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If you’re looking for secrets that help you become rich, you’ll find no shortage of tips on social media sites like TikTok. One finra study found that 24% of investors turned to social media for investment advice and those under 30 were even more likely to do so.
While there is legitimate content in social media that helps you build wealth or better understand your finances, you will also hear advice that is not only wrong but potentially dangerous or illegal.
one in Youtube videoMoney expert George Kamel reacted to a number of TikTok videos focused on the secrets of the rich. We chose three of their responses – hear their take on these pieces of advice to see if it’s worth your time.
Leveraging LLC
One TikToker claimed that wealthy people would start a limited liability company (LLC) so they could take out loans and generously forgive living expenses without using their personal credit. The idea is that you will use the business for most financial matters.
Whereas ir While the rules allow LLCs and other businesses to deduct “ordinary and necessary” expenses, claiming personal expenses as business expenses can get you in trouble for tax fraud. Kamel did not like this illegal advice and suggested avoiding credit altogether. If you own a business, consider working with a tax expert who can help you maximize deductions legally.
to wish for money to show generosity
While many people want to become rich for the sake of status or a luxurious lifestyle, one TikToker had a different goal. She discussed wanting experiences such as vacations and meals with loved ones and wanting money to give to charity. Material possessions like fancy houses or designer clothes were less important.
Kamel described the plan as “really beautiful” and discussed how important giving is to having a meaningful and purposeful life. He encouraged giving because it benefits both the giver and the receiver. Surprisingly, it can also help your career.
Kamel said, “I think successful people are often generous because they are givers and that makes them more attractive in the marketplace and so people want to work with them.”
Invest $75 per week for financial freedom
This TikTok video is about investing early to benefit from the most compound growth. The TikToker used a scenario in which someone invested $75 every week from age 20 to 30 and achieved financial independence in retirement with approximately $1.8 million.
Kamel consulted ramsey investment calculator To verify how much a person would have with a 10% average return, 10 years of contributions and $325 per month invested. That amount would be $66,574 at age 30, and if no further contributions were made, that balance would grow to $1.3 million at age 60, $1.6 million at age 62, and $2.1 million at age 65.
Ultimately, the data was examined and Kamel said you can expect a typical seven-year doubling time for your money.
Editor’s Note: This article is for informational purposes only and does not constitute financial advice. Investing involves risk, including possible loss of principal. Always consider your individual circumstances and consult a qualified financial advisor before making investment decisions.