These are the top 10 money lessons I’ve Learned.
Here we go:
Table of Contents
1. Money as a Store of Value
Understanding Money as a Store of Value: This is The Key to Financial Success
Many people see money simply as a means to buy things, but there’s a deeper concept: money as a store of value.
This means that the money you have reflects the value you’ve generated for others. In today’s economy, people exchange value for money and vice versa. When you provide value—whether through products, services, or skills—you’re compensated with money, which acts as a stored representation of that value. To grow wealth, focus on providing value to others.
Ask yourself, “How can I serve others in a way that brings value to their lives or businesses?” The more valuable you become, the more financial rewards you’ll likely receive.
2. Invest in Valuable Skills
Investing in Skills is Your Best Financial Move in Your 20s
Skills are the foundation of financial independence. The best investment you can make in your 20s isn’t in stocks or real estate, but in yourself—specifically, in developing valuable skills.
Skills that are in demand, like tech, data analysis, and marketing, have a high value in today’s marketplace. By focusing on learning skills that can help you create or support value, you set yourself up for a future where your income potential grows.
Remember, your earnings are often proportional to your skills. And while markets fluctuate, skills compound and generate long-term income.
Continuously learning and upgrading your skills keeps you adaptable and valuable, which is critical for long-term financial success.
3. Set Up a Business for Tax Efficiency
Setting Up a Business is A Smart Way to Save on Taxes and Build Wealth
Taxes can significantly impact your earnings, especially if you’re only earning as an individual. When you set up a business, many expenses become tax-deductible, from meals and travel to educational courses.
This approach can save a significant portion of your earnings, which can be reinvested in the business or personal wealth. This is particularly useful in countries where personal tax rates are high, but business tax rates are more manageable.
Learning how to use business structures effectively allows you to legally minimise your tax burden and retain more of your hard-earned money.
4. The Power of Long-Term Compounding
Long-Term Compounding is The Way of Building Wealth Over Time on Auto-Pilot
Compounding is the most powerful concept in wealth-building, yet it’s often underestimated. Compounding means that the returns on your investments grow over time, and those returns begin to generate their own returns.
The longer you allow your investments to compound, the more exponential your growth. Instead of focusing on short-term gains, invest with the intent to hold and let time do the heavy lifting.
This applies to both financial investments and personal growth: compounding skills and knowledge also yield exponential returns.
5. Focus on Growing Income Over Chasing Returns
Growing Your Income Beats Chasing Higher Returns
Many people fixate on squeezing a few extra percentage points from their investments, but the real power lies in increasing your income.
When you focus on boosting your income through side hustles, skill-building, or entrepreneurship, the gains can be far greater than any market return. Income growth has no cap, while returns from investments are limited by market dynamics.
By dedicating more energy to increasing your active income, you can save and invest more, which ultimately leads to greater wealth than if you only focused on optimising investment returns.
6. Increasing Income is Easier Than Just Saving
Increasing Income Leads to Greater Wealth Than Purely Saving
Saving is essential, but there’s a limit to how much you can save. The real opportunity for wealth-building lies in increasing your income.
For example, taking on a side job or freelance work can add a significant amount to your income. While saving is often about cutting back, income growth has unlimited potential.
A mindset shift towards earning more, rather than just spending less, can have a huge impact on your financial well-being.
Focus on leveraging your skills or assets to generate additional revenue streams, and you’ll find it’s often much easier and more rewarding than restricting spending.
7. The Difference Between Rich and Wealthy
True Wealth Often Goes Unseen
Being rich and being wealthy are often mistaken as the same thing, but they are fundamentally different. Rich people show their wealth in tangible forms like cars and luxury goods, while truly wealthy people focus on growing their assets.
Wealthy individuals don’t need to show off; their wealth speaks for itself in terms of stability, investments, and long-term security. A rich person might have a high income, but a wealthy person has assets that grow in value over time.
To build real wealth, prioritise investments and savings over lifestyle inflation. True wealth provides freedom and peace of mind, not just flashy possessions.
8. Live Simply and Define ‘Enough’
Defining Enough to Avoid Chasing a Moving Goal
Many people chase wealth without ever asking themselves what “enough” means. Without a clear sense of what’s enough for you, it’s easy to fall into an endless loop of wanting more.
By defining your own “enough”—a point at which you feel financially secure and fulfilled—you can avoid lifestyle inflation and focus on what truly matters. Living simply and mindfully not only helps you reach your financial goals faster but also gives you peace of mind.
Wealth isn’t about hoarding money; it’s about freedom and security. Knowing when you have enough allows you to stop the endless pursuit and enjoy life.
9. Compound Wealth Over Time
Time as Your Greatest Asset: The Case for Long-Term Investing
One of the best tools for building wealth is compounding. Small, consistent investments grow exponentially over time.
If you start early, compounding can turn modest amounts into substantial wealth. Avoid get-rich-quick schemes and high-risk investments. Instead, focus on steady, long-term growth, and let time work its magic.
A portfolio left to compound for decades can often yield greater returns than the most ambitious short-term investments.
10. True Happiness Comes from Freedom, Not Money
The Real Goal of Financial Success: Finding Freedom Over Wealth
While money is essential, it’s not the ultimate source of happiness.
True happiness stems from freedom—the freedom to choose how you spend your time, where you live, and what you do.
Money enables this freedom, but once you have “enough,” the additional returns of wealth diminish in value.
Life is short, and no one wants to look back and regret not spending time with loved ones or enjoying life’s simple pleasures. Financial success should provide the foundation for a life of freedom, not a constant pursuit of more.
Real wealth is the ability to live life on your own terms.