Use Your Finances Aggressively When You’re Young

Just got back a couple days ago from a weeklong trip to the Dominican Republic. I would’ve updated you sooner, but I’ve had World War III occurring in my stomach since eating some bad airport food 😉 I’m finally starting to feel better so I thought I’d shoot you a blog post.

Being that I just got back from the Dominican Republic and am on the road again to Dallas in a few days I thought I’d share with you today one of my favorite philosophies. I call it living on thin margins and aggressively investing your resources.

The inspiration for this blog post came from people constantly asking me how I’m affording all my travel this year. My parents don’t pay for my travel expenses and I just turned 18 years old. How the hell does a teenager get the money to graduate school early, and leave for a three month trip to Asia?

The secret? Cutting out all the nonessentials out of your life and aggressively investing your resources. For several years this has been a cornerstone in the way I live my life. The thing you’ve got to understand is that if you want to get ahead of the pack, doing it while you’re young is hands down the best time to do so.

You (presumably) have low recurring bills, because your parents are covering the majority of your expenses. Unfortunately, the problem with most teenagers is that they’re too dumb to realize this isn’t going to last forever.

You can’t be like most teenagers though. Remember, everybody wants the good life, but not everybody gets it. If you want a life that’s extraordinary you can’t take an ordinary approach.

What’s the ordinary approach most people take? Frivolously spending their money on shoes, fancy electronics, and other things they don’t really need.

The thing you’ve got to realize, however, is that material possessions don’t amount to increased levels of happiness. Well, at least sustained levels of happiness. The minute an expensive toy stops being a novelty you’re back to square one, only with $200 less in your pocket.

So what should you do? Invest in experiences. The reason I’m spending my money on a half-dozen trips this year is science has shown that experiences and memories are the things that produce lasting happiness in your life.

In a year when you’re expensive jeans are torn and unwearable they’re no longer going to contribute to your happiness, but in a year when I think about the memories I shared with the people I met in the Dominican Republic you can bet a smile will still come to my face.

OK, fair enough. Material possessions typically stop making you happy once their novelty wears off, while experiences tend to lead to more sustained happiness. You’re saying I should avoid consumerism. I can agree with that. But what I don’t agree with is you saying I should spend the majority of my money on experiences. Wouldn’t the best choice be to simply save all my money?

No, and I say no for a few reasons. The first is that life is short. You never know when you’re going to die. There’s too many people who have been tricked into saving all their money for retirement only to pass before they made it, or to reach retirement and realize that they were too old to do the things they’d always wanted to do.

You don’t have to be like Lil Wayne and live completely YOLO. A lot of lives have gotten destroyed that way as well, but like most things a balanced approach tends to lead to the most fruitful life.

The second reason I recommend against investing significant amounts of your money in the market is that while you’re young there’s a far better place for you to invest the majority of your money. It’s called your brain.

Although cutting expenses, and saving your change is an admirable approach to creating a secure financial future there’s an even better way. Increasing your income!

Like Bill Gates says, “The more you learn, the more you earn.” Investing in your education (which could mean college, but doesn’t necessarily) will greatly increase your ability to create generous streams of income for yourself.

Can you conceive of a reality in which reading books, spending money to attend conferences in your field, and traveling to meet your mentors wouldn’t pay off? If you’re an active thinker and are willing to take massive action the resources you invest into your education will pay off one-hundred-fold.

Perhaps the biggest reason I recommend you aggressively use your finances while you’re young is that doing so will allow you to attract better people into your life. Sure, you can work at your mediocre job scrounging together a dollar here and a dollar there, but do you think that’s going to attract great people into your life?

The person you want going to war with you probably isn’t your coworker at Wendy’s. You want the people who are going to hustle their asses off and push you to do the same. Unfortunately, these people may not be in your city or even your country. I’ve found two great people I want to work with, but one is currently traveling the world as a digital nomad while the other is in France.

It’d be great if they’d come to Wisconsin sometime, but the reality is that if I want them in my life I’m probably going to have inconvenience myself and fly overseas to meet them.

You’re probably going to have to inconvenience yourself in some way to meet the people you’d like to as well. Whether that means traveling to another country, paying for someone’s time to coach you, or doing bitch work to get someone to mentor and invest in you. Whatever the cost, DO IT. As the saying goes, the quality of your life is proportional to the five people you spend the most time with.

While you’re young you can expend significant energy and resources meeting these people that’ll push you to be the best you can be and show you ways to increase your income. This is the active thinker and hustler approach to life. If you’re willing to take massive action this is probably the path for you.

Otherwise, you can cut costs, and skip your morning latte hoping to scrounge together a dollar here and a dollar there to one day have enough money to be financially secure. This is the passive thinker approach for one that is uncomfortable with any uncertainty in life. Unfortunately, for the majority of people in life this is their best option (It still beats throwing money away at useless material possessions).

What I’d recommend you do is identify what type of person you are. Are you willing to hustle? Are you able to think creatively? If so there’s a good chance you’ll want to invest your money going to conferences, and traveling to meet the people you want to go to war with.

If you’re not willing to hustle and live aggressively then fuck off. Get used to associating with mediocre people, and living a mediocre life. The world is crazy, but it’s not a crazy enough place to give you something you don’t deserve.

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If you enjoyed this post consider picking up a copy of Richard Branson’s Losing My Virginity. It’s a great book that is centered around the same line of thought.

(Pictures from January 2015 in the Dominican Republic.)

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