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Graham Stephan, a YouTube sensation and real-estate investor, leverages a frugal and long-term mindset to save 99% of his income.Once he finds a good deal, he pumps those savings into real-estate investments.Stephan didn’t go to college and had terrible grades in school.But he made $221,300 in a single month in 2019 and makes over $1 million per year from his YouTube channel.Click here for more BI Prime stories.
Graham Stephan, a YouTube sensation and real-estate investor, makes more in a month than most people earn in a year. As recently as 2019, the 29-year-old earned as much as $221,300 in a single month, according to CNBC.”I had terrible grades; I didn’t go to college,” he said during an interview on “The Financial Confessions” podcast. “Statistically I should not have been successful whatsoever, but I had an interest in working hard and making money, and saving as much as I can and really taking an interest to investing.”Stephan said his journey to wealth began in 2008, when he received his real-estate license and started working as an agent.”The commissions that I was earning were so sporadic, I didn’t know when the next deal was coming, so I just saved everything,” he said. “Saved up enough money in 2011 where it made sense to start buying real estate, so I started investing in real estate.”He would buy cheap foreclosures, fix them up, and rent them out for income.
Stephan scored his first property for $59,500 and spent $12,000 on renovations. That same house is worth anywhere between $250,000 to $300,000 today — and it has been making $1,200 in monthly rent payments for the past seven years.As the real-estate market improved, so did Stephan’s commission checks. He reinvested his commissions with the income he was earning from his rentals to form a virtuous cycle. In total, he has sold over $125 million worth of real estate.Then came YouTube. “I’ve always wanted to make YouTube videos, so that was always a dream of mine,” he said. “I could make YouTube videos and talk about credit cards and personal finance and investing and saving money. Basically all the things that my friends weren’t interested in — and I could talk to a camera and then have internet friends that would like to listen to me.”
He added: “That alone earns over a million dollars a year, from just the YouTube channel.”It’s a figure that was reconciled by CNBC’s “Millennial Money” series from 2019, which featured Stephan as one of its success stories. CNBC reported that Stephan earns an average of $90,684 a month through YouTube, setting him on a pace of $1.09 million annually.Today, Stephan’s YouTube channel has over 1.5 million subscribers.Personal-finance principlesBut just because Stephan is raking in exorbitant amounts of cash doesn’t mean he’s a big spender.”I’ll save all of my money, as much as I can, like 99%,” he said. “And then when I get that 99%, I’ll save it up and try to buy another property with it. So I wait for a good deal to come up that makes sense to buy, and then I’ll spend it all on a property.”
“It’s almost like a challenge to save money,” he said. “I get so much enjoyment over just not spending it. I don’t know why; it’s like my brain is wired kinda weird.”Stephan provided an example from earlier that morning. Instead of buying “designer coffee” at a cafe, he made it himself.”I revel in the fact that if I can save $3 on that, and invest it over the next 50 years at a 7% return, it’s going to be worth like $200,” he said. “That’s just fun for me.”Though that coffee may seem like a trivial purchase given his seven-figure income, Stephan said his whole philosophy really comes down to optionality.”To me, the more money I save, the more options it gives me, and if I can cut back on the things that don’t matter — like coffee — and spend it more on the things that do, I just get enjoyment from that,” he said.
He suggests trying to cut on down on impulse purchases, “or things that really don’t make that big of a difference,” and recommends sleeping on purchase decisions before following through. He says you’ll likely change your mind. In addition, Stephan wants you to think about what your purchase today will cost you in the long term. He provided an example involving the purchase of a pair of shoes.If the shoes cost $100, Stephan will think about what that same $100 could grow to had he invested it for 20 years with a market return of 8%. “Would I rather have ‘X’ amount of money in 20 years than the shoes right now?” he asked. “And sometimes every now and then, I’d rather have the shoes. But a lot of times, I’d rather have the potential money you have in the future. That would, again, give you more options.” It’s that long-term mindset that keeps Stephan socking away swaths of cash to pump into the real-estate market. He’s fully aware of power of compounding.
“Not a lot has changed,” he said. “For me, I’ve really just been doing the same thing repeatedly.”
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