How to Invest Money from your Side Gig

There are many different ideas for a side gig and several different options for what we can do with money from our side gig, but what about investing it? There are 4 ways I’ve considered investing the money from my side gig and each have their own pros and cons. They are:

1) Put the money into a Roth IRA. This allows me to invest in index mutual funds in a way that’s tax free and will gain interest overtime. When I take the money out in retirement, I can do so tax-free. Plus, if I happen to need this money before that to put a down payment down on a home, pay off some of student loans, invest in real estate, or pay some unexpected medical expenses I can do so without any penalties.

2) Increase the money I contribute to my job’s 401K. Technically you can’t put your side income into a work 401K but you could open up a solo 401K or increase the percentage of money you contribute to your work 401K up to the $19,000 yearly limit. The benefit of this is that you are still investing toward retirement in a way that’s tax efficient and you don’t have to worry about managing another retirement account with different investments. Plus, if you have federal student loans like I do and are on an income-driven repayment plan going for public service loan forgiveness, increasing the percentage you contribute toward your 401K actually lowers your monthly student loan payments which may leave even more money in your pocket each month.

3) Open a taxable “brokerage” account. If you have already contributed the max amount to your retirement account or Roth account but still want to invest in stocks and index funds, open up a brokerage account. This will allow you to invest in the stock market in a way that will gain you interest over time but isn’t tied to your retirement. This means if you happen to need the money for home renovations, better car, or a lavish vacation you can have your broker sell some of your stocks and get the money you need when you need it. Opening up a taxable “brokerage account” isn’t the most tax-efficient account since you will pay taxes on the profits you make but it gives you easier access to your money when you need it.

4) Invest in real estate. One of the main ways many American’s build wealth is through Real estate. Not only can it help you get higher returns on your investments which increase your profits, but it also allows you to do so in a way that’s tax-efficient and even tax-free. If you already have a decent chunk of money in your work retirement plans invested in index mutual funds perhaps you may want to diversify your invests a little and get started in real estate. You could start buying rental properties to increase your monthly cash flow and become an active investor who can write off taxes from your day job, you could start investing in crowdfunding deals or real estate syndications with other investors who focus on making money from apartment deals as a more passive investor, or you could simply start buying smaller properties and renting them out over time, or even just invest in some Real Estate Investment Trusts (REITS) which are like index mutual funds for real estate deals. There are many options available.

My point? The correct option may differ for each person. If you are young, haven’t maxed out your retirement accounts, and don’t need the extra cash on hand, perhaps putting the money into a Roth IRA or extra money in your job’s 401K may be the best option. If you’ve already maxed out your retirement accounts or think you might need this money before you turn 55, then perhaps opening up a brokerage account may be the best move. Although you pay a little more in taxes it may provide the flexibility you need to take the money out if an emergency arises. If you already have a good chunk invested in the stock market perhaps you should consider other investment vehicles like real estate. Contrary to popular belief, you don’t have to be rich to invest in real estate and there are many different options that may suit your lifestyle and risk tolerance best. Right now, I’m putting extra money into retirement accounts, but I plan to invest a lot more into real estate once I finish my residency training. Look into the different types of investment options and choose the one that may be best for you, keeping in mind that it may vary based on your life circumstances and net worth.

6 Things To Do With Your Stimulus Check

Of note, a version of this article first appeared on Doximity’s OpMed.

The federal government has started sending out stimulus checks of $1200 to all Americans with an adjusted gross income of less than $75,000 a year for singles and 150,000 a year for married couples. Although the amount of the stimulus decreases for those who make above $75,000 a year and is completely phased out for those who make over $99,000 a year, many people will be seeing a bank account boost, if they haven’t already. Here are 6 things you should consider doing with your stimulus check:

1.     Pay bills and buy necessities. With over 22 million people filing for unemployment over the last 4weeks, many people are seeing a sharp reduction in their income and may be relying solely on government assistance. This $1200 may be just what people need to cover all their bills during this time. It may also help newer physicians and healthcare workers with any extra expenses we might be facing such as increased transportation costs to and from the hospital or increased food costs as we pay for more take out & delivery services. Others people may have children or a spouse they are helping to support and may need to use this money to pay a babysitter or cover other childcare fees. Regardless of what the expense is, we should all use this extra money to cover any bills we would have had difficulty paying otherwise.

2.     Create an emergency fund. Saving money for an emergency fund it a little bit like trying to eat healthier or lose weight. We know we should do it, but we’re always tempted to put it off. Why not use this stimulus check to finally get the ball rolling? Although many of our jobs are salaried and thus our income seems guaranteed, an emergency fund is still useful. You never know when the car might break down, the house needs repair, or our cell phone stops working. While these inconveniences may not bankrupt us, having money set aside for these seemingly inevitable, unpredictable expenses is a good use of our money. According to finance guru Dave Ramsey, the minimum amount of money in any emergency fund should be $1,000 and many financial planners advise patrons to have about 3 months of expenses in cash available at all times. This stimulus check is a good starting point.

3.     Pay down your debt. If you have any consumer debt like credit card bills or car loans that have an interest rate of higher than 8%, use this money to pay down the debt. The sooner you are able to eliminate your consumer debt, the quicker you’ll be able to build wealth and become financially independent. Instead of sending hundreds of dollars a month to a credit card company or car dealership, after paying off the debt you can instead use that money to increase your savings, invest, and fund future trips and vacations. With the Coronavirus pandemic, you may even be able to refinance loans at a lower interest rate which will allow you to pay off the balance you owe even sooner.

4.     Spend it when the economy bounces back. Whether it’s gifts for your kids or a much-needed family vacation, one of the things you could do with the money is simply spend it. Now for those who already buy way more things than they need, perhaps this isn’t the best idea, but for others who have a budget in place and are meeting all of their saving goals, using some of the money to “treat yo’self” may not be a bad idea. Many of us have been on the front lines of this pandemic and have sacrificed a great deal to help care for others. Despite the increase in hours, workload, and mental stress, many jobs don’t include any sort of bonus pay for times like these. Instead of feeling like you have to always put others before yourself, why not consider going against then grain and spending part of the stimulus money on yourself or those you love? Perhaps you’ve delayed buying those air pods you see your colleagues wearing at work. Maybe you’ve always wanted to travel overseas with your family, party in Las Vegas with your friends, or go wine tasting with your significant other. We all work hard and deserve a break. Why not use part of this check to do something nice for yourself?

5.     Prepare to invest it when good opportunities arise. Although the economy is down right now, it won’t be this way forever. Once the pandemic begins to subside and the prevalence of the virus decreases, the economy will start to bounce back. Why not use this money to prepare for when it does? Using this stimulus check, along with any additional money you may have received from your tax return or previous savings might leave you with a nice sum of cash to invest in various opportunities. Perhaps you’ve considered investing in an intriguing business idea, purchasing a rental property, or simply want to increase your investments in the stock market. Using this stimulus check as a jumpstart for your future investments might be a good use of this money.

6.     Give some of it away.  I’d be remiss, and a bit selfish, if I didn’t mention that one additional thing you could do with your check is give part of it away. For those of us who are in a good financial position, giving part of the money away to our friends and family who may be less fortunate may also be a good use of this money. While many of us have financial goals or fancy trips we’d like to save up for, we can all think of at least one person in our life who could use a little extra cash around this time of the year. Perhaps we could commit to giving at least a small portion of the money away or buying someone we love a nice gift. As the biblical saying goes, “We are blessed to be a blessing.” Why not use this money to provide a small token of love to someone else?

What should we do with money from our side gig?

Many of us have side gigs or extra income outside of our day jobs. While the extra money is nice, is there something “smart” we should be doing with it? Here are 4 options:  

Choice 1: Pay off Debt  

Whether it’s student loans, a car loan, or credit cards, one of the first things you should consider doing with any extra income, is paying down any debt or loans you have. As someone who is going for public service loan forgiveness (PSLF), paying off my student loans is not a priority for me, right now. With PSLF, my payments are currently capped at 10% of my discretionary income. After 10 years of these low payments, the government will “forgive” any debt I still have left, tax-free. This is a pretty sweet deal, so I have little incentive to pay more money towards this debt than I have to.  If you aren’t going for PSLF, then your strategy may be vastly different. Perhaps you’d want to consider refinancing your student loans at a lower interest rate and paying them off as quickly as possible. If that’s the case, then using money from your side gig to pay off your student loans faster might be a good option.

For those who don’t have any student loan debt or have already paid theirs off, you could use the money from your side gig to pay off any other debts, especially anything with an interest rate higher than 8%. For example, if you have credit card debt or a car loan, using the money from your side gig to get rid of these debts quicker may not only save you money in interest over time but it will also leave more money in your pocket each month as you begin to get rid of that debt and no longer have those payments as one of your monthly bills.

Choice 2: Save It.

As a first-year physician, saving money is a major priority for me. Unlike many other graduate school programs, it was virtually impossible to work a job in medical school. The inability to work, precluded me from making money which meant I couldn’t save money. As a result, my emergency fund was non-existent and I didn’t have all the funds I needed to move to a new city, make necessary travel plans for various events, or even schedule the celebratory vacation I needed before starting one of the most demanding jobs in the country. After going through that experience, I never want to be in that position again.

If you haven’t been able to save a good chunk of money from your main job, perhaps you should use the extra money from your side gig. You should not only consider saving money for emergencies but also factor in saving money for future vacations, Christmas gifts, car maintenance or any other large purchases. They key is save the money in a high-yield savings account or money market account which will allow you gain a interest on your money in a way that is risk-free while still giving you the freedom to pull money out of the account easily whenever you need it.

Choice 3: Spend It

As a resident physician who can sometimes work up to 80 hours a week without any extra over-time pay, work can be a bit exhausting. Sometimes being able to purchase something I really want, have monthly self-care days that include a massage and trip to the spa, or going on an international vacation to one of the places on my bucket list can be just the refresher I need. While I’m all about financial independence and having enough money to create a life you don’t need to vacation from, career longevity is vitally important, at least at this stage in my life. Sometimes the best thing we can do to maintain career longevity is to take necessary breaks and occasionally treat ourselves to some of the things we really love and enjoy. We all need balance in our lives, especially in terms of work vs play or work and relaxation.

Choice 4: Invest It

As I’ve stacked up a decent emergency fund and paid off all of my credit card debt, one of the things I’ve been contemplating more and more is how to invest the money from my side gig. While I don’t like the risk associated with buying individual stocks, I’m a huge fan of index mutual funds and have always liked real estate, so when it comes to investing side income I  have a few options:

-Put the money into a retirement account (such as Roth IRA or increase the percentage I contribute to the 401K I have at my job)

-Open a taxable brokerage account (so I can make different types of investments in a way that isn’t tied to my retirement so that I can more easily pull the money out if I need it)

-Invest in real estate (either through rental properties, apartment syndications with other investors, or a variety of other options).

My point? I’ve listed many options of things you can do with income from your side gig. However, the right choice may be different for each person. If you don’t have a decent emergency fund, perhaps you should start by saving your side income. If you have some high-interest debt from credit cards or a car loan, eliminating that might be your second option. If you’re nearly debt-free and already have money saved for emergencies and other large expenses, consider investing your side gig money into retirement accounts, taxable accounts, or real estate.

6 Step Money Challenge for 2020

As we embark upon this new decade, many of us are committed improving our finances. We may have vowed to stick to a budget or have a general goal to live below our means. While these are noble goals, let’s challenge ourselves to do even more. Here’s my 6 step-money challenge for 2020:  

1. Buy 1 or 2 finance books to read. There are many different ways to consume information but I’m a firm believer in the benefit of books. While I enjoy blogs, books can be a one-stop-shop for the information you seek. Having books allows us to highlight certain passages and tips that make the material a consistent resource we can refer to throughout our journeys. Plus, it provides a single resource we can use to learn about a several different topics or go in depth on one particular area. There are plenty of good finance books but I think the white coat investor has a list of recommendations organized by various categories that can be useful. When I started on my personal finance journey my favorite books were Rich Dad Poor Dad, the White Coat Investor, and the Total Money Makeover. I’ve just purchased How to Think about Money and tend to refer to Ken McElroy’s The ABCs of Real Estate Investing as I’m thinking over new real estate deals. There’s always more to learn and books are a great way to do that. Pick a couple finance books to read this year.

2. Download a finance podcast. As someone who is intellectually curious and loves to be efficient during my “off” time, I consume a lot of finance information via podcast. Whether it’s the “Hippocratic Hustle” giving me insight into ways other female docs have increased their income, “Docs Outside the Box” giving me new ideas on ways to create additional revenue streams, or the “White Coat Investor” providing step-by-step instructions on how to do a backdoor Roth IRA, podcasts can be a great way to learn about various finance topics without requiring a huge sacrifice of your time. Most episodes are 30-45min or faster if you alter the playback speed. Whether you’re commuting to work, cooking dinner, or working out at the gym, there are plenty of good podcast options. As you continue along your journey of increased financial literacy, download a finance podcast and commit to listening to 1-2 episodes a week.

3.  Join an in-person or online group. Along with increasing your knowledge via books and podcasts, strive to be more active as well. Whether it’s participating in a finance-focused Facebook group, joining the Bogleheads F.I.R.E. (financial independence retire early) online community, or going to real estate investor meetup groups in your city, surrounding yourself with likeminded people can be beneficial. In fact, it’s this active engagement that can propel us even further along in our journey. These groups and online communities challenge us to share our goals with others and inundate us with people traveling a similar path. They also provide a slew of contacts that can keep us motivated and accountable. As you continue along your journey, commit to joining at least one finance or investor group.

4. Create a spending plan for the next month. There couldn’t be a money challenge without a point on living below your means. While many of us would like to increase our savings and invest more, this can be quite challenging to uphold. Sustainable change involves altering our behaviors and putting boundaries in place that keep us focused on our goals. One of the best ways to do this is by creating a spending plan for the next pay period. While most of us know where large chunks of our money are spent, there still may be things that go unnoticed. The challenge for this year is to create an active spending plan that outlines which things we will purchase, and which bills will be paid on certain dates. It also includes automating our payments so that a percentage of our income automatically goes to various savings accounts or investment funds. If you haven’t already done so, create a spending plan that automates payments and “forces” you to live below your means.

5. Pay off “bad debt” early. I’m a huge proponent of paying off consumer debt, especially when the interest rate is higher than 7%. Many of us understand the importance of getting the match to our retirement plans, but once that’s done, we are unsure on what to do next. The correct answer may vary from person to person but generally speaking, once you have at least a small amount of cash for emergencies, you should prioritize paying off consumer debt like high-interest credit cards or car loans. Although investing in the stock market is another great option, the guaranteed return from paying off debt cannot go unnoticed. Plus, paying off consumer debt faster will increase our monthly cash flow and allow us to invest even more towards retirement once the debt is paid off.

6. Give more to charity. Although we each have different priorities and plans for our money, one of the things I challenge you to do this year is think outside of yourself and give more. Even though it can be tempting to delay helping others until we have met all of our own individual goals, I challenge you to find ways to give in the midst of this journey. Oftentimes, we find the most happiness when we find ways to assist others. Giving has helped me stay grounded in the midst of success and allowed me to help others in a way that has increased my own quality of life in ways I never imagined. In 2020, I challenge you to find ways to give more. Doing so may impact your own life more than you may realize.

Tell me, what are some ways you will challenge yourself to improve your finances this year?

New Goals for the New Year

1. Increase retirement investments. As young professionals who will eventually retire or cut back on work at some point, we need to start investing towards our future. While many of us may already have started setting aside money for retirement, others of us may not have begun that process. In 2020, let’s strive to do even more. Let’s commit to increasing our retirement savings, even if it’s by a small amount. As we continue to set aside more money for retirement, we will have a greater amount of money invested which will allow the magic of compound interest to work in our favor and increase our net worth.

2. Save more of my income. In addition to investing more money for retirement, I am also striving to save more in general in 2020. In addition to saving up money for vacations and large purchases, we should also have a certain percentage of our income in an emergency fund and for unexpected expenses. While some people may choose to save all additional funds in retirement accounts, I plan to keep a certain percentage of money “liquid” or saved outside of retirement accounts just in case I need to access it at a later date. It’s difficult to take money out of retirement accounts before you reach your mid-50s, so having money saved in a more accessible account is ideal for those of us who may be a bit younger.

3. Live below my means. As I enter in 2020, my goal is live below my means. Instead of buying things because I can afford them or living the doctor lifestyle I envy, I’ve chosen an alternative path: practicing self-control. I share an apartment with a roommate, which allows me to save money on housing costs and other bills. I have a budget for food that I adhere to each month. I also refrain from going to the mall unnecessarily or buying things I want simply because they’re “on sale.” Learning to live below my means has helped me become less materialistic and allowed me to save more, invest a greater amount, and be better prepared for any unexpected events. It has also prevented me from buying things to impress those around me. Instead, I’m focused on my own financial goals which will allow me to make even greater progress toward financial independence.  

4. Pay off bad debt. Before I became financially literate, I made some costly mistakes. I used credit cards to purchase things I didn’t need. I moved to a city I couldn’t afford and failed to live on a budget. I also didn’t save much of anything, for retirement or for emergencies. Now that I’m older and wiser, I have sought to right these wrongs. You might be doing the same thing as well. As we enter this new decade, lets strive to get rid of credit card debt and car loans and refrain from accumulating more. The quicker we get rid of high interest debt, the sooner we can increase our cash flow each month and have more money to invest.

5. Give money to charity. Along with spending money on ourselves and saving money for the future, my goal is to give more. It can be easy to focus on my own priorities but giving allows us to improve the lives of others. Whether it’s paying tithes to the church or increasing charitable donations, giving is a self-less act that allows us to make a difference in the lives of people with real struggles and financial hardships. Although I’d love more money for myself, I recognize that I’ve been blessed beyond measure and should actively seek to pass that grace onto others.

Tell me, what are some of your financial goals for the new year?

5-Step Money Challenge for the Holiday Week

1. Pick one charity or organization to donate to as a family. The holiday season includes a lot of celebrations but it also a time we give. Whether it’s putting a little extra in the church offering or giving our spare change to the solicitors outside of our local grocery stores, many of us express our generosity around the winter holidays. Why not take it a step further this year? Together, with your family members or close friends, pick a charity, organization, or church to give an extra offering to this holiday season. Doing so not only makes us less selfish but it allows us to enhance the lives of someone else.

2. Have a limit on how much you plan to spend during your next restaurant outing and stick to it. While sticking to a budget for an entire month can be a bit challenging, why not take baby steps towards this goal during the holiday season? We can do this by thinking about our next restaurant or social outing and coming up with a budget of how much we want to spend. Then stick to it. For example, if you plan to go to dinner with friends then look at the menu ahead of time, determine how much you plan to spend, and make a concerted effort not to go over that amount when you actually get there. Whether it’s a restaurant or some event in our city, try to use self-control by sticking to a budget, not matter how large or small it may be.

3. Vow to do 3 things that don’t cost any money. Because of the holiday season many of us get additional time to spend with the people we love. While we may be tempted to go out to dinner and do various things around the city, we must be conscientious of how much we’re actually spending. Part 3 of this challenge is doing 3 things during the holidays that don’t cost you an additional money. You could watch a Christmas movie on TV, listen to a holiday album, or bake cookies with ingredients you have at home. You could also video call family members that aren’t with you in person, decorate a Christmas tree with your kids, or play a fun board game with your family. Regardless of what you choose, pick 3 things to do that don’t cost you any extra money.  

4. Purchase at least one meaningful gift for someone you care about. Along with donating money to others, another part of the holiday season is showing appreciation to the people we care about. While we may be tempted to purchase new designer items or expensive electronics, this year deviate from the norm. Think of one inexpensive, but meaningful gift you can give to someone you love. Maybe it’s a book they’d like, a bottle of wine they’d love, tickets to a show or concert they’ll enjoy, or a framed photo of one of your favorite memories.

5. Pledge to learn a little more about personal finance. Along with giving to others and spending time bonding with those we love, as money savvy young professionals we should take this challenge a step further. This holiday week, why not pledge to learn a little more about personal finance as well? We may not have time to read an entire book or go make a budget for the entire year, but we can still start small. We can pledge to spend at least 1 hour increasing our financial literacy. For example, we could listen to a podcast episode on how to best pay off our debt or read a couple chapters in a book on different ways to save money for retirement. We could even skim a few blogs on different ways to get involved in real estate investing or learn how to lower our tax rate in the upcoming year. Whatever the topic or the method, we should vow to spend a little time this holiday season learning more about personal finance and different ways to build wealth.

Tell me, are you willing to try to 5 step holiday money challenge?

Priceless Advice for the Holiday Season

This is one of my favorite times of the year. Thanksgiving dinner with my family, cool air that calls for cute winter clothes, and holiday festivities that invoke the spirit of love and positivity. As we embark on this season, inevitable holiday sales may tempt us more than we can imagine. In order to deal with this temptation and stay within our budgets, we may need a little motivation to help us practice self-control. Here are a few of my favorite money quotes for the holiday season:

“No amount of money or success can take the place of time spent with family.” –  I love this quote because it reminds me of what’s most important. In my quest to find the perfect holiday gift, advance in my career, and make the most lucrative investments I can, I am reminded that it’s quality time with my family that matters the most. This quote also gives me permission to take a day off from writing articles or put my phone down for a couple hours to enjoy a holiday movie, have a large family meal, or bond with my brothers over a football game.

“If you want your children to turn out well, spend twice as much time with them and half as much money.” Abigail Van Buren coined these words and although I’ve never met her and don’t have children, this quote still resonates with me. When I reflect on my childhood and the holiday season, I have so many fond memories. Not because my father bought us the most expensive gifts or because we took the most elaborate vacations, but because we spent plenty of time together. My brothers and I went on to become the Vice President of a large corporation, a financial analyst, and a medical doctor, respectively, because of the life lessons and shared support we gave to one another. Whenever I’m stressed about spending money on gifts, I remind myself that what I lack in money I can make up for in quality time.

“Don’t save what left after spending, but spend what’s left after saving.” This Warren Buffet quote helps me keep my priorities straight, especially during the Christmas season. Black Friday is quickly approaching and I’m always tempted to spend much more than I had planned. When I was a young graduate student living in DC I’d often purchase items “on sale,” then spend the rest of the month praying that I had enough money to cover my remaining expenses. Fast forward to my current life as a doctor, and I’m definitely doing things differently. I have money in certain accounts reserved for bills. I also have money in a “holiday account” through which I saved money during the year so that the gifts I plan to purchase don’t dismantle my financial goals. I’ve learned to make sure my bills are paid, save a certain amount each month, and only spend what’s leftover.

“We make a living by what we get. We make a life by what we give.” This Winston Churchill quote is something I try to remember throughout the year, especially during the holiday season. While I have several financial goals, money alone does not bring happiness and meaning to life. Instead, it’s the spirit of generosity and how we seek to positively influence the lives of those around us. Rather than only thinking of myself and my family, I try to remember those in need and give to other charities and organizations as well.

Tell me, what are some of your favorite money quotes for the holiday season?

5 Money Tips I Learned from My Parents

As we head into the holiday season, many of us will reflect on the things and people for which we are most grateful. For me, that’d be my parents. Not only were they kind enough to have me, their 3rd child after my two older brothers nearly drove them insane, but they also loved me unconditionally and attempted to teach me several life lessons that can be applied to my finances. Here are 5 money tips learned from my parents:

1. You don’t need to be rich to be happy. Unlike many of my physician colleagues who grew up in a family full of medical professionals, my upbringing was much different. With my mother working as a teacher and my father spending the early years of my life working as a non-tenured professor at the local community college, I didn’t grow up rich. Nevertheless, my childhood was amazing. I had plenty of friends in our neighborhood and school. I was extremely involved in our local church and a plethora of after-school activities. The bills were paid, my parents collaborated as a cohesive unit, and I had very few complaints. Finding contentment without being rich, isn’t that strange of a concept. A large analysis done a couple years ago showed that the ideal amount of money for emotional well-being is $75,000 per year. Most people reach peak satisfaction by making around $95,000 a year, but making more money than that can actually decrease your happiness.

2. Making more money may require you to sacrifice time with your family. Before my father started working as a professor, he was very involved in business. He was the general manager of a large department store by the age of 22 and was quickly moving up the corporate ladder soon afterwards. Despite the high pay and rapid promotions, 5 years later, he gave it all up.  He liked the work and got along well with his coworkers, but he quit to spend more time with his family. As he climbed the corporate ladder, he started spending more and more time away from home, away from my mother, and away from his children. He resented the fact that his own father was never home as he grew up and had vowed to more present with his own kids. After saving up a nice nest egg in a “transition account,” he quit his job. My father became a stay-at-home dad for 3 years while he launched his own small business and did some accounting work for his brother’s businesses. While I’m sure our family’s finances took a huge hit, my father will tell you it’s the best decision he ever made. He helped me do my homework each night, picked my brothers up from baseball practice each day, and ate dinner with us each night. He realized that quality time with family can make you happier than money ever will.

3. Live below your means. When I was about 12 years old, my father started working as an auditor within the federal government. With this job, came a substantial increase in pay. Within a few years he had paid off our home, our cars, and built up his retirement savings.  Despite this increase in income, our lives didn’t change much. My father only allowed us to get new clothes once a year, he refused to take us to restaurants with entrée prices over $25, and total Christmas gift spending was still capped at $150 per kid. We kept living in our 3 bedroom 2 bathroom house with furniture we’d had for well over 10 years. I thought this was crazy since we could afford to live more elaborately, but my father refused to budge. He believed in the art of saving for a rainy day and did not want his family to become materialistic or spoiled.

4. Invest in your kids and give to others. My parents wanted to make sure my brothers and I had a fulfilling childhood. We were involved in several sports, played band instruments, and spent a great deal of time forging strong bonds with our extended family. I’m sure many of these things were not cheap but instead of keeping it all to themselves, my parents choose to invest in their children. Along with using money on us, they were also firm believers in the virtue of generosity. As Christians, they gave 10% of their income to the church and donated additional money to various charities and organizations. Again, I’m sure this is money my parents could have used on a bigger home or fancier cars but instead they chose to invest in their kids and give to others. While my parents had fewer material things, they definitely gained more life satisfaction and appreciation for what they had by investing in their children and giving money to others.

5. Everyone’s definition of success is different. As I was deciding what field of medicine to specialize in, I faced a dilemma. The specialty I liked most (family medicine) wasn’t the one that was going to make me seem as smart and accomplished in front of others. It also wasn’t the one that was going to pay me the most money in comparison to other fields. After hearing me vent to him for nearly an hour about my “impossible decision,” my father said something I’ll never forget: “At some point, you have to let go of the opinions of others. At some point, you have to define happiness and success for yourself.” His words helped me see that success isn’t about having the most prestigious job and happiness doesn’t come from making the most money. We each have to determine what success means for us and find happiness in the simple things that fill us with joy, even if it looks different from someone else.

Tell me, what tips and words of advice did you learn from your parents or loved ones?