1. Save 20% of your gross paycheck for retirement before you do anything else. Get used to saving like this immediately and it will never feel like a hardship. Paying yourself first is the key to acquiring wealth.
  2. Contribute enough to your 401(k) to get the full match. If your new job has a 401(k) contribute enough to get the full match. Never walk away from free money.
  3. Don’t contribute more than your match if you plan to retire before 59 ½. If all of your savings goes into your 401(k) and you plan to retire before 59 ½ you may have a problem when you try to take income. Withdrawals before that age are typically penalized by 10%. It could make sense to find other avenues for investing. That would provide access to funds if you retire early.
  4. Don’t get your financial advice from TikTok. Most people on social media aren’t actually financial advisors. They often aren’t licensed and don’t have the training a financial advisor has. If you are using social media to find advice, make sure the person giving the advice actually has the licenses and training that makes them legitimate. You wouldn’t want your surgeon to be some guy who read a book and dissected a frog once. Your financial advisor shouldn’t be either.
  5. Focus on the creation of income streams rather than net worth. The industry accepted withdrawal rate for market based investments during retirement is around 3%. That means 1 million dollars creates only 30,000 of income per year, regardless of how it is invested because some years you win and some years you lose. Cash flow producing assets can potentially create much more income. If the end goal is to maximize your income, keep that focus from the very beginning.
  6. Stay open minded. The world your parents are retiring in is different than the world you are retiring in. You don’t have a pension. The tools that will create wealth and income for you are different than those your parents used. Approach everything with a beginners mind and look for the value (and the catches) in every strategy.
  7. Diversify. That means cash, the stock market, real estate, whole life insurance, and eventually private equity and venture capital. You need a full set of tools for optimum performance. You can’t play golf well without a driver, wedges, and a putter. You need a variety of options for life too.
  8. Develop an acquisition strategy. Fund a Private Reserve for self-financing. How you acquire the things you buy determines how much money you can keep growing. Many people are taught to believe that cash is king. And that’s not wrong, but if you use your cash to create a private reserve strategy, you can keep your money growing without giving up the use of it. Any time you can keep your money on the compound growth curve rather than transferring it away and starting over, you’ll be better off in the long run.
  9. Read. The books that have most influenced my financial journey – in the order I read them: Rich Dad Poor Dad by Robert Kyosaki, LEAP: the Lifetime Economic Acceleration Process by Robert Castiglione, Becoming Your Own Banker by Nelson Nash, The Lifestyle Investor by Justin Donald.
  10. Do the experiment. Everyone I know has an opinion about finances. And opinions have no place in a financial plan. Always run the math – or find someone to run it for you – so that you have a concrete comparison between your options. If the math works out, do it. If it doesn’t, don’t. It really is that simple.

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