What I would tell my younger self: If only I knew what I know now about money…
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| Go ‘Back to the Future’ to pass down finance knowledge! |
Kurt Vonnegut: “Of all the words of mice and men, the saddest are, “It might have been.”
My wife and I are really grateful that we were able to retire early and reach financial independence at the age of 51 and 48. Don’t get me wrong. It was a difficult thing to do, to have the willingness to forgo wants, to sacrifice the now for a better tomorrow, and to push through our own doubts about whether or not we were doing the right thing.
In the end, it was definitely well worth it! Not needing to go to work I didn’t enjoy, has reduced most of the stress from my life. I wouldn’t change anything right now. We’re happily retired and doing the things we always wanted to do, namely, traveling and spending more time with family.
It got me thinking though. What if I had a time machine, like the DeLorean from the movie “Back to the Future?” What would I tell my younger self? Would that equal even earlier retirement and reaching financial independence earlier?
In this post, I’d like to share my thoughts on the things I would tell my younger self. In doing so, I hope this post helps others to focus on what needs to happen to reach financial independence and to retire early.
I think everyone can relate to the general premise of telling your younger self and to impart knowledge you now have, to your younger self. I always ponder what would’ve happened if I had invested earlier, say age 22, rather than at age 35.
Everyone probably wonders what would’ve been if they had purchased stocks of big companies like Apple, Microsoft, and Amazon, when they were just starting out. Wow. It makes me happy just thinking about it, but it’s followed immediately by regret, at not doing just that…
Living to be 50 years of age has imparted in me knowledge of things I’ve learned through my personal experiences and of my own learning. Honestly, I still can’t believe I’m 50 years of age. When I was in my teens, I thought 25 years of age was old. I couldn’t see myself at 25, let alone 50 years of age at that young age…
I may not have the youth or the energy of a teen anymore, but what I do have now, is knowledge about life, and most importantly, about money. Some of you may wonder what’s more important. Is it knowing about life or knowing about money?
I’m a firm believer in knowing about money, as we’re currently living in a capitalist society in the United States. If we were an indigenous people living in the Amazon jungle, then the concept of money, would be utterly useless.
In a capitalist society, knowing about money and having money will make your LIFE that much more easy. To have money means YOU have options if things happen. If you get laid off from your job, you can plan a new career, or retire, if you so choose. If your car breaks down, you can replace or repair it.
I would argue most things we have to deal with as we become adults, are made easy if you have money. Having money and knowing money means you control TIME. If you’re financially independent, you can choose to work to make more money, or choose to retire to spend time how you want to spend it.
Money is what most married couples fight about. Money is omnipresent in our everyday lives. We need money to put a roof over our heads, we need money to eat, and we need money to get to work so we can get paid. Clothes require money, many entertainment options require money. Mundane things like the internet, utilities, and personal grooming products also require money.
Although some things like love, enjoying nature, enjoying time spent with family, reading, doesn’t require money, most things do…The bottom line is that it’s better to know about money and have money in the world we’re living in.
With that introduction out of the way, let’s take a look at some of the finance related things I would tell my younger self.
- Don’t spend every dollar you earned on your unreliable sports car!
- Don’t spend so much on everything else…
Same for movies. I initially bought VHS tapes, then DVD’s. It would then be replaced by Blue Rays. Aarrgghhh! This all equaled less money in my pocket.
Clothes! So many clothes! I tried to keep up with the times. When Hong Kong’s ‘Heroic Bloodshed’ movie genre came out (A Better Tomorrow, The Killer, Hard Boiled) thanks to John Woo, I had to buy a long coat worn by main characters in those movies.
When Sony Walkman came out, I had to buy something similar. Things I bought never stopped…Every dollar I had, went to buying things and eating things…Savings? What’s that?
After I got married, I shouldn’t have booked that all-inclusive Cancun trip on credit card, but I did. Eating out was our ritual on weekends to treat ourselves and to alleviate all the stress from our jobs.
I would tell my younger self to do one of the most important things in life which is…
- Budget, budget, and budget!
- Use the money spent on our huge wedding reception on a down payment on a condo instead
- Don’t be afraid of the stock market
- Have interest in investing and retiring early
I would’ve said to my younger self to have interest in wanting to retire early and to learn about investing.
- Don’t cash out your 401k twice!
- Use company sponsored retirement accounts like the 401k to your advantage
In conclusion:
There are so many things I’ve learned about money and life after living on this earth for the last 50 years or so. There are so many ‘what ifs’, ‘could’ve beens’, ‘should’ve beens’, and ‘would’ve beens’ to fill the entire post, but it’s too late for me. I can’t, unfortunately, magically take a time machine to go back and talk to my younger self…
What I hope to see is for our nieces and nephews (and our readers to this blog) to learn from my mistakes and to diligently learn about money.
Regret is too common for too many people as they reach their retirement age. Many regret not saving enough money. Don’t be that person. Be proactive and seek out knowledge from various sources to learn about investing and wanting to retire early and to be financially independent.
No one else will do it for you…
I wish you the best of luck in your path to financial independence and to retire early!
Thank you all for reading!
Jake
Wandering Money Pig
If you missed the post ‘What’s it like to hand in your resignation...’, please click here.
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