Free AI web copilot to create summaries, insights and extended knowledge, download it at here

2333

Abstract

compound interest is on your side and will probably eventually make you rich.</p><p id="9286">For me, none of these statements apply, which is why I’m trying to take a different approach.</p><p id="1956">I would like to have F U money a little earlier, as they say. Or financial freedom. No matter what you call it, I would like to have the opportunity to travel, do what fulfills me, and live according to my own terms. Being the richest person in the retirement home, on the other hand, is not my goal.</p><figure id="ae14"><img src="https://cdn-images-1.readmedium.com/v2/resize:fit:800/0*7Zcfc_GuKiI6c54C"><figcaption>Photo by <a href="https://unsplash.com/@mrbrodeur?utm_source=medium&utm_medium=referral">Matthew Brodeur</a> on <a href="https://unsplash.com?utm_source=medium&utm_medium=referral">Unsplash</a></figcaption></figure><h1 id="ff09">What To Do Instead</h1><p id="47b7">As I said, I have no problem with compound interest. My problem with it is just that it takes an extremely long time if you follow the normal advice.</p><p id="65c7">And that’s where the problem lies. <b>I think time is more valuable than money. You can always make more money but you can never get more time.</b></p><p id="8df6">However, if you already have a lot of money, compound interest is a dream. 8% a year on 2 million, not bad. That’s why I think that if you disagree with any or all of the statements above like I do, you should try to make your assets grow as fast as possible because then compound interest becomes way more powerful. You have to find a shortcut.</p><h1 id="4053">But How?</h1><p id="2e42">Of course, there are well-paying 9–5 jobs, but these usually require a degree and job experience. So for most people, the best way to earn a lot of money in a relatively short time is to start their own business. This way you can generate passive income and decouple your income from your working hours.</p><p id="4263">Nowadays we have the huge advantage of the internet, so anyone who really wants to can start a business without much prior knowledge. There are countless ways. If you are serious about it, you will find a way. You should probably start on the side for now. As a side hustle, since you probably won’t immediately replace the income of your regular job. But who knows what might develop out of it.</p

Options

<p id="43d4">Thanks for reading!</p><p id="62c8"><b>Wait a second.</b> Y<i>ou should get my articles in your inbox. <a href="https://medium.com/subscribe/@whitep"><b>Subscribe here.</b> </a>Maybe you also want to start writing on Medium yourself and make money. I made $2300 in my second month!

You only need a membership for $5 a month. If you sign up<a href="https://medium.com/@whitep/membership"> <b>with my link</b></a>, you support me with a part of your fee without additional costs.</i></p><p id="5cca">I think you will also like these articles:</p><div id="e6d6" class="link-block"> <a href="https://readmedium.com/this-killer-business-advice-can-make-you-rich-df2491ce140d"> <div> <div> <h2>This Killer Business Advice Can Make You Rich</h2> <div><h3>How to really make money</h3></div> <div><p>medium.com</p></div> </div> <div> <div style="background-image: url(https://miro.readmedium.com/v2/resize:fit:320/0*YlyPMm76YcO9JkiV)"></div> </div> </div> </a> </div><div id="77a8" class="link-block"> <a href="https://readmedium.com/the-richest-1-by-age-group-3e32d8622e92"> <div> <div> <h2>The Richest 1% by Age Group</h2> <div><h3>What it takes to be in the top 1%</h3></div> <div><p>medium.com</p></div> </div> <div> <div style="background-image: url(https://miro.readmedium.com/v2/resize:fit:320/0*H5kAZVpuuT0TE0qu)"></div> </div> </div> </a> </div><div id="6cb1" class="link-block"> <a href="https://readmedium.com/the-subtle-art-of-not-giving-a-f-ck-my-favorite-lessons-38500bdb7acb"> <div> <div> <h2>The Subtle Art of Not Giving A F*ck- My Favorite Lessons</h2> <div><h3>This book is worth the hype.</h3></div> <div><p>medium.com</p></div> </div> <div> <div style="background-image: url(https://miro.readmedium.com/v2/resize:fit:320/0*-hXZxP-fW3-yTUjG)"></div> </div> </div> </a> </div></article></body>

Why Most Financial Advice Is Bullshit

…at least for most people.

Thinking for yourself is a competitive advantage these days. Before you follow any advice, including this one, about money, please think for yourself.

9 out of 10 financial gurus give advice that goes something like this:

“Save 10% of your income from your 9–5 job and invest it in an index fund. Over time, the compound interest effect will kick in and you’ll be rich in a few decades.”

It works. What’s the problem? I calculated it using a compound interest calculator. If I invest $500 a month and get an 8 % return a year, I will end up being rich. Here’s the proof:

Compound interest is powerful, no question about it. I don’t disagree with anyone on this point.

However, I see a few basic requirements that have to be in place for this to be a good plan. These are:

You’re sure to get an average 8% inflation-adjusted return.
You are content to trade 5 days of work for 2 days off and receive a fixed payment for it.
You are happy to retire only at high age and thus exchange youthful time for elderly time.
You’re sure you’ll live until you’re 70 or longer because only then you will be rich.
You don’t want to eventually take larger sums out of your investment portfolio. For example, to buy a house. Because this would screw up your calculation.
You don’t want financial freedom and the ability to work on whatever you want before the age of 70 or you don’t think you could do it.

If all these things apply to you, you can follow the mainstream advice of getting rich slowly without a concern. Even if it takes a long time, compound interest is on your side and will probably eventually make you rich.

For me, none of these statements apply, which is why I’m trying to take a different approach.

I would like to have F U money a little earlier, as they say. Or financial freedom. No matter what you call it, I would like to have the opportunity to travel, do what fulfills me, and live according to my own terms. Being the richest person in the retirement home, on the other hand, is not my goal.

What To Do Instead

As I said, I have no problem with compound interest. My problem with it is just that it takes an extremely long time if you follow the normal advice.

And that’s where the problem lies. I think time is more valuable than money. You can always make more money but you can never get more time.

However, if you already have a lot of money, compound interest is a dream. 8% a year on 2 million, not bad. That’s why I think that if you disagree with any or all of the statements above like I do, you should try to make your assets grow as fast as possible because then compound interest becomes way more powerful. You have to find a shortcut.

But How?

Of course, there are well-paying 9–5 jobs, but these usually require a degree and job experience. So for most people, the best way to earn a lot of money in a relatively short time is to start their own business. This way you can generate passive income and decouple your income from your working hours.

Nowadays we have the huge advantage of the internet, so anyone who really wants to can start a business without much prior knowledge. There are countless ways. If you are serious about it, you will find a way. You should probably start on the side for now. As a side hustle, since you probably won’t immediately replace the income of your regular job. But who knows what might develop out of it.

Thanks for reading!

Wait a second. You should get my articles in your inbox. Subscribe here. Maybe you also want to start writing on Medium yourself and make money. I made $2300 in my second month! You only need a membership for $5 a month. If you sign up with my link, you support me with a part of your fee without additional costs.