Money is everyoneâs best friend.
Youâre lying if it wasnât.
Even wealthier countries are happier and healthier. Below a base level income of roughly $70k per year, financial freedom, flexibility, safety and happiness are directly correlated to the number in the bank account. Past that point, itâs more dependent on the work you put in yourself to feel satisfied and you.
But the problem isnât the relationship with money, itâs how most perceive it and what it can do. Many of the problems we have cannot be solved by more dollars yet most people assume with more, more will go away and come their way. Unfortunately, that isnât the case.
Most free things in life offer the greatest happiness and if youâve been smoking for the past 40 years, no amount of lung transplants or cold turkey bootcamps can completely erase the side-affects and prolong your life span.
Most people prefer to listen and learn from those whoâve accomplished what they strive to achieve but most donât take any action afterwards. They prefer to stay comfortable and not make any change. Unfortunately, that doesnât bring about any return. Even passive investing doesnât require any maintenance after putting in the work.
Whatâs most frustrating to me is that majority of people my age donât know a thing about personal finance, let alone what business involves. They study it because they want to manage billions and invest in meme stocks like Melvin Capital. They hear about the planes, the homes, the court-side seats disregarding how these luxuries make someone feel and the hassle behind it all. Itâs not how much you make/earn, rather how much you keep and if your earnings can truly provide a better existence.
Growing up in a upper-class neighborhood in New York, Iâve witnessed people who earned and looked big and lost it all with a Wharton degree after inflating their ego and taking on too much risk and those who had no background in money and look and live penniless but have the best fulfilling life because they were taught the hard right way about what money can provide.
Ultimately, you can choose to have money work for you or against you. Whatever you choose, choose wisely because thereâs no going back. Itâs an addiction that will last and usually gets worse overtime.
The Universal Truth
We all care about and cherish money to death. If we had to choose a best friend or an enormous bonus, most people would secretly choose the latter assuming other things can be figured out or replaced later.
Thereâs nothing wrong with making money, you can read here why but there is something wrong when you expect to earn more and donât invest in yourself. That brings me to my first nugget of wisdom that sets the top 1% apart from everyone else:
#1 Listen Carefully
Why listen to someone who doesnât know more than you? You are the average of the people you are with and need to prioritize your ears. Most families donât discuss money and consider it taboo because they havenât mastered it themselves although itâs basic necessity that can get people way ahead of the curve.
The more you learn, the more you earn.
#2 Money is a direct reflection of the value you provide
Do you make peopleâs lives easier, more fulfilling, simpler or better?
Specifically in the entertainment industry, most professions, if not all, entirely rely on this feedback to predict their career. This is by far the most competitive and cut throat industry because profit and views are 99% based on the audience. Since the customer is always right, audiences have sort attention spans, instant gratification and want to see something fresh, new and different every time. Rarely will you see an actor on the red carpet in every movie for several decades in a row. They come and go based on demand, tastes, and trends. This means shows to movies are always looking for new hosts and entertainers on their screens in order to justify the $30 overpriced subscription.
In other professions such as in banking or law, you can be given bonuses and traditionally compensated by a fixed amount for your position whether or not you do a stellar or mediocre job. Talk about a hierarchy system in life!
To increase that pay and rise the ranks of the company, showing up, never failing due to a lack of effort, staying present, focused, being the first and last, saying yes, and going the extra mile will set you apart. Become reliant and dependable so people notice you since everyone is a robot doing the same packed like sardines.
#3 Spending More Can Save More
Although this isnât conventional typical advice from a stealth wealth frugal minimalist, this is a core feature of the philosophy. This lifestyle entails that you value less = more, are grateful for what you have and invest wisely.
Investing isnât just in the stock market, itâs through education, family time and with your spending habits as well. I still buy clothes and go on vacation. Iâm as budget savvy as anyone else but the trick to the trade is to spend a little more now to save more time later, which is equivalent to more money in your pocket down the road.
Itâs all opportunity cost. Ask yourself, what are you willing to give up now, to do instead? Invest in quality clothing and healthy food to reap the benefits long-term like a prudent investor. Being cheap is buying junk from the dollar store needing to replenish every week what you bought. That probably costs even more for less.
#4 Donât Expect It To Heal You
I know several neighbors to family friends who are purely miserable because they arenât able to break free from their inflationary lifestyle. They didnât grow up learning personal finance and got trapped in the vicious cycle of spending more than they earn.
No matter how many passive income sources to real estate properties you may own, if you canât get your own life together, nothing will be straight.
The FIRE movement is the hot new trend these days post-Covid. Unemployment is at staggering rates while businesses are chasing employees all while Millennials donât want to go back into the dreaded workforce not realizing how much better off they probably will be with a purpose working.
Without purpose, drive and a mission beyond your egotistical self, thereâs nothing. No amount of money, status, fame, position or title will bring you self-fulfillment and you will only discover that first-hand yourself. People are chasing these extern things that will become irrelevant soon after and bring toxicity into their lives.
The last thing you should ever do is compare yourself to someone else who looks better off and get jealous. You have no idea whatâs going on in their personal lives, family, health and mentality all while business may be flourishing.
Any kind of work, regardless of pay, will bring you a piece of mind and get you out of yourself. Exposing yourself to diverse people, having a schedule and a goal is the best feeling.
Retirement is boring, expensive for most pre-50 yrs of age and scary.
#5 Money Can Only Solve Limited Problems
There are several studies on the exact income rate at which happiness starts to plateau. Some say $50k, others say $100k and I say $200k. Regardless of what the economists and researchers might predict, which is all at the ballpark of around $70k, no matter if you have less or more, your health, happiness and safety have to always be top of mind.
With less, you have less security which means you have to watch your expenses like a hawk because itâs ride or die which naturally brings about more stress. Itâs suggested with less of an income, to follow the 50/30/20 spending allocation method to not go bankrupt, live below your means, pay off any toxic debt, save more than 50% of your income and invest, invest, invest establishing several passive income sources.
Without a safety cushion, which is mainly indicative of your cash cushion, income sources, and debt burden, your happiness is sure to decline.
Money doesnât have to rule our lives and the rich are as unhappy as the poor in more instances than we believe but overall, the more you have to your name, the more financial flexibility, freedom and safety you have. The best feelings that cannot be replaced. Everything else is based on luck, timing, genetics and your own choices that donât require a $1m net worth.
You decide who you connect with to find a job, where your time is spent, how to mend the relationship and what you put in your mouth. No one wants to hear you blaming money as an excuse to not achieving your dreams.
Safety first.
Most people by what they donât need with money they donât have to impress people they donât like.
The rich borrow, treat and perceive money differently to stay and grow from where they are. This low-interest rate environment is helping the rich invest and borrow more to earn more. The top 1% own 32% of the wealth in this nation and theyâve amassed roughly $12 trillion during the deadliest pandemic while the bottom 50% only $2 trillion.
Set yourself on the path for success and security by knowing your limits, what you need not want and invest in yourself. It pays dividends for a lifetime.