“…I wish I knew then what I know now”, or so goes the expression. I am sure we have all wished we had a few important financial secrets early enough in our career that we could have taken advantage of them. Right? Of course.

 

So a reporter recently asked me what my top 9 financial tips would be if I were to share them with someone on the way up. It took more time to narrow them down to 9 than to think of a list. Here they are, in no particular order:

 

  • Risk is real, but so is life; so take a few calculated ones
    • You can’t live without making decisions & taking risks so gather the best information you can, make a decision & live with it; or change it.
  • Understand, and appreciate, the difference between a cost & an investment
    • A cost is money spent without an expectation of a return
    • An investment yields a return. Make investment decisions with risk/return in mind [like #8 below]
  • Live on a budget
    • Yes, you can. It is a matter of choices & priorities
  • Live below your means
    • There is always more you want than you need. Living below you means equates to your ability to satisfy all your needs & even a few of your wants without guilt or default. And you sleep better, too.
  • Pay yourself first
    • Deduct & put away a) retirement, b) savings & c) emergency funds first. Then live on the rest. You’ll thank yourself in retirement (and even earlier).
  • Find enjoyment in the little things
    • Big things are great; occasionally. But all the little things we see, hear, small, tough & feel everyday make life really worth living; and they are usually way less expensive than the big things (well, ok, not diamonds).
  • Don’t worry about keeping up with the Jones’
    • They’re probably borrowing too much anyway & worried about bankruptcy
  • Invest in cash flow generating assets
    • This is the only true type of independence, giving you financial freedom
  • Understand the benefits of the right kinds of insurance
    • The relatively small premiums reflect the diversification of the risk & when something major goes wrong, you’ll be glad you did.

 

How can Build It Backwards help you achieve your financial goals? Contact me at DanielFeiman@BuildItBackwards.com

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