“Time” action items — The Algebra of Wealth Recap
1 min readOct 29, 2024
- Value your time above all your other assets
- Appreciate the power of compound interest
- Beware the power of inflation: the flipside of compound interest is your money being worth less over time
- Be rationally obsessed with money
- Track your actual spending
- Save some money, even just a little, every month
- Avoid financial commitments: subscriptions, payment plans, and assets that require maintenance
- Stabilise your spending
- Determine your “head above water” budget
- Account for your evolving preferences
- Set achievable, short-term savings goals
- Make spending a thoughtful choice
- Organise your expenses into three buckets: day to day expenses, intermediate expenses including tuition and house down payments, and long-term savings for investments
- Keep your intermediate bucket funded with low variability and high liquidity investments
- Take the match on pension plans funded by your employer
- Bad things happen, you will make mistakes: these are reasons to adjust your plans, not abandon them
