- in Mindset
I’ve been reading books and blogs about personal finance for years.
The advice and perspective runs the gamut. Some are extreme savers. Some are real estate gurus. And some just want to travel. But there is one thing all people who hit financial independence early in life have in common.
They Have An Intense Focus On Value
What do I mean by an intense focus on value? Early retirees find it painful to waste money.
- They look around at a world in which people making $40,000 per year are buying new $50,000 pickup trucks using finance, and they find it preposterous. Weird.
- They see their friends blow $300 in a night at a bar and wonder why they didn’t just party at home for one-tenth the price.
- They quickly figure out that playing the frequent flyer points game will yield huge value and help them avoid paying $2000 to get to Europe and back.
- They think through the value of their education and avoid burying themselves in debt where possible.
- They know that an index fund will beat a mutual fund with a 4% load almost every time.
- Even when they have a seven-figure liquid net worth, the still don’t blow money on fancy cars and might even buy their cars slightly used.
Is Value Thinking Innate Or Learned?
It’s an interesting question where this intense focus and sense of value comes from. Some of us are just wired that way.
But I firmly believe that the value perspective is mostly learned, usually in the family we grow up in. This can because a family was poor and had to focus on saving money, or it could just reflect the values of that family regardless of income or wealth.
Develop Your Value Radar
Thinking in terms of value is powerful. Why? Because it means your dollars go much further in life--and you can build up savings and assets quickly.
If you are reading this blog, chances are that you already have developed the value perspective. But if you are new to this type of thinking, don’t fret. Just keep reading. This way of looking at the world is quite simple. Very basic math. You can pick it up in no time. Then start piling up the assets and investing.
You won’t regret it when work becomes optional, you can do what you want, and you are ready to choose your own adventure.