Ramit Sethi came up on a few of the podcast episodes in promotion for his new Netflix show. The concept that he goes over is determining what you really enjoy and shifting your finances to support that, and cut out spending on the areas that don’t bring you that same joy.

This premise is one I hear from many personal finance teachers and it makes a lot of sense. Put your money towards what you really love and enjoy and stop spending on things you are only doing because you think you are supposed to or you are keeping up with the crowd.

He calls these money dials - so at different points of your life, you can change where the dial is focused. My dial has always been cranked up on housing. I want to live in a nice home and surroundings. It affects my mood and wellbeing and its what I very clearly spend the most on in my budget.

The caveat is the personal finance crowd usually offers easy advice to cut back on big expenses like rent by living at home or with roommates so you can have money to invest in bigger things. For this reason I have always struggled with a lot of the common advice I find out there.

The exercise he goes through after you determine what you love to spend on is, is thinking about what that would look like cranked up. So now I live in a nice home - but I rent. Cranking this aspiration field up I would own a nice home. And going beyond that I would likely own several so I could feel that same comfort and tranquility in all the places I go.

But if I asked myself, would I feel financially secure if I owed four homes. The answer would hinge on whether or not I had enough of a cushion in the background. Yes having a home is a sense of security for me, but it isn’t a direct correlation that more of them means more security. If I don’t have enough of a retirement and safety net funds in place, what do I really have to fall back on?

And to be clear, the likes of Ramit Sethi or others in the space who champion these concepts aren’t saying- spend all your money on your money dial. There is always a break down of fixed costs first, portions for saving and investing, and then the rest as enjoyment spend.

My realisation is that my enjoyment spend is actually not going to be fully enjoyable until I have a more robust backbone to my finances. Part of this misalignment is because my fun money and living costs are the same category and its too high of a percentage in the total breakdown. Going forward I want to change the balance so I can increase the saving and investing portions to gain some of that cushion I am lacking.

Finally, how I take my ‘home’ money dial and crank it up is different than how you would increase your spending if your dial was set to travel. If you currently using your fun money for trips you could look into travelling more often, more luxuriously, taking people with you. It’s a direct ‘I do my thing but with more money’. But there is chasm between renting a nice home and buying a nice home. It isn’t a dial that I can tangibly see regular increase to. At the end of my lease term maybe I find something with more space. But really the shift needs to acknowledge living well while putting the ‘fun money’ away for a deposit.

Has anyone ever identified as the home as their big money happiness point? How did you work towards increasing that dial without losing the joy of living in the meantime?

We can probably all conjure up some grand vision of what copious amount of wealth looks like. Just as we can also idealise what our own notion of success would look like.

What may often be overlooked but is crit…

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I would read someone’s bold claim that they would retire a millionaire because they had invested X amount by a certain age and therefore would be fine to retire because their investment would have grown to at least a million dollars based off of assumed annual returns.

And sure that is great but it didn’t really excite me.

If you are currently young and in the workforce retirement sounds like a long way off so it can be a difficult benchmark to strive for.

However what I was really not grasping was how new the concept of retirement was. Historically, your average worker didn’t retire - if they were living into their golden years, they would have been working up until they died.

Pensions and social security are a relatively modern invention1. An invention that may actually still be in its experimental phase and isn’t guaranteed to last - or more specifically - still be an option come our own time to retire.

Therefore if you want to not be on the 9-5 grind well into your 80s, investing for retirement is critical.

For me, drawing the connection to retirement as a concept that only I can secure for myself was what made me appreciate the headlines saying I’m 26 and know I will retire a millionaire.

And not only that but seeing how that built onto the larger notion of wealth that I aspire to.

Securing your retirement is the precursor to creating a wealthy life.

In my opinion, living well means more than having the financial funds, but having the freedom to spend your time how you want.

Therefore being able to retire is already saying I will have the freedom in my old age to spend my time how I want.

And with that guaranteed you can continue to work towards building a life that allows you that same flexibility. Ideally prior to your late 60s.

Ultimately I want to live well while I am active and young and not delay everything until I am old - so while the journey doesn’t end at creating a robust retirement fund, it is also the first step.

A passive income stream is beneficial for many reasons.

1. Money coming in from multiple places (presuming your active and passive)

2. Less effort on your part

3. It isn’t tied to your time and is therefore scalable

So with the benefits who wouldn’t want to also deploy a…

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And you’d think someone who is effectively blogging about how they are working to grow their personal wealth would have a pretty good assessment of what is going on with their money.

But life is always there to humble us.

In the past few months I have changed jobs, moved countries, and houses. The currency I operated in, the money I was bringing home, the daily habits forming my new routines had all changed. Plus how much I paid in rent, bills and taxes.

That meant a lot of financial newness all at once and I realised I no longer really knew what my norm was. So I set out to create a budget.

My first goal was to understand my new norms. What were my average monthly bills? What was my average take home salary? How much did normal cost of living expenses like groceries really come to each month?

I began tracking all of my expenses and income. I needed to know what was happening with my money each month and how this stacked up to the money I was bringing in.

Next came a deep look into where was all my money going? With so much change to daily life had I become susceptible to lifestyle creep? Had I slipped into some bad spending habits?

Now it was taking all this data and turning it into a budget.

After a few months my monthly earnings had averaged out so I had a better idea of what I had as a starting point each month. Sounds like an obvious but as I had moved to a new country, I wasn’t being taxed there previously that year so my first paycheque wasn’t taxed at the normal rate. Then adding in some holiday bonuses I wasn’t actually sure what my standard take-home was that I could consistently count on each month.

Next up came fixed expenses.

I had ended up moving houses shortly after relocating countries so it also took some time to settle into what my final expectations could be for utilities. Additionally not all of them were paid on a monthly cycle and I wanted to know what I should reasonably have on hand even if it wouldn’t be used on a month by month basis.

Finally, what were my variable expenses and were they out of control?

With all the moving I unfortunately had a lot of unforeseen costs and this was hurting my money out categories. Also there were side-effects, like having all the kitchen stuff packed up and ordering takeaway more than I’d normally advise for myself.

I also came up against another circumstance of bad timing. I had deferred some spending during the lockdown years on items such as clothes because I wasn’t exactly going anywhere. Now I am going to an office, and my threadbare pair of joggers aren’t appropriate out of the house.

Reviewing my spending it became clear I had too many expenses in too short of a period.

No budget is healthy if there is more money going out than coming in.

I could see my spending was too high and while some of these items were quite expensive, many of them were one-time purchases. However it was also the sheer quantity of expenses. This was a period of my life that ate my emergency fund and now I had to be careful it wouldn’t extend into long term bad money management.

So, how could I define a new budget?

A budget is like a diet. If its super restrictive you will feel guilty and end up bingeing fast food at the end of a stressful day feeling overwhelmed and trapped by the system you’ve devised. I think the best budgets take into account flexibility and freedom and work for you when aligned with your goals.

That being said, I was in crash diet mode. I was going to be on a more restrictive budget for the next few months and cutting out some basic humanities in order to help make space for the other costs. I knew my next few months would still be expensive and I needed to prioritise. That unfortunately took away some extras that I would normally not stress over. I would be re-reviewing my budget in a following few months to see if I could add some slack back into it when life calmed down. I wanted to be conscious so I’m not falling into misery because I didn’t have any financial room to breathe.

Now walking to work and packing a lunch can help save a bit, but that’s a not a long term solution. These were temporary measures in place to help minimise a rough patch. However other expenses, such as the work clothes, were going to have to become a drip fed project to spread this out over a longer period of time and not overwhelm my credit card.

In my budget I had created categories for myself - expenses like rent or internet were fixed and I knew exactly what I would be paying each month and when. But cost of groceries, public transport, or a pair of trousers were changeable costs and I needed to have a very clear understanding on what I could realistically be spending in those categories each month.

Now knowing my starting amount and my fixed costs I dove into what my other expenditure could be. (Income - Fixed Costs = Allowance for variable costs)

As a note: I include savings in my fixed costs category.

Seeing what my remainder was allowed me to start breaking down each of my variable categories. I was already seeing where my money was going in previous months and now I was looking at ways to minimise those to keep myself out of the red.

Also as I had the spending data from the last few months I could see where the weak links were in my spending (aka the exhaustion at the end of the week let’s just get a takeaway response) and be conscious and plan around this. If I know by Friday I can never be arsed to cook, what can I make earlier in the week in a large enough portion to have ready and on hand for myself? Or can I reserve my night out with friends to the day I already am most likely not wanting to cook?

With a tighter budget than usual I want to make sure it is something I can commit to even if its only for the next few months. If I can’t I’ll be not only demotivated but very stressed about money.

With all that in place I set out calmer knowing my finances had I plan and I could withstand the spendy months ahead.

TL;DR

1. Whenever you feel you may not be effectively managing your money - creating a budget and tracking expenses helps to create transparency on where your money is going and how you can apply it for your needs.

2. Budget creation can be simplified into your incoming funds stacked against your outgoings. Figure out your constants and then what is left for monthly spending. Remember you don’t want to spend more than you have.

3. Review the figures you have and think about how this relates to your lifestyle. Have you reduced spending quotas past manageable limits? What are your biggest challenges that derail attempts to stick to budget? This is for you by you, even if it is a short-term commitment it is worth it because its a commitment to yourself.

It’s a large part of why I created this Substack. I kept kicking myself with the realisation I had royally screwed up, and couldn’t believe that someone who felt they were reasonably financially aware could have so clearly missed the mark.

The best investment strategy is time and consistency.1

I can’t go back to 10-year old me and fix this.2

Why was Warren Buffet being a child so important to his success? Because compounding interest is powerful.

We might know that in theory but it doesn’t necessary make it a simple concept to grasp or truly believe in. Until you start to really feel it.

Compound interest calculators were how I began to visualise what I was missing and the potential of starting as soon as possible.

The second aspect, consistency, is also part of the calculation. If I am running a calculation where I am putting in a 100 dollars a month for the next 60 years and getting excited about my end result - I may have lost the plot. I need to contribute that 100 bucks first.

Consistency, especially when life happens, is a challenge.

And this is where earning more money really became my focus3.

I want to consistently invest but I can’t always guarantee consistent expenses. I can rewrite the budget or bleed the emergency fund, but that won’t move the needle4.

I started late, so I need to add more to the pot. That means earning more.

Plain and simple - starting late means doing more to come out with less. Because now its going to cost me a lot more to ‘catch up’ to a portfolio like Warren’s.

Another mistake was beating myself up about all the lost time and how I should have known better.

And then I read that the Roth IRA (an American retirement account) that is often heralded amongst personal finance gurus as a must when building a portfolio, wasn’t created until 1998.5

I am older than the Roth IRA.

Index funds haven’t been around for centuries.

Our modern means of growing wealth are in fact incredibly modern.

Do I still feel it is a pity I am a bit late to the party? Yes.

But I am now keen to catch up. I’d rather be late than never begin.

Starting late is better than not starting.

We all have our motives: maybe you want to leave a bad job or any job, you want to pick up and move half way across the world, whatever your aspiration is, you know you need money for it, and now is the question - how much money would buy the life you are imagining?

What is the amount of money you need to make to be comfortable?

When designing mine I kept it simple: food, shelter, and wine were covered but not all the finer things in life. I wanted to have it be more doable as a starting goal so I wouldn't become burnt out trying to achieve everything from the start. I have a lot of aspirations, in this case, shooting for the stars can make me feel very far away from any sort of achievement, so I went incremental.

I then tried to map out a timeline for myself. What did I want? When would I achieve this? And how could I keep it urgent so I didn’t end up defining it and forgetting about it?

I went about it this way by making it as specific to me and my needs and keeping it actionable. So I knew I had basic necessities that weren’t so basic, ie eating well and having a comfortable home, not merely surviving off ramen amongst a dozen roommates. So what would I need for a monthly contribution to that? Would I expect that to change (ie inflation or change of location).

Quickly followed up by, I know I have many further goals beyond that, how can I continue to save & invest towards larger goals? This is a calculation for buying freedom, so we don’t want to be beholden to a paycheque dictating what can or cannot be done that month. As pointed out above, a basic calculation is tallying up your monthly expenses and multiplying it by 300.

A big part of not getting bored or losing sight of my aspirations is keeping on top of them, so I wanted to make sure everything I was doing was leading to progress, not just movement.

As an example, I had a marker of 30,000 as a sort of emergency fund, on its own, that isn’t a quick box to tick, but choosing an index fund, regularly contributing, and tracking the progress of that means I am not forgetting about it. Here I used a mix between a spreadsheet and a Notion board to include a progress bar to help me visualise and keep coming back to this. It kept me actively engaged as I am working on one aspect of my ‘freedom goal.’

How can this be unlinked from a job?

My introductory goals were focused on basics (the aforementioned emergency fund). Partially from wanting to reach my goals sooner and partially because I knew there was so much more I wanted to achieve, this began to divulge into the larger question ‘how can I achieve this without a job?’ Not because I’m anti-work or don’t want a job, but because of the limitations it has on my financial goals and overall earning potential.

Think back to some of your goals, do you want to be able to give up a job entirely or work in a sector that more aligns with your desires even if it doesn’t pay your lifestyle? That is where thinking about your freedom number comes into the consideration of - what do I need to be able to still have my basic necessities and my emergency or retirement fund, even if I wasn’t working at the job I have now? In essence, being free to live - regardless of what comes into my bank account every month.

How can this scale?

Knowing how much you need is the first and most critical aspect but knowing how to scale it keeps you secure long term. This is where investments can be a lifeline.

An index fund can keep your money actively growing so you are prepared for cost of living increases. A bond might protect your money more than a standard savings account. Picking stocks based on dividends could be your new hobby now that you’ve given up the office job and have moved off the grid to keep expenses down. Investing isn’t an option you have to take but it gives you flexibility if your needs change and provides security to your financial freedom plans.

Investments can keep your money working even if you no longer are. They have also been crucial for some to retire early or move into less demanding careers. As the earlier screen grab highlights, having money compounding in your favour translating into your goals being reached faster.

What is the number you’re aiming for to find your freedom?

A big question is how do I invest? What should I buy? How can I get started? Really its what steps can I take so I can make sure I am making my money work for me. Learning how to make your money an asset is important and a lesson more likely to be taught at the dinner table than the class room.

So if you are curious but a bit overwhelmed, let’s start with the basics. Where can you open an investment portfolio. What are some options to consider when getting started. And how you can start making your money work for you. This isn’t investment advice, merely an overview of some of the possibilities available.

Type of Investments

Stocks

A stock in its essence is buying a piece of a company, a balanced portfolio means holding stocks of different companies in different sectors in different stages of maturation. This could be a range of companies from a start up you think will have a big impact and you want to invest in its future, companies you use as a consumer and want to support, or simply names you’ve heard of and would like a piece of. Buying a piece of the company means when the company does well they pay you a dividend as a thank you for supporting their business. The age old wisdom with stocks is to buy low and sell high, but its important to remind ourselves that knowing when those points are in real time isn’t something that can be predicted. A longer term approach to investing is to assume you are going to keep your investments long term and therefore you buy in when you have the funds available, one day it might be lower, the next higher, but long term you are better off for having started sooner. (That’s referred to as dollar cost averaging).

Dividend

Dividend investing is buying stocks specifically aimed at companies that have a history of performing well and paying out to their shareholders. This can be become a hobby for some people - researching company’s that have historically done well and the percentage of return you stand to earn. Reinvesting your dividends puts more money back into the company and increases your future payout if that company continues to do well. A dividend focused investing strategy is focused on maximising the returns possible from the stock market.

Index Fund

If you’re dealing with less than 1-2 mil in assets the general advice is to drop your money into an index fund. Index funds are groups of stocks pre-selected on your behalf representing the top performing companies nationally or internationally. The intention is that it takes the guess work out of individual stock selection and the volatility of seeing a company go up and down and panic selling. Traditionally, index funds perform better over time than individually selected stock portfolios. This is often touted as the best strategy for most investors as you can continue to buy and hold the fund while maintaining a diverse profile.

Treasury Bond

If you’ve read a book like Your Money or Your Life you would have heard of the benefits of buying bonds. Bonds are a way to lend your government money and earn interest on the loan. You would buy a bond for a certain period of time that would have a guaranteed interest rate return that the government would give you in return for the loan. The book was written through a US boomer lens and bonds are often not as appealing today as they may have been historically - its important to check the rates the government would be offering. It may be higher than a traditional savings account but how does it compare to the annual return that can be expected from other investment types?

Gold

Precious metals like gold, silver, and copper are finite resources that society uses and can buy and sell like any other digital investment type. Our currency used to be backed by the gold standard meaning for every dollar in existence there was gold in a vault that could be attributed to the value of the dollar, without us having to carry around gold or silver for every day transactions. Metals typically have a more stable value and can be a useful element in the diversification of your portfolio.

Tip: For whatever type of investment you start with, track how much you put in and the dividends you earn. This helps keep you engaged so you continue to regularly contribute to the fund, but also you can see the money that your money has earned. I use a tracker in Notion that you might find helpful for your own portfolio.

Investment platforms

Now that we might know the types of investments we want to buy into, we need an access point to the stock market. There are a myriad of services and platforms around the world so we can’t touch on them all, but think about what you might be expecting from a platform. I found it shocking how poor of a user experience a lot of platforms had and coming from a non-financial background it was intimidating at first. Others may charge a service fee for every transaction you make.

For instance, you know you want to go the index fund route so you go direct to the source. A popular choice is buying into the S&P500 and you could go to Vanguard.com and open an account to purchase shares of $VOO.

Maybe you are based in Europe and you want to start buying individual stocks - platforms like Trade Republic are available as an app and give you access to the whole stock market.

If you are in the UK then you might want to open an ISA and can use platforms like Nutmeg. While every country has a different approaches and options to take, investing is available universally.

Consider your risk

One of the most widespread teachings I had always heard of the stock market and investment is that it is risky! You can lose a lot of money playing the stock market.

And I would see graphs like these and that would confirm it for me. Look it just falls off a cliff, you lose so much!!

If you are “playing the stock market” and trying to guess the ultimate high versus the lowest low, you will likely be unsuccessful. But if you can use this as a long term tool then you can buy in gradually at whichever point, and over time, you can come out stronger for it. Then you will find yourself building your profile no matter where in the graph the market is and continuing to add to your investments over a lifetime.

And the final note, that is the most important and arguably the most difficult to convince anyone of, is to, whenever possible, start sooner than later. Time is your most valuable commodity.

The sooner you start investing, the more time your dividends compound and the more of those uphill spikes you have had your money in the market growing for you. I’m switching from my savings only mindset to investing in my 30s which puts me at a disadvantage if I had started when I was out of high school or in university. But I’d rather start now than not at all, and I will continue to encourage others to learn more to grow their own family wealth.

I could have used an article like this when I was first starting but that doesn’t mean it ends there - let me know what topic you’d like to see covered next so we can continue to grow our wealth together.

Financial investments might be something we can agree will be good for future us, even if the long term goal of retirement isn’t as sexy as a r…

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You don’t need to abandon your financial goals in the process, let’s go through how I stay focused on my financial goals even during times when I’ve lost focus.

• routinely revisit them.

• reflect on progress and if this is still the direction I want.

• refine. life change so can goals. I can pivot.

• how are you habits working towards or against your goals?

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And ten years later, I found myself engulfed in the same feeling. Better job, making more money, thinking I had more resources, until a problem comes along that will take lawyers or thousands to resolve, and I am that desperately upset 22 year old all over again.

It was a harsh reality check - my situation in life hadn’t changed. I actually wasn’t really better off, even if I looked better on paper.

I was still just a crisis away from a full meltdown and faced with an unresovable problem.

That’s because the resolution was out of my price range.

Do I technically have the money for a lawyer? Yes. Will the price of shouldering those fees seriously degrade my quality of life for the foreseeable future, also yes.

It’s a metaphor I’d heard with luxury items but hadn’t applied to the ‘emergencies’ of life. If you buy a handbag for $2,000 and its destroyed, do you have the money to comfortably buy it again. If not, you can’t actually afford the handbag. Do I have an emergency fund, yes. Will I be crippled if I use it? Yes. So I am not actually prepared for an emergency.

Having money set aside if an emergency comes along is of course better than not having anything ready. But I was confronted with a question every time I saw myself in a situation I could use that money to buy myself out of - how will I recover if the money is gone? If I use my emergency fund, then I need to rebuild it, and that will stall other goals.

If I am constantly rebuilding the basic pot, I am not actually accumulating anything to turn into assets to grow into wealth.

I am on a hamster wheel indefinitely, always a crisis away from rebuilding my funds or life. That is not progress. And I will always feel like I am just keeping my head above water, regardless of how much I’ve saved.

That fury is what made me start new projects. Find new ways to earn money. How to invest better. How to really think how I could move the needle from incremental change to exponential. All in attempts to never feel that helpless again.

What do I mean by this? Let’s start to unpack the suggestions for how to make ends meet or get ahead financially.

Hustle Culture: You want to get rich, then hustle baby!! You’ve got to have three gigs going simultaneously, monetise that side project, and launch a start-up.

All while sleeping 8-hours a night, eating balanced meals, regularly exercising, and seeing your friends + family, right? There are 24 hours in a day and the math on that doesn’t add up. What’s got to give?

Well you need money for basic necessities and god forbid you ever want to retire, so all of a sudden its 5-6 hours of sleep a night, grabbing a bite to eat on the run, skipping the gym membership because who needs more recurring costs, and your social circle only seeing you through the quick selfie you posted online to try and build your brand.

The ‘sleep when you’re dead’ mantra will put you into the grave: if you need a lesson on why sleep is so so vital, read Matthew Walker’s book on the topic.

Just get a roommate!: A big way to save money is reduce your recurring expenses. So whether that is the suggestion to live at home, take on roommates, or live further away from your work location - how we spend money on housing is often suggested as a quick fix to help reduce costs.

Except having a stable home is a fundamental need.

Which is often why as soon as people start making a bit more they are quick to ditch the flat-share. What you might save in money you may be adding to your mental load in aggravation as you are now chasing roommates for rent payments or to take the trash out. If you are adding stressors to your life, you may be saving money, but you aren’t adding to your happiness.

Goodbye Joy: We’ve ALL heard it. Cut your daily latte to be able to save for retirement, skip brunch if you want buy a home.

Actually being able to enjoy life is not only part of your happiness but your health. And having to routinely live through scarcity adds stress and guilt to your life. Or the unsaid loss of social connection when you feel shamed to go on a coffee date or grab lunch with friends.

Again, this doesn’t mean live frivolously but we should all be able to have a little room for joy, we need it in fact as perhaps you’ve noticed the rising statistics on loneliness, anxiety, and depression.

These are examples of what is often considered as ‘self-care’ but it doesn’t stop there. How many people have skipped a dental cleaning because they couldn’t afford it or put off going to the doctor for not wanting to pay their premium? And when money gets better maybe they’re able to prioritise the dentist, but now likely many have gotten accustomed to the quick meals and no exercise, and don’t change their habits to incorporate those wellbeing expenses.

However to me, sleeping 8-hours a night shouldn’t be a lush extra to be enjoyed Sunday mornings - it should be standard - except when my boss is asking me to stay late at work and I know this will impact my sleep schedule, that isn’t deemed a valuable reason to say no.

So many of us, the boss included, have had to give up forms of self-care during our careers to make money, and even when financial circumstances improve, aspects of health and care can be so far removed from daily life at this point its not even considered on the lists of necessary expenses.

You know what makes me feel good - taking care of myself. At different times of my life that may mean different things and I encourage you to think what that could be for you.

Maybe that means a therapist, or a gym membership, eating well, and routinely sleeping well. Taking good care of myself is what I consider basic happiness and I have had many instances in my life where things I needed for my health and self were cut due to finances.

Think of what some of these items might cost you on a monthly basis.

• Therapy

• Gym

• Fresh + local groceries

• Quality Mattress

• Massage

• Facial

• Weather appropriate clothing

• Clean home

Not only does this list add up quick, many of these are recurring expenses. And in my eyes, this is just self-maintenance. I’ve not even included time to relax somewhere else or even your current home costs. Add up what your list might look like and consider if this is different than the basic threshold you were aiming for when budgeting for a happy life.

I’m sure plenty will balk at what I included as basic necessities, but thats perhaps the red herring of this. We’ve become conditioned to put ourselves last and not take care of ourselves.

When I say sleep is important to me, it means if I’m out with friends for dinner and the evening goes late, I don’t want to extend it by being on the tube for another hour to get home, I want to be able to hail a cab and be home and getting ready for bed in twenty minutes. This costs money.

Taking care of my body is important to me and for me that translates into eating well, to use a gym regularly (and the one thats convenient not the cheaper one 45 minutes away), and to do treatments such as massage on a monthly basis.

A lot of advice to cut costs really translates to cutting corners on your well-being and spending the resource of time or happiness instead.

For cheaper rents you shouldn’t live in the city centre so you give up your time to commute. Take on roommates or a smaller place, means loss of your personal space for rest. A massage or facial is a luxurious extra don’t waste your money on that can turn into a chiropractor or a dermatologist later because nothing was being regularly attended to.

In between all the side hustles you may find yourself with no time to clean your home and no excess cash to hire a service so your headspace suffers as a result. We live one life and we don’t want to spend it in a constant state of unhappiness. That means taking care of ourselves, and having the money to be able to do that.

What were areas of your life that you compromised or dropped to save money? Have you reprioritised ‘you’ if you’re financially better off now?

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What’s not expressly stated but equally important to note is that a double income household is a reduction of expenses because rent + bills are shared. For awhile committing to a partner and moving in together seemed like the easiest way to get ahead financially, this may not be a golden ticket but its principle still stands.

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If you are thinking this is your year to grow wealth or hit your own financial milestone, I’ve written about setting financial goals before and I encourage a re-read for anyone not sure where to start. Todays article is about assessing and refreshing your current goals.

Many long-term goals aren’t actualised in a year but it is worthwhile to take stock of the past year and whatever progress did or did not accrue. And while goals might not be completed all within a year, sometimes it is helpful to ask ourselves if these are still the things we want. Have situations changed that what you once wanted is no longer applicable? Have you found more meaningful aspirations you want to focus on instead? If you are still on the right path then where might you have fallen short or excelled in the past year? Did anything come out of nowhere that threw you off track?

Before we set forth to go after new ambitions or keep going on the same course, let’s do an annual audit of the goals we have open for ourselves.

The rationale being to understand our wins and losses of the past year. Were you aiming to save an emergency fund within two years but you’re now on track to have it complete after fifteen months? Great - what will you do next? Do you need to keep saving or are you ready to pivot towards investing and can now start all the sooner? That seems like a win to me, how do you want to adapt your plans now? Sometimes it is all too easy to keep going on the path ahead.

We had spent a lot of time originally defining and planning our goals, and without an audit will keep going to plan, even if it is no longer applicable.

This is most detrimental when our original plans aren’t creating the outcomes we had aimed for. It’s important to assess what went wrong and determine what we would do differently in the year ahead for our existing goals.

For instance, are you trying to make up for missed milestones or changing your timelines to accommodate? Has a life event come along that your entire setup needs to be redesigned? If your original goal line is still applicable, how are you going to create the path to get there knowing everything that went wrong in the past year?

The audit gives an opportunity to reframe and replan to ultimately keep you going towards your goal. Without a review, if you made it to the deadline and hadn’t completed what you aspired to, you’d likely be very disappointed - this gives a chance to mitigate that and keep you going towards your ultimate outcome.

Finally when reflecting on the progress and problems you have encountered thus far, would any of this affect any new goals you want to set for yourself?

If you are further along or behind schedule, presumably this impacts what your new years resolutions could look like. It also gives an opportunity to take the learnings from your audit to build this into your upcoming goals so you can continue to improve, no matter the outcome from the previous year.

The audit provides a chance to self-reflect as well as keep yourself accountable when working on long-term aspirations and ultimately keeps you on the path towards success, something I hope you achieve for yourself in the year ahead!

Now that many are together again with their families for the coming days, what money lessons do you want to leave for the younger generations? Likely you want to see your siblings, kids, or parents to be better off financially then they are now.

Unless you create the next big tech craze, chances are if you weren’t born a millionaire, you won’t live as one. Money takes a long time to accrue - self-made millionaires are the exception not the rule. If you want to impart the seeds of long-term financial prosperity in your family, these are some lessons to start now.

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Nine times out of ten we make our budgets or financial projections off of an average or the state of our finances in that moment, and when something comes up such as the holiday season, we are thrown for a loop because of the gift buying and holiday parties and seasonal outfits are a surprise expense going against our pre-defined goals.

Except there is a slight caveat - whether it is Christmas or your birthday, it is the same day every year. Whatever holiday spectacular you celebrate this December, chances are it is an annual tradition you know is coming. There are many unknowns in life, Christmas being the 25th of December isn’t one of them.

So this really comes down to making better plans - ones that include the splurges of life.

How might this look like if you planning your budget or general financial allocation for the year? Think how you might divide your categories to take into account the known unknowns aka the birthdays, the holidays, the trips. So a small stipend of your monthly take home always is added to a discretionary fun-money pot for when the occasion arises you can celebrate without guilt or panic and fully enjoy your seasonal merriment.

As we slip into December now, keep an eye on what you get up to this month so you have a number to aim for when you draft your financial plans for the year ahead.

Maybe a typical month you go out for drinks or dinners twice, and now it’s twice a week - how much extra padding would you like to have in place next year when the holiday season hits? Now you can divide that by 11 so you know how much you want to squirrel away piece by piece so you don’t feel quite as skint next year.

Now everyone doesn’t work well under the guise of a long-term plan, so what if you didn’t carve this out well in advance, but just started to think about it when the weather got cooler.

Let’s break this down in some example napkin math. So hypothetically you take home 3 grand a month: of that, a grand goes to rent, another thousand to savings, and the final third for all other spending. Because you know December always bleeds you dry or leaves you with a massive credit card bill, evaluate where you have flexibility in this budget.

Categories like rent don’t offer a lot of wiggle room, but would you be able to use less of your general spending funds for a few months to have a holiday pot ready to go? Alternatively would you rather ear mark a portion of your monthly savings to help fund your holiday season? It is your life and your priorities so you know best what is important to you and where you might find flexibility.

Doing this only a few months ahead likely means larger chunks to save, but over a shorter amount of time (aim for Sept - Nov).

Now it is December and you are flooded with the holiday outings and secret santa for every friend group you’ve ever had, and because you budgeted with knowing this was coming up, you are prepared without being squeezed or burdened during the month or living off of pot-noodles come the new year.

Again, I’d advise after the festivities die down, look back on the activities and gifts and the relative cost so you can have an idea of what to brace yourself for in future years so you are no longer burdened by the holidays. What would you like to do differently? What would be your ideal holiday season budget?

Whether that is a parent who grew up scrimping because their own parents were clinging to depression era habits or work friends who live perpetually in their overdraft, other people’s habits impact our own.

When thinking of your money goals, also consider the type of relationship you’d like to have with money. Now think of the current influences in your life and the relationships they have with money. If you are actively interested in building your wealth, here is who you’d like to be in your corner.

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Assuming now you know your baseline, now that you have the foundation you can start to build achievable goals. Whether you’re looking to retire early, get out of debt, or buy a second property you can use the below framework to fit around your personal goals.

Begin with spotlighting what you want. Really think about what your goal is - put it on a metaphorical pedestal and create a near singular focus on ‘this’ being your goal. It sounds obsessive but without this focus it is easier to become distracted or neglect your goal. You want to create a visual space where you see your goal ahead of you.

Also to clarify, this doesn’t mean visualise yourself achieving the goal - its not about imaging how great your life would be if you retired tomorrow - it is about seeing early retirement as something that is in front of you that you are going towards.

It can be dangerous to visualise achievement of the goal because the brain takes it as a hit of accomplishment so you’re actually less motivated to get working on it, as psychologically your brain has already cashed in the reward for it. You want to identify your goal and not allow goal setting to become the proverbial finish line.

Next, most goals are made up of components. Even if your goal was to win the lottery, you’d need component steps to ‘buy lottery tickets’. Take some time to assess what you might need in order to accomplish your goal.

Does this require new skills, networking, a career change? Especially if your goals are centred around the type of work you do or want to be doing, a valuable resource using behavioural science is Think Big. Since you can see your goal in front of you, what are the steps you will take now to bring you closer to it?

Big goals are actualised by many small actions coming together.

• What are your next steps?

• How will you be doing them?

• What’s your timescale for accountability?

• How are you tracking your progress?

We aren’t done here though. Seeing the steps in front of us is important but we also need to be aware of what might become our blockers. Let’s say you want to get a second income stream. Admirable, what stands in your way? Time constraints? Tax codes? Opinions of others?

Being prepared for challenges means you’re braced for them when things get hard. People are more likely to quit when the goal becomes difficult or they’re not seeing the results they had originally seen in front of them. Things always get hard - life rarely runs on easy mode - so consider these challenges when you are setting up your goals so you are more likely to overcome them when something inevitably goes awry.

Finally, you want to be auditing your progress to ensure success. Goals like these aren’t a tick off in a day type of accomplishment.

You will be regularly working on small steps to bring you closer to your goal, and you will likely have pit-falls along the way. Set up a recurring review as to how you are progressing.

This helps you identify if you aren’t making the progress you’d planned before years go by with nothing to show for it. Being able to identify changes early helps you to replan and get yourself back on track to keep moving towards the goal in front of you.

So let’s say you’re trying to build a nest egg for retirement so you don’t need to worry about collecting pension funds and you decide to save 100k over the course of the next 5 years. You tallied up all your assets and have no cash on hand saved, so for this example, you’re starting from zero. How might you start to break this up? What are the obstacles? How will you keep yourself on track?

First, we identified what we want: 100k within 5 years. This is what we see in front of us and want we want to commit our energy to.

Next, how might we get there?

• If you saved a bit less then 1700k a month, in 5 years you’d have 100k.

• If you saved 1400 a month at a 7% interest rate in 5 years you’d have 100k

• If you saved 2400 a month, you’d reach a 100k in about three and a half years

There is nothing to say it has to take the full five years, so a couple different breakdowns helps us to see how we might actualise this.

What are my obstacles

• Can I not consistently save the money?

• Can I not save enough money per month?

• Do I not have an account that is generating interest?

How might we start to address these obstacles? If we don’t earn the same amount per month maybe we should look at our contributions on a quarterly scale or keep this as a review point when we audit our progress.

Perhaps you aren’t making enough to reasonably save this much. Is it a question of changing the time frame of the goal or increasing income through a part-time job? You think you could save the 1400 monthly but your current account isn’t giving you any interest - what do you need to open an account elsewhere?

Now we are starting off with a more realistic view of what this goal might present us over the next few years.

Finally if we are setting ourselves up for a five year goal - this isn’t something that needs to be reviewed on a daily basis. Think of a schedule that works for you and how you can stick to it. For instance, if I’m paid once a month, then I will send money to my interest generating account at that time and review my progress.

Setting goals is a lot like creating new habits, you need to find something you can consistently incorporate into your existing routines and keep working at and building upon in the medium to long term. Being able to set and keep goals sets you up for further success because now you are building up top of previous wins.

Happy goal creation!

I said in my first post I had figured out I needed 3 income streams to work towards my personal financial goals. I had broken up each hypothetical income stream towards supporting one area of my life - one for retirement, one for a property purchase, one for general investing. But when I really analysed these it felt like even that was the just the tip of the iceberg.

Before I marched myself right into a doom spiral of never obtaining my financial goals, I turned instead to what a multi-income stream setup might actually look like in practice.

The 9-to-5 comes with its own set of pros and cons. A full-time job offers the stability of steady pay but it is very time consuming.

Eight hours every day go towards ‘the office’. Working from home was the great eye opener for many that when you’re not surrounded by office chit-chat and coffee breaks you can actually get a lot done in a shorter amount of time.

Does a full-time job really need to take 40 hours a week or can I get the work done in 15 and do something else with my time? Except I’m contractually obligated not to, because no matter how long it takes me to actually complete the tasks of my role, I’m in essence on call for the rest of the time to field slack messages and emails or jump on a quick call.

Passive income streams are famous for making us money while we sleep. Your investment portfolio counts as a passive income steam, however as you need money to make money in that scenario, it works a lot better after you’ve already cashed in from perhaps a more active stream.

My scenario was that I was saving 45% of my monthly earnings but as I learned from my breakdown of lifetime earnings, 45% of not a lot isn’t much. So I couldn’t rely on solely putting the remainder of my paycheque into an index fund and hope to retire early and have a home in the city.

So the purpose of my investigation was finding ways to earn more money in multiple ways. Here I entered the world of everyone tying to sell you a course on how to make courses.

The internet is full of everyone and their brother trying to sell you the dream that you can be a quick millionaire with a drop-shipping company or an instagram following. And many people have had success with that however it was now at the point of over-saturation.

Many an internet personality champions using what makes you unique to create an email list or sell a product, but if you look around there are a million and a half options per niche so finding a way to make your voice heard could become a full time job in itself. I had a full time job and I didn’t want to lose one income stream in search of another.

Overall I had two main takeaways from on how to earn more money for myself- I could create a product or service business on the side and have the flexibility to work around my job, but be competing with many in this space. Working for yourself however gives the greatest financial returns.

Or I could find a second employer, be that in a cafe or another tech company and juggle my time commitments and take in two salaries. Working for others though always means less flexibility and only a fraction of the total pie though.

My own aspirations felt capped even with a second job so I began with the side business option. As I didn’t want to jeopardise my current employment I sought to find ways to take on extra projects in my spare time. I spent time learning social media algorithms, facebook advertising, and what I could reasonably charge for freelance services. It’s an ongoing trial and error process that can be very exciting at times and just as disappointing in others.

I see more and more people around me turning to side-hustles, whether that is for a chance to explore their creativity or increase their earnings. I applaud you if you’ve struck out and tried to expand your options (for whatever reason) beyond the standard day-job.

Have you thought of taking on a side hustle before? What were your motivations to get started?

I had followed the general rule often parroted, create an emergency fund in case something happens you aren’t caught scrambling. But when I watched those I knew lose their businesses and livelihoods in 2020, I realised my rainy day fund wouldn’t last long if I found myself in similar circumstances.

So an emergency fund might tide me over for 3-6 months, but what if the economy goes tits up and I can’t get a job for the next year, or whatever income source alternative I find isn’t covering expenses? If I was tied to my day job to keep living, then I was a very small margin away from destitution.

I realised I would never be ‘rich’ if I was constantly worried about being laid off.

I took a step back and thought of what I would need to really feel secure whether that was a temporary stumble or an economic collapse. This partially meant that my great ambitions for my definition of success needed to be reevaluated to consider the foundations before scaling beyond that.

I defined three areas that were necessary for me to feel financially secure before I could really amount to the bigger game of accumulating real wealth.

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