The most powerful way to think about money |Every Choice Comes with a Trade-Off
Every decision you make has consequences, and money is no exception. You can afford anything, but not everything. If there’s something you value—whether it’s travel, food, or a house—you can have it, but you can’t have an endless series of "ands." You can't have that or any other thing or anything else. This doesn't just apply to your money. But it also includes your time, attention, energy, and commitment. Life is the ultimate finite resource. So when you practice managing your money better. You can also practice managing your life better.
Introduction to Financial Freedom
Hello everyone, I'm law fundix llc and we're the hosts of the Afford Anything podcast. I am here to help you to spend or invest your financial freedom by making smart decisions with your money. The mistake I see when a lot of people start asking questions about managing their money is that they often ask about products or strategies.
For example, they might say, or “Should I invest in cryptocurrency?” But true financial success requires first principles thinking. That is, separating everything to get to the root of the matter.
First Principles Thinking: Starting from Values
Think about a tree. The tactics and products are like the leaves—what people tend to ask about first. But let’s start with the roots of the tree: your values. What matters most to you? From those roots, the tree trunk emerges—representing your life philosophy, the type of life you want to live.
From there, we branch out into specific objectives or goals. Once you know your philosophy and goals, the branches represent the strategy for how to achieve them. Finally, the leaves—those products and tactics—come into play. If you start with a question about tactics or products, you’ve got a leaf in your hand, but you don’t have the root system built yet.
Financial Independence vs. Delayed Gratification
Personal finance often focuses on delayed gratification—saving for the future. But it's hard to get excited about saving money for your 75-year-old self when we reframe that concept as economic freedom. It becomes even more attractive. FI means that your passive income—usually from investments—covers your expenses. Then you have the freedom to decide what you want without worrying about finances.
Whether you want to continue running your business, change careers, travel, or be a full-time parent, FI helps you make the decision independently.
Steps to Financial Independence
There are only three steps to achieving financial freedom:
- Increase the gap: Increase the gap between what you earn and what you spend. You can do this with more income. Spend less or both
- Invest the difference: My personal belief is that you should aim to save and invest at least 20% of your income. This includes saving for retirement. Debt payments that are higher than the minimum and creating an emergency fund Start by increasing your savings rate by 1% every month or two until you reach the 20% level.
- Repeat: This is a lifelong practice. Money management is a lifelong journey. It's not a quick fix.
Accept Change and Instability
There has never been a time in history when the world was unstable haha wars evrerytime. A hundred years ago there was a pandemic and a world war. A decade later The Great Depression occurred. This was followed by World War II. Global events have always had an impact on people's lives.
I achieved financial freedom because I was afraid and worried about the uncertainty in life and the world. Saving as much as possible helps overcome that fear and provides a sense of mental peace of mind.
Using Fear as Motivation
Change is inevitable. But fear can inspire. If you are unsure about today's world You can use that fear to fuel smart decisions about your money, time, and effort. That's how you create a more intentional and happy life.
إرسال تعليق