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The mistake that I see a lot of people make when they start asking questions about how to manage their money is that oftentimes people will ask a question about a product or a tactic. So for example, they might say, "Should I use this app, or should I invest in cryptocurrency?" First-principles thinking is stripping away everything and really getting to the root of something. So if you think about a tree, the tactics and the products are like the leaves of a tree. That's the most visible surface so, of course, it's what people might ask about first. But first, let's start with the roots of that tree. The roots of that tree are your values. It's that question of what matters most. And then from those roots stem that trunk of the tree, which is your philosophy of life, the type of life that you want to lead. And from that philosophy, then your objective or your goals: How does that philosophy of living translate into specific goals? That's really that tree trunk. From there, you go out into the branches of the tree, and they represent the strategy. Now that you know your philosophy of living, you know your goals, now you can come up with strategies for how to obtain those goals. And then once you have that strategy in place, then those leaves are the tactics and the products. So if you're starting with the question about tactic or product, you've got a leaf in your hand, but you don't have that root system built yet.

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The mistake that I see a lot of people make / when they / start asking questions / about how to manage their money / is that / oftentimes / people will ask a question about / a product / or a tactic.// So for example /, they might say, / "Should I use this app, / or should I / invest in cryptocurrency?" // First-principles thinking / is / stripping away / everything / and really getting to the root / of something. // So / if you think about a tree, / the tactics and the products / are like the leaves of a tree./ That's the most visible surface / so, / of course, / it's what people might ask about first. / But first, / let's start / with the roots of that tree./ The roots of that tree / are your values. / It's that question / of what matters most. / And then / from those roots / stem that trunk of the tree, / which is your philosophy / of life,/ the type of life that you want to lead. / And / from that philosophy,/ then your objective / or your goals: / How does that philosophy of living / translate into specific goals? / That's really that tree trunk./ From there, / you go out / into the branches of the tree, / and they represent the strategy. / Now that you know / your philosophy of living, / you know your goals, / now you can come up with strategies / for how to obtain those goals /. And then / once you have that strategy / in place, / then those leaves / are the tactics and the products. / So / if you're starting with the question about tactic or product,/ you've got a leaf in your hand, / but you don't have that root system built yet. //

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When personal finance is framed in the context of delayed gratification so that you can have more money when you're 75 years old, it's really hard to get excited about that. But when we reframe that as financial independence and how taking better care of your money leads to this flourishing of freedom, of opportunity, of choice, that becomes much more enticing. FI is the point at which your potential passive income - money that comes to you when you're sleeping, typically through investments - is enough to cover your basic bills. And the reason that matters is because then endless options open up for you. You have the freedom to do whatever you want - whether that's to stay in your current profession, make a midlife career change, become a full-time parent, or travel the world. Whatever choice you want to make, you're able to make that without having to sweat about how you're gonna keep the lights on, how you're gonna keep the fridge stocked.

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When / personal finance is framed / in the context of delayed gratification / so that you can have more money / when you're 75 years old, / it's really hard to get excited about that.// But / when / we reframe that / as financial independence / and how / taking better care of your money / leads to / this flourishing / of freedom, of opportunity, / of choice, / that becomes much more enticing.// FI / is the point at which / your / potential / passive income /- money that comes to you when you're sleeping,/ typically through investments /- is enough / to cover your basic bills. // And the reason that matters is because / then / endless options / open up for you. / You have the freedom to do whatever you want / - whether that's / to stay in your current profession, / make a midlife career change, / become a full-time parent, / or travel the world. / Whatever choice / you want to make, / you're able to make that / without having to sweat about / how you're gonna keep the lights on, / how you're gonna keep the fridge stocked.//