It’s hard to believe that I am coming up on my 30th birthday. I’d like to say that I still feel like a kid, but I can’t honestly do that in good faith.
When you have children, a switch in your head gets flipped.
When you take on a mortgage and get a big boy job, another switch.
And when you start tracking your FI journey and realize that with a few smart moves and a lot of hustle, freedom is only a few years away… fireworks.
I have definitely gone through some mindset changes over the past few years.
Not necessarily becoming boring, dull, or however else you picture as one leaves their 20’s, never to be seen again.
Instead, it’s more of an awakening. A focused light that gets honed in on the future.
Exiting my 20’s is a sobering experience. There is definitely a bit of sadness that a fun chapter of my life is ending. But the sadness is quickly engulfed in the optimism and brightness of the years to come.
As I prepare for the next chapter of life, I wanted to dig down and think through some of the most important money lessons I’ve picked up along the way.
Wherever you are in your journey, I think there will be some actionable takeaways here for you. Whether you’re still in debt or maxing your accounts. Whether you are single or married with kids. Whether you are happily employed or miserable in your cube.
I am always very focused on the future and my next steps, so it’s a rare treat that I let myself sit back and just reflect on the journey so far.
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1. The best financial decision I ever made was picking the right partner
I love my wife more than everything in the world combined. She is the torch that guides me, and sometimes the gentle nudge I need to keep moving forward.
If you haven’t found your special someone, the advice I can give is to get yourself out of the crazy puppy love phase once and a while and make sure that the compatibility goes beyond skin deep.
Money. Faith. Kids. Work Ethic. Leisure. Life is tough when you and your spouse aren’t on the same page in these areas. I am blessed that I have found my kindred spirit, and we walk together on the topics that matter.
2. Control your expense ratios
I was a dumb initial investor. It wasn’t until my 3rd year of working full time that I realized the power of my 401(k) and started investing. I was always a good saver, but was a bit slow to realize I should be putting my money to use.
You can’t control the market direction. You can’t control what happens to your favorite company in the news. But you can control the cost of your expense ratios, trading costs, and diversification.
So control the controllables.
3. Pick an allocation, and stick with it
This is a lesson I continue to re-learn.
I am a tinkerer by heart, so whenever I hear of a new strategy, I just have to test it. In Meb Faber’s Global Asset Allocation, he lets the research show how insignificant slight tweaks to your allocation matter over time. Stay true to an allocation and rebalance every year.
4. Always be testing – but always move forward
This applies to business and life more than investing. My wife gives me a hard time because I constantly tinker with technology and tools online. And yet some of our most successful advances in business have been born from an experiment that seemed like a waste at the time.
Allow yourself to test and try new things, but know what you want out of that test, and honestly decide the outcome you expect is worth the time you would need to put into the experiment.
5. If it sounds too good to be true, it probably is
Whole life insurance. Trading derivatives on margin. Get rich quick schemes. You don’t leave your 20’s without being duped by at least one of these.
Always consider what’s in it for the guy across the table. When you understand people’s motives, you are better able to discern your next move. Pick the good-enough option that has truth behind it, not the moonshot scam.
6. Financial leverage = scary… time leverage = game changer
When you hear leverage you probably first think of mortgages, trading stocks on margin, and credit card debt. My family has taken a strict policy on debt. We got out of it as quickly as we could, and we intend to never get into it again. Financially, probably not optimal, but right for our culture.
Time leverage, however, is indispensible. This is the ability to write an email once, and convert it into an individualized, personal email to thousands of potential customers in the future. Bringing in sales automatically. It’s the ability to receive a question from one confused reader, and instead of hitting Reply, hitting Go Live on Facebook and answering the question for hundreds of people who have, are, or will be struggling with the same topic.
Time leverage is how a husband/wife team can grow a 6 figure business during nap time. It’s also how we will scale it to 7 figures. Find what you’re passionate about, and find ways to leverage its success.
7. FI is more for my children’s sake than my own
This will require a more thorough post in itself. But every now and then I come across someone’s reason for wanting to be free. And many times it’s to travel. Or to say “FU” to the boss. Or to go sit on a beach and do nothing.
For me, I want to end the days when I finally roll into the house at 6pm to hear my girls scream “DADDY WE MISSED YOU!” as they run to my arms. I love that moment, but they deserve more of me. I give my best self to my day job, and my family gets what is left.
That’s great for profit margins, but bad for the soul.
I desire FI so that I can be by my family’s side through this life both physically and financially. To teach them entrepreneurship and that there is another way to succeed.
8. You have to enjoy the journey to FI
Seeking FI shouldn’t be a road of scarcity and adversity. You shouldn’t be suffering as you pass up purchases. What is the point of hating existence for 10 years while you save up, even if for the dream of a longer retirement?
No one is guaranteed tomorrow. We have to live today, while preparing for tomorrow.
So as I pursue FI, I make sure that while I am smart with my time and money, I never let myself feel deprived, and I always try to maintain a feeling of gratitude for the abundance that is all around me.
9. You can only save so much, but there is no limit to how much you can earn
Increasing your savings rate tends to be a strong focus in the personal finance community, but I want to start changing that.
We need to strike a balance between saving money with the creative pursuit of entrepreneurship. The term “new economy” has been appropriately coined for the world of online business, and with good reason. We are truly in a new era of opportunity, and the playing field is getting more crowded every day.
I have learned the hard way that in corporate America, age and politics play a much more important role in your annual compensation raise than your direct contributions.
In my short career, there have been years where I have absolutely 10x’d results for my company. When it comes to compensation time, I was handsomely rewarded. With 5% increase year over year…
Budget constraints. Tough political climate. And my favorite excuse – “well, you got a good raise last year, so we couldn’t give you too good of one this year.”
I don’t mean to sound like an ungrateful, entitled kid. It’s simply a truth that the compensation structures between corporate life and entrepreneurship are extremely different.
Want more money in corporate America? Keep your head down. Say yes sir. And wait….
Want more money on your side hustle? Double your efforts, and you can quadruple your income. And as you stay consistent and grow, every year can compound on the previous. You can build an empire of assets online with enough time, energy and persistence.
10. Don’t ignore taxes when comparing investment strategies
For every new investing strategy that makes its way on the internet, there is an unbelievably seductive performance chart to go with it.
And in many cases, those performance charts are riddled with issues, like not taking into account slippage, transaction fees, and most of all, taxes.
Learn to master the tax game. Max out your IRAs, HSAs, 401(k)’s. Don’t fear the fact that the money is locked away for years. There are wonderful strategies to access that money earlier than 59.5, and the tax benefits you get and the years of compounding on these benefits far outweigh any potential downside.
11. Saving money is not deprivation, it is strategic purchase of freedom
At work, whenever a bonus is coming up, all I hear are plans for how quickly that money can be spent. Hot tubs, new car leases, or just the latest gadget.
As soon as I pitched in that I was excited I could up my 401(k) contribution, the entire mood in the room died and they proceeded to make fun of the idea for the next few minutes.
I’ve always known I’m different. The entire FI community is different – and that is so amazing to me. Every dollar I save is hours of freedom I am buying years down the road. No knick knack is more valuable than my life.
12. Work is not the enemy. An Anchor is
I’m a workaholic that desperately wants to quit my day job. Not because I hate it – in fact, I love what I get to do during the day. Writing excel macros, making important decisions that have huge impact on may people’s lives and the company’s profitability. It’s exciting.
But it is an anchor weighing me down. A heavy one. Feeling important is great, but I am already seeing my children grow up too quickly, and I want to be there for it.
But I will never stop working. I actually never want to retire. The online world is just too exciting and the work is FUN. But I want to work in the off hours. During nap times. Before the kids wake up. When they are at school. But once I declare FI – I want to make their breakfast every morning, and make it to every recital and game.
13. Money really doesn’t matter. Contribution does
I’ve spent years of my life focusing on increasing my net worth. And as I have gotten closer to the point of not needing to focus on it any more, I’ve realized that I have been focusing on the wrong thing.
At the end of the day, you won’t be remembered for your money. You’ll be remembered for the contributions you make while you are here. But if you are a wage slave who spends every dollar, you likely won’t have the bandwidth to make the meaningful contribution you desire.
So money is incredibly important, but it is simply a vessel to fulfillment. It is not the fulfillment itself.
14. Strong Body, Strong Mind. Sacrifice work time to keep in peak condition, and the rest will take care of itself
I took almost a year off from weight lifting. A back injury made me stop. But then laziness, stress, and parenthood kept me from getting back in the saddle.
In that year, I met depression. I met self-doubt. And I met failure. I would work myself ragged, and find ways to self-sabotage just before finding success.
When your body weakens, so does your resolve. An hour in the gym every day can seem impossible to commit to. Besides, that Netflix isn’t going to watch itself!
To be in peak mental condition, you need to be in peak physical condition.
15. Children are expensive, but I’ve never been richer
Sometimes it seems like the diapers never end. The doctor bills flow in steadily. It’s a drain!
Not only are they expensive in money, but they are incredibly costly to your time. Those 5 hours of free time you have after work every day? Yeah, they just went away. Try 1-2 hours at night after you finally get them in bed. And that is the worst energy of the day.
Sometimes I wonder how I can possibly be moving forward with my goals with all these drains on my time and energy.
The answer is – my purpose has leveled up. I’m not just working for myself anymore. Because I don’t have 5 hours to poke around, my 1 hour has become hyper focused and productive.
And kids are also a great way to save money in other ways. We are in the “bunker down” years, so we can save tons on eating out, movie nights, etc. Celebrate the small wins!
16. Don’t break the chain! In finance, health, family, and hustle
Jerry Seinfeld attributed much of his professional success as a comedian to his ability to “not break the chain” of writing a new joke every day.
In the same vein, you can make your own chain of wins in the big areas of life.
Hit your budget for the month? Keep the chain going.
Get your workout in for the day? Cross that day off!
Turn your phone off and spend quality time with your spouse and kids? You earn another point!
Work on your side hustle for a dedicated hour at night? Another one added to your chain.
The secret is the intrinsic motivation you get when your chain gets longer and longer in each area of life. When you only have 1 or 2 days in your winning streak, it’s not much of a motivation. But if you can go a full month or two without breaking the chain, you will FIND a way to achieve your goal just to keep the streak alive. I love it!
17. Most productivity tools are often just procrastination tools
GTD, Eat the Frog, Trello, Kanban. You name it, I’ve tried app after app to get more productive.
The end result? Days of my life wasted in the name of increased productivity.
The only productivity tool I need now is to have a strong WHY for whatever it is I am doing. If the reason is compelling enough, the work gets done. Strive to find your calling and passion, and you’ll be amazed at how much work you can accomplish.
18. Invest in your family, your business, and yourself
This community is quick to throw all their spare money into index funds, which is a great habit.
But when it comes to asset allocation and diversification, I believe a significant portion of your assets should be pumped into your own self improvement through continued education and testing.
If you have an idea that is worth pursuing, I think a healthy 5-10% of your allocation should be pumped into a business project. As it improves and grows legs, the allocation should increase.
19. The math is rarely the only part of the equation when it comes to Debt
We knew we wanted to be debt free before we declared FI. The only question was – do we pay off the house now and rebuild our investments, or do we go 100% into our investments, and pay off the mortgage once we accumulate enough to be FI?
With the low interest rates, the financial decision was clear – Stocks all the way. But we went the other way due to risk aversion, and pure curiosity of how it would feel to be debt free before 30.
It really does feel different – a certain subtle weightlessness.
Definitely do your research before making the big decision, but know that ultimately personal finance is…. personal.
20. Hobbies can be an expense OR a profit center – make a smart choice
I was inches away from plunging $2,000 on a complete kite surfing kit. After a couple of lessons, I was ready to go pro.
But then this advice came back into my head.
Not only is it an endlessly expensive sport, but it would also impose the choice of spending time with my family, or being alone on the water.
When you find a passion that can also be profitable, you’ll wonder why people spend money on hobbies at all!
Whether it be blogging, making Youtube videos, or any other myriad of ways people are making money online these days, there is definitely a way to intersect your passions and profits to supercharge your path to FI.
21. Stop expecting hand outs – take ownership of your outcome
People complain about Social Security going away in the future. About their boss not being fair and promoting them. About their parents not sharing with their children equally.
On and on and on.
That’s no way to live life, and no way to set an example for your children.
Create your own future. Don’t expect it to be handed out freely.
22. Embrace mentors, but learn how to sniff out motives
Read any self-development book, and you will probably hear the advice to find a mentor to cling to and learn from.
It’s great advice indeed, but they rarely mention the potential pitfalls of the mentorship model.
I have a healthy skeptical side about me. And it has saved my shirt a number of times.
I will regularly look out for potential mentors to get me to the next level. And many of them are genuine. But there have definitely been some snakes in the grass.
At first glance, always give someone the benefit of the doubt. But through every interaction, continue to ask “What’s in it for them?”
Could they be truly altruistic with no other goal in mind? Possible, but not probable.
Learn from them, but as soon as you start to feel a sales pitch coming on, be prepared and unemotional when it’s time to leave.
23. Don’t focus on the money. Focus on continuous self improvement, and the money will come
When my wife and I started our blog, we watched every day’s income like a hawk. I even set up automations and code to parse through our emails so that I could add up all the income automatically when we got notification of a sale or affiliate commission.
It was motivating at the time, and was able to tell us if we were on the right track.
But as our earnings continued to increase, I stopped paying attention to the money. Partly because I was starting to feel greedy, which was not the goal of this. But also because each incremental dollar earned meant less than the one before. I was accelerating towards our financial goals, but something inside wasn’t getting as jazzed up about the income as before.
I was still hyper-motivated, but from the continuous improvement I was seeing in myself, and in our ability to serve others better and better.
Life is a game of self mastery, and it’s fun to play. Don’t get too caught up in the money.
24. Trend Following fails in the stock market, but succeeds in small business
Many gurus will sell you a $40 book that promises to make you rich by following market trends. I know – I bought a few myself.
It’s not going to make you rich.
But when you turn that same lense onto small business, the story changes.
Trends are all around us. We all think we need to create a brand new idea that has never been done before. But it probably hasn’t been done before for a reason!
Instead of inventing, become an expert at adapting.
If you see something new and trending in the fitness space, can you adapt it to the personal finance space?
If you see a catchy billboard – can you write a blog post that borrows from it?
Companies are spending millions on market research and R&D to create the new things – there is plenty of room to adapt those ideas to your own audience, using your own brand and experience to create a new offering without the fear of failure.
25. Home cooked meals are healthier, less stressful, and cheaper than eating out with small children
Crock pot, instant pot – whatever your preference, healthy food just tastes GOOD. Learn to cook, make it a family ritual, and save your wallet and waist in the process!
26. Not all gym memberships are money pits. The YMCA has been a life saver for our health, wealth, and family!
People scoff at paying for gym memberships. “Why pay for something that I could just do for free?”
Well, probably because you’re not going to do it by yourself.
As someone looking for financial independence, keeping peak health is a huge priority to me. And I was finding that making time for exercise with 3 children was just not happening.
When we found a gym that had built-in child programs, the game changed, and our stress levels have gone down as our energy levels have gone up.
All this to say – do your own research and make the right choice for YOUR family.
27. Once you’ve tasted debt-free life you’ll never want to go back
In our preparation for baby #3, we had the brilliant idea that we needed more house in a nicer, more expensive area.
We started the race to keep up with the Joneses, and were determined to catch up.
So we put a down payment on a house 2x the price of the one we owned outright. We were ready to go back into debt to create a better future for our children.
But as the deadline grew closer, we grew more stressed. Broke out into arguments about nothing. We knew we had made a mistake.
About a month from closing, we cancelled the deal.
Immediately, the shoulders relaxed and the smile returned.
Nice things are nice, but freedom is hard to beat.
28. Always have a 2 week and 6 month vision of where you want to be, and work to it
Goal setting is important in all areas of life, but I found out I’ve been doing it wrong. I would either plan out way too far in the future, or I would make random lists of daily tasks that never really felt like a cohesive plan.
I moved to 2 planning windows, and life became more clear.
I like looking 6 months out because it is far enough away that I can dream big, but it’s just close enough that I feel every week I am truly getting closer to my deadline.
And 2 weeks is a healthy balance of being significant enough to choose large projects to tackle, while short enough that I can effectively break down my large 6 month vision into actionable steps.
29. Let the small stuff go, and focus on the big picture
Don’t worry what your coworker said to you the other day. Don’t define yourself based on other’s perceptions.
And don’t limit what you can do based on how others value you.
Set your sights high and focus on the big picture. When you have lofty goals like financial freedom before 35, it becomes really hard to sweat the small stuff.
30. Don’t worry about the other guy. You do you.
And finally, recognize that we are on a lonely road to freedom.
Most are comfortable in their prisons. They prefer to be told what to do for the next 40 years. Imagine all the decisions they WON’T have to make as long as they have a boss.
Celebrate our difference. Work hard. Plan smart. Pursue freedom relentlessly. And enjoy every step of it.