Make a million dollars … (8th May 2019)

Sounds great right? Well let me start this off by bursting the bubble, having a million dollars won’t make you any happier. We’re creatures of habit, and however you’re living your life now is most likely the same as if you had more cash. Your environment and material possessions might become more luxurious. While everything else will pretty much stay the same.

Please don’t wail that the extra money to buy nicer things WILL make you happier, I think we can both agree enough studies have been carried out to prove new cars/clothes/bigger flashier houses only bring a fleeting happiness to the consumer.

A wise man may now ask, ‘Well what’s the point in trying to make a lot of money if it won’t make me any happier?’

Great question.

Here’s the answer… If happiness is your objective there is no point.

You have an abundance of happiness to tap into any time you want. A reservoir that will never dry up. All you have to do is learn to meditate, quieten your mind and you’ll feel a blissful state that no amount of money can compare with. Present moment living doesn’t cost a penny.

Then of course comes the next question, ‘Well if money won’t make me happier then why bother making money at all, let alone a ton of it?’

Clearly this question has an obvious conclusion, unless you’re a foraging monk living life in the wild, we all need money for food, shelter and to do the things that keep life interesting and entertaining.

Once these things are covered a surplus of money won’t really make much difference, but there is a bonus. Once you’re making more money than you need you can then start investing it wisely to make passive income, and passive income = freedom.

More freedom is the closest you’ll get to happiness on a material level, but it’s still unnecessary. As a guy in his thirties on the brink of making his first million I can conclusively say the extra cash and the freedom it brings is simply a perk and certainly doesn’t fulfill me in any way.

Spending time with friends and family/loved ones, reading, playing sports, these things cost nothing and are way more fulfilling than any bank account balance.

‘Ok ok, you’ve convinced me, but I still want to make a million just for the fun of it,’ I hear you say.

Great! Why not! It won’t make you happy but you do get a nice little buzz from building a business and watching it grow, or having the self restraint to invest wisely and be patient as it accumulates

At this point I can only elaborate on what’s worked for me. I’m not a financial advisor or some get rich guru, but the single best piece of advice I can offer is this…

Save to invest as much as possible, spend as little as possible.

I’m sure many people would argue ‘their’ way is better. In some cases I’m sure they are right, there’s something to be said for taking big risks, or having a sickening work ethic to hustle and grind eighteen hours a day every day for years and years and years. Which is great if you are super passionate about your work and it brings you joy to be working so much.

My goal was different. I wanted the money to do the things I enjoy in life but I also wanted the freedom. Again, let me clarify that having more money hasn’t made me happier. It’s simply allowed me to have more options with what I choose to do with my time.

Taking the freedom lifestyle route to financial riches is certainly no quick fix. If you’re not willing to work long days every day then instead it’s going to take time, patience, and a lot of will power.

Let me give you an example…

There are many options of how to invest money to make money but in this hypothetical experiment we’ll use diversified index fund shares, arguably the safest way to invest.
The shares themselves will fluctuate each year, but because we want to enjoy our freedom without working ourselves into an early grave it means we’re in this for the long haul, so the fluctuations aren’t as important as the long term average percentage increase on investment, which in this case is 5%.

This means if you invest as little as $550 per month from age 20, you will reach millionaire status within 45 years when adding in compound interest to the equation.

That’s not bad. It’s also not to much of a strain on the old will power muscle. I’m sure most people can resist the temptation to spend all their earnings and instead put aside $550. I’m not saying it will still be easy, if you’ve made the mistake of working for somebody else instead of avoiding getting a job you will most likely have to make sacrifices on your spending. Maybe taking cheaper annual vacations rather than the all inclusive lavish ones.

For the more entrepreneurial you’ve (hopefully) got more to save as well as a little more to spend. In my case I seen college and university as a waste of time. I knew from a young age that I wanted freedom with my time, but it still meant working hard. After following the classic societal programming of getting a job and working for other people I realised early on that it would never allow me the resources to have freedom with my time. So I looked for opportunity elsewhere, and seeing a niche service to offer to people I set up my first business at 19.
I worked almost every day and night for three years to get the business to the level I wanted it, saving as much money as I could. At that point I bought my first property. The formula I followed ever since has been the same – save to invest as much as possible while spending as little as possible. Rather than investing $550 per month I was earning enough to invest more than four times that. Choosing mainly to invest in buying more properties which give a higher percentage return on investment when occupied as rentals. As well as the added bonus of the assets appreciating over time, the passive income received got added to the amount invested.

Maintaining a minimalist lifestyle while investing sometimes up to 80% of my overall income meant I was able to reduce my working hours dramatically. I’ve been accused of sometimes taking it a little to far with frugality, I don’t drive a flashy car, nor do I care too, I still fly economy most of the time, and I still buy high street brands over designer, but I actually get a kick out of resisting buying unnecessary things in my life. It doesn’t stop me being generous, hopefully those same accusers would also agree I’m happy to spend when it comes to buying things for the people close to me. Occasionally I’ll treat myself too, I usually do this when I’ve achieved some monumental goal or pushed my boundaries in some way, I think it’s important to reward yourself at these times.

The important thing here is to play to your strengths. As a kid I had three paper delivery rounds and at fifteen was already saving to buy my first car. Thankfully I had parents that taught me the value of money and so saving came naturally to me, but ask me what’s a good product to buy and sell, or how dropshipping works and I’m pretty clueless. Yet I have friends making fortunes in this way, so it’s all down to knowing your niche and what you’re good at.

Whichever route you choose I believe the most important thing is to be having fun along the way. Life is way way to short to not be doing the things that excite you and put a smile on your face each day.