Minimize your needs, while maximizing your income.
That’s the secret to long-term success.
As soon as you need to spend all of the money you’re making, you’re in hot water. You’re not planning for the future. You’re burning too fast.
Keeping your costs to a minimum is the best way to build longevity and sustainability. It allows you to stay in the race longer.
You can hold out longer than most, and you can focus on working on the right things (not just the things that will make you more money).
Some might call it minimalism, others call it frugal. I’m all about spending on the things that matter to you.
Having a mindset of “I make money so I can spend it” is absolutely not going to build success for the future.
People have this mindset about other things in their life too. “I’m gonna do this workout so I can eat more food.”
You’re immediately spending your assets, which is why you’re never able to get ahead in life. It takes sacrifice, and a mindset of delayed gratification to eventually become successful.
There’s a difference between living these principles and talking about them. It’s easy to sit here and say “save money” and invest in the future, but it’s harder to actually put that into practice.
As I sit here today, my income is about 3x gross than I did 365 days ago. Yes, I spend more. I’ve got a wife and kids, and it’s awesome to be able to buy great things for them.
Soon, we’ll be buying our first house - because we feel it will ultimately make our family more productive and provide a space to grow the things we’re working on.
However, it’s so easy to lose track and expand to your income.
I technically could afford a home that’s very extravagant, and that would be a great forever home. However, based on our circumstances and the path of our lives, we’re opting to get a 5 year loan and buy a cheaper home that satisfies our needs.
There’s a few reasons, but put simply - we’re going to be making a lot more money in 5 years. That, and because minimizing the impact of the home on our current finances allows us to be more flexible with how we use and spend it.
Reinvesting money back into our businesses will provide the best return. Owning a home is an asset, not an investment. Having a home that allows for productivity (office, exercise room, dedicated spaces for recording and content creation) is more valuable than the home itself.
Being able to have exactly what you need to generate more income and provide for your family is incredibly valuable, and it’s the only thing we need out of a home.
Otherwise, we would probably just stay where we are. But as it is now, I’m mostly working out of coffee shops and other places that allow me to escape the kids for a few hours so I can focus.
Overall, it’s fine. But having a place in my own home that I can do that would be ideal - as I could frequently and easily switch roles with my wife as she’s working on her own projects.
It is a struggle to not spend all of your money on things. Luckily, I’m not a big spender. I only like to spend on what I need and nothing else.
I’ll wear something into the ground before I buy something newer. And even when I do buy, I typically opt for used goods or a more premium option that will last a longer time.
As you might know, having kids is pretty expensive. There’s food, clothing, diapers, travel stuff, toys, etc. It can add up if you’re not paying attention, and it’s better to be intentional with how you spend your money on your kids.
We tend to get toys that will have a long-lifetime, and will also grow with the kids. We typically buy second-hand clothing to encourage recycling and discourage fast fashion. All of this saves money, and keeps the perspective in check.
Having the means to be able to buy whatever you want, and then not doing so is a superpower. That superpower, is discipline. The discipline to delay gratification will provide you with the greatest future possible.
The longer you put off cashing in on your assets and continue building, the better chance you have of building a completely different life. A life that’s entirely different, including flexibility, options, and peace of mind.
But, the more you use credit, debt, and continue not saving and investing money, the more you lose out on the benefits of compound interest.
You can put in a hard 10 years to live the rest of your life in an incredible way.
Or, you can spend the next 40 years at the same level and never change, and have a retirement that matches the same lifestyle.
I’m choosing the former, and I’m about 2 years in.
Discipline is an incredible skill to have. To be able to avoid distraction, avoid pitfalls, and avoid bad habit cycles will allow you to continually grow. When you’re continually growing, you’re hedging against anything bad happening to you.
And if you hedged enough, even if something happens to you it’s not going to stop your progress. You’re prepared, and you’ve been planning in advance for this.
The best time to save money is when you don’t need to save money. The best time to go to the gym is when you don’t actually need to be healthier.
As long as you continue to grow, and your cost of living never rises, you will always be profitable, successful and productive.