$8,600 and a Cup of Coffee
Four Amazing Assets That Will Set You Up for Life
I think it’s safe to say that anyone who’s reading this would like to be able to have more freedom in their life.
Whether this means spending more time with your family, escaping the tyranny of the alarm clock, or finally being able to travel to glorious destinations, you’re going to need money to do it.
What’s more interesting about starting to hack your path to financial freedom is that you don’t even need that much to do it. $8,600 a year, $717 a month, $165 a week, or $24 a day will all equally start you on an upward path to become wealthy that is neither illegal, immoral, and practically free for anyone to access. The absolute key to making this happen in your life is knowing the four components of the formula: investing in the stock market, HODLing Bitcoin, focusing on fresh food, and never ceasing to improve yourself.
The Stock Market: Contribute Gas to the Economic Engine
No matter how you feel about it politically or socially, one thing about the stock market is undeniable: over time, it makes money.
This is because the stock market is the “economic engine” of the United States and is comprised of almost every profitable public company that the general public wants a part of and is willing to issue stock. By contributing “gas” (your hard-earned money) to this engine, you will be allowed to join the ride of economic growth and have a literal share of the products and services that you probably consume.
Assuming a long-term perspective of 30 years or more, you should expect anywhere from a 7–12% return on money that you’ve invested into the stock market. Variables such as age, time invested, and assets will skew this number, but the general principle remains the same — you historically get more money out that you put in.
Specifically, the Roth IRA is the exact vehicle that most working people will want to get inside, and it’s not extraordinarily difficult to set up your own account on Vanguard, Betterment, Charles Schwab, or many other brokerages. You can even get people to help you set it up over the phone, step by step, or watch videos online. You’ll be able to contribute a maximum of $6,000 a year to this account and will pay taxes on it beforehand, but then for the rest of time it will GROW tax free.
If you don’t have any clue what to invest in and the concept of stocks freak you out, then don’t worry. You can simply purchase all of the stock market (and a little bit of bonds too) through Target Date Funds to reap the benefits of everything that grows over time and minimize your risk. It’s as simple as selecting the year you think that you’ll retire (or just get tired of working for money) and investing whatever the fund minimum is. If you don’t have the fund minimum and are super eager to get started, you can actually build a similar portfolio using only four “total market” ETFs that are available at most brokerages.
Unless you are independently wealthy, have plans to inherit lots of money, or are currently running a profitable business that significantly outpaces inflation, the stock market and the amazing digital access we have to it in the 21st century is a godsend of wealth creation for the average working person. You ignore its simple compounding and appreciation power at your own peril, and it really is that simple.
Bitcoin: Hedge, Collateral, Currency
Bitcoin is many things to many people. It is simultaneously a currency, hedge against in inflation, digital gold, revolutionary philosophy, and a computing marvel rolled up into one package. The only two things you can do wrong with Bitcoin are:
- Not to invest some portion of your financial portfolio into it (start with 1%)
- Not securing it properly (by yourself or with a trusted custodian)
While many cryptocurrencies continue to come and go, Bitcoin will more than likely stand the test of time. It is also one of the highest performing assets in human history, appreciating 8 billion percent since it first received a price in 2009. But with the price of Bitcoin hovering around $60,000 you may be wondering if it’s still worth it to invest. No matter what the price of Bitcoin is, the answer is always absolutely.
Instead of investing in a whole coin (which most people, including the wealthy, cannot afford) take the tried and true approach of dollar cost averaging $50/week ($2,600/year) into Bitcoin using a trusted exchange such as Coinbase and letting your holdings appreciate in value for the rest of your life. If you doubt this approach at all, simply play around with this handy dandy DCA calculator or watch the video below.
Taking this approach, a $2,600 investment during the chaotic and crazy year of 2020 was worth $7,719 on December 30 (a 191% increase). Not only has it preserved its value in dollar terms, but it has tripled in price since then. To say Bitcoin is an amazing store of wealth is to understate the obvious. With a diligent DCA strategy and a tiny amount of income, you can compound and even outperform the effects of your Roth IRA with ease.
With this approach, traditional investors can be assured that their $6,000/year in a Roth IRA will perform as historically expected, while a modest $2,600/year that is averaged into Bitcoin can easily outperform their main portfolio and act as collateral, currency, or an inflation hedge far into the future.
Believe it or not, there are still lots of people that hate Bitcoin and wish that it didn’t exist. Warren Buffet and Bill Gates are among the wealthiest and most prominent, and this is easy to understand why: their wealth and chief asset in life is dollars (allocated through stocks and bonds), which Bitcoin seeks to transfer value away from.
Yet Bitcoin can now be used as collateral for loans, has been proven to be an excellent store of value, and has even been called “mathematically pure” by Apple co-founder Steve Wozniak. When you invest in Bitcoin, you’re far from being out on the fringe.
Fresh is Best
It might seem odd for the title of this article to reference a cup of coffee, but it’s a worthwhile analogy (also, I love coffee). When it comes to living an optimal life full of simple enjoyment that maximizes your personal potential, try to stick to the adage that fresh is best. But what exactly does this mean?
Your health and day-to-day happiness is an asset that is often overlooked, but which if you safeguard in many ways can reap far bigger benefits than all the money in the world. This is because if you decide that “fresh is best” in areas of your personal life and immediate needs, you can have optimal experiences in affordable doses that eliminate waste and maximize awe.
A couple of examples:
Everyone’s had at least one morning when they just felt “fresh” and ready to take on the day, complimented by an amazing cup of coffee that they then made (fresh) or purchased themselves (made fresh) by baristas at your local shop. While you may have been on autopilot when you made these decisions, they work in synergy with creating a spectacular day.
In a similar vein, it’s now common nutrition wisdom that some of the most biologically available forms of nutrients are present in whole foods. From cold salads to hot steaks, you’ll always feel wonderful and in tip top shape if you’re eating real food made with actual ingredients tailored to your needs. It doesn’t necessarily need to be freshly picked from a garden, and flash frozen fruit or vegetables can be just as nutritious as those in the produce section.
Hopefully I’m not blowing your mind by saying that getting as much sleep as you need is vitally important toward living a healthy and productive life, and that quitting caffeine is not the death sentence you might think it is. If you think that the stock market and Bitcoin will ultimately make up for your poor sleep habits, I’d ask you to think twice.
A package of boutique coffee beans will run you $12, but can yield almost two weeks’ worth of quality cups along with numerous health benefits. The same concept applies for all the smaller decisions that we make in our day to day life, and by allowing those to compound we can have people around us wondering how we’re so damn chipper for seemingly no reason. We know the secret…
Choose Yourself as the Top Performing Investment
Tap into the world’s economic engine, HODL Bitcoin (or use it as collateral/payment), and brew a fresh cup of coffee from real beans after a good night’s sleep so that you’ll be able to use more free time to invest in the greatest asset of your life: yourself. Easy as pie, right?
Unfortunately all the coffee beans, Bitcoin, and dollar bills in the world won’t save you from self sabotage and a life of disease and emotional desperation if you don’t choose to invest in yourself for the long haul.
Whether this means finally cracking open that book you’ve had on your shelf or starting a daily walking routine, investing in yourself is a completely unique experience that almost cannot be quantified. If you start learning new skills that make you more money you can help with this, but the results often tend to be more ethereal and qualitative.
Want to have more self confidence? Start practicing a skill or hobby and get really good at it. Need more friends? You’ve got to be friendly, go out, and put forth your best face. Hate where you live? The best time to start saving up to move and browse apartment listings was yesterday, making today pretty damn attractive to tomorrow.
There is only one of you, and you’ve been placed in the unique and fascinating job of developing yourself into the best you can be. While this can seem daunting, it is one of the chief fundamental tasks of life. $8,600 a year might put you on the path to financial success, but it can’t ultimately make you a kinder person, crave healthier foods, or move onward toward a brighter future. Only you can do that, and it seems a wholly worthwhile effort to start today.
Please be advised that this article does not constitute financial advice and that you should seek out a certified financial advisor for all your personal wealth plans. I cannot be held liable for investment decisions that you choose to make, and all investments are subject to risk (including losing all of your money). I’m simply a man who loves teaching other people about Bitcoin, freedom, and other topics of interest.
