Core Principle # 1 - Health and time are your 2 greatest assets.
You can use your time to make you money. You can also use money to buy you time. But even with all the wealth in this world, your time is still capped to a certain point. As cliché as it sounds, you can’t reverse time. Once its over, its over. And what good is time without the health to enjoy it? Take good care of yourself so that you can take care of those around you. There is a paradox in society where people work all their lives to save money so that they can have time to enjoy their retirement age at 65 (and now getting even more delayed). The problem is, work has been slowly killing their health and now that they hit retirement age, they do not have the strength to do what they love.
Core Principle # 2 - Everything compounds - that includes money and knowledge
We all know about the power of compound interest. You earn interest on your interest and eventually with time, you see exponential growth, But this is the same for your knowledge. Every experience you gain, every mistake you make, you learn and get better than before. The problem is with all the information readily available out there in the palm of your hands, there is also a ton of misleading information and outright lies. There is too much noise out there and it is hard to keep organized! You will have to learn how to filter the noise and at the same time keep an open mind. Stay informed, always do your research, rinse and repeat.
Core Principle # 3 - Spend your gains, not the principal
Don't touch the money that you originally invested, only the interest that comes out of it (but only if you really have to). Don't buy things that you can't afford and don't need. Do not fall into the lifestyle creep! The equation is very simple: once your monthly interest can pay for all of your monthly expenses, then you are essentially financially free.
Core Principle # 4 - Find your "Ikigai"
What is your purpose?
Ikigai is a Japanese concept that means "a reason for being".
There are 4 key elements that must all be met in order
to reach your Ikigai:
1. Something that you love doing
2. Something that you are good at
3. Something that the world needs
4. Something that you can be paid for
I want to put emphasis on #4, since there tends to be a negative
connotation to “money” or being "rich". Society has conditioned us
to view money at a certain light. Words that immediately come
to mind when we think of money are: greed, power, fighting,
evil rich people.
The majority of us have been conditioned to think these things.
Sure money can definitely be associated with those things.
But before you continue, you have to strip these notions and think of
what else can “money” be associated with?
In its core, money can also give you:
2. Time (although still finite)
Once you find your Ikigai, you won't need to "retire". Everything is in
harmony and it becomes your way of living.
Core Principle # 5 Automate
Master it, automate it, and then move on to the next thing. Set up a system where you don't have to spend time and effort monitoring. It’s all about time saved. Once you only have to monitor it once in a while (or not at all), then you can direct your time on other things that matter!
Examples: Automatic deposits to an investment account, utility bill autopay, using a great property manager for real estate
Core Principle # 6 Focus and consistency
Maintain laser focus on your goal. Don’t focus on multiple things, otherwise you get distracted. Just focus on that one thing and focus all of your energy into it. With persistence, energy, targeted effort, and time you will achieve it. It’s all about targeted effort and taking MASSIVE action.
Core Principle # 7 Chunk your goals down
Don’t feel overwhelmed by the million things you have to do. Organize it by priority and only do the top few things that will move you closer towards your goal. Once you accomplish those, you can move on to the next lesser tasks at hand. There’s a snowball effect whenever you accomplish something. It makes you feel good and you tend to ride that energy and end up accomplishing things one after the other!
Core Principle # 8 Work smarter not harder. Understand the 80/20 principle
There is something called the “80/20 Principle”. It’s also called the Pareto principle, which basically states that around 80% of the effects come from 20% of the causes. If you think about it the other way, 20% of wasted effects come from 80% of efforts. Note that the ratio doesn’t have to be exactly 20% and 80%. All this means is that a small percentage of what you do will give you most of the results. Hence once you do find out what works, you should really focus all that energy on the 20% to maximize your results even further!
Core Principle # 9 Balance between research and action. Do not fall into "analysis paralysis"!
Don’t spend too much time analyzing things. You most likely will not be 100% prepared for anything. 80-90% is most likely good enough. Even if you researched 99%, things can still go wrong. Eventually, you just HAVE to take ACTION. It’s OK to make mistakes. The important thing is to learn, adapt, and get better.
Core Principle # 10 Leverage other people's strengths
What is your time worth? Can you pay someone else to do it better than you so that you can spend your time on something else that you love doing and will be more effective at? We all have strengths and weaknesses. It’s very important to create a great team where each person can naturally use their strengths to contribute to your goal. That way, you can focus on doing something else. Outsource your weaknesses. Of course, this will depend on which stage of your financial freedom journey you are at. In the beginning, you will be doing everything yourself. But as your resources grow, your ability to leverage grows as well. It’s your responsibility to recognize which task can be delegated to whom throughout each step of your growth.
Core Principle # 11 Give back to society
Keep perspective. There is always others in worse situations than you are. The fact that you are reading this means you have internet access! There is a good portion of the world that is still being kept in the dark. Never forget where you came from. Donate to charity. Donate to a cause. Help others around you!
Core Principle # 12 There are 3 sides to every coin. Keep an open mind.
"There are three sides to every coin, heads, tails, and the edge." - Robert Kiyosaki. Keep an open mind and understand opposing sides. See all angles of the story. Do not fall into an "echo chamber" where you only seek information that reinforces your existing views. What may be a fact today may not be tomorrow! And yes, these aforementioned principles above can change. But what truly matters is that you continue to learn and develop your own principles that can evolve over time.