Looking back to my younger years, there is always somethings that I wish I had make it different. It’s inevitable. Although I believe that we should always be looking into the future (preparing future adventures), it’s important to learn from lessons that past events have teach us.
Today I’ll write about important things that I wish I knew years ago, and hopefully it might be helpful to you on your own journey.
7 Pieces of Advice to My Younger Self
1- Plan for your future. First step is identifying your goals, so you can write a plan on how to achieve those objectives. Take for example your financial situation. If you plan accordingly, you can set a savings rate early on. And then begin to invest.
Another thing: when planning don’t forget to contemplate the “worst case scenario”. If you have a solution for that, you will be better prepared. Things change, learn to adapt.
2- Embrace a healthy life. Sometimes in our life, we are full of work and things to do. It’s easy to say “I’ll hit the gym tomorrow…or the day after,…or next weekend”. Don’t do that. Keep your health and physical well-being as a top priority. I keep imagining a health problem that basically consists in: If you don’t do exercise today you will die. So even if I have a lot of work, I always try to find 30-45 minutes to exercise. Additionally you build “physical credit” for those days where it was truly impossible to hit the gym.
Also it’s very important to eat well and sleep enough time to truly rest. Your future you will thank those precious healthy habits.
3- Start saving earlier. The earlier you start saving, the more you will grow your emergency fund. Therefore you will have more options to choose from. Bare in mind, the more you increase your savings, more stability you will have in your life. Less pressure.
4- Learn how to invest. But keep it simple. Learn to use the passive investment strategy in your favor (beats active management strategies). Understand how companies work. Keep your costs to the minimum. If you start investing earlier, you will learn the true power of compound interest.
Albert Einstein reportedly described compound interest as “the most powerful force in the universe.“
It’s ok if you want to take a little more risk when you’re young, you have more time to recover, but take into consideration a simple 60%/40% portfolio between stocks/bonds. Worldwide diversification is better than only one region (unless that region is the US, in that case you’ll probably be ok). Diversification among sectors is way better than focus only in one sector. We never know what the future holds. Here’s a free tutorial.
5- Travel. Be curious, get to know different people from different cultures. You will get more tolerant, and learn a new perspective of the world, that you never thought possible. Also learn at least 2 new languages. Start as fast and early as possible.
6- Pay off your debts. Asking for a loan can help you at some point in life. But pay all of it as fast as you can. It can be a burden, and in the end you will feel free. Your future you will be happy with all that money saved in interest.
7- Evidence-based decisions. Don’t decide on something only because everyone is doing the same. Learn to say “no”. Learn to ask for evidence if someone is trying to sell you something or an idea. Don’t be embarrassed for asking information. It will save you both money and time. Invest your money and time in things that you actually understand. If it’s too complicated, say no and move on.