Some stuff I’ve learnt about money and not losing it all:
How to be financially competent (not get rich, but I’ll mention businesses, stock market, and real estate). ETF’s; get some real data again. Money is fake shortened.
1) What is money?
Money is debt. Refer to this video made years ago, and then search up “Money as Debt II” and “Money as Debt III”.
Refer to this old blog post of mine if you want an explanation, rather than a simple conclusion.
Basically, money is created when we borrow money from a loan provider, or from a bank.
Taking out loans is easy nowadays, with apps like Afterpay and literally heaps of other things.
I’m not sure what the reality is with these apps, but I know that borrowing from most traditional loan providers and from banks actually creates money, by creating a loan agreement.
Since money is being digitalised, loans can be provided without physical cash.
So the money’s created once there’s evidence of its necessity, being on a document signed or declared by you, that you want to borrow a certain amount of money at a particular interest rate.
As for borrowing from a bank, this document would give them permission to firstly “give” you that money, and then to go and invest that amount of money at a higher interest rate elsewhere.
This would usually end up being in real estate, or in business or the stock market, as these provide the highest returns.
Money is fed into the economy this way, and ultimately you’re spending debt, and they’re investing debt.
So most money besides cash, is debt.
And so as the money supply increases as loans are taken account, the economy is also therefore in debt.
But the only way to pay off that debt is with money you get from your job or somewhere else, of which is also debt.
Debt paid off with an increased amount of debt, due to interest.
Perpetual increase in debt.
The rich own real estate, business and the stock market, and so they get exposure to assets heavily invested in, while the poor get nothing.
A gap which will never stop widening.
2) How can you use this to your advantage?
Invest in real estate, business and the stock market.
Real estate, probs go study it, or just research how to do it via podcasts and stuff.
Here’s one: Passive Real Estate Investing by Marco Santarelli.
Business, I’ll be talking more about that in a few days.
Stock market, don’t invest in random shit like an idiot.
Don’t even research it and pick anything individually.
Just invest in ETF’s/Index Funds, for your country.
Low management fee, diversified, pays dividends, less head-ache.
I invested in VAS (Vanguard Australian Shares) and VGS (Vanguard International Shares).
Probably just search up, “Best ETF’s for [enter your country here]”.
3) Personal Finance
Pick a mental budget for things.
I wanna talk about buying things on credit, then paying that off in the interest-free period with money from your debit account, but I’m still looking into that so I won’t say anything.
You improve your credit score, and can also claim whatever benefits that card offers.
I’m also looking into getting a business card to purchase all business expenses on, so that when you pay it off in the interest-free period, you don’t need to worry about collecting deductions at tax-time.
They’re all logged in the card.
In Australia, we can download the app made by our tax department, the ATO, and log deductible expenses with our receipts that way.
Also something to keep in mind when spending, if you can’t AFFORD to buy two of whatever it is, you shouldn’t buy it.
5) Break down why you spent money.
You can either do it at the time that you spend the money, or you can reflect on it at the end of the day.
I enter a daily log on this app at night, answering how good my day was.
In my notes, I write down exactly why I spent money on certain things.
What was the reason I bought?
Didn’t buy more?
What would’ve made me buy more?
Stuff like that.
6) Join the Peaky Pines Email Community.
I dare you… to Become a New Person in 30 Days.
