Everything changed the day I realized no one would value my money as much as I do. Not even the people I was paying to manage it.
My financial advisor was a good guy. He’d steered me in some beneficial directions and helped me avoid a whole life insurance pitfall. You know, one of those products that gives you life insurance and a promise you can cash it out if you don’t die. (Where, if you just buy cheap term insurance and invest the difference, you come out way ahead).
So, I’m thankful to him. But the day I opened an additional IRA account for my new wife, and his office put my money the wrong type of investment, something snapped inside me. To them, it was an honest mistake that could be fixed in an instant. To me, it was hostile carelessness.
Why the strong reaction? I finally figured it out. Because my money isn’t just a means to consumption or a number that makes me happy when it’s larger. For most of us, our money represents hours of time we’ve sold – precious hours of our lives that could be focused on loving the people in our lives. To give someone else the capacity to waste those hours, days, even weeks of my time and life made me want to take the reins. And that’s what I did.
It was 2014. That week, I scoured the internet for financial advice. After wading through myriad clickbait and sterile, obvious financial advice, I found JL Collins – a readable, almost grandfatherly financial counselor. After finding his site, I didn’t move from my seat for 3 hours. I was in a learning vortex. My mind, ripe to learn after my financial advisor’s blunder, was being blown with answers. For the first time, I understood how markets and investing worked. After paying an advisor, purchasing rental property, and even writing a financial education curriculum, I still hadn’t understood most of this. Since I’ve started leaning into Collins’ advice, the wind of bullish markets blowing in my favor, the money I’ve invested has earned about 20%+, accounting for all expense ratios and fees.
Maybe I was the only one in the dark, but I didn’t realize until a few years ago basic investing savvy, like:
- While saving large lump sums is vital, money stashed in a simple savings account is actually rotting – losing value to inflation every year.
- Autoinvesting part of your paycheck into your company’s tax advantaged 401K can reduce your taxable income and save you thousands in taxes owed every year.
- If you have an HSA through your employer, you can invest the money and let it grow, doubly tax free, and just use your own cash for medical expenses in the meantime.
Around this same time, I flipped a house I didn’t want to bother with and netted almost my year’s salary at my day job (after-tax) in one week. Whoa. Part of that was just being in the right place at the right time – I can’t do that every year. But the key insight was this: if I’m ever going to be financially successful, I’ll have to work with large lump sums of money – and that means learning how to steward them.
I hear a lot of people in my circles say what I used to about this: “investing is boring or creepy” or “that’s for rich people – I don’t have much to invest” or “I don’t have time to learn about all that.” The truth is, we don’t have time NOT to learn about it…unless we want to work extra hours, weeks, and years of our lives to make up for lost potential. If money represents those precious hours and days we’ve given up with those we love, then financial savvy is worth mastering.
As pilgrims on a journey to more than just wealth, let’s be real here, too. The more you have, the harder it gets to remain pure in your ideals. Money can mean power, which corrupts you easily. I have to admit that the more I earn, the more my net worth grows, the harder it is to give – even when I hear about the famine in Yemen or see poverty in my own city. When I was a volunteer teacher in Vietnam with little to no money to my name, I was generous beyond my means. Others have named this generosity paradox, too. We always say, “oh, if I had that income level, I’d be giving so much more back…” But in practice, it actually becomes harder. Like a camel going through the eye of a needle.
Does this mean it’s unwise to create wealth? It’s a good question to wrestle with, but I don’t think so. Once you gain control of your finances and begin to grow them, it’s difficult not to make them an idol, to fall into a hoarding mentality, or to become obsessed with what the markets are doing. I’ll be the first to admit guilt to dipping in and out of this. I struggle internally with the goal of financial independence, because I believe that we as human beings aren’t made to be independent. So many on the journey to financial independence seem to aim at some kinder version of hedonistic self-reliance. I resonate with a part of this desire for freedom, but I want the version that is saturated with interdependence and relationships – that is even relationally costly – because that’s how we’re made to find joy.
At this stage on the journey, I’m glad to have basic mastery of the financial management tools. This kind of new power can be used for increased consumption and hedonism, or leveraged to create value for the world and others, which also forms me into a more full human being. The question is: which path will we choose? Let’s keep wrestling through this together.
P. S. If I can help you rethink your finances, get in touch for a consult. I’ll schedule a time to give you an hour of objective, honest, kick-your-ass-in gear advice. In full disclosure, I’m not a financial advisor. I won’t manage your money. Nor will I take 1% of your assets for eternity or try to sell you anything. I’ll just tell you what I’ve done and what I think will work best for you in your situation.
Or…if you’re looking to grow your finances through compassionate housing endeavors, I recommend checking out my video toolkit: Homegrow a Housing Business for the Greater Good. I’ll walk you through clear, adaptable steps in how to empower people who are marginalized to attain stable housing and make a just, sustainable profit in the process.
