Ending the Struggle of Saving Money (course class 1)
Did you know more Americans are struggling to save money than ever? 77% of people live paycheck to paycheck. And if they're living paycheck to paycheck, that's a very stressful life. I'm going to share with you how we can end that life and get you on the path to not just financial security, but real wealth, and position you where you can retire, and retire permanently.
My name's Mark Prather, founder of the Mark 1 Wealth Academy. As you can see on my little bio here that I've been in the real estate industry since 1977. I started in the real estate industry at age 18. Over my long life journey, I've learned some really powerful and profound things about how wealth growth really works that have never been taught to the average person. In this presentation I'm going to share with you strategies that can help you to overcome America's number one challenge, which is the struggle of saving money. I'm going to show you how you can actually become not just financially secure, but wealthy without saving money through understanding the power and wealth growth principles that are incorporated in real estate.
I've crunched the numbers in your retirement account, it's time to figure out who'll be driving the getaway car and who'll be wearing the mask. This is where most people's financial plan looks like, it's just guesswork and they're desperate to be financially secure. What do you believe is possible for your life financially? I wrote a book called Why the Rich Stay Rich and the Poor Stay Poorer, and here's why I titled it that. I learned on my life journey that most people stay in the place they are because that's where they believe they belong. Neither one of my parents had high school diplomas, the community I grew up in was poor. My cousins, my family, everyone really struggled to get by.
The great challenge is changing that belief system. But here's the key, the limited belief system of that our life can never change is because we don't know what we don't know. I'm going to change that in this presentation. I want to show you and prove to you that what is possible for your life financially is so much more. Elder poverty in this country is nearing rates unseen since the Great Depression. This is the Baby Boomers. The Baby Boomers are struggling more than ever. During my lifetime, we've seen a big shift. And the shift has been from it used to be a time where people that had jobs, they could have a pension and they could rely on that pension. Well, in the private sector, pensions are pretty much all but gone. 80% of Americans, if they were to retire, would run out of money within five years. Saving in a 401K or an IRA has failed people miserably.
If you have a 401K or an IRA, that's a good thing because saving money is a good thing. But here's the reality, is if you're not saving a lot of money, you're never going to get there. And most people in this country believe that that's the only path, through saving money. Let me show you where we are with the wealth gap crisis in this country. Now, if you look at this chart, in 1989, that's the dark blue, through 2016, you can see the top 10%, the top 10% are the people in the last three categories. The 90 to 99%, their wealth growth currently is 42%. The top nine-tenths of 1%, you can see their wealth growth is at 33%. And then the top 1% is 16%.
So, the top 10% own over 90% of the assets in this country. Now, I'm going to repeat that, the top 10% in this country own over 90% of the assets in this country. Now let's look at the middle class, the 50 to 90 percentile. Their wealth growth has contracted from 16 to 7%. This is the struggle of saving money, and this is the evidence of the fact that the 401K and IRA has failed the American people miserably. Saving money is not a real world solution for the middle class person to reach wealth and financial security. In this presentation I'm going to show you how we can make that happen.
Here's why so many people are falling behind, and one of the real keys to understanding wealth growth is also understanding inflation. I like to say inflation's either your best friend or your worst enemy. Understanding what inflation is, how it works, and then how to use the power of inflation to help propel your life financially and to position you so that you can in fact build wealth. The real cost of inflation, nationally the goal is to be between 2% and 2.5%. Historically, if you look it up, the country's average is more like 3%. If you look in California, California's inflation rate is even higher. Real estate values have averaged growing about 7.3% a year, rents in Los Angeles and Orange County have averaged about 5%, 5.5%.
So, inflation is really challenging when you look at how much things are increasing in prices, and then compare that to your average pay increase. The average person's pay increase is more like 2% to 3%, and they're losing the inflation battle every single day. Now, what does it mean to be rich? Here's why I ask this question of you, because here's what I used to believe being rich was. It was having a big house and an expensive car. And a lot of people think that's what being rich is. But that's not what being rich is. That's being in debt. A lot of people believe that saving money and a 401K or IRA is what being rich is all about. And that's not true either. See, rich means having a lot of non-employment income.
Here's why this is so important. We move in the direction of what we focus on. So, when it comes to your financial security and where you're trying to go, what are you focused on? I was focused on material things for a long time, because I was caught in that delusion. And then I started to learn that that's not where we want to go. Where we want to go is we want to focus on non-employment income. Here's why I call it non-employment income. In the mortgage industry I've taken thousands of loans out through the years. And I tell you what I learned, when I ask someone the question, "How much do you make?" Per hour, per month, per year, people know what they're getting paid on their job. But when I asked them, "What is your net worth? What assets do you have and how much investment income or non-employment income do you have?" They almost never knew.
The key point is focus. For you to be financially secure and retire, we have to replace your employment income. So, whatever your employment income is, if that was to disappear, how financially secure are you? Odds are you're in that category of the 80 to 85%, if they lose that employment income, they're going to be financially broke within 30 days. That's our game plan, is to replace your employment income. Everything is about how do we create this non-employment income? And I'm going to show you how we can do that, and saving money is not part of the plan.
Saving your way to wealth is almost impossible. Let me share with you what our typical client scenario looks like. They're about 40 years old, they want to retire at age 65. Their current expenses are about $5,000 a month. So, this is rent, car payments, utility bills and so on. Their monthly savings rate is about $400 a month. They have $20,000 in their retirement account, the 401K or the IRA. But inflation is averaging about 3% a year and their net return on that 401K or IRA is averaging about 4.5%. And I say net because these money management accounts are not free. There are fees that come along with that. After 25 years, their total life savings will be $282,000, but their expenses will have more than doubled.
What people aren't aware of is your expenses are going to double about every 22 to 23 years because of inflation. If they were to retire, you can see that they will run out of money in less than two and a quarter years. This is actually ... It's actually worse than this, and here's why. In that $282,000, a good chunk of that is due to the state of California for taxes and the federal government. Their monthly retirement income on their life savings is only $1,060, so they're going to have to be living on their life savings if they were to retire. Their shortage is over $9,400 a month. How much do you need to save in that retirement account so that you can become permanently retired and be secure that you're not going to have to go to work or run out of money?
Well, let's reverse engineer this. If your retirement expenses are $10,469 and you get 4.5% return on your money, your savings that you're going to need is $2,791,000, almost $2.8 million. Over 25 years, means you need to be saving $3,000 a month. Now, when I share that with clients how do you think they react? I'm going to tell you how they react, most of them laugh. They go, "I'm struggling to save $500 a month. There's no way I can save $3,000." And that's why they have the false belief that retirement and financial security is not really an option for them. And the truth is, they don't even want to think about it. They just put it on ignore.
Well, there's a solution to this and I'm going to show you that solution. Here's a chart comparing real estate, California real estate, which is the orange line, the stock market, or the DOW Jones, and national real estate. Now, what you'll notice is that they all track the economy. But simply looking at this chart, which dates back to 1968, there's no way to really know which is the best path. Now, statistically I'm going to tell you less than 10% of the people own investment real estate. Meaning they own a rental. Less than 10%. 65% are in a 401K or an IRA because they believe that the 401K or IRA and saving money via the stock market is the way to go.
I'm going to show you how wrong they are. The secret to real estate wealth growth, and I call it the secret sauce to real estate, is the utility value. Now, let me explain to you why I call it the secret sauce. The secret sauce to real estate is the utility value. That's a line I stole from Shark Tank. If you've seen the show Shark Tank, an entrepreneur will come out there and present their business. And very often they'll ask the question, the sharks will ask the entrepreneur this question, "What's your secret sauce?" Now, here's what they're really asking, "What's the insurmountable competitive advantage that your product or service has?" Well, the insurmountable competitive advantage that real estate has over every other asset class is the utility value, meaning you can use it. Let me show you what that means in dollars and cents.
Let's say we're talking to a renter, they put $120,000 in the stock market. So, they buy $120,000 worth of stock, they get their stock certificates. Let's say that stock performs exceptionally well and averages a net return to them of 8%, which means they're going to be averaging more like 9%, 9.5%. Let's say they get a net return of 8%, what can they use those stock certificates for? Nothing. I mean, wallpaper? Maybe they can frame it and call it art.
Here's the point, there's no utility to it, so they have to live some place. Let's say they're renting, paying $3,000 a month and their rent is going up 4% a year. Now, keep in mind, in Southern California it's more like 5%, 5.5% a year that rents are going up. But the rents going up 4% a year. In 30 years their stock portfolio would be $1,207,000, so it would've grown by tenfold, which is terrific. But look what they would've paid in rent, over $2 million in expenses. See, renters are losing money every single day and they don't know it. They are going backwards financially.
So, if you're a renter with a 401K or IRA, you are losing money. You are going backwards financially. Now, let me show you if you take that same $120,000, which is 20% down on a $600,000 property. Not that you need 20% down to buy real estate, but just to create kind of an apples and apples comparison. Let's say you only get 5%, and I say only 5% appreciation because California's average appreciation rate is 7.3% for over the past 50 years. Nationally, 5% is the number. Let's say your payment is $3,279: principal, interest, taxes and insurance. And this is at 4.5%, which in today's world sounds like a high interest rate anymore. In 30 years that property's worth over $2.5 million, double the stock market. You would've only paid $1,180,000, half what a renter would've paid.
We've included some numbers in here for maintenance and some expenses on the property, your net gain is $1,322,000. Add back the $811,000 difference with stocks, it's over a $2 million difference. Here's the point, the utility value in this scenario is worth over $2 million, and almost no one knows this. They never calculate this. Now, let's say you turn your home into a rental. Same scenario, but now we're collecting $3,000 a month in rent. Here's where you're going to be in 30 years, you will have collected over $2 million in rent.
Now, in this same scenario I've increased the expenses. I included a property manager expense, a vacancy factor, and some additional expenses in maintaining the property. The net gain is over $3 million, compared to a $1.2 million in the stock market. See, real estate on average will outperform the stock market by three-to-one. Let me repeat that. Real estate on average will outperform, meaning you will grow your wealth at three times the speed of what you will in the stock market. Here's why, there are five economic benefits. You're making money five different ways.
Number one is leverage. I'm going to explain what that is. But leverage, in short, means that you're making money not just on your money, which is the down payment, but you're making money on the bank's money. Number two is the mortgage pay down or the principal pay down, which is greater than it's ever been in history because interest rates are so low. Number three is rental cashflow. And rents basically go one way, they go up. Number four is tax benefits. Real estate has preferred tax status. Real estate has write offs, tax deductions that your 401K or IRA or any other investment does not have, and it's worth a lot of money to you, especially over time. Number five is appreciation. What most financial planners and realtors will talk to you about is only one of those five factors, is they will compare the growth rate of a stock investment to the appreciation rate of real estate. And it is not an accurate comparison. Let me show you an accurate comparison.
Let's say you have $65,000 and you put it into a retirement account, versus buying a $650,000 property with 10% down. Now, you can see we're stacking the deck in favor of the stock market or the retirement account at 5% growth rate, with only 4% in real estate. You can see the annual appreciation rate, because of the leverage factor, which we have an asset that's 10 times the size of the stock market, huge advantage. See, with real estate because of the leverage factor, you don't start from zero, you start from the value of the asset. So, you're growing wealth tied to that asset value.
Now, principal reduction, as I mentioned, interest rates are at incredibly low levels. What this means is the percentage of your payment that is interest, is lower. The lower the rate, the lower the percent of your payment is interest. And the higher the percentage is principal reduction. So, you're building wealth at a far faster rate with low interest rates. Now, if it's your home, there's no rental income, unless you're renting a room. You have the mortgage interest deduction, and that's sizable. Up to $750,000 mortgage, the interest is fully deductible. Look at the annual return. The annual return and the difference on the real estate is $33,000 a year in this scenario, on a $650,000 property. That's $2,800 a month.
So, here's the point, remember I talked about how you could become wealthy without saving money? In this scenario, this person is basically saving $2,800 a month, without saving money. Now again, I'm not discouraging saving money. Saving money is a great thing. But you don't need to save money. It's the icing on the cake. In this scenario if you're renting, you're losing out on all of this. But if you can save this kind of money with one property, let's talk about how we can grow it further than that. Now, here's why real estate is the safest investment. Because fast without safe is no good. Here's why real estate is the safest investment you can make.
This chart, and by the way this is from a website called DeptOfNumbers.com that you can go to. And that's D-E-P-T OfNumbers.com. This chart is showing California's rental rate history from 2005. Now, here's what makes California real estate the ... Well, frankly, real estate anywhere is far safer, here's why. Imagine in 2008, the stock market collapses, let's say you had a million dollars in the stock market. The stock market collapses, that million dollars is reduced in half to $500,000. Let's say you had a million dollar fourplex and the price on that comes down. Here's what happened, we had a financial panic and the demand to purchase stocks and the demand to purchase real estate both collapsed and both of them, their values came down.
If you were retired, had a million dollars in the stock market and your stock portfolio went down to half a million, what do you think happened to your retirement income? Well, it was reduced in half. It was reduced dramatically, and here's why. Every other asset class, the income stream is tied to the asset value. But not real estate. Here's why real estate's the safest investment you can make. Real estate is the only asset that operates on two separate supply and demand components. The first one is the demand to purchase real estate. The second is the demand to rent real estate. Now, if you look at here, what happened in 2008? Well, in 2008 we had massive foreclosures. But a big percentage of those foreclosures were people just walking away from the home. They saw the property value drop dramatically, they were upside down by hundreds of thousands of dollars, and they said, "I'm not going to pay it." And they just walked away. But they didn't choose to be homeless. What did they choose? To be renters.
So, demand for rents actually went up for a brief period there as more people entered the rental market. Look at the stability of the rental history of California real estate. You can chart rental history back to about 1940 in the state. This is what it looks like, and here's why. People keep moving here. The demand for rental property ... In fact, it's at a crisis level. That's another conversation. State of California's done some pretty aggressive things to create more units because there's such a shortage for rental property. Vacancy factors in L.A. and Orange County are like 1%. That's why California real estate is the safest investment you can make. Do you think people are going to stop moving to California in your lifetime?
Next I want to share with you how to grow your wealth exponentially. The reason that real estate wealth growth blows away the stock market, as I said before, is because of the five economic benefits. Let me explain this to you and show you in a presentation of the exponential wealth growth caused by these five economic benefits, as opposed to the linear wealth growth of saving money in the bank or the stock market. Let's say you have $1. So, the red chip represents your money, you put $1 in the bank. Now, as you know, interest rates are incredibly low. The interest return on money in the bank is like next to nothing, it's next to zero.
But, let's say for simplicity, you get 1%. So, $1 in the bank, and let's say you got 1% would be one cent, you're not even going to get that. This is your return. Now, this is what's called linear wealth growth, meaning a straight line. Here are the problems with it, there are three significant problems. First problem is that the return is so low, it's just ... like I said, it's even less than 1%. That's the first problem. Here's the second problem, is the reality is you're actually losing money. Because you're not making enough money to keep up with inflation. If inflation's running 2.5%, 3% and you're getting less than 1%, you're actually going backwards. But here's the third problem, why I created this presentation. It is the biggest problem and it is the monumental blindside that most people have because they have no awareness. And remember I said, you don't know what you don't know? Let me show you what you don't know.
It's linear wealth growth, meaning you're only growing money on your money. And you're going it alone and you're saving money. Now, let me give you another example of that. Let's say you put $1 into your retirement account. And let's say you get 8%. So, $1, 8%, way better than the bank. But it still has the huge problem of linear wealth growth, you're only making money on your money and the money that you save. You know, when I do these consumer presentations and we'll have a hotel room full of people and I ask them this question, "How many of you believe people are getting wealthy through a 401K or IRA saving this way?" How many people do you think raise their hand? No one. They know they're not going to get wealthy. This is at best a band aid for survival.
You want to do what the wealthy do, and the wealthy do what I call exponential wealth growth, and I'll show you what I'm talking about. You put $1, so same as these scenarios, and you buy a $10 property. So, 10% down, here's your $1. You borrow $9 from the bank. There's two, four, six, eight, nine. So, 10% down, nine dollars from the bank, this is the leverage factor. Here's what's awesome about this to get started. First off, you've bought a $10 property. So, where do you think you're going to make more money, on a $10 asset or a $1 asset? Well, it's pretty obvious, right? That's the first thing that's
Second thing is that would you loan somebody 90% of the money to buy a property and get zero ownership, zero partnership in the property? No, I wouldn't do it either. But that's what banks do every single day. They will loan you 90%, 95%, 97%, in some cases 100%, and they don't own any of the property. You'll own 100% of it. They just have a contract where they're going to make some interest on the money, which in today's world isn't very much. Now, this is the first economic benefit of leverage. Now, we're going to use 8% in the stock market versus 5% in real estate. So, we're slanting the deck in favor of the stock market. Stock market at 8%, real estate's only going to get a 5% return, not the 7.3%. So, 5% of $1, 5% of $1 is five cents. 5% of $10 is 50 cents. Let me show you what that looks like.
There's 10, there's 10. 20. 30. 40. And 50. Now, we've only covered two economic benefits: leverage, which is the bank's money, and appreciation. And we've already blown away the stock market or your 401K, it's not even close. There are three more economic benefits. Now, I showed you those other three benefits. If you were here live, I'd give you a free book if you could name one of the other ones. Here's next one, tax benefits. The tax write offs on real estate. Significant tax advantages. When you see the difference in tax advantage that real estate has over your 401K it will blow your mind what it means in dollars and cents. Third is principal reduction. Every time you make a payment, a big percentage of it, and right now it's about 33%, 35% depending on the rate, and growing every time the rate comes down. But as the years go by, the percentage of principal reduction is rising. And if you keep the loan over the life of the loan, the interest rates are so low that the percentage of your payments that's principal reduction is actually more than half.
Here's number five, rental cashflow. Now, here's what's so significant about rental cashflow. I showed you in that chart, rents basically go sideways or up. They almost never go down. So, you have this nice stable income. And that's what you need, especially at time of retirement. But here's the other factor, remember we talked about the utility value? Here's where real estate is so different from every other asset class. The reality is, is what you've done here is you have a business. Investing in stocks, you don't have a business. You're at best this passive investor where you have this insignificant percentage in stock ownership in this company.
When you have real estate, whether it's ... Let's say you take your home and you were to turn that into a rental, here's the reality, is you have a business. Just like a hotel. A hotel is a business, right? What do hotels do? They rent bedrooms and ballrooms. So, when you have a property, you buy a home, you turn it into a rental, now you're basically in the hotel business and you're renting bedrooms and bathrooms in that. But here's the benefit of being a business, you have these tax benefits. Being a business, you can borrow money. So, you can use the asset and you can borrow this money. Now you're creating all these advantages. And here's the biggest advantage, you have a customer. Who's the customer? We call them a tenant or a renter. They're paying you rent. You take their money that you're collecting and you pay off your loan. I'll say that again, their money pays off your loan.
So, if you were to borrow 90% of the money to buy an asset and get somebody else to pay off your loan, didn't this money become free? There's no other way to secure free money than real estate. How much free money do you think you should secure in your lifetime? Well, the obvious answer, as much as possible. The more free money you secure in learning these wealth growth principles, the faster you're going to become wealthy and be able to retire or just live the life that you want to live. The key to building wealth, as you saw in that presentation, is through the exponential wealth growth.
But to say simply that real estate is your path to wealth, that's really not true either. I'm sure you've known people that have lost money in real estate, just like they've lost money in stocks. Here's the key, it's understanding the science of building wealth. There are seven key principles to wealth growth that real estate allows you to take advantage of. 98% of the people don't know what these seven principles are, let alone know how to use them. So, I'm going to share with you what these seven principles are, and then we can talk about how we apply them to your life circumstance.
Number one is growth rate. Now, everybody talks about growth rate. I just showed you the exponential wealth growth of real estate and how dynamic it is compared to the stock market and making money in the 401K. We've created some custom proprietary calculators where we can analyze the growth rate of real estate, whether it's a single family rental, units, two to four units, bigger units, commercial or so on. But you need to have an accurate analysis of the growth rate, including all five economic benefits. Almost no one ever does that. They simply look at either the appreciation rate or the cap rate, and neither one tells the whole story.
Number two is debt management. Where are you with respect to your debt? See, wealth growth and retirement's really only about two numbers. How much money's coming in and how much money's going out? We need to organize a plan to get rid of all your debt as quickly as possible and grow your wealth. Now, when I say all your debt, let me qualify that, by there's such a thing as called good debt versus bad debt. Okay? Bad debt is debt that is high interest rate, number one, and creates no income. Good debt is if you're creating more income than you're paying on it, and we can get into that in a little more detail. But here's the other factor with respect to debt, the older you get, the lower the debt. So, how old you are, whether you're 25, 45 or 65, those numbers are very relevant and we're going to analyze that in your plan.
Number three is leverage. I showed you where leverage is in that example of the five economic benefits. Leverage has to do with risk and managing other people's money, meaning banks' money. That strategy can vary depending on your threshold for risk and how old or young you are. So, we want to analyze that. But leverage is kind of like a turbo charger to your wealth growth. But you need to be crystal clear on how you're using the leverage and how to strategize it, so that it fits in line with your wealth growth strategies and objectives and you're retirement objectives.
Number four is the investment income. In that analysis before, we talked about where your expenses are today. So, let me give you kind of a recap on that. Let's say your expenses are $5,000 a month and you want to retire 22 or 23 years. We know your expenses then are going to be more like $10,000. Then we add income taxes to that, which can be about $13,000. We need to create investment income to cover that level. We're going to show you how to make that a reality.
Number five is taxation. The most recent tax reformat gave real estate some additional tax benefits. Now, the only thing you heard in the media was that there were tax write offs that were removed from certain states with the limitation of the $10,000 state income tax. What they didn't tell you is the additional tax write offs for investment real estate, meaning rentals. There are all kinds of tax rules, this is a long conversation. But this is where we get into with our consultations and our trainings, so you learn what these laws are and then you use how to use them to propel your return on investment and accelerate your wealth growth.
Number six is asset protection. We want to make you financially bulletproof. Building wealth takes a lifetime, but one major recession or one major lawsuit can wipe it all out. The wealthy ... You ever notice, the wealthy never go broke? Why do you think the wealthy never go broke? Because they know the rules of the game. I made this journey, I didn't know the rules, but I have paid big dollars to attorneys and CPAs to learn the rules of the game of taxation and learn the rules of the game of how to protect your assets. And you can get position so that you are financially bulletproof. You need to know how to do that.
Number seven is risk management. See, everyone's threshold for risk is different. Now, I may be more conservative than you, or I may be more aggressive than you. My job is not to tell you what to do. What my job is, and what our real estate wealth advisors, what their job is, is to educate you. And it's for you to understand where you are at this point in life, what the risks are associated with where you are and what your goals are, and then for you to make the decision. Now, if you ask me, "What would you do, Mark?" I will tell you. But you need to understand what the risks are and what the timelines are associated with those risks, to make your decision. These are the seven principles of the science of building wealth. This is the magic. It is knowing these seven principles and how to manage them and tie them into your life, whether you're 25, 35, 45, 55.
To simply say, "Oh, I just got to buy real estate," is not true. It is way more involved than that. And you know, we all want to make things really simple. But things aren't really simple. They're complicated. And we need to get the answers. And that's why you need to bring in an advisor. There are five critical questions that we all need the answers to, if we're going to be financially secure. Here's what those five questions are. Number one is how long will your life savings last? Very few people ever do this calculation. And the truth is, it's a pretty simple calculation to do. Any financial planner can do this, a lot of websites can do this. We do this with our clients, and this is where everything starts. But have you ever done this consultation?
I called a friend and asked him that question, I said, "Have you done this calculation on how long your life savings will last?" Here's what his answer was, he goes, "You know Mark, no, I haven't done that. But I know it's not enough." And that is true for easily 80% of the people. But that's our starting point. We need to do that analysis. You need to know based on what you're currently doing, is it going to get you to where you want to be as far as financial security, wealth and retirement? If it's not, and most times it's not, it's a financial train wreck is the truth of it. And people believe because they can't save any money that they can't fix it, and that is simply not true. I'm going to show you how we can get there, and saving money is not necessary. If you can save money, makes it easier. But I just want you to look at saving money, as I said earlier, as icing on the cake.
Number two is how much will inflation increase your expenses? You know what your expenses are today, but what are they going to be down the road when you want to retire? That number is a moving target, depending are you 25, 35, 45, 55 and so on. Timeline and lifestyle affect your expenses and inflation and what the bar's going to be. That's really important. Number three is how much monthly income will you need, including income taxes? Let me give you an example. Let's say your expenses today are $5,000 a month. In 22 years we know they're going to double with inflation. So, they're going to be $10,000. Well, if your expenses are $10,000, $10,000 a month in retirement income is not going to be enough. Because we have to pay the government, the state and the federal government. So, we're going to need about $13,000 a month in income to pay our taxes and to pay our $10,000 a month in expenses.
Number four, and here's the really tough question is how? How will you create the monthly income that you're going to need, to maintain the lifestyle you desire? Again, if your expenses are $5,000, inflation makes them $10,000, and then the government makes them $13,000, do you have any idea how you're going to create $13,000 a month in retirement income? I'm going to tell you in short, saving money is not going to be the way. Very, very few people could ever get there saving money. We're going to show you in our consultation how we can create this $10,000 to $15,000 a month in retirement income without saving money.
Number five, it takes a lifetime to build wealth. But it takes one recession, one lawsuit to destroy it. Have you ever noticed how rich people never go broke? Here's why, is they learn to play the game. They learn the rules of the game. I've made this journey from zero to millions of dollars in wealth growth. But I've learned that there are rules to the game and I've paid a lot of money over my lifetime to really bright, expensive CPAs and really bright, expensive financial planners and really bright, expensive attorneys. The wealthy play a completely different game than the middle class and the poor. You need to learn the rules of the game. In our consultations, we're going to show you the path and we're going to bring in some bright attorneys, some bright CPAs in to help create a ... Or to position you in a way so you're financially bulletproof. This is what our consultation is all about.
Are you ready to change your life? And I want to repeat that, are you ready to change your life? I've shown you just the tip of the iceberg. We stared with that question of you don't know what you don't know, I revealed a lot. But it's more complicated than just simply saying, "Oh, I got to go buy some real estate." There's a path. We're going to show you how to build a plan and how to end financial uncertainty. You know, the number one stress most people have, in fact 80% of the people for every generation category, is? Money stress. Does that surprise you? I bet it doesn't. And here's why they have money stress, uncertainty. We can end the uncertainty by building a wealth growth plan and a timeline without saving money that's going to put you in the place where you can be financially secure, wealthy and permanently retire. Build real wealth, serious wealth.
And if you're young, we need to be looking at some big numbers because you have the most valuable asset, which is time. And then how to leave the planet and leave a legacy of wealth for your family and for your heirs. All this is possible, this is real. If you'll go to my website, Mark 1 Wealth Academy, you'll see some testimonials of clients that are ecstatic. And you'll see the smiles and the laughter because we've removed the uncertainty. What do you believe is possible? It all starts with belief.
And here's the sad reality, my number one challenge in making you rich is you and what you believe. I'm sure a lot of you out there are going, "Oh, this is impossible." But you don't know what you don't know. I've given you the tip of the iceberg. If you will at least open your mind to learn more, we can share with you how we can change your life in a powerful and profound way. It starts with belief, but the next is knowhow. That's what we're here for. That's what our real estate wealth advisors are trained for, is to show you the way. And then we have to take action. A great strategy, a great game plan, if you don't get in the game, then it's game over. We have to take action.
Here's my favorite verse in the Bible, I share this everywhere. "According to your faith, be it unto you." And here's what that's saying, according to what you believe, will come to pass. I've lived that journey. As I said in my book, Why the Rich Stay Rich and the Poor Stay Poor, is because 90% of the people never change their life circumstance. Rich stay rich, middle class stay middle class, and poor stay poor all for the same reason. They believe that is where they belong. I've made this journey, I know how hard this journey is. Changing your belief system, there will never be anything harder than changing what you believe.
If you're ready to take the next step in learning how you can become wealthy without saving money, through real estate, register now for our online course on how to become wealthy without saving money through real estate. Or you can go to Mark1WealthAcademy.com to learn more about what is possible for your life. This course we are going to drill down very specifically into the science of building wealth, every principle. We're going to analyze whether you're a renter and a young person just getting started, a homeowner halfway along that journey, or a serious investor. We're going to break down every step of the way in this course in great detail.
This is not a fluff course, it's going to be a mass of information. Because I want you to learn, it's not simply about just saying real estate's the path. The path is the science of building wealth and these seven principles and mastering them and how to apply them to your life circumstance, regardless of where you are. If you're a young person getting started or you're already well along the way, we're going to show you how to apply these principles to your specific circumstance and propel you on your way.
I'm Mark Prather, founder of The Mark 1 Wealth Academy. If you have any questions, go to Mark 1 Wealth Academy and reach out. We really want to change your life. Some powerful things can happen, you can have the life of your dreams. Because that big obstacle of saving money is removed, it is gone, get it out of your head. We don't need it. And again, I don't discourage it, it's a good thing. But it's just icing on the cake. I hope you've enjoyed this presentation, I hope to hear from you soon.