And since most americans live in debts, that means most americans aren't just living paycheck to paycheck, but their paychecks aren't enough to cover their basic necessities.

That's a scary number because once you miss a single credit card payments, for example, the banks aren't your friends, you will be charged with interest, which means that you're more likely to miss another payment since the next payment will be bigger than the first.

This cycle keeps moving until it drags you to the point where you have no way out of that desperate financial position.

Average household pays $1,000 in credit card interest and fees annually, which might not sound a lot.

But it is since that illustrates that most people aren't just using credit cards to build their credit scores, but also because they really need them.

Since they are really struggling financially.

According to Consumer Financial Protection Bureau between 2018 and 2020 americans paid 100 and $20 billion in credit card interest and fees each year.

Just think about that number for a moment.

That's 100 and $20 billion of cash just because they struggle to make their credit card payments on time.

And that's just one type of interest americans on average pay.

Don't forget that we also have car loans, mortgages, student debts and the list goes on not being able to pay for one payment leads to difficulties to make the second payment, which eventually can lead you to barely staying above the waters.

The Fed's survey of 2018 where they asked over 12,000 households about their financial well being.

Show that almost 40% of Americans would struggle to come up with a $400 emergency bill.

$400 would barely last year week leave alone stand as an emergency fund.

If you don't have $400 aside, you are definitely below the poverty level.

Even if you look at the bigger picture, the middle class in the us is shrinking.

America's middle class now holds a smaller share of the US wealth than the top 1%.

The entire middle class controls a smaller share of the economy than just 1% of the population.

That's insanely disappointing.

There are many reasons behind this wealth inequality and one of them is definitely the 2020 global pandemic advice.

It seems like the government distributed stimulus checks to help everyone.

But at the end of the day, trillions of dollars went into the pockets of companies that were already making unbelievable amounts of money.

The world's top 10 richest men more than doubled their fortunes.

From $700 billion $1.5 trillion $15,000 per second or $1.3 billion 99% of humanity fall on over 100 and 60 million more people forced into poverty.

Every crisis presents an opportunity but to take advantage of this opportunity, you need to be ready for it.

If you're busy surviving, you will most likely miss it.

Just to give you a sense of how rich these people are.

If these 10 men were to lose 99.99% of their wealth tomorrow, they would still be richer than 99% of all people on this planet.

They have six times more wealth than the poorest 3.1 billion people.

And this is not the first time every crisis leads to more wealth inequality.

It happens all the time.

Remember back in 2008 when millions lost their jobs and ended up with houses that were worth a fraction of what they paid for at the same time, we had the government bailing out major financial institutions that deliberately took unnecessary risks just to fill their pockets.

The same happened back when the dot com bubble burst or how about the first Bitcoin bubble?

At the end of 2017, we can complain about this wealth inequality forever, but that's not going to change anything.

Of course people should speak about these problems and elect people who would tackle these problems However, individually, each and every one of us can do something to do financially better.

I get it.

When you're down in the bottom, it seems like there is no way you can get out.

Trust me, I've been there.

I have been in a situation where I did not even have $400 in case of an emergency, but thank God I'm no longer there and most people have the ability to improve their financial condition if they just push themselves a bit harder.

I'm a huge believer in credit cards.

But honestly the way I see people use credit cards is insane.

People have very little control over themselves.

Once they get hooked, they will max their credit cards instantly and then end up paying thousands of dollars in interest.

Here's how I would do it.

If I couldn't control my spending, I would get a credit card just for my subscriptions like netflix and iCloud, which are quite small and no matter what happens, I will be able to pay them.

I wouldn't use it for anything else.

That's why I'm building my credit score to a certain degree, but at the same time lead a lifestyle as if I don't have a credit card at all.

That is the number one reason that usually drags people into poverty, especially since the culture of student debt has started, kids who are just graduating from school are given an option to take on dozens, if not hundreds of thousands of dollars of debt to go to college.

Of course, people who go to college often do better financially, but at the same time, there are plenty of examples of people who end up struggling to pay their student debts for decades after graduating.

And that debt burden often stops people from taking a bit riskier decisions suggest starting a business or joining a startup since they need to find a stable job as soon as possible to finally start paying their debts before it generates even more interest, especially when the average interest rate on student debt is around 6% that is higher than mortgage rates, Secondly, get rid of this consumerism culture Americans just love wasting money on stuff.

They don't need Americans waste about a pound of food per person each day with people who have healthier diets rich in fruits and vegetables.

The most wasteful.

According to research about 100 and 50,000 tons of food is tossed out in the U.

S.

Households each day equivalent to about a third of the daily calories that each american consumes.

People often ask, how do I start saving money?

Here you go stop wasting money on stuff you're going to throw away anyway.

We've already made a video about conscious spending.

I will leave the link in the description but you get the point thirdly, we are most likely going to go into our session.

That is going to be long and painful.

Yeah.

Some experts point out that recession is unlikely but there are enough reasons to be conscious during recessions.

What matters the most is cash that's why saving money now is even more important.

I get it, inflation is rising and the cost of living is becoming ever more expensive.

But if you want to make the next session your turning point then you should start preparing now of course it takes far more just saving money in order to avoid the paycheck to paycheck lifestyle.

We have already talked about that in previous videos, from how to teach yourself to save money to different investing strategies.

By the way, I have created an entire course on how to start investing that you can find on skill share.

If you use the link in the description you can get two weeks of skill share premium and get the course for free.

The US is far from broke, it might have reached its potential but there is always a room to grow.

It remains the wealthiest country in the world and will be at least in the foreseeable future.

The challenge is to learn how to take advantage out of this wealth especially since we are in the middle of the greatest wealth transformation In history, baby boomers, the wealthiest generation in the history of the US are getting old and expected to transfer $30 trillion dollars of wealth to younger generation over the next decade.

That's what you should focus on.

If you go it's financial independence.