- Tony Robbins wants to help Americans become financially literate.
- “You have to make money while you sleep,” he says.
- That means not fearing corrections in the stock market and instead taking advantage of them.
Tony Robbins wants to change the way you think about money and saving.
His goal: to help people become financially literate.
“We are taught to be consumers, not owners,” the best-selling author and entrepreneur told CNBC on Wednesday.
That’s led to a crisis in savings. According to a recent BankRate survey, only 40 percent of Americans are able to cover an unexpected $1,000 expense with their savings. Many also aren’t saving enough for retirement. A 2018 study by the Federal Reserve Bank of Saint Louis found that only 27 percent of U.S. households have a defined benefit plan, or pension, and 33 percent have a defined contribution plan, such as a 401(k).
“You are not going to earn your way into a fortune. Even people that do that don’t usually keep it,” Robbins said on “Power Lunch. ” “You have to make money while you sleep.”
The only way to do that is by earning compounding interest, in other words, interest on your interest, he explained.
Robbins, a special advisor to CNBC’s Financial Wellness Advisory Council, pointed out the benefits in an op-ed for CNBC Invest In You. For example, if a 19-year-old invests $50 a week and averages a 10 percent annual return, he or she will have over $2.2 million at the age of 65.
But even if you are older, it’s not too late to get in the game. To have $1 million for retirement, a 40-year-old needs to put away $15,000 a year and a 50-year-old needs $37,000 a year, he said.
“No matter how much volatility there is, there are truths about the markets that you have to know, and they don’t vary. And if you understand those, that’s the people that win the game. But they become owners; they become capitalists,” said Robbins, who interviewed some of the biggest financial experts for his book “Unshakeable.”..