40 Practical & Realistic Money Life Lessons I Learned in 40 Years

Bullets only. No fluff.

Money is a form of life lesson.

There is no escaping it. We need it. We use it. We blow it. We earn it. We borrow it. Without it, life is miserable.

Buying a cup of coffee becomes a problem.

I have learned many money lessons over the years. Some of them are macro-level thinking. Many come from my daily life.

Here, I present my 40 practical money life lessons in 40 bullets.

Use them. Develop them into your personal financial ideology.

That is how we become better at money.

Here goes.

1. Money is like oxygen. You only know how painful it is when it is not there.
2. Learn to keep some. It gives you comfort.
3. Budgeting is not complicated. Having your income exceed expenses is a brilliant start.
4. Having multiple streams of income is a beautiful idea.
5. Avoid digging multiple income rivers of coins. Instead, aim for 3 to 4 oil fields. That will do the trick.
6. Our time is the ultimate constraint when it comes to working for money. No one escapes the 24-hour-a-day fate. No one.
7. When we earn a lot of money, time becomes precious. When we are penniless, we have 24 hours to spare. Life is a yoyo between active earnings and time.
8. No one says you must climb to the CEO room at level 70, earn 6-digits a month, and then surrender all your net worth to that guy in a white coat. Pace yourself. Health matters. Eat well. Exercise.
9. You don’t need to be a 6-digits a month to be wealthy. Choice does. When you get to choose what you want to do, and people [still] pay you? You win.
10. Active earnings as an employee come with a limit. Your salary goes when your job goes.
11. Get your brain to think about assets.
12. Financial assets pay you periodically. Bonds pay interest income. Stocks pay dividends.
13. Understand the power of 5%. 5% annual investment returns on $1,000 is $50. 5% annual investment returns on $100,000 is $5,000. $50 is chump change. $5,000 means something.
14. Financial assets are your money clones. They help you make money even when you sleep.
15. If you are not making money in your sleep, you will work until you die.
16. Read # 15 again.
17. During boom years, assets [in general] provide capital appreciation. Your Apple stock goes from $110 per share to $180. Accountants call it unrealized gain. Your wealth balloons.
18. During bust years, assets [in general] lose paper value. Your Apple stock goes from $180 per share to $110. Accountants call it unrealized losses. Your wealth evaporates.
19. Unrealized gains [or losses] is exactly what it is. Unrealized. You only realize [or materialize] your losses when you sell your assets at a loss. Be smart. Hold. Bid for your time.
20. According to Jordan Belfort, the Wolf of Wall Street, bulls make money, bears make money, but pigs get slaughtered. We need to think harder about our money. We aren’t pigs. Hopefully.
21. Ideally, you get both capital appreciation and cash dividends [or rental income] from your assets. Some asset types only provide capital appreciation. Think penny stocks, cryptos, NFTs, gold bars, silver coins.
22. When you buy an asset [so] to flip it at a higher price, you need a market of suckers. Pray hard they exist.
23. Long-term investors focus on value. Study Warren Buffett, Jack Bogle, Mark Howards, and Benjamin Graham. If you don’t understand what they tell you, [just] learn to be a discount shopper in the financial markets. You find great discounts in a market crash.
24. And then there is debt. We may hate it, but we cannot avoid it. Live with it.
25. Want to use debt as financial leverage? Robert Kiyosaki is your go-to mentor.
26. If you want to manage debt, get out of debt, and live debt-free, listen to Dave Ramsey.
27. You may not endorse the idea behind good debt versus bad debt. No matter. For a start, make sure you can service your debt. If your debt repayment is greater than 50% of your monthly salary, you have a problem.
28. Debt squeeze means it becomes more difficult to borrow money. Interest rates may have increased. Or your personal credit rating has deteriorated.
29. Credit card debt is expensive. Pay it off. Pay it ALL off. Think about it. You can borrow money for free if you pay off your credit card bill by the end of the month. And you get rewards.
30. A credit card can be an asset in your wallet if you treat it as one. Read # 29 again.
31. Recap. Too many assets are [still] too little. More is more. Go for more.
32. Recap. Liabilities are designed to kill. Even a couple is too many. Think mortgage, car loans, credit card debt, renovation loans, and personal loans. Liabilities bankrupt you to enrich the creditors. Be nice to yourself.
33. Inflation is not about things getting more expensive. It’s your money losing value. Big difference.
34. Worrying about inflation does nothing to our financial health. Earn more. Invest more. Be proactive, not whiny.
35. Seek out foreign currency advantages. Imagine you write an article for USD 10. I earn $10 Argentine Pesos for the same work. Holding all things equal, I lost out because the exchange rate is 1 USD to 355 Argentine Pesos. Think.
36. Interesting and informative books about money are hard to come by. I recommend Rich Dad Poor Dad by Robert Kiyosaki for a start.
37. Followed by The Richest Man in Babylon, The Psychology of Money, Think and Grow Rich, The Little Book of Common Sense Investing, The Millionaire Next Door, The Only Investment Guide You’ll Ever Need, How to Invest, The Death of Money, Guide to Investing in Gold and Silver, and The Wolf of Investing.
38. Digital assets, like our online articles, are brilliant vacuum cleaners for sucking chump change. You must create hundreds or thousands of them to earn decent money. Remember. Every drip contributes to a growing pool. Keep the drips going.
39. You can be a high net worth bankrupt. Don’t go there. Have cash. Build a cash flow engine. Be liquid. Stay liquid.
40. You can retire anytime… if you are money-smart. If you leak money [all the time]… the workplace will be your forever retirement village.

Actually… I am 41 this year.

So, I will add one more practical money life lesson.

• Learn the basics of accounting. The Profit and loss statement, Balance Sheet, and Cashflow Statement teach us to connect the money dots. You will [then] know how money works in modern-day societies. Not kidding.

I hope you enjoyed this mega listicle.

Cheers, and I wish you a life of financial abundance and prosperity!

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Oh, oh, you can buy me a cup of black too! Thank you!