your income, it's about finding a vehicle that you can do from
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your phone part-time on weekends, in the evening, like what we had, but
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also then invest some money in actually developing your skills,
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right? So yes, we spent evenings and weekends doing that, working on
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our side gig, but we really knew too we were building our skills for
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the future as well, right? So we invested in growing this side
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gig. And of course, we also wanted to grow our network. So this is where we attended
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events. at tier two is to attend events to grow
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your network. We went to BX networking events, BNI events, we
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went to industry events, we went to non-industry events, any
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which way we could meet new people and learn new things, we did that. So we invested time
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and money on like, you know, one weekend a quarter, various
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evenings, just learning skills, right? So the main strategy here
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at tier two is to keep your job You
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know, have your emergency fund in place and have that breathing room. But the reality
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is you've got to amplify your income. So the main strategy is to spend your
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evenings, weekends and time building skills and
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of course building that side income up. And I remember for us, I
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remember when we got paid our first $400 quite
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quickly and that was a great win. But then we wanted to make it
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more and more and more. And one day I was in the gym. and
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all this hustle and spending this time together with my wife building this thing.
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And you always wonder whether it's going to pay off, but of course you get paid and
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you just want it to be more and more and more. And this one time I was in the gym
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and I looked down at my phone for that paycheck that week and it was like 1800 bucks
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for the week. I was like, Oh my God, I've literally doubled my income. And
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so it took us about three to four years to really earn
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as much there as what I was earning in my job. And so
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it does take time, it's not fast, but you've got to build this
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asset. Because at the end of the day, a side hustle that's systemised and working for you,
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where you're building your skills, that's you building an asset. And
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it's how you actually amplify your income. This is how
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you do it now, right? And there's multiple different side hustles, you've just got to choose one, stick to it, they're all
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hard. There's no such thing as an easy side hustle, right?
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So don't look for fast. Don't look for easy. Look for what
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is already working. What are people already doing to make side income? What
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system are they following? Are you paying them for mentorship to show you
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how as well? And then are you doing the work? And then you're having patience
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to continue to do the same basic stuff. When we pulled up
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in the car every day for the Hour of Power, it was the same thing. Post on social media,
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follow people up, talk to people, ask if they want to buy. Like, boom, boom, boom, boom.
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It was not like anything else. It was just years of doing that, which
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is cool because you get better at it, right? So this tier is build
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skills, increase income, and that will move you to another tier,
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which is, of course, tier three. And this is where you
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start to make multiple six figures, right? So at that point in time for us,
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we were earning about $150,000 in our side hustle and
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I guess cumulatively $150,000 in our jobs combined
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with my wife. So we were doing pretty good. And
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I made the, it was a pretty good decision looking back, but
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you don't have to leave your job. If you have two incomes and it's working, don't
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leave. Because what I noticed when we left is we cut our income in half. So
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that's not ideal to do that. So then I went off and built
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another income. So two incomes is good. You don't need any more than just
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two core incomes that are taking your attention and time. But
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tier three is about, actually earning more money and building more
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wealth that doesn't take your time. So this is a really cool
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tier to get to. And of course, you can begin this tier in tier two
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if you want to, but certainly tier three, it's how you scale absolutely
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beyond your time, way beyond 250K a year, and it's where your
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wealth starts to actually produce itself. And this is where we buy
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assets. That's the main aim here. It's called scale and
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protect. So scale your wealth without scaling your time, and
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protect your wealth by buying assets, right? So in tier two, you
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built the asset in tier three, you're buying assets. Okay, so
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the goal here is to build and protect real wealth. So
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here's what we did. Throughout the different
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tiers, I did begin like with a small amount of money, just investing in
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shares. And when you get to tier three, you have a lot more money.
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So you can actually add a lot more to buying assets, because To
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buy assets, you need money, right? And so in
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this tier, the very first step was start buying an index
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fund. So we opened a brokerage account and we put like 10-20% of
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our entire income, as much as we could, but within reason 10-20%
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every year. Into buying more shares and we've continued
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to do that for the last got 10 years 15 years like a
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long time And now we have a multi-million dollar portfolio that
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just grows over time and its own wealth And the reality is
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that without us touching that that could probably glow grow to about
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35 million dollars just through the compound effect So all
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the hard works kind of done when you start that process off.
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You just have to keep putting money into it It's like a big snowball Like
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if you start with some snow and it rolls down a hill, it'll grow. But if you can add
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more snow to it on the way down, which is you adding more money, it's
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going to be a huge snowball. So do that. And of course, engage an
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accountant because when you're earning more money like this, you'll need to make sure
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you're minimizing tax legally, which means you're going to have the right company set up,
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the right trust structure set up, and they can give you the advice on
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how to do that. Because if you're earning like $250k plus a year, you're going
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to have a big tax bill and there are ways you can legally minimize
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your tax. But of course, I'm set up a company structure to that
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also limits your liability if you're in open business, right?
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So talk to your accountant, then we hired more mentors. So
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like, We hired tier mentors to
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teach us higher level skills to then grow
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our income as much as we could. So we continued to hire mentors and
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pay for programs. And we still go to events. We still do all the things we did
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in tier two. But we've systemized things a lot better. So part of
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this tier three is to make sure your side hustle has got other people
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and other systems in it so you can actually scale it and
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achieve more by doing less. And you can buy back your time with some
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of your money too. So hire your first VA. you
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know, and start building out people to buy back your time, right? That's
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the whole objective here. But without a doubt in the buy assets phase is
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to actually get your money working harder than you do. This is what you want to do here,
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right? This you've done the work, you've done tier one, you got ahead, you've done tier
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two, you've effectively doubled your income
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through a side hustle. Now you want to like get your money working harder than
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you do. So this is about putting your money to work. Because
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when you put your money to work, it works 24 seven, seven
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days a week, never has a rest day, doesn't call in sick. It
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just works and works and works and works and works. And it's really cool because when
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you've got assets, you can pick up your phone and pull up your brokerage account for the day. And
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like some mornings I wake up and I'm like, whoa, Portfolio grew
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by a hundred thousand in a day and that's not because I we
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started with a lot We started again 15 years ago. We
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started with about 2,000 So you have to start with luck you got
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to start? Because every big snowball started with a little
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bit of wet snow and a really long hill So the sooner you start the
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better you can start buying assets for a very small amount
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in tier tier 2 but certainly at tier 3 when
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you've got way more money, you're definitely wanting to do that
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and people can fall in the trap of you know, surpassing
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tier 2, they've got two great incomes, they've got all this money coming in
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and they don't pay themselves 10-20% and they don't invest in assets and
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of course, what happens? Their business can get into a bit of a troubled season and
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they're back to tier 1. You don't want to go back in tiers,
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you want to keep progressing forward, alright? Keep doing that
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and then of course you get to a point in time where you can start to give back Strategically
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so you can either give to charity you can either give to you
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other people in your life in some way you want to But
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certainly starting to give back some of that wealth and getting to philanthropy is
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kind of like this awesome Place to be this this third tier
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right and that gives you a tremendous amount of joy, too so the main strategy in t3 is
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really Think like the wealthy and buy assets, all
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right? That means getting your money to work harder than you do to scale your money
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on autopilot, which is a super fun place to be, all right? They're
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the three tiers. Tier one, get ahead. Tier two, scale your income. Tier three,
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buy assets and scale your wealth without scaling your time. Super fun journey
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to be on. So that's what I encourage you to do. But here's the
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thing I really need you to remember. More income definitely
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gives you more options, but not more discipline. So if you're
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not managing your money well at 50K in tier one, you'll blow
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it at tier three. You'll blow it at 500K. The
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trick to doing this is to learn how to upgrade your money strategy
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as your income grows without losing the discipline that
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got you there in the first place, because you
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always have to maintain that. Live lean, build assets, protect
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your time, money, and energy. That's the game. And
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if you play it right, wealth isn't just possible, it's inevitable,
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right? If you wanna learn how to master that at a higher level and build
18:46
systems and build wealth faster, then check
18:50
out my latest book, Money Buys Happiness, where I break down the
18:53
five steps that I use to actually strategically build that, all right? The
18:56
link's in the description, you go check it out. Until next time, don't just make money,
19:00
make it grow. Thanks for listening to Money Grows on Trees. If you enjoyed
19:03
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and subscribe to us on YouTube so you never miss an episode. And
19:11
if you're serious about building wealth, make sure to check out the links in the show
19:14
notes and follow me on all social media platforms, at