I keep reflecting on how incredible 2024 was. With the S&P 500 up 23%, Bitcoin surging, and residential real estate climbing in most of the country, personal finance enthusiasts have had an amazing year. The investment gains almost feel like free money\u2014and who doesn\u2019t love getting something for free? With the return of volatility, we must practice gratefulness.<\/p>\n
If you read Financial Samurai and subscribe to my free weekly newsletter<\/a>, there\u2019s a good chance you\u2019re a personal finance enthusiast. Instead of spending eight hours watching sports over the weekend, you might find reviewing your net worth allocation<\/a> and optimizing your investments far more entertaining. How unique and lucky.<\/p>\n Back in March 2020, when pandemic lockdowns began, if someone told me that five years later the stock market would be up ~85%, real estate up ~30%, and Bitcoin up over 1,000%, I\u2019d have had a hard time believing it. Sure, I was bullish on asset prices at the time, writing posts like How To Predict The Stock Market Bottom Like Nostradamus<\/a><\/em>. But I wasn\u2019t that<\/em> bullish.<\/p>\n Yet here we are, so much wealthier! By staying engaged with our personal finances, chances are high your net worth is near or at an all-time high. With investment gains far exceeding historical averages, we have significantly outperformed the masses who don\u2019t take an active interest in building wealth.<\/p>\n <\/p>\n Here are seven reasons why I believe those who religiously dive into personal finance books<\/a>, sites, and podcasts create more luck and live better lives than those who don\u2019t. Of course, we’re not always going to get things right. Mistakes will be made. Money will be lost. However, our million-dollar mindset is what sets us apart from the crowd.<\/p>\n As personal finance enthusiasts, we\u2019ve studied the history of bull and bear markets. Bear markets, defined as a decline of 20% or more in a major stock index like the S&P 500, occur roughly every\u00a04 to 6 years\u00a0on average. When they do occur, the last for about 9.6 months on average. Knowing that neither lasts forever keeps us measured during both the worst and best of times.<\/p>\n We\u2019re also less prone to FOMO<\/a> that can derail less informed investors. We understand how to properly allocate assets based on our risk tolerance. We usually avoid taking unnecessary concentration risk or leverage that could blow up a portfolio.<\/p>\n In real estate, we negotiate smarter deals and follow sound purchasing guidelines<\/a> that maximize joy while minimizing financial stress. Writing real estate love letters<\/a> to make a connection and learning how to skillfully negotiate terms becomes second nature. <\/p>\n When it comes to retirement planning, we have clear net worth targets by age<\/a> to keep us on track. We enjoy running withdrawal rate simulations to ensure long-term financial independence. By preparing for \u201cwhat if\u201d scenarios and learning from the success stories of others, we approach life\u2019s uncertainties with confidence. For instance, having a plan for market downturns allows us to stay calm while others panic-sell at the bottom.<\/p>\n This level of understanding makes us better equipped to deal with both external shocks, like a pandemic, and personal challenges, like a job loss or unexpected medical expense.<\/p>\n We recognize that economic challenges\u2014such as inflation, job loss, recessions, accidents, and divorces\u2014are inevitable. Yet, we remain steadfast in our belief that we will overcome them.<\/p>\n Take inflation, for example. We recognize that inflation is both an adversary and an ally. By investing heavily in inflation-hedged assets, like stocks, we not only neutralize its negative effects but also profit from it. <\/p>\n When the 10-year bond yield dropped to 0.51% in 2020, homeowners refinanced at record-low rates, with 30-year fixed rates averaging just 2.7%. Some of us used that opportunity to buy homes before prices skyrocketed starting in late 2020.<\/p>\n Now, with bond yields around 4.5%, we\u2019re earning meaningful risk-free returns on cash. For those of us with low mortgage rates, it feels like we\u2019re getting paid to live in our homes! <\/p>\n The knowledge we gain as personal finance enthusiasts equips us to better handle economic challenges. Whether it\u2019s renegotiating vendor contracts in a business, rebalancing portfolios, or simply adjusting household budgets, we remain proactive rather than reactive.<\/p>\n By saving and investing more than the average person, we\u2019ve bought ourselves incredible optionality. When your investments generate more income than your job<\/a>, work becomes a choice, not a necessity.<\/p>\n Imagine no longer needing to chase promotions or work overtime to justify raises. You can say goodbye to 6 a.m. calls or Sunday travel to make a Monday morning meeting and still enjoy financial security. How wonderful to feel more free.<\/p>\n If you\u2019ve reached at least 25 times your desired annual living expenses in investable assets, you could even retire early and pursue your passions stress-free. Better yet, as savvy finance enthusiasts, you know how to negotiate a severance package<\/a> and enjoy unemployment benefits while transitioning to your next phase. Most people just quit with nothing due to fear and a lack of understanding.<\/p>\n Optionality extends to your career as well. Personal finance fanatics are often more willing to take calculated risks, like starting a business<\/a> or pivoting to a completely new industry. Knowing that you have financial security gives you the courage to explore paths that align with your interests and values. Financial security also enables you to be your true self.<\/p>\n If you end up, marrying a personal finance enthusiast, you might not have to work very long at all! <\/p>\n Parents always worry about their children, but personal finance enthusiasts worry less because we plan more.<\/p>\n We\u2019ve locked in affordable life insurance policies, set up death files<\/a>, superfunded 529 plans<\/a>, and created revocable living trusts<\/a>. My wife and I found tremendous peace of mind after securing matching 20-year term life insurance policies during the pandemic through Policygenius<\/a><\/strong>.<\/p>\n Beyond that, we prepare for rising college costs by exploring financial aid options<\/a> and funding custodial investment accounts and Roth IRAs for our kids early on. By teaching our children to contribute earned income to these accounts, we foster both a strong work ethic and financial literacy.<\/p>\n Some of us go even further by building rental property portfolios or side businesses to provide career insurance<\/a> for our children. If they graduate without job offers, they\u2019ll have a safety net\u2014and maybe even a job in the family business.<\/p>\n Once you achieve enough wealth, the goal becomes enjoying it for as long as possible. The longer you live, the more you win. Personal finance enthusiasts often prioritize healthier food choices, better exercise routines, and reduced stress.<\/p>\n During my 13 years working in finance, I suffered from chronic lower back pain, TMJ, and sciatica. Within six months of retiring, all my pain disappeared and my hair stopped graying. It was then that I finally realized that constant discomfort shouldn\u2019t be normal.<\/p>\n Beyond the physical, financial freedom enables us to focus on mental well-being. We can afford therapy, wellness retreats, massages, or even simple joys like daily walks without the rush of a strict schedule. We develop hobbies that promote longevity, such as hiking, gardening, or yoga with friends. When you don\u2019t have to stress as much about money, it\u2019s easier to lead a healthier lifestyle.<\/p>\n The health benefits of retirement are priceless<\/a>. Toward the second half of your life, you will better appreciate how short life really is. By getting our finances right, not only do we have a greater potential to live healthier, but we might also extend our life expectancy.<\/p>\n Because we understand that money is interconnected, we\u2019re constantly spotting new investment opportunities. If AI development becomes cheaper, companies with massive customer ecosystems that have been slow to invest should benefit. If a recession hits, bond prices will likely rise, leading to lower interest rates and stronger demand for real estate.<\/a><\/p>\n As derivative thinkers, we always ask:\u00a0What opportunities could arise from a challenging situation?<\/em>\u00a0We seek out problems to solve or invest in companies that are solving them. With a positive bias, we focus on the upside.<\/p>\n One of the reasons I allocate a portion of my capital to venture capital<\/a> is the opportunity mindset entrepreneurs must embrace to succeed. As a solopreneur myself, I know you have to be a little crazy to believe you can beat the odds in a highly competitive landscape. But you do it anyway\u2014because you\u00a0have<\/em>\u00a0to.<\/p>\n Personally, I\u2019m investing in private growth companies like Anduril, Databricks, OpenAI, Anthropic, Canva, and more through Fundrise<\/a><\/strong>, a Financial Samurai sponsor. When I see other entrepreneurs building and scaling great businesses, I can\u2019t help but want to invest in them over the next decade. <\/p>\n Personal finance enthusiasts keep pushing forward, no matter what. If we fail at an endeavor or make a losing investment, we learn, adapt, and try again\u2014this time smarter and more efficiently.<\/p>\n We recognize that the journey itself is more rewarding than the destination. Because once we reach a goal, satisfaction is fleeting, and we inevitably seek the next challenge. While this mindset can sometimes lead to unhappiness, it also teaches us to appreciate the process and find fulfillment in the pursuit.<\/p>\n We never fail due to a lack of effort\u2014because effort requires no special skill, just determination. As a result, when we do fail, we can accept it with peace of mind, knowing we gave it everything we had. Sure, losses will sting. But not nearly as much as for those who half-assed it\u2014because they\u2019ll be left with something far worse than a sting: the weight of regret<\/a>.<\/p>\n Given the immense benefits, I\u2019m genuinely surprised more people don\u2019t embrace personal finance. Yes, the topics might not be as exciting as your latest reality TV drama. Yes, downturns and calamities will happen, but with our knowledge and experience, we always have hope\u2014and the tools\u2014to grind our way back.<\/p>\n Once you master your finances, you\u2019re not only more confident and secure but also less envious of others\u2019 success. You\u2019ll likely find yourself being kinder and more generous because financial stress no longer weighs you down.<\/p>\n Perhaps the barrier lies in perception. Some see personal finance as dry or intimidating. But as those of us in the community know, it\u2019s anything but boring. Personal finance is a gateway to freedom, adventure, and a life filled with options.<\/p>\n So, here\u2019s my hope: that more people discover the joys of personal finance. Luck doesn\u2019t have to be left to chance. By taking control of our money, we take control of our lives\u2014and that\u2019s the greatest gift of all.<\/p>\n Readers, why do you think there aren’t more personal finance enthusiasts? Given so much information can be obtained online for free or at a low cost, why don’t more people get obsessed with their finances to build more wealth and gain more freedom sooner?<\/em> What other types of million-dollar mindsets can you think of? <\/em><\/p>\n If you want to build more wealth and create a life filled with opportunity, pre-order your copy of Millionaire Milestones: Simple Steps To Seven Figures<\/a><\/strong>.<\/em> This book will show you how to achieve financial freedom and live life on your own terms. Take control of your future! Order a copy on Amazon<\/a><\/strong> or anywhere you buy books.<\/p>\nHow Personal Finance Enthusiasts Build Their Own Luck<\/h2>\n
Million-Dollar Mindset #1: More Optimism, Less Worry <\/strong> = Better Mental Health<\/h3>\n
Million-Dollar Mindset #<\/strong><\/strong>2: Find Solutions To Economic Challenges = More Belief<\/h3>\n
Million-Dollar Mindset #<\/strong><\/strong>3: Find Ways To Create Work Flexibility = More Freedom<\/h3>\n
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<\/a><\/figure>\nMillion-Dollar Mindset #<\/strong><\/strong>4: Diligently Plan For Our Children’s Futures = More Hope<\/h3>\n
Million-Dollar Mindset #<\/strong><\/strong>5: Strive To Live A Healthier Lifestyle<\/strong> = Higher-Quality Life<\/h3>\n
Million-Dollar Mindset #6: Find Opportunities in Every Corner = Greater Wealth<\/strong><\/h3>\n
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Million-Dollar Mindset #7: Never Give Up = Greater Satisfaction<\/strong><\/h3>\n
Shocked More People Aren\u2019t Personal Finance Enthusiasts<\/h2>\n
Order A Copy Of Millionaire Milestones<\/h2>\n
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