7 Money Lessons I Learned The Hard Way (Learn from My Mistakes!)

Learn from the lessons that I've learned about money. These can drastically change the way you think about your finances, and help you build a solid financial foundation for the years to come.

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Timestamps:
0:00 - Starting Zone
0:45 - Lesson 1: You Don't Need That Much
2:42 - Lesson 2: It's OK to Spend Money
3:53 - Lesson 3: Don't Get a Credit Card Prematurely
5:14 - Lesson 4: An Extra Source of Income
6:54 - Lesson 5: Communicate Your Goals
8:04 - Lesson 6: Know Your Worth
9:50 - Lesson 7: Not All Advice Is Good

1. You Don't Need That Much
One of the most impactful lessons I learned was that you don't really need that MUCH money to live a lifestyle you desire.

For a long time in my 20s I struggled with how much I was making and how much I wanted to make. I had an arbitrary number in my head, "I want to make $500k a year, or $1 Million Dollars a year". But often times, these numbers aren't tangible and just because it sounds good, doesn't mean you NEED it.
I was telling a mentor of mine, Dave about this over coffee at my favorite coffee shop here in the Bay, he taught me my favorite money lesson to date.

He told me exactly this, write down everything you think you need in the lifestyle you wish to have, and you'll be shocked at how much more reasonable that goal will be.

2. It's OK to Spend Money
A lot of money experts and Financial YouTube will say, "Buying coffee makes you poor", or don't make rash financial decisions.

While I agree that you shouldn't be buying dumb purchases such as $500 sneakers, I still think we get caught up in living frugally sometimes that we don't actually spend money on things that will bring us happiness.

As long as you're intentional about your spending, I think it's OK to spend that money on loved ones and things you love.

3. Don't Get a Credit Card Prematurely
Credit cards are really great tools for building credit and getting cash back, or rewards points - but THEY can also be DANGEROUS.

The average interest rate on a credit card is well over 16%, and being in debt and carrying a credit card balance even for 1 month can be a big detriment to your wallet.

4. An Extra Source of Income
Researchers have even pinpointed a statistic: millionaires, on average, have not just one, but seven streams of income.

List of 7 Possible Extra Sources:
Earned
Business
Interest
Dividend
Rental
Capital Gains
Royalties

5. Communicate Your Goals
Be upfront and communicative with your financial goals to friends/family and you'll take some of the pressure off of you when it comes to social spending.

There's this societal taboo that we have about out finances - people don't share how much they make or spend. I believe the approach where people are open about their finances shifts the narrative from one of embarrassment towards empowerment.

6. Know Your Worth
A lot of my friends don't ask for raises regularly, but as you progress in your job & if you're learning new skills, you're more valuable to the company.

If you can make a good case for what your value is, you should be asking for more compensation. I know people that are too afraid to ask or have an awkward conversation, but sometimes all it takes is asking.

7. Not All Advice Is Good
You need to develop own moral compass When it comes to financial advice, not all advice is meant for you.

Whenever you're reading something, or watching a YouTube video, and you don't agree with whatever is being said - reflect upon that advice and see if it applies to you. It might not!

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😺 WHO AM I: I am not a cat. My name is Humphrey Yang, I've built multiple businesses and am passionate about Personal Finance, Investing, among other things! If you're trying to build a solid foundation of financial literacy, learn to invest, or become financially free - then I'm here for you!

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PS: I am not a Financial Advisor, any investment commentary are my opinions only. Some of the links in this description are affiliate links that I do receive a commission for.