I have often been called “Grandpa.” I even had this nickname back in my college years. No, it’s not because I look old…although I do have 3 random small white patches of hair on my head! Not to toot my own horn but I am actually in really good shape, haven’t smoked a thing in my life, rarely drink anymore, and I monitor my diet to a certain degree. What I am trying to get at is that physically, I am the opposite of looking elderly.
The reason I got this nickname is because I have always been frugal. Even before I was financially literate, I was frugal. I can’t tell you the exact reason why I have always been like this, but I believe I know some of the reasons why:
- My parents put me and my 3 sisters in sports year round, so our time was always occupied with practices and games.
- When I wasn’t playing sports, I was watching sports. The majority of my days in middle and high school consisted of going to practice after school and then watching sports immediately after practice.
- I was ADAMANT about not smoking or drinking for the majority of my youth. I still have never smoked anything, but I had my first drinking experience during my senior year of high school.
- I was TERRIFIED of disappointing my mother. She was the type of parent who had no issue correcting you if you slipped up, and it didn’t matter where you were when she corrected you. Love you Mom!
- I have always kept more to myself. I have always had a small group of friends and family that I frequently interact with, and I rarely ever (still don’t) go out of my way to attend events with those who aren’t in my inner circle.
- I have always been in long-term relationships. I am 25 years old and I think I have been single for a grand total of 12 months since I was 16.
Now what do all of these have in common, and how did they give me a frugal mindset? Well, it’s quite simple…
Due to my love of sports, most of my time was taken up with sports, not giving me a chance to really spend money. Since I have always kept more to myself and my inner circle, and because I didn’t smoke or drink (only the couple occasions senior year), I wasn’t invited to the majority of high school parties. Because of this, I wasn’t spending money on alcohol or drugs. Also, being in long-term relationships for the majority of my adolescence and adulthood, my extra time and money was only spent on those relationships. Last but not least, I knew not to slip up with my mother. Looking back on it, I actually can’t thank her enough for her role in developing me to be the man I am today. She (and my AWESOME father) constantly had me in sports, made sure I cared about school and my grades, just so I could go to college and have the opportunity for a better life than they had.
All in all, it was the discipline I carried with my daily schedule and my close personal relationships that caused me to not spend my money on things that didn’t interest or benefit me.
Due to the discipline I had in my youth, I am very fortunate to be in the position I am now. I have a good job that pays me well, I am engaged (soon to be married!), and our net worth is closer to $100,000 than it is to $0. If you haven’t picked this up by now, I am REALLY into personal finance. Like obsessed with it…
For the past few years since I entered the workforce out of college, I have educated myself constantly on personal finance. I read about it every day, and I constantly look for more ways to improve our financial situation. Even though I am obsessed with personal finance, I am going to tell you a secret…
PERSONAL FINANCE CAN GET BORING QUICKLY
Money by itself is never boring. Everybody loves getting money and having money. There is a big difference though between getting money and building wealth. Getting money presents you with a quick high and puts you in a short-term euphoric state. This feeling will ALWAYS feel good in the moment, so we will always associate receiving money as a positive interaction that’s fun.
On the other hand, building wealth is boring. It truly is. Building wealth is a long-term process that consists of doing the exact same financial procedures week after week, month after month, year after year. These financial procedures aren’t difficult at all. They consist only of earning money, saving money, then investing a big portion of that saved money. You don’t even really start seeing big gains until you have at least $100,000 invested- then, you can really see the wealth snowball begin to roll down the hill! What I am trying to say is that building wealth is simply a long-term rinse and repeat process.
The potential problem with this is that you can become bored and distracted along the way. How do I avoid getting distracted on my path toward everlasting wealth???
I NEVER FORGET MY FINANCIAL “WHY’S?”
Establishing your financial “Why’s” is absolutely critical in your path towards building wealth. It can be the only thing at times that keeps you on the disciplined path required for this financial journey. Your “Why’s” never lets you get influenced by outside factors, and it constantly reminds you of the reasons you are doing what you’re doing.
Frugal Money Man’s “Why’s?”
As a result of me having a pretty disciplined schedule/mindset growing up, I don’t have to fall back on my “Why’s” often. Having said that, there are definitely days where it does get to me and I do have to remind myself of why I am doing what I am doing. Let’s start with the first “why?”
#1 – I want Mr. & Mrs. Frugal Money Man to be able to AFFORD to retire one day.
This one is first and foremost. I have come to the realization that for millennials, retirement will be fully funded by their own savings. If Mr. & Mrs. FMM want to actually be able to afford retirement one day, then WE carry the responsibility of savings/investing for our retirement.
Have you ever thought about how much money you will need to fund your retirement every year? Let’s say that a retired couple wants to live off of $50,000/year in retirement. This money will cover all of their living expenses and hobbies. If you go by the 4% Rule, this means you will have to have a retirement nest egg of $1,250,000 to draw from. Even if you want to live off of $40,000/year in retirement, you need to grow a nest egg of $1,000,000! The 4% Rule is a standard that financial experts recommend regarding how much money you should pull from your nest egg. The rule says that you should only be withdrawing 4% of your entire nest egg per year, so that you don’t erode your nest egg to quickly.
You need to get this in your mindset NOW that you most likely will need to have at least $1,000,000 in retirement accounts come retirement, probably even more. Mr. & Mrs. FMM have a lofty goal of actually accumulating $10,000,000 by the time we fully retire. My advice on how to set lofty financial goals: Determine a dollar amount you want saved in your head, then DOUBLE it. It will get your brain in a mindset of constantly thinking how to save and accumulate more assets. That strategy alone got my mindset from originally wanting $1,000,000, to now wanting over $10,000,000. Trust me…It is 100% possible.
“Shoot for the moon. Even if you miss, you’ll land among the stars.” – Les Brown
#2 – I want Mr. & Mrs. Frugal Money Man to own a single family home with land.
I truly want nothing more in this life than to provide Mrs. FMM a single-family home (with land) that is stable. I want the type of home where ALL of our families can come to for holidays, and everyone has enough room to be comfortable. I want Mrs. FMM to be able to go to sleep at night knowing that the home she is in is owned by her and that she never has to worry about moving again. This “why” alone drives me every single day. We also plan to own this home in FULL within the next 5 years;) More on that in future posts…
#3 – I want to leave a legacy for our family’s generations to come.
A big reason it is so easy for me to be extremely frugal is that I have always cared about others quality of life over my own. This may partially be because I only really need my sports, dog (Loki), and my family to make me happy. Those 3 reasons of my happiness make it extremely easy for me to say “no” to outside pressures and keep me focused. I have always had the mindset of assuring my inner circles priorities/happiness over my own.
I was fortunate enough to be given a blessing in my life (more on that in a future post) from my late aunt that helped me get through college debt free. I don’t think anybody had any idea the money she had to her name but, when she passed, she blessed 4 siblings and 11 nieces/nephews with a financial gift that helped each and every one of us in our own way. Because she cared about her family so much, she had a plan to bless her family when her time was up. I want to leave the same legacy and MORE.
Her gift gave me my initial fire to become financially literate, and that fire continues to burn inside me today. I want to leave a legacy that’s so BIG that it touches more than just my family’s future generations, but many more families! I want to help future families send their children to college, afford their first homes, afford emergency medical bills, and anything else that could benefit their family! This is the main reason I want to accumulate over $10,000,000.
There you have it…
You now know Mr. Frugal Money Man’s “Why’s?” These 3 reasons are why I can stay focused on this path toward financial freedom. These reasons keep me humble every single day and help me stay focused on my path. I haven’t been deterred yet, and these reasons won’t ever let me get off track.
I encourage you to starting thinking about your financial “Why’s?” Without them, it will always be easier for you to fall off your path and abandon your principles. If you have read this far, I take it you are extremely interested in achieving financial freedom for yourself and your family. If that is indeed the case, then I hope you understand that you have to begin NOW.
It all starts with maturing and accepting that you are now an adult who is held responsible for your daily actions. Your life will be a constant result of your daily actions, and the results you get are either your fault or hopefully your blessing because of disciplined principles. By establishing your “Why’s” now, I promise you this…
Your journey towards financial freedom will be easier, but even more importantly, your journey will become REALITY.