10 Financial Lessons for my 18 Year Old Self

Here are 10 financial lessons I’ve learned in the past 10 years that I wish I could tell my 18 year old self.

Start with the proper framework of accounts:

  1. Checking
  2. Investment (retirement)
  3. Long term savings (wedding, house, car)
  4. Short term savings (vacation)
  5. Guilt free spending (clothes, dining out, and gadgets)
  6. Emergency (three months of living expenses)
  7. Credit card (groceries, utilities, etc)
Automate your personal finance framework for investing, saving, and paying bills.

Automate your personal finance framework for investing, saving, and paying bills.


Set up automatic monthly investments, savings, and bill payments. “Paying yourself first” will help you achieve savings and investment goals and live within your means.

Avoid debt. It’s easy to start, hard to stop, and expensive to keep.

Start investing in index funds as early as possible. Hold them long term and let compound interest make you wealthy.  A dollar invested today is worth many more tomorrow. Forget mutual funds and GICs.

Don’t save mercilessly on the small things, only to spend carelessly on the big ones. Buying a house or a car is a huge purchase. Take your time, do your research, and don’t spend on needless options.

When you feel the need to buy something, put it out of your mind and wait three days.

Everything you buy has three costs: the cost of acquiring it, the cost of owning it, and the opportunity cost of not using the money for something else. Consider all of them before making a purchase.

Buy fewer things, and buy quality ones. Seek happiness in experiences, not possessions.

Money increases day-to-day happiness up to $75,000/year. Above that, life-satisfaction may increase but day-to-day happiness stays the same. Optimize for the most fulfilling work, not the highest paying.

Start a business. You’ll value money more after learning how challenging it can be to earn it outside of employment.