10 Brutal Money Truths What should people who want to become wealthy in a coming inflationary world know and what measures can anyone take?

The first year of the new NISA program is about to end, and we Japanese have been living in a long deflationary and low-growth economy for more than 30 years, with prices of goods remaining the same (or falling) and salaries not rising (or falling).

And in recent years, coinciding with the spread of the new coronary disease, the Japanese economy has finally begun to move forward, with prices and salaries gradually beginning to rise.

Under these changing economic conditions, we Japanese are entering an "inflationary society" that cannot be dealt with by the "economic common sense of a deflationary society" that has prevailed for so long.

Specifically.

With the coming of the new "inflationary society" we are forced to take "new economic actions".

What then should we do?

Today, with the permission of Yohhei, a financial YouTuber I respect and admire.

Yohhei] An ex-securities manager's money talk that anyone can understand.
The Brutal Truth: 10 Money Rules That Anyone Who Wants to Become Wealthy Must Understand

I will introduce you to what is presented in the video of the "The Future of the Company" and also explain my own investment strategy for the future.

According to Yohhei,

• To win any game, you need to understand the rules and take advantage of them.
• If we continue to act with high expectations, we will win in this capitalist world.
• The truth about money in the world is very cruel and not often told

Why is the "cruel truth about money" so rarely told?
that is

• Antipathy from the general public
• From the point of view of the vested interests that already enjoy the tasty parts of the game, there's no need to dare to publish the rules of the game.

It is called.

So, what is the cruel truth that people who aspire to be wealthy in this game of capitalism must know?
Today, we will introduce you to 10 of them, as well as 5 measures that anyone who wishes to become wealthy can take.

10 Brutal Money Truths Every Aspiring Wealthy Person Should Know

(i) Lack of money decreases the probability of happiness.

It is not a case of "you have to have money to be happy."
It only means that the probability of happiness is reduced.

When do people feel happy?

Don't people feel happy when they are doing what they love, when they are with people they love, when they are in places they love?

Are you in control of your life?　The way you feel happiness depends on whether or not you can realize it. That is what I mean.

And in today's capitalist society, of course, the more money you have, the more options you have in life, and the more likely you are to be in control of your own life.

If you have enough money,

• Quit your current job and FIRE (Financial Indipendent Retire Early Financial Independence and Early Retirement)
• Provide financial security for your own loved ones.
• Even if income is temporarily interrupted, you can change jobs, start your own business, or take on new challenges.

On the other hand, they need money,

• I'm so busy earning an income and making a living.
• I have to do work I don't like or associate with people I don't like.
• I can't truly enjoy the things I enjoy.
• You can't afford to be nice to others because you can't afford to be nice.
• You will not be able to make rational decisions with an eye to the future.

As a result, they will have their hands full with their daily lives and will not be able to invest, plan their lives, or invest in themselves for the next 5 or 10 years.

The rich are treated well and the poor are treated coldly.

It is the absolute rule of capitalism. Think about the financial sector,

• Interest rates increase for large deposits.
• Large investments have low fees.
• Large investments have good conditions.
• Some financial instruments have a minimum investment hurdle.
• Rich people get preferential borrowing rates.
• Access to IPO stocks, loans backed by securities, and other financial instruments that are difficult for the general public to obtain
• The rich get preferential treatment at private banks and face-to-face brokerage firms.

and other services and information that are only offered to the rich and are not available to us, the general public.

(iii) Beautiful men and women are more financially prosperous.

In this day and age when people are afraid to talk about their appearance, it is said that a beautiful woman can make a difference of 30 million yen in lifetime income compared to an ugly one.
The Beauty Gap: The Economics of Inborn Inequality | Daniel S. Hamermesh, Hamermesh,Daniel S., Mamoru Mochizuki | Books | Retail | Amazon

It is impossible to measure exactly how much appearance reflected economic strength, but I think we can agree to some extent.

A typical example of how beautiful women monetize their appearance to earn large sums of money is cabaret and lounge girls, who earn 10,000 to 20,000 yen per hour at night when they are "hired for their faces" in Roppongi and Ginza.

In my own experience, my hourly wage when I was working for a company was about 20,000 yen, in the professional world it was about 20,000 yen for a lawyer, and in my current job as an administrative scrivener, it is about 10,000 yen. I spent many years studying, and worked for many years with people I didn't want to work with or didn't like.

You can see how beautiful women are earning in their 20s.

Also, if you make promising connections while you are young and beautiful, you can monetize them in the future. This is one of the aspects.

In the securities sales, real estate sales, consulting, and professional services industries, the key is to connect with people who have money, and if other abilities are the same, good appearance is an absolute advantage.

Perhaps that's why so many beautiful women are receptionists for large consulting firms, because it benefits those firms.

When considering an individual's balance sheet, in addition to cash, securities, insurance, real estate, and other assets such as automobiles and precious metals, personal assets include "knowledge, skills, experience, contacts, qualifications, and credit" as invisible assets. One of these intangible assets includes "appearance.

(iv) If you don't have money, you're wasting money.

You will continue to pay wasted costs compared to the poor and rich who have no money.

A typical example is "life insurance.

Life insurance, including medical insurance, is purchased in advance to prevent financial hardship in the event that something happens to you or your family.

On the other hand, if you are rich, you do not need insurance because your assets on hand will not put you in financial trouble without insurance.

In our financial planning practice, we receive many insurance-related consultations. Insurance is an important financial product that is very good at acting as a "fallback plan," but according to a survey by the Life Insurance Cultural Center, the generation that needs insurance the most (the generation with the smallest children and the most need for money if something were to happen) pays approximately 350,000-400,000 yen in premiums annually in their 40s.

In other words,The company pays a premium of 4 million yen for 10 years and 8 million yen for 20 years.

Another easy-to-understand typical example is "interest rates on mortgages and auto loans.

Wealthy people with money on hand can purchase the property in cash, but if they do not have money on hand, they must take out a loan and continue to pay extra interest to the financial institution.

While it is often effective for wealthy people to take out loans to save on taxes, inheritance, etc., at least having the option of buying with cash or taking out a loan makes a difference.

5) There is no great economic significance in investing small amounts in reserve.

With the launch of the new NISA, many people have started investing, for example, 10,000 yen per month.

Of course, taking steps to build assets for the future is very important and significant. On the other hand, it is true that "the larger the investment principal, the larger the absolute value of profit.

Again, it is very important to start investing, and I strongly recommend it, but the only fact that must be recognized is the fact that if you invest 1 million yen and yield 51 TP3T, your profit will be 50,000 yen, and if you invest 100 million, your profit will be 5 million yen.

However, accepting this fact will help you improve your own financial literacy, continue investing, and gain the "investment grip" necessary to become wealthy in the future.

6) Avoiding risk will not make you rich.

No one wants to take risks.

Many of the people who come to me for advice are first worried about the risk of losing their money and are unable to take the plunge into investing.

Capitalist society is structured in such a way that "those who take risks siphon off (exploit) profits from those who do not want to take risks.

A typical example is the relationship between "capitalists (shareholders)" and "employees (workers).

The business owner, the capitalist, takes the risk of starting a company and hiring employees with monthly labor costs. Employee-salaried workers, on the other hand, are generally in that position for a steady paycheck. In other words, employees are not taking risks in relative terms.

andA lot of the company's profits are distributed to the capitalists (owners and shareholders).

The indicator that represents this is the labor participation rate. The labor share of medium-sized Japanese companies is about 601 TP3T, while the labor share of large companies is less than 401 TP3T. In other words, most of the company's profits are distributed to the capitalists (owners and shareholders).

Furthermore, entrepreneurs have expenses that are allowed by the government. Along with a high salary, expensive meals, luxury cars, and even golfing fees are allowed as expenses. While salaried workers' income taxes are deducted from their salaries at source, entrepreneurs can control their taxes to a greater extent than salaried workers, although there are certain restrictions.

This entrepreneurial privilege is recognized as "payback for taking risks.

(vii) Saving is a trade-off between now and the future.

Save and lower your expenses and your assets will surely increase.

On the other hand, saving money also means "losing things and experiences that you can gain now. If you do not save with this understanding, you may regret it later.

After building assets in the future.

• I should have played more.
• I should have made more memories with my family and friends.
• I should have had a lot of experience.

You will not get your time back if you regret it later, for example. It is important to be aware of this and ask yourself this question when saving.

In other words, even if saving money gives you a brighter future, it means giving up and enduring what you can now.

8) Maintaining the status quo is a downhill escalator

As you all know, Japan now has a declining birthrate and an aging population at a very strong pace, and tax increases, including increases in social insurance premiums for pensions and health insurance, are inevitable in the future.

For example, a salaried worker with an annual income of 7 million yen had a take-home pay of approximately 5.9 million yen 20 years ago, whereas today's take-home pay is approximately 5.4 million yen.

Furthermore, after the Corona disaster, JapanInflation and price increases are becoming more pronounced. 1 million yen now would be worth about 6.5 million yen in real terms if prices continue to rise at 31 TP3T for the next 15 years.

To give an easy-to-understand example, the price of a beef bowl as of 2018 was 290 yen, and as of 2025 it will be 453 yen. The price has actually increased 1.5 times in the past 7 years.

Under these circumstances, if we, the common people, stick to the "status quo" and continue only with bank deposits, their face value will not change, or even if they increase with a tiny bit of interest, we cannot expect the gains to exceed inflation and higher taxes.

in other wordsSticking with the status quo is the same condition as riding a downhill escalator.

(ix) In the future, disparities will continue to widen in Japan.

The number of wealthy people in Japan and around the world is increasing rapidly.

The reason,

The formula r (return on capital) > g (economic growth rate).

Around the world, the price of risk assets continues to rise. Last year, in 2023, for the first time in almost 30 years, the Nikkei Stock Average exceeded its record high. On the other hand, real wages have been diminishing due to inflation rather than maintaining the current level.

This means that even if the average person achieves economic growth through labor, the investment returns on risk assets will be higher than if the average person achieves economic growth through labor, and more money will be attracted where there is capital.

(10) Inequity in parental mess will be magnified.

Parental mess is the fact that people are given different amounts of things depending on the house they were born in and where they were born.　This amount of what is given can also be seen in educational disparities as well as assets.

In general, the wealthy are eager to educate their children and invest capital in their children's education, and children who receive a good education will further expand their assets through the formation of human capital. On the other hand, the average family has certain restrictions on the educational environment, and the income generated by their children in the future will not increase as much.

As this disparity widens, the inequity will continue to grow.

5 measures anyone can take to become wealthy

The above is a discussion by my respected financial YouTuber, "Yohei". It was quite shocking and harsh, and it may not have been said out loud very often, but I think many of you may agree with it somehow.

When you rethink this cruel truth, must you despair of the elements you do not have and give up on becoming rich?

That is not true!

With an understanding of these brutal truths, we can begin to do what we can now.

In addition, "Let's start tomorrow!" will not start anytime soon.
What can be done and what should be done should be started today, or rather, "should be started now.

From here, I would like to introduce five measures that anyone can take based on the premise of "Money rules that anyone who wants to become wealthy must understand.

Measure 1: Understand that being rich is the right thing to do.

When I talk about money with my family and friends, I am often told that I am a "defensive person," "all about money," or "controlled by money. In particular, compared to Westerners, Japanese people do not learn enough about money in their childhood, and on the contrary, they may have been taught that people who think only about money are "lowly" people.

Indeed, money is only a "tool for happiness".

It is certain that a life dominated by money does not bring happiness to anything. It is just thatWithout money, the odds of being happy go down."It is a fact. Let's understand that it is right to aim for riches as a "tool to attain happiness.

Measure #2: Start preparing to become rich.

In today's capitalist society, there are many systems that favor the rich and information that is given only to the rich.

Then take action to get preferential treatment.

There are many ways to become rich without being a wealthy person who inherited many assets from wealthy parents.Study and take action today to become rich, including saving and investing.

I worked for a major foreign company for many years and earned an annual income that would put me in the upper-mass bracket of the Japanese average income scale. As a result, I had only about 2 million yen in savings at the age of 50. After that, I started studying money, thought about money thoroughly, and took action.

Countermeasure 3) Improve your appearance

Don't you think that appearance is something given to you at birth and that you cannot do anything about it later?

This is again a personal matter, but when I started my FP firm, I lost 10 kg in one year and spent 1 million yen for treatment of AGA.

When a newly established financial planner or administrative scrivener first meets with a client, he or she wonders whether the client would be more willing to pay to consult with a "fat, thin-haired uncle" or a "smart, crisp uncle".Invest in your appearanceI was a "good" person.

Nowadays, plastic surgery is not as negative as it used to be and has become popular among young people.Considering plastic surgery as an "investment" is the right course of action with a certain amount of economic rationality.

andThe result of your efforts to improve your appearance will not only change your appearance and style, but also your confidence will show in your facial expression and attitude. People with self-confidence naturally gather around people with self-confidence, and this will bring you success in your work and business.

Measure 4: Take the risk and go to the side of the capitalist.

By changing your own money mindset and continuing to work to maximize the assets on your balance sheet, you will be able to go from being an employee to being a capitalist.

Specifically.

• Start your own business and become the owner of the business.
• Continue to invest in yourself, increase your market value, and move to a company with a higher salary.
• Enter the capitalist side of the business by starting to invest in stocks.

These include

Of course, the risks one can take depend on one's family structure, outlook on life, and other factors, and it is not the case that everyone must become a capitalist to be happy.

However, there is no doubt that the degree of happiness will be different if you build your own life plan based on these facts, or if you live your life without taking any action.

Also,In a capitalist society, it is "riskier not to take risks.

Countermeasure 5: Invest in yourself.

This measure is the greatest measure to enrich your life.

When considering an individual's balance sheet,Knowledge, skills, credit, qualifications, health, and contacts" listed as intangible assets are assets that can be grown more significantly than other assets "cash, securities, insurance, real estate, and other assets.

Financial instruments such as stocks, bonds, mutual funds, insurance, and real estate have a fixed profit to some extent. In terms of annual interest rates, even the best financial instruments with the best performance are at most 5-10%. In addition, financial instruments come with a list that corresponds to the profit.

Products that offer no risk and profit potential are definitely scams. Stay away from them at all costs.

On the other hand.The returns on "self-investment" in knowledge, skills, studies and certifications are unlimited.

For example, if a person spends 200,000 yen to attend a qualification prep school for one year, studies for 1,000 hours, and obtains a national qualification, the investment would be 200,000 yen for the prep school + 1,000 yen per hour x 1,000 hours = 1.2 million yen.

If you invest the same amount of 1.2 million yen in a financial instrument and leave it as it is for 10 years at an annual interest rate of 5%, it will amount to about 1.9 million yen.

(Mitsubishi UFJ Asset Management, Inc.)
Bulk Investment Simulation｜Mitsubishi UFJ Asset Management Co.

In other words, a profit of 700,000 yen is expected, but this profit is not promised, and there is a risk that it will be zero in the worst case.

On the other hand, if you use the knowledge and qualifications you have acquired through your studies to change jobs or start your own business, the salary increase and profits you can earn from your business are unlimited. Even if your salary does not increase or your business does not do well and you do not make as much profit as you had hoped, your knowledge and qualifications will not be reduced to zero.

In other words, "self-investment" is the lowest-risk, highest-return investment in capitalist society.

summary

This column is by no means a statement that "rich people are great," "let's get rich," or "money is everything.

There are many people around me who are leading happy lives even without money. On the other hand, I have also seen many people who were controlled by money, caused trouble to their families and people around them, and became unhappy.

I repeat,Money is just a tool to enrich our lives."

But on the other hand, there is a big difference between "a life that could not be realized due to lack of money" without knowledge and "a life of poverty of one's own choosing". At least.The wealthy have "many choices in life for themselves and their families."It is true that

The "cruel truth" that I have shown you today is that there are many things that you cannot control, such as your appearance or your parent's mess.

Still, facing this brutal truth first is the first step you need to take to become wealthy. Money relations are the core of capitalism in particular, and its content is truly cruel. But on the other hand, in order to win in a capitalist society, we recommend that you know this law, accept the truth firmly, and then take on the challenge from what you can do "for the happiness of yourself and your family" without throwing up or giving up.

We hope that our firm can contribute to your asset building as a companion.