Set for Life

Set for Life

Perfect for: Introduction to Financial Independence; roadmap to achieve Financial Independence

Length: 236 pages

Depth: Inspires heavy self-reflection about lifestyle choices. So light for some, heavy for others.

About the Book

The Basics:

The book is broken down into the 3 stages of your financial life. The first stage focuses on how to reduce the cost of your lifestyle and save more money. The second stage explains how you can start taking more financial and career risks once you have a bit of a safety cushion built up (accomplished via stage one). The final stage discusses how to use your accumulated wealth from stage one and two to generate passive income.

All the Feels:

Excited to pursue financial independence more aggressively.

I live modestly and contribute heavily to my retirement accounts. However, to achieve financial independence at an early age, I have to do more. I have to continually find ways to reduce my lifestyle expense. I have to pursue investment strategies which produce usable cash flow today, not just 40 years from now.

 

My Main Takeaway(s):

Saving a dollar is more powerful than earning one. Every additional dollar you earn is taxed, so you only keep around 70 cents. If you make a lifestyle change that saves a dollar, you keep the full 100 cents.

Variable expenses (entertainment, travel, etc.) do not make up a large percentage of your monthly spending. Focus on reducing your largest monthly expenses (housing, food, transportation/commuting).

House hacking (buying a residence and renting out the other units/bedrooms to cover the mortgage payments) can provide a massive wealth boost. Renting an apartment or purchasing a single-family home are far less beneficial to building long term wealth.

If you never take a risk, you will never be rewarded. Climbing the ladder at a corporate job for 40 years puts your income at the discretion of the managers above you. Your income is less volatile, but it is also capped. Taking a role where compensation is tied to performance (commissions, bonuses, etc.) gives you more control over your potential earnings (for better or for worse).

Don’t waste countless hours trying to beat the market when you don’t have massive nest egg. If you are only investing $10,000 then an additional 1-2% return will not be life changing. You are better off dedicating those hours to other assets/investments such as real estate.

Disclosure of Material Connection: Some of the links in the page above are "affiliate links." This means if you click on the link and purchase the item, I will receive an affiliate commission. I am disclosing this in accordance with the Federal Trade Commission's 16 CFR, Part 255: "Guides Concerning the Use of Endorsements and Testimonials in Advertising."

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