- Imagine how you would feel if you never had to worry about money ever again
- Money can provide both freedom and power, so it's worthwhile being ambitious and purposeful with your financial goals
- Sometimes a radical statement can be what catalyses change in your life
If you saw my last blog post, you might've noticed that at the end of it I mentioned one of my short-to-medium term goals was to:
"Find sustainable ways to earn money so that I can reach my goal of having 16 million AUD net worth by 35."
I understand that statement can make me seem greedy or money-oriented, but in this article I want to talk about the rationale behind my statement and potentially convince you to do a similar thing for yourself.
The idea was first sparked whilst I was listening to an episode of the My First Million podcast (which is one of my top three favourite podcasts at the moment along with Not Overthinking and The All-In Podcast). At the end of this episode, one of the hosts, Sam Parr, discusses the idea of "what is enough money?" with the guest, Andrew Wilkinson. Sam Parr talked about his earlier goal of earning $50K/month every month (continuing to adjust for inflation) starting at age 30 (which he has achieved). Even though he knew he wouldn't spend that much each month, it would allow him to live with peace of mind and enjoy various aspects of life without having to worry about finances. This amount of money would essentially buy him freedom.
This is something that spoke to me for a number of reasons.
- I want to be financially free. The beauty of financial freedom and passive income is that it gives you back time. Time is the most important commodity we have. Over the past year, I've increasingly recognised that I don't want to work in Medicine full-time and that I want to have the choice to spend my time on the various things that matter to me. However, if I'm always worried about finances and I'm working in a traditional career like as a doctor, I'll never be able to take time off because those extra hours of work will give me more money which means I'll be better able to provide for myself and my family. No, I want to spend time with family and pursue my interests whilst simultaneously making a difference.
- As I've talked about before, I want to make the biggest impact on the world that I possibly can and I don't think working as a doctor on a day-to-day basis is the best way to achieve that goal. An 80,000 hours article theorised that over a lifetime, the average doctor saves 20 lives. In contrast, by donating US$2300 to The Against Malaria Foundation, you can save the life of one child in the developing world. So it would take just a US$46,000 donation to make the equivalent contribution to lives saved as the entire career as a doctor. I know there is a lot more nuance involved, but there's no doubt that simply by donating to effective charities, you can make a bigger difference in the world than by working full-time as a doctor.
- I want to pay my parents back for everything they have done for me. My parents migrated to this country and made so many sacrifices so that they could give my sister and I the best opportunity to prosper. There is no amount of money that can repay the debt I owe them, but I hope that I can at least allow them to enjoy their retirement without having to worry about finances.
- I want to provide my children with every opportunity to explore different aspects of life without having to worry about money (within reason). The world is an ever-evolving place and there'll only be more and more pressure to "keep up with the Joneses" by the time my kids enter adulthood. I don't want them to feel this social pressure to have to join the workforce and take a typical, financially stable career path if they don't want to. I want them to be free to pursue whatever it is that makes them happy (as long as it's Medicine, Engineering or Law amiright?).
- I don't want to money stopping me from enjoy certain aspects of life. There are lots of expensive but fun things in life to enjoy, such as travel, dining out at fancy restaurants, or expensive hobbies, like photography or golf. I want to enjoy all these experiences without having to make cuts in other areas of life.
So I decided that I would use a target of A$40 000 per month. It's a massively conservative value and I hope I never spend even half of that in a month. I'm giving myself a bit more time than Sam because I've committed the early part of my adult life to Medicine which requires a huge upfront time cost with no return. Again, using a conservative estimate of 3% return per year, I calculated the sum I would need to be A$16 million.
Obviously this doesn't take into account any other streams of income I might have, it's purely the gross amount I would need if I didn't want to spend another minute working. And so whilst this is an extreme because I know I would inevitably continue working because 'work' is a major part of what gives our lives meaning, I don't want to have to be tied down to anything by necessity.
So... 16 million Australian dollars... It's a pretty immense number.
What am I going to do about this? How exactly am I going to reach this number?
There are plenty of resources out there talking about passive income and building wealth and as someone who is only at the start of their journey, I'm not going to pretend like I know how to get to point B.
These are the things that I'm going to be focusing on:
- Building an audience. I don't necessarily think that this is the fastest way to get to my financial goal. However, I do believe that having an audience who trusts me increases the likelihood of future endeavours succeeding by an immeasurable amount. A social media following provides immediate distribution to likeminded individuals from all over the world. For example, say I wanted to create an online course about how to thrive in medical school. There would be no one who'd pay for the course because the only way I'd sell it would be to go up to other medical students I knew and ask them to give me money for the course. They'd have no guarantee that I knew what I was doing because they'd never have seen anything that I produced. However, if I have an audience, some of whom are medical students or aspiring medical students, they may be more inclined to purchase my course because they (hopefully) trust that it would be valuable based on prior free content I had put out.
- Building businesses. Entrepreneurship fascinates me. I've long wanted to start a business, and I know I could make up a multitude of excuses as to why I haven't yet but the truth is that I have been too scared to fail. I often get caught in the mindset, "I could do this if I just had more time" or "I just don't have the skills right now to execute on this idea". It's much easier to feel sorry for yourself and not try than to give it a go and fail, because at least with the former you can soothe your ego by telling yourself that you could've done it if you'd actually tried. To break free of this cycle, I'm currently trying to start a dropshipping business.
- Smart investing. It's surprising how many people have gotten to their level of wealth simply by investing in the right thing at the right times. The earlier you start, the better your returns will be, so I'm actively learning more about investment and financial instruments so that I'm better poised to capitalise on opportunities when I have the disposable income to invest.
You might've noticed that 'day job' or 'Medicine' isn't anywhere here. The main reason for this is that the amount earnt from this will be a minor contributor in getting me substantially closer to this goal. I want to have passive income as the sole source of this $40K/month.
Now, in addition to freeing up time, having this sort of net worth will allow me to also invest in projects and charities that can greatly influence the world. I'll be able to help other likeminded individuals who are in financially difficult situations to get their projects off the ground. I'll be able to donate more to charities that provide the biggest bang for buck in terms of impact. And, I'll be able to fund future projects of my own.
If you still think I'm some power-hungry, narcissistic jerk who's only doing it for the money, let me just say a couple more things before you cancel me.
Money is undoubtedly a driving factor for everyone in their career whether they like to admit it or not.
You wouldn't work for free and neither would I.
What I've decided to do here is put what we all have (a subconscious goal of amassing wealth) out into the open and in my case with a specific, defined value of A$16 million for a few reasons:
- It's taboo to speak about money and that needs to change. We literally spend majority of our waking hours during the best years of our life in pursuit of additional zeros at the end of our bank account balance, so it seems ridiculous to me that we don't openly address our financial goals. I'm hoping this article can be part of the cultural change towards being more open with financial matters.
- I want you to think more about your own financial goals and be more purposeful in the way that you spend your time. Given the choice between more money and more free time versus less money and less free time, I think we all would choose the former. Life's too short not to spend it on the things that matter to us.
- I'm hoping that by putting this out on the internet, where anyone can read this, it'll give me some extra accountability to get to where I want to go.
- More selfishly, I'm hoping that in 12 years time, when I have achieved this goal, I can look back at this blog post as the catalyst which got me started on my entrepreneurial journey.
So whilst money doesn't bring happiness, in my eyes it is currently the best method of attaining both freedom and power in our modern capitalist society. If you want to live an easier, stress-free life, or if you want to leave this planet a better place then when you arrived, then be more ambitious with your financial goals.
PS. Contrary to what this entire article has said, this statement was not entirely about the money. The real reason behind it is that I want to change the story about how my life is going to unfold.
Currently, the path I'm on is very linear. I'll graduate as a doctor at the end of 2022. I'll join the medical workforce. I'll work as an intern, then a resident and work my way up the ranks until I become a consultant. I won't really need to overcome many obstacles, it's pretty well laid out before me. And it has been like this my whole life. Sure, I wasn't always going to be a doctor, but I was always going to some type of 'typical' career where I was a 'worker' i.e. an employee for someone else. However, I don't think this path will bring me fulfilment. I want to do something different, I want to create content, I want to build companies, I want to change the world on a larger scale. But in saying all this, I retain the right to change my mind on any of this at any time; future me is not accountable for what past me said.
Let me finish with a quote from Episode #180 of the My First Million podcast.
Most people ... when they make career choices, it's a rational, logical decision and I think that gets you to a certain type of outcome [a stable job with a reasonable income]. But if you hear these outcomes [selling companies for tens or hundreds of millions of dollars] and you're like, "how do I get some of that?" then you gotta follow the irrational playbook a bit more.