3 Money Lessons From Jay Z’s 4:44 Album

 

I finally listened to Jay Z’s new album 4:44. If you don’t have a TIDAL subscription that’s too bad, I hope, like me, you have friends with TIDAL accounts 😉

I kept bumping to the album for a week straight, I mean, it’s Jay-Z – it’s expected. On the second listen of the album, specifically the song “The Story of O.J” (which is my absolute favorite song on the album, btw) I realized that there were so many money and investing gems that I hadn’t learned and I want to share them with you. I hope you’ll find that Jay-Z wasn’t playing when he said: “I’m trying to give you a million dollars worth of game for $9.99” 😉

1. The value of long-term investing:

“I bought some artwork for 1 million, 2 years later that sh*t worth 2 million. Few years later, that sh*t worth 8 million”

Jay Z invested in a painting and employed a buy and hold strategy which means that he held it for a long time as he anticipated the value to increase over time. This strategy is also known as long-term investing.

Many people think that they have to be very active investors – frequently trading/ buying and selling stock – to have any chance of building real wealth in the stock market. However, the reverse is usually the case, with a lot of traders losing a lot of money through transaction costs as well as the fact that many very active investors only invest for the short-term and do not give their investments enough time to ride out any waves (down turn in the market) or market volatility. By doing so, they lose potential investment returns. Even in Jay-Z’s song, he literally had to do nothing but sit and wait till his investment increased in value.

Warren Buffett also famously said:

“If you aren’t willing to own a stock for ten years, don’t even think about owning it”

Although I don’t think you should take this literally (as in today’s markets, things change very quickly), there is still a lot to be said about the value of investing for the long-term.

2. The value of real-estate investing:

“I could have bought a place in Dumbo before it was Dumbo for like $2 million. That same building today is worth $25 million. And guess how I’m feelin’? Dumbo”

Jay (look at me saying his name like he’s my uncle ) also talked about the importance of having real-estate in your investment portfolio.

Although it’s great to invest in stocks and bonds, a great way to diversify your investment portfolio is to invest in real-estate. The good news is that you don’t need to have hundreds of thousands of dollars to get started. You can start investing in real-estate on a smaller-scale by investing in real estate investment trusts (REIT). By investing in REITs, you can gain dividends and you can also sell your initial investment when the value for the REIT has increased; just like a regular stock. This is a great way to get started with investing in real-estate with limited funds.

However, if you have more money, you could consider buying a home, investment property, or even investing through a real estate investment group. Of course, you should do your research and contact licensed professionals for more information before undertaking such a commitment.

3. Why you should stay away from trivial spending:

“You wanna know what’s more important than throwin’ away money at a strip club? Credit”

Jay-Z mentioned that there are more important things than trivial spending.

Although it’s important to enjoy your life and indulge once in a while, you have to ensure that you don’t indulge ALL the time (It’s all about balance). When it comes to your money, every little bit counts. Buying lunch or dinner every day for $15 adds up to about $420 a month and $5,040 a year. That is A LOT of money, which could have been saved or better still, invested.

As often as you can you should review your budget and find out ways you can cut your spending, and start using that money to build your empire 😉

Tell me your favorite money lessons or favorite quotes from Jay Z’s 4:44 album! 

 

Written By

Chinazom Chidolue is a personal finance blogger and an accountant. Growing up in a household with entrepreneurial parents, she developed a keen interest in business and finances. Chinazom combined her background in accounting and her passion for financial literacy and founded Investment Conversations: a personal finance blog which was created to help millennials take control of their personal finances by breaking down complex money topics into easily understandable and fun concepts.

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