Money Advice for Young Adults

What money advice would you give to your younger self? George G talks about the fundamentals for getting off to the right start!

Apr 11, 2024 | Blogs, Podcast

About the Episode

What money advice would you give yourself as a young adult? The world of personal finance is vast and pretty noisy, making it difficult to know what to focus on. George G shares a recent presentation to a group of undergraduates on the fundamentals to pay attention to! 

 

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George Grombacher

George Grombacher

Host

Episode Transcript

So excited to be with you talking about something, obviously near and dear to my heart personal finance more specifically money and wanted to or I’m going to tell you about what my advice to my own kids will be. And my advice to you is going to be today. I know, I think and I know that one of the greatest gifts that we can give another person is our undivided attention. And with that in mind, appreciate you making the decision to give me yours. And I do not take that lightly, I accept your gift, and I’m gonna give you 100% of me everything that I have, and I want to be a resource want to answer all your questions want you to get started on the right path foot, however you want to think about it, I want to help you avoid a bunch of mistakes that I have made, and that a lot of other people have made and get you to wherever it is that you want to go. Here are my two boys, James on the left, and Jack there on the right piers that Jack is about to strike James with his sign. Anyway, there is baby Joe, and Joe is about 10 months old. The way to her heart right now is through cheese. And that’s obviously a genetic thing because that’s me as well briefly about me, I’ve been a financial person for over 20 years going on 25. I’ve worked for great big financial companies that you’re aware of. Today I own and operate a smaller financial firm that you’re probably not aware of. I’m the host of the lifeblood podcast and the aligned money show. The author of Berend CFO how to get good at money. The purpose book, The purpose book for financial professionals, as well as the daily journal honored to be named to invest PDS listed top 100 financial advisors five years in a row. So that’s a little bit about me also, also about me, I’ve made all the dumb financial moves you can make. I spent the good, good part of my 20s in and out of credit card debt, living paycheck to paycheck and just not paying attention to where I was, fortunately, I’ve made some changes. And I’ve made lots of great financial decisions. So today I stand here or speak to you in a really solid financial position. But I share that just to let you know that wherever you’re at, or wherever your your family was at or are at doesn’t mean that that’s where you’re going to end up we have the opportunity to, of course correct and to overcome bad decisions or bad mistakes. So but I guess fundamentally, I’ve been in all the different positions, somebody that’s made bad decisions, somebody has made a lot of good decisions. So wherever you’re at, I’m confident and get you a little closer to wherever it is that you want to go. Here’s something that a lot of financial folks are not very interested in saying or talking about. It’s simply that if you take the steps that I’m going to talk with you about today, I can almost all but guarantee your financial success, certainly you’ll have financial security, you’ll be on the path to financial prosperity. That’s all relative to whatever it is that you’re trying to accomplish. But I think that I know, I’m going to give you a lot of actionable steps that you can take and implement immediately. And I really hope that you do and that you will. So I don’t know, how much time do you do you spent thinking about money? Is it something that’s on your mind? Do you? Do you talk to your friends about it? Is that something that your parents talked about? And then dig a little bit deeper into that? When you think about money? What do you think wealth is? What is wealth to you? Think about that for a second? Is it? Is it cash? Is it owning a lot of real estate? Is it owning a company? Is it owning a bunch of gold bars? Is it swimming in a large pool of gold coins? Alas, Scrooge McDuck what does it mean to you? Well, here’s some some level setting or some perspective. And it is this that if you’re making at least $34,000 a year you are in the 1% globally. So if you’re making at least $34,000 a year, you’re in the 1% from a global perspective. And certainly, if you’re making $34,000 in the United States right now, you’re probably not feeling all that wealthy. But just from a perspective, perspective, Perspective Perspective, I love that. And over the over half the earth, over half of the Earth’s population, roughly 4 billion people live on less than five bucks and 50 cents a day. So I don’t know how much money you spent at Starbucks or whatever. But over half the earth’s population lives on less than 550 a day. People were curious and whenever human beings are curious, we work to satiate that curiosity. So people were curious as to what the biggest regrets that us human beings have at the end of our lives. So the research that they study that like what are the biggest regrets for people at the end of their lives? Looking backwards, and here they are top four. Number one is I wish I wish I had not worked so hard. Number two, I wish that I had the courage to live a life true to myself, and not the life that others expected of me. I wish I’d stayed in touch with my friends, I wish I’d let myself be happier. What do you think about those, as those wash over you, she let it wash over you. You know, when I was 22 years old, I was already I was somebody who is accustomed to working really hard. And I still am a really hard worker here. 45 years old. I think that’s an important thing. So, but certainly, if it’s, if it’s in spite, or if it’s in place of doing things that you enjoy, or doing things that you love, or it takes time away from your family and things like that, I think that that’s what this is speaking to. I wish I had the courage to live a life true to myself not to let others expected of me. This is a big one. And this is one that’s it’s a trap. It’s so easy to fall into. We operate under so many different assumptions. You operate under the assumptions of the home that you grew up in the values, the way you did things, the beliefs and just how you how your family operated, where you want to vacation, the kind of cars you drove the kind of work that you did, what you did for fun with any religious or spiritual traditions, so much stuff. And then you move on, and now you’re part of a you’re going to college or whatever it might be. There’s so many different systems and structures and assumptions that we’re living under. And you’re going to keep running into that at every stage of your life where you go to work culture, they’re the people that you date, your friends group, how you entertain yourself, all of these things. And the sooner we can figure out what’s most important to you what your biggest priorities are, what really matters, the better off loop that we will be otherwise we’re sort of carried along by the current life, and there’s just very, very low chance that you’re getting carried along and doing what other people think that you ought to be doing. There’s very little chance that’s going to result in the life that you want. But if you never think about what you want, if you never think about what’s important, if you never think about what is valuable, then you won’t know, I wish I’d stay in touch with my friends. And you are right now, in the best time, well, they’re all the best time of your life, I shouldn’t say that. I think they’d been a kid was awesome. Like that being a student was awesome. Being in college was awesome. Being in my 20s was awesome. Being in my 30s was awesome. You know, my 40s is awesome. But you are in a very unique 3456 year time period, when you’re in college, where you are just hanging out with your buddies all the time, the girlfriends or boyfriends, whatever. And there’s very little, yeah, you’ve got coursework and all that stuff and responsibility, but very little. So knowing that it’s important to keep in touch with your friends. And you’re probably thinking, of course, I’m going to keep in touch with these guys forever. And that may be true. And it’s important that you make it a priority, if it’s a priority. If it’s important to you, you need to organize your life so that you don’t fall into this trap where you sort of lose touch with people. It’s harder. When you have a job and you have families and stuff like that it makes it a lot harder to keep in touch. But it’s very, very possible. So I wish to let myself be happier. Oh, my goodness. It’s certainly something that is difficult. It is difficult, which that maybe that sounds dumb. Anyway, I share these just to frame our conversation today. It’s such an important thing. So what is wealth? Circling back on that? I think it comes in a lot of different forms. Certainly there is monetary wealth. But if you don’t think that health is an asset, you’ve never been or don’t know anybody who is really sick or has been really sick. Do you don’t think relationships are an asset? You don’t know anybody who is alone. If you don’t think time is an asset, you don’t know anybody who is filled with regret. So all of those things that I was just talking about, really want to frame the conversation of globally, where are you at?

From looking back, you’re at the beginning of your life versus the end of your life. You don’t want falling into the traps, and understanding that wealth. There’s a lot more that goes into it than simply money. Maybe you already know this, I thank you at the top for giving me your undivided attention. And I’m serious about it. I believe that our most valuable resources or MBRs are time, attention, energy and money. So time is very finite. Attention is finite, even though it seems like it’s not money is finite, so is their energy. So we need to be good stewards of these things. That’s really the whole point. That’s the whole point of this conversation is I need to decide for myself, what matters what is a value, and then I need to prioritize how I allocate these resources. Because not everything can be the most important thing. It just can’t be, when I’m giving my resource to one thing. When I say yes to one thing, I’m saying no to everything else. Right now it feels like you’ve got all the time in the world. And you do, you have a lot of time. But we don’t have time to waste. None of us have any you have all the time to do whatever it is that you want, you don’t have time to waste. So don’t waste your money. Don’t waste your time, don’t waste your attention. Do not waste your energy, like for each one of these, that are just armies of marketers, and salespeople and algorithms. And everything was following us around from device to device, screen to screen, trying to extract little bits of all of these things, and they’ll take all of it. So here’s a question for you. Would you rather would you rather be wealthy? Or would you rather appear to be wealthy? What do you think? Well, I think it’s an obvious answer, I’d rather be wealthy. But here we are today, you’ve heard that phrase, no doubt Keeping Up with the Joneses. A better one is keeping up with the Kardashians. And that’s simply signaling that you are wealthy versus actually being wealthy. Can you do both? You can, as long as you are, you know, pursuing wealth and actually taking steps towards gaining it, then you can sure have nice things. But if you are spending all of your money on nice things, and that means that there’s no money left over for the actual accumulation, or the pursuit of actual real wealth, that he can’t do that. Then you’re just chasing your tail, you’re gonna get stuck in the biggest trap, one of the most common traps out there, trying to keep up with the Joneses. Trying to keep up appearances, trying to pretend that you are something other than what you are, is not easy. Thomas Sol famously said there are no solutions, only trade offs to what I was just talking about. When you say yes to one thing, you’re saying no to everything else. So when you decide to rent a really nice apartment, and lease a BMW, well, that means that means that there is less money for your savings, there’s less money for your investing. So you’re just you’re not, you’re not finding solutions. There you are making trade offs. Keep those most valuable resources in mind, time, attention, energy and money, and do not waste them do not squander them. We human beings have a lot of superpowers, tons of superpowers. And I’ll tell you, we don’t think about them as superpowers but got a ton of them. And when we are cognizant, we’re thoughtful, we’re mindful of how powerful we really are, then we can put these things to use. Life is all about intention. It’s being intentional, it’s trying it’s striving towards things, versus the opposite is just getting carried along by the current and going with the flow and everything else, setting your intention, making plans and executing on those plans. That’s a human superpower. One of the things separates us, from the animals on the planet and all the other things on the planet, at least that we’re aware of, is our ability to do that, to impact to positively impact to to consciously be working in impacting. Once it happened that the Traveler was traveling along as they often do when he came upon a worksite and that this worksite there were three stone cutters stonemasons, walking away, chipping away at rocks cutting stones, and he was curious so to satiate that curiosity he approached first stonecutter he said excuse me can ask you what you doing. Man looked up and I’m pissed off. So what does it look like? I’m doing cut any stupid rocks. I’ve got the worst job in the entire country. My hands hurt. My head hurts. My back hurts. Everything hurts. Travis Oh my goodness. I’m so sorry for your trouble. I hope that things changed for you. gingerly cautiously. He started walking towards the second stone cutter. So excuse me hate to bother you can ask you what you’re doing. Second man looked up very focused look in his eye. He said. I’m working to become the best stone cutter in the entire country. Traveler so that’s an awesome goal. I wish you luck in achieving it. Done a little better. stone cutter moved on. Or rather the traveler moved on to the third stone cutter got about halfway there. So do I hear him whistling? Could he possibly be whistling a happy tune? Sure enough. Third stone cutter was whistling a happy tune seem to be really enjoying himself said I hate to bother you. Can I ask you what you’re doing? Third Man looked up this gleam in his eye. He said I’m building a cathedral. So three people doing essentially the same thing but having a completely different experience. This our first superpower? Is that a perspective? You get to choose? You have choice. You get to choose you have a choice. I don’t have any control over what happens to me. I don’t have any control of the circumstances over my life. But I have absolute control over how I think, feel and respond to those circumstances. Good or bad. whatever comes my way. I get to choose. Nobody else chooses how I think feel or react. That is a superpower. It is perspective. It used to build cathedrals versus have a terrible job. What are you going to choose? This is true of everything is true of your relationships. This is true of success. This is true of money, this is true of your work. How you look at something makes all the difference. And you know, people who suck at this, you know, people are constantly moping around. They’re just super negative, you can’t get them to do anything. You’re like, oh my gosh, you can lead a horse to water, but you can’t make them drink. Something’s always wrong or irritated, whatever. Don’t be that person. You get to choose. So decide, how do you want to show up? How do you want to be with money? I’m just not good at money. Okay? I’m going to be financially successful, I’m going to be really successful, great with money, great business person, an entrepreneur, whatever. You get to choose. Super powerful thing. I talk a lot about and think a lot about alignment. In this book, I wrote the purpose book, talks about how purpose is why you do things. Goals are what you want. Beliefs are who you are. It’s also values and then habits are how you do things. And ideally, you want to get these things lined up. You want to be all rowing in the same direction as our four people are, I think that’s four are doing here in the picture. For those who aren’t looking, it’s just like a bomb canoe and outrigger Probably. Anyway, the second human superpower is goal setting. And it is absolutely squandered. You know how long I’ve known about the importance of goal setting? Somebody guess? Since I was 10 years old, 10 years old. I’m 45 years old today. So I’ve known about how important it was to set goals for about 35 years. You know how long it took me to actually set goals when I turned about 35. So it took me 25 years to actually sit down and write out my goals. The verdict is no, there’s no question. Having goals exponentially increases your odds of achieving what you want. writing those goals down, blows that up even more. Only 3% of people write down their goals. Preposterous. I can tell you one thing, it’s start writing down your goals. If you can do that right now. The only way to live how you want is to know how you want to live. The only way to live how you want is to know how you want to live. Otherwise, just wandering around, no idea. That sounds good. I’ll pursue that. Okay, maybe I’ll go over this way. No, need to set the intention, you need to get super clear. This is superpower because you can imagine any future that you want, literally any future anything. And you can make plans for bringing that your desired future into your current reality. Then you can execute on those plans get to work, doing it. Amazing. That’s why it’s a superpower. Nobody. No, nobody else can do that. Our third superpower is our opposable thumbs. Nobody else has those either. You get the idea. So it’s a super powerful thing, but we squander it. I know I did. And I also know that I am not a fan. In fact, I detest when people say just just do it, just do it. But most people don’t know how to just do it. They don’t know what it is, they don’t know how to do it. So never just going to tell you to do it, I will give you step by step, rock solid ways to actually make it happen. So if I know I just said, what are your goals? You’re like, oh, I have no idea. It’s way too big of a question. Super abstract. I have a lot of things that I want. So we need to really narrow that down. And like anything else. I know that when I give people prompts when I could prompt people like oh, yeah, that sounds good. So there’s six areas that I focus on. family, community, career and financial, personal development, wellness, and then peace of mind. So your family? Do you want to start a family? You wanna have a better relationship with your parents, with your siblings, whatever that might be? What are your goals for your family?

from a community standpoint, what is your community, I know that you have your community and your paternity, your social clubs, your team’s kids, you went to high school with your friends, he played sports, whether you’re in theater or the band, whatever. What is your community? How can you strengthen it, nurture it move further along? What are your goals there? What do you want? From a financial standpoint and a career standpoint? This is a big one. What do you want out of your career? And it’s beyond the scope of our conversation today. But I can tell you that I had no idea when I was 22 years old when I wanted to do none, zero, zilch, nada. Snow, I wanted to make a lot of money. No one wanted to wear a suit I wanted to be respectable, was able to do those things. But it sort of happened into it and backed into it, lucked into it. I advocate that you’re more intentional about it. And then what do you want to know? Do you want to get rich? What does that even mean? Want to have peace of mind not worry about money. The big questions, personal development, what do you want to get good at? What do you want to learn just for the sake of learning not because you have to, you’re gonna do a lot of career development and a lot of learning and certifications or designations, this, that and the other thing, maybe you got to go to medical school, so you’ve got a full plate. But beyond that, what do you want to learn, maybe you’re interested in doing a podcast or reading a book, starting a blog, or playing pickleball, whatever. And from a wellness standpoint, as you get older, need to pay closer attention to this kind of stuff. Because it becomes harder to stay on top of be healthy. So physical wellness, your mental wellness, your emotional wellness, all these things need to be need to be cared after, you need to put yourself first and make sure that you’re showing out as best you can. It’s not selfish, it is a function of you at as close to 100% is way better than you and 50%. So, for your family and your community and your work, personal development, you got to be strong, need to be stronger than you are right now. You need to keep getting better. Think about this, if you can, between personal development and wellness, you can get a little bit better every day, get 1% Better than you were yesterday. That’s the whole game right there, you can do that. You will you will come out on top and then peace of mind. Do you have a religious or spiritual practice that helps you to calm your mind and just be at ease to be content. That’s a really important thing, that a lot of people out there, they’re full of stress and anxiety, and they do not enjoy peace of mind. They are flat broke, they are unhealthy. It’s hard to have peace of mind when you are sick, financially, mentally, emotionally, all of these things, maybe it’s just a matter of I need to get outside and do hiking or become a Buddhist or just go to church on Sunday, whatever it might be. So those are the areas that I focus on. With the Yin, yin and yang, everything has an opposite. So with our superpowers, we also have weapons of mass destruction, we are capable of so much we’re so dynamic as human beings cannot have the good without the bad. Everything. There is a dichotomy to it. And one of our weapons of mass destruction is our ability to rationalize. I can literally rationalize and talk myself into just about anything. It’s amazing. Why didn’t I do what I was supposed to do tonight? Well, it’s because this that the other thing? Why am I not where I want to be professional? Well, there’s all these different reasons. It’s because of this and this and this and this, what happened was this, okay, maybe, probably not, you’re probably just full of it. And I tell you what, I don’t like to be asking anybody, I’d rather be somebody else than BS myself, I don’t want to lie to myself, you need to be able to look myself in the mirror, I want to I need to need to, and not blow smoke on myself. Life is way too short to be doing that. But our ability to rationalize is a weapon of mass destruction. And the negative part of it is it just keeps us stuck. It causes us to accept less than we really want. Like, ah, you know, they’ll show to my goals, what’s because these things. So now instead of going harder or changing, I just accept, rationalize, it’s okay. She’s not for me. And that’s, that’s that’s BS don’t fall into that trap. So such an important thing to avoid. And when we have these limiting beliefs, we have these beliefs. So beliefs and values. We all have an operating system, just like our cell phones have an operating system that’s running 24/7. It’s always raining in the background. It’s estimated that we human beings make about 35,000 decisions every day. Obviously, if I was making those consciously, I wouldn’t be able to do anything, I wouldn’t be able to operate in the world because I’d just be making decisions all the time. You could break that down real quick. If you sleep for eight hours, which you ought to you probably don’t. But if you’re awake for 16 hours, what’s 3500 or 35,000 rather 35,000 choices divided by 16 and then break it down by the minute. It’s amazing how many choices that we’re making on a minute to minute basis, but a lot of those are made by our subconscious mind, our operating system, consciously running are constantly reminding the background to our benefit. Times on top but what if, what if it’s not? What if it as a bug or it’s not operating effectively? What if it’s broken? Well, then your apps or your phone doesn’t work? And you and I don’t work? Or we’re not working as well as we possibly can. When we We have a limiting belief, it becomes a self imposed class ceiling or a glass cage that we are stuck in. And we don’t realize it’s there. And that is the the sinister, insidious part of limiting our negative beliefs is that we don’t recognize that they’re there and where they come from, how do these, how did I get these beliefs, positive or negative, Where did our beliefs where their operating system come from, and it came from around Joe’s age, remember my daughter, so age zero, from birth to about James’s age, age seven, that’s where we got our operating system. A lot of it was downloaded to us just through DNA. But then it came to us from our interactions with other people are just observing the adults in our lives, and all these things. So that is where all of this stuff actually comes from. is from zero to seven. So good news is, if you had a perfect childhood, you got nothing to worry about. Right? No worries, everything is working great for you. Bad news is if you’re like the rest of us, where maybe things weren’t always perfect all the time, then you maybe have some limiting beliefs floating around that you need to become aware of? How do I know? How do I know if I have a limiting belief? Well, you just need to notice when it is that you are triggered by something. Daniel Kahneman, rest in peace, Danny Kahneman, he passed away within the past month. And he was a very, very famous psychologist who won the Nobel Nobel Prize in Economics, Danny became fascinated with why it is that human beings make decisions around money the way that they do. And he wrote a book called Thinking Fast and Slow, really, really important book, key takeaway was that he found that 90 90% of the decisions we make about money are based on emotion. What do you think about that? Think about that for a minute. Like, I remember thinking, I remember hearing that I was like, No way, there’s no way that 90% of my decisions around money are based on emotion I thought about it’s more like, oh, well, most of the decisions I make about everything are based on emotion. It’s, do I want this? Why did I choose these clothes today? Why did I choose to do the things that I’m doing? It’s because the way that I feel about things. And the trick that Danny figured out was that thinking fast, that’s our, our knee jerk response to things. When a stimulus comes in the first response, that’s the fast part of our brain. And that’s the emotional part of our brain. The slow part is going to take the information and and think about it logically and reasonably, and make a more informed a better decision that’s based on what I think is most important and have the highest value. Okay, so that’s how we figure it out. So in terms of, you know, and it’s true of everything, again, it’s true of relationships, find yourself dating the same kind of person over and over again, oh, you’ve got some kind of a negative or limiting track or belief running? If you find that you’re somebody who just thinks that you’re somebody who can’t be good at money? Well, there’s something going on there. You got that idea somewhere. true success?

If you think that rich people are terrible. If you think that if you think that people who are in fraternities or sororities are awful people, well, there’s a limiting belief there somewhere that is going on to how do we figure it out? How do we figure it out? I think that for our money, I want to go through these prompts with you. And I want to use the first part of our brain, which is or rather the fast part of our brain to just answer these questions as quickly and honestly as I possibly can. And then you can go back and you can use the slow part of your brain. Say, Okay, well, here’s, here’s what I really think about this. In my family money caused. Money is in order to have more money, I need to I think money. People think money. People with money, our Money makes people. So you can answer these in 100 different ways. Probably a million. My parents thought money would. You know, my parents thought money was the root of all evil. In my family money caused fights. Money equals greediness. I think money is the root of all evil. People think money is the most important thing in the world, but it’s not. Or you could be saying in my family money allowed us to take great, great vacations. People with money are generous and caring and important because they give a lot of money. So you can see having money is not acceptable. Having money is not a big deal. There’s so many different ways you can be thinking of About this, but what you’re gonna find, what I found is that I was able to trace some of my limiting beliefs about money all the way back to when I was a kid, which again, 07. That’s when these all came to be. So growing up, I grew up in a place called Duluth, Minnesota. So it’s in northern Minnesota. And I had a great childhood, great childhood. My folks split up when I was five, and my mom raised my older brother and I, and she was school teacher, they still back then they didn’t pay teachers very much anymore than they do today. So growing up, there was just never enough money to go around. Again, I had a great childhood, but we were working class, and there was just never enough, which is a pretty, pretty common story. Once a month, my mom would pay bills. And that meant she would literally spread out all of the paper bills, which we used to have back in the day, on our big wooden, circular dining room table. And it was on a Sunday, and my brother and I knew we just need to stay away from mom, because she stressed out, she’s trying to make it all work trying to figure out how it’s all going to figure it out, all out. And so that just taught me month after month, year after year, avoid financial matters, avoid, avoid, avoid, believe it or not, that then led me as an adult to avoid financial matters. And so that manifested itself as just waiting the last minute to pay bills. Not dragging my cash flow, not budgeting, living paycheck to paycheck, using credit cards just didn’t. I was sort of treading water. And like I mentioned, I made some bad mistakes, made some good moves. But when I learned about limiting beliefs, negative limiting beliefs, I’m like, Oh, look at that. I wonder why I avoid financial matters? Why do I Why do I avoid these things? And I was able to trace it all the way back. So pretty interesting. So I want you really advocate and encourage you to think about do I have any limiting beliefs about money? What do I think about money? How do I feel about money? And I wonder why? And try and trace it back to your earliest memories of money? Just interactions? What did your family think about money? What do they think about people with money? Did people did you have family members with money that you have family members who were in financial trouble, money cause fights, all these things? It’s going to have an impact on you. There’s no two ways about it. So what do you do? Again, you have choice, you get to choose how it is you feel about money, you get to choose cool part of our brains, something called neuroplasticity. And that just means that our brains are malleable, and how ideas Connect. They’re called neural pathways. So I see somebody that I perceive to be rich, I get angry at them, I don’t like it, I’m triggered by it. Whatever it might be. We’re able to change those pathways takes time. But we can rewire our brain essentially, to get it to do what we want it to do. So we get to choose. How do you feel about money? How do you want to feel about money? Understanding how I currently feel more importantly, I get to choose how I want to feel. And then once you once you make that decision, let’s assume that right now you’re like, Oh, I just don’t I don’t know anything about money. I’m ignorant, and I will kind of see hopefully, I’ll be able to do it. But I’m not sure. Maybe you do have a negative belief about it. Like I’m just I’m never going to be good at this. I just can’t quite get it. Okay, I advocate that you change that to a more positive, positive approach or thought process when it comes to money. Like I am going to be financially successful. Maybe I’m not not there right now, but I will be financially successful. It’s what I’m going to do I get to choose. So every time you go and start paying attention, start being a detective, a thought detective or feeling detective of your own brain, your own thoughts and feelings really think and really think spend some time examining how it is you’re thinking and feeling it just pay attention. And then you catch yourself. Ah, I just I just said I am not good at money. Nope. Not anymore. I am going to be financially successful. So notice when you’re triggered you have a negative thought, or you’re going back on the same patterns like you used to think stop yourself. Nope, that was the old me and then you reprogram you put what you want and the new me is going to be good at money is going to become financially successful. You keep doing that and over time, you will rewire your brain you will eliminate the negative belief and replace it with a positive belief. This is such an important thing. And again, you can do that same notice stuff and reprogramming everything in your life is really interesting thought exercise, it says that if you or I or anyone else, any wonderful human being, if we were walking past a body of water walking past a pond, and we saw a child struggling to swim, that we would jump into the water, and try and save them, we would do that. My question for you is this, would you extend yourself that same courtesy, when you’re struggling? When you’re struggling to swim, or whatever? Are you willing to do whatever it takes to support yourself? pull yourself out of the water, give yourself the hand up that you need. Are you do you believe that you’re somebody worth saving? Do you believe that you’re somebody worth taking care of? Do you somebody that you are you somebody that you think is worth being happy? And deserving of nice things? I think you are in terms of money. I think that we’re all worthy of becoming financially successful. I think that we all deserve to be financially successful. But we’re not entitled to it. We’re not entitled to it. This stuff takes work. It takes doing the stuff that I’ve been talking about deciding what his wealth to me examining limiting beliefs they can about what your goals are, where you want to be, and then making plans and execute on those plants. But I think that you have to, you have to accept the responsibility for it, you have to take personal responsibility, that I’m worthy of this, I deserve it. And I know that that’s not a great word. But you are worthy of becoming financially successful, you’re fully capable of it. But you need to embrace that you need to lean into it and ask yourself, Am I giving myself every opportunity and advantage to actually do these things and to be in position to do it. And we have to act accordingly to that. There will never be anybody. There will never be anybody who is more interested in your success than you are. You may want that. You may wish that the people around you are more supportive of you. But they have their own stuff going on man. We’ve all got our own race to run our own load to carry. We must carry our own load, carrier on water, shoulder, our own burden, take personal responsibility for everything in your life, but certainly for your money, and your success. So this is the starting point.

This is the starting point to you becoming financially successful, is accepting personal responsibility for it. And I know I’m talking to the right people about this. So let’s talk about the Olympic medals of personal finance. And I tell you this, if you can master these three things, this is the guarantee that I’m talking about. If you can do these three things can all but guarantee that you will be financially successful. And I make them Olympic gold medals because we’re all aware of gold, silver and bronze. And it gets pretty sticky. And I want this to be pretty sticky. Gold Medal of personal finance rule number one, pay yourself first. Pay yourself first. The opposite is if you’re in the habit of paying everybody else first waiting around to the end of the month to pay yourself. What happens. Not gonna be any money leftover for you. You will find that there is all too often more month, then there is money. And you will have put yourself on the treadmill to nowhere. You will be spinning your wheels you will be stuck. So nice of you to pay all your bills first, to put everybody else’s needs ahead of yours. Nope, nope. You put yourself first. You pull yourself out of that body of water. You save yourself. This is the time to be selfish. Pay yourself first. So I’m going to talk about how you actually do that. This is the first thing this book called The Richest Man in Babylon. And I think that’s maybe where this idea was born. But I should probably know that. But it’s so true is that if you’re in the habit of paying everybody else first there will be Nobody left no, no money left over for you. And the reality is that the vast majority of Americans do not do this vast majority over three quarters think like 80% of Americans right now living paycheck to paycheck means the broke, means they spend everything that they earn. And more often than not, especially right now, tough economic times, spending more. So spending more money than they’re earning, which means the rest of its going on credit card. So that’s like a death spiral. It’s tough to break out of it been tough to break out of it. This man right here, this great man is Chief Seattle. And Chief Seattle was the head of the Native American tribe in the area that is today, Seattle, believe it or not. And the federal government, the White House, wrote him a letter said we’d like to buy your land, cheap Seattle, Chief Seattle wrote this eloquent letter back, just talking about how he did not understand our way of life, he did not understand it didn’t make sense to him, the way that we were interacting with nature. And he said, if we were to accept your terms, accept and sell you our land, that would be the end of living in the beginning of survival, the end of living, and the beginning of survival. I remember I was in Seattle, when I learned about Chief Seattle that got this beautiful monuments to him. And on the inscription said that it hit me like a ton of bricks, and of living the beginning of survival. And it just hit me because I immediately put it in the context of, of making the transition from young people to young adulthood to being an adult, to adulting. And how, what that transition is, is when we’re kids, all we’re doing is living, waking up every waking up every day and living when we go to college, and we take on student loans, graduate, need to get a job to start paying this debt back, rent an apartment, more more expenses, lease or buy a car, more expenses. And now we’re slave to the lender. And we’ve successfully successfully moved from living to survive. For way too many of us have got jobs we frickin hate, and lives that we do not like and we’re not happy with. And that’s just pure survival. I want you to avoid that trap. A lot of traps have been laying or that have been laid for you. And I don’t want you to I don’t want you to fall in any of them. Certainly this one, debt is one of the most dangerous things. It is the killer of dreams. He got a bunch of credit card debt, a bunch of other frickin debt, stops you from making decisions, stops you from opening a business that stops you from pursuing the things you truly want. Causes you just jump on that hamster wheel or whatever carried along by what other people think is best for you don’t do that. You need to remain autonomous. So the silver medal, stand out. Stay out of debt. And I’m not saying you know, here we are. If you’re a graduating senior, or you’re already in college, and you have student loans, that is what it is, is what it is. It’s put together a plan for how you’re going to manage and pay these loans back and get out of debt. What this specifically is talking about is consumer debt also known as credit card debt. It is way easier to stay out of credit card debt than it is to get into credit card debt and to get out. So I advocate that you stay out of debt. Do not get into credit card debt. Not saying don’t use credit cards, you can use credit cards, that’s fine. Just pay them off every month. As soon as you start rolling balances over from one month to the next. You’re you’re you’re moving right into survival. And this was 100% me I was in and out of credit card debt all my through my 20s it’s just a crappy place to be crappy place to be putting happy hour on a credit card you end up paying for it for five years the form of minimum monthly payment crap like that. Paint it 20% 25% annual percentage rate the interest rate on my debt. It’s a good deal for the credit card company bad deal for me. So stay out of debt. Just don’t do it in the first place. You find yourself in debt. Let’s make a plan for getting out ASAP. Gotta stay out of debt. I remember I remember what it’s like to be a young person because there was a time when I myself was As a young person, and I know all the motivations that go along with it. I, my primary objective, as a 20, something guy was meeting girls, that was the animating driving force behind everything that I wanted to do. That’s fine. I’m glad that it was, I’m glad that I did. I’m glad I did most of the things that I did, certainly some things I’m probably not glad for, or certainly proud of. But for the most part, I did the things that that I wanted to do. And I didn’t want to be in a position where I felt like I regretted or I missed out. Because I didn’t want to get to this stage in my life and be going through some kind of a midlife crisis, where I was trying to relive my 20s and do the things that I didn’t do back then. But one day, one day, God willing, you will be a 45 year old. And when you find yourself in that position, you will be very, very glad that you took my advice today. And you were paying yourself first, you’re avoiding credit card debt. But more so than that, more so than that, that you were that you are taking a prudent and wise approach to managing your money. Because the thing about money, which you already know is that it has time value. Money has time value. And what that means is simply that the longer you wait to start pursuing your most important financial goals and objectives, the harder it becomes to reach them. If your parents had started putting away money when you were born, then you’d be in an awesome position. If you had started, when you were 15, you’d be in an awesome position. As the saying goes, best time to plant a tree was 30 years ago, next best time today. So I know it’s hard to think about when you’re 4045, it’s very old, and it is very old. But God willing, I will be 90. And the 90 year old version of me will be super glad that this version of me was putting some money away, putting a lot of money away and making decisions based on both of our good interest, best interest. So when it comes to investing, when it comes to how it is that we invest, when it comes to the approach that we take to investing, the vast majority of it should be extremely boring. Should be super boring. Why is that? Well, I tell you what, it is really hard to beat the stock market really hard.

But in order to get really, really rich, you need to take concentrated bets or risks. So how do we do both those things? Well, you do that by writing yourself a permission slip. You give yourself permission to be more aggressive with your investing, to take big swings, to place concentrated bets to buy individual stocks or Bitcoin, to start a business to buy real estate, buy a bunch of real estate, whatever. So how do I give myself permission? You do that by taking a diversified approach to the majority of your financial concerns plans. So how do we do that? What does that mean? Well, the opposite of that is what I just said, it’s buying shares of individual stocks. It’s buying, putting all your money into one piece of real estate. It’s putting all your money into Bitcoin. That is the opposite of diversification. That’s extremely concentrated. And the problem with that is it can go a couple of different ways. It can be stagnant and flat and just do nothing. It could work, you could win the lottery, and your stock or your Bitcoin could go to $1,000 in Bitcoin or it could go to zero. I’m not saying bitcoin is going to zero or anything like that. But I know that I personally have invested in many, many, many individual companies bought shares of stock and individual companies that have gone out of business. That means you lose all your money. It’s a bad place to be. And I’ve made a lot of money doing the same thing. So what I advocate that you do, is you make plans for saving and investing for all of your most important financial goals and objectives. Retirement down payment on a home children’s education. You should be funding those goals, investing in low cost, well diversified boring investments, things called index funds. Very, very low cost index fund investing. The best example of an index fund is the s&p 500. s&p 500 stands for Standard and Poor’s 500. So what that means is you buy it, you can buy a share of the s&p 500. And that means you own a small piece of the 500 biggest companies in the stock market. All right, cool. How much does that cost? So a share of the s&p 500. I don’t know exactly what it’s trading at today. But the ongoing cost of it is essentially free, you can actually buy shares of the s&p 500. And you buy a share of it, let’s say it costs $100. So you own one share. And there’s no or very, very minimal cost to actually own it. So it’s almost like these days buying a stock. So you buy the share of a stock. But you don’t have to pay to have somebody manage it on your behalf. It’s very, very, very low cost. And you get the same return that the stock market gets, which over time, has been a really, really successful and winning strategy. So taking a diversified approach, that means whatever your financial goals and objectives are, and I’m going to talk about time horizon in just a minute, that instead of trying to hit homeruns, with all of your investing, make sure that you are fully funding your retirement. Okay. So let’s say that you want to retire at 65. So you have, and you’re 25 years old, so you have 40 years to be saving. And let’s say you want to have $3 million when you retire at 65, say okay, I’ve got 40 years, how much do I need to be saving every month, right now, in order to make that happen? Then you figure out, okay, I need to save $500 a month. And then you invest that money in a low cost. index fund could be a mutual fund, or an exchange traded fund, they’re essentially the same thing. And within your 401k, those are essentially going to be the options that you have. But when it comes to investing in a brokerage account or something like that, again, figure out what your main priorities and objectives are, and the fair how much I need to save today. And then be investing in well diversified vehicles. Once you’ve done that, then you can let it rip, go buy shares, stock, small, small cap stocks, small companies, go buy bitcoin, or buy Dogecoin, whatever. But don’t, don’t get that twisted. Don’t put all your money in speculative stuff. Because if it goes sideways, you are losing out in the time value of money. So make a lot of your investing really, really, really boring. So if you’re able to do these three things, pay yourself first. Stay out of debt, take a diversified approach. You write your own ticket, really almost guarantee it. So let’s talk about some steps to success. So how are we actually going to make all this happen. So step number one, leaving here today, you’re graduating the vast majority of Americans again, we’re not doing well with money, but they don’t have $500 in cash. So I want you to first step first step is to get the $1,000 saved up as the beginning of your emergency fund. So 1000 bucks, you needed to be in an account that is separate from your everyday checking account. So open up a savings account should be free with whoever you’re banking with. And work to bid to put $1,000 into that however long that takes you. That’s the first step. Step number two is pay yourself first. So we do that in a couple of different ways. You can certainly by saving $1,000, you’re paying yourself first you’re doing that. You can also if you’re working at a company that offers a 401k you enroll in the 401k as soon as you possibly can. Okay, so that’s a perfect way to pay yourself first, because what happens is, you enroll in the 401k, you get your paycheck, your contribution to the 401k goes into your 401k before the money hits your checking account, you automatically pay yourself first. So that’s a really powerful thing. All at a time, your company will offer you some kind of a match a 401k match. It’s really important that you understand how much you need to contribute in order to get the full match and work to get to that amount as soon as you possibly can. Okay, so if they match 100% of your contributions up to 3% that means if you put in 3% they’re also going to put in the same amount that 3% So you’re not now you’re putting 6% away. So that’s awesome. Okay, so you need to understand that enroll in your company’s 401k As soon as you possibly can start putting money in. If you’re not with a company that offers a 401k, you should open up an IRA or an individual retirement account, and begin funding it. And you can just set up a direct deposit the first of every month, so that your contribution goes into your IRA. So you pay yourself first that way. So that’s how you do it, you want to automate this as much as you possibly can. So as part of all of this, we need to be tracking our cash flow, we need to be knowing having a personal budget, which we could talk about more at some point, we need to get one month’s worth of expenses saved. So this is our emergency fund, we need to have cash on hand because things happen. And we don’t want to be caught off guard when these things happen. So you need to know what your budget and your cash flow how much your monthly expenses are. And then you want to get to one month. Next step, once you’ve done that, and that can be a while, it’s probably going to be a good amount of money. That if you have credit card debt, I want you to eliminate consumer debt. So once you get one month’s worth of expenses saved up, start directly attacking aggressively attacking any consumer debt you have. Next, I want you to get to two months, because you already have one month’s worth of expenses saved up, then three, then four, then five, then six, I know that those words leave my mouth really easily a lot harder to do, than I think a lot of us realize. But once you have that, once you’ve got, you’ve eliminated credit card debt, you’ve got six months worth of cash, in the tension, leave your shoulders take a deep, deep breath, you’ve got financial peace of mind, that that’s really up. And then from there, once you’ve done those things, you’re really positioned for success, you’re ready to go start saving and investing. If you can save 15% of your pre tax income, you can start doing that immediately. That really, that really sets you up for success long term, I can almost guarantee. Okay, so

that those are the steps to success, where I advocate that you get to as soon as you possibly can support it take into consideration time horizon, short term time horizon zero to three years. So that’s our emergency fund, and any other things that are coming up and you will vacations, and you’ve got mid term, so four to 10 years. So that could be buying a house, it’s a common want. So let’s figure out how much house you want to buy how much you need to save for a down payment, start working to save that, and then long term is 10 years plus, it’s going to be your retirement, traveling stuff like that. Okay, so keep it in time horizon in mind and then finding the right account for whatever it is you’re working to accomplish. You need checking accounts and savings accounts immediately for your daily spending, and then your emergency funds. So your savings account, then for your retirement. If you have a 401k at work, you should enroll in it. You don’t you should open up an IRA or individual retirement account. You can do that at companies like Fidelity or Charles Schwab. And then also you can open up a taxable brokerage account. So commonly when people think about a brokerage account, you’re thinking about companies like Fidelity Schwab Vanguard, Robin Hood, and acorns are two of the financial startups that are very, very popular, I would greatly encourage you to avoid those for a million different reasons. But, and that’s really because they’re encouraging more activity, because those companies make more money when you trade more. And from my experience, trading a lot is a good recipe for losing a lot of money. So open up a brokerage account, fund it, but do it with a company like Fidelity or Schwab Boring, boring is good, you can still buy whatever you want. But I don’t want the interface to be like Tik Tok or social media where you’re going to be on there all the time and making transactions that getting rich. So you’ve got to track your cash flow. It’s really easy these days, once a month, review all the cards that you spend money on your checking account, your savings account, any credit cards you’re using, look at all the expenses and just need to be looking at it. Keep a budget. So important, very low chance of being financially successful if you don’t budget. And then I want you to hold a monthly money meeting where you look at your cash flow, review your budget, look at all your accounts, Track, track your goals, just review it all. So you want to keep it top of mind. Do not put your head in the sand on this stuff. So I want you to make it real. So in taking ownership of your finances, I want you to be honest with yourself. Got to start paying ourselves first because money has time value. The sooner you get started, the easier it’s going to be. Get out of debt. Do that by staying out of debt. And then take a diversified approach. You’re de risking your retirement. If all your money is in high, highly risky stuff, you are walking a tightrope. I hope it works out for you. But more often than not, it’s probably not so that’s how we’re going to do it. You can get the Herbers book for free, get a PDF copy of it, or you could certainly buy it. But I encourage you to do that. During the podcasts, the aligned money show is one of my podcasts I talked about. So would be great. If you would check that out. If you’re interested in saying thank you, for my time, if you could subscribe to the show, that’d be great. But more so if you can leave a review, leave a positive review for me, that would help the show grow as well, I’d be super grateful. Finally, finally, finally, finally, the term is Let’s go. It’s not I go. So I’m here to help you get further along on whatever it is that you want. I want you to get what you want. I really I honestly do. So whatever help you need. Don’t, don’t keep things a secret. If you’re struggling with something, be honest. There are people around that want to help you that want to support you. You’ve got all the resources, it’s let’s go it’s not I go. So lean on the people around you to help you. All right. I really appreciate you taking the time and investing that hour with me. Hopefully you found value in it. You know my contact information, you go to money alignment academy.com and find me there, check out the aligned money show. Check out everything else I’m working on. And again, friendly reminder, never going to be anybody more interested in your financial success than you are. So act accordingly.

 

 

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