In my early years of college I became highly interested in money. I used to sit at the Barnes & Noble near my house and work my way down the Business & Finance section, reading any book that contained tips on accumulating wealth.
I learned about the success of Warren Buffett, Peter Lynch, and Jeremy Siegel in the stock market and how they became incredibly wealthy. I proceeded to open a TD Ameritrade brokerage account and fund it with $1,000 I had in savings.
First I bought stock in XPO Logistics, then promptly sold a few months later, only to buy Visa, Hershey, and Disney, holding each for a few months and selling after they rose a few dollars. Between the trading fees and my lack of patience I turned my initial $1,000 into about $1,100.
These early experiences in the stock market taught me a valuable lesson, which I have gone on to write about in several blog posts: For young people, income matters so much more than investment returns.
Instead of watching candlestick charts of the stocks I owned in class, I should have been out applying for internships. I should have been looking for ways to make more money, not obsessing over investing the tiny amount of money I already had.
Over the past few years I have figured out how to increase my income and consequently my net worth. I snagged an internship as a data analyst during my senior year of college, then took on a full time analyst position as I completed my one year Master’s program. Most recently this summer I made the leap to a new company to increase my annual salary to $80,000.
Along the way I have also had success in side hustles with statistics tutoring, blogging, and acquiring dividend-paying stocks. All of this effort has led to a substantial increase in my income. But the most important financial revelation I have ever had is that retained income is all that matters. Who cares if I make $80k per year? What truly matters is how much of it I keep. I learned that the best way to keep more of my income was to practice a simple idea called minimalism.
The first major “life hack” I felt I discovered was the concept of early retirement. When I learned that it was possible to work for ten years or less and have enough money to never work again, I felt like I had been exposed to the world’s best kept secret.
Then came along The Minimalists. Their philosophy of “living with less” was captivating. I read about Joshua’s minimalist apartment, watched their Ted Talk, and voraciously consumed their podcast episodes.
I became a frequent reader of Zen Habits, Becoming Minimalist, Colin Wright at Exile Lifestyle, and Greg Mckeown. The more I read, the more crap I got rid of, and the more I began to see that I didn’t need much stuff at all to be happy. Minimalism was simultaneously putting more money in my pockets and removing stress from my life.
Two is Stronger than One
It wasn’t until this past year that I realized my obsessions with personal finance and minimalism were both pushing me towards a common goal:
Through reading books on finance, investing, and hustling, I have been able to increase my income.
Through reading books on minimalism, simple living, and essentialism I have been able to reduce my spending drastically. Instead of using my increased income to upgrade my car, buy a house, or build up my shoe collection, I’m practicing the subtle art of being content with less. This allows me to save a ridiculously high portion of my income.
I think most people on the path to financial independence (or any financial goal) could benefit in a major way from simultaneously choosing to increase income and practice minimalism.
There are plenty of personal finance aficionados out there who are amazing at saving every last dollar. But their financial circumstances would improve even more if they learned how to earn more.
There are plenty of high-income earners across the U.S. who are great at making money. But their financial situation would also improve dramatically if they started practicing the art of owning less.
I recently tweeted out my thoughts on this:
By embracing a high-income mentality and minimalism, it’s possible to save an insane amount of money in a short period of time. By embracing the art of duality, it’s possible to turbo-charge the path to financial freedom.
This morning I snapped a picture of two books sitting on my desk, both of which have had an astoundingly positive impact on my financial life:
Simply reading one of these books will add value to your life. But combining the ideas from both will have an even stronger impact.
If you’re on the road to financial independence, I bet you have a unique superpower. You might be really good at saving. Or you may have mastered the art of the high-income profession. Or maybe you’re an impressive side-hustler. Or perhaps you have a natural ability to practice frugal-living effectively.
No matter what your financial superpower may be, you can benefit from practicing duality. Emphasize both earning more and spending less. Look for ways to increase income while simultaneously learning to be content with less. This is how to start sprinting towards financial independence at an incredible pace.
Zach is the author behind Four Pillar Freedom, a blog that teaches you how to build wealth and gain freedom in life.
Zach's favorite free financial tool he's been using since 2015 to manage his net worth is Personal Capital. Each month he uses their free Investment Checkup tool and Retirement Planner to track his investments and ensure that he's on the fast track to financial freedom.
His favorite investment platform is M1 Finance, a site that allows him to build a custom portfolio of stocks for free, has no trading or maintenance fees, and even allows him to set up automated target-allocated investments.
His favorite way to save money each month on his recurring bills is by using Trim, a free financial app that negotiates lower cable, internet, and phone bills with any provider on your behalf.
His favorite micro-investing app is Acorns, a free financial app that takes just 5 minutes to set up and allows you to invest your spare change in a diversified portfolio.
His favorite place to find new personal finance articles to read is Collecting Wisdom, a site that collects the best personal finance articles floating around the web on a daily basis.
Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.