#35 Personal Finance

The Idea Roastery

About the Episode

In this episode we dive into the topic of personal finance, how to ensure that you don't run out of money at the end of the month, the importance of income rather than saving as a means of accumulating wealth and some topics here and there about how to generate value in this modern world.

Outline

(0:00) How to start the conversation about personal finance. (1:30) A concept, how does inflation work? (4:30) Putting money to work as a solution and using stocks as a way to make money with your money. (7:00) Buying vs renting and delayed gratification. (9:50) What about the FIRE movement? (11:50) High housing prices, saving for retirement & increasing income. (15:00) Importance of cashflow (16:30) Herman drops some opinions on investing in stocks. (18:35) ETFs vs starting a business. (20:45) Correction!! it would be 120% ROI soz :) (21:30) Accumulating wealth via properties and leverage. (23:15) How would you know you've "made" it? (24:40) Some advice on money vs happiness and finding the minimum amount needed to live. (26:38) How to increase your income and get more cash? (28:13) On getting a university degree in South Africa vs United States. (29:05) Supply and demand for skills, picking a career & value to work ratio. (31:40) Gigs vs small businesses vs startups. (33:50) Generating value via bootstrapping on your physical input. (37:00) Building an emergency fund if you have a job & paying yourself first. (40:10) Emergency funds as a way of building a risk appetite. (43:35) The hedonic curve of getting building up income and getting wrecked in US & UK. (45:40) Using percentage of salary to baseline certain expenses. (48:00) Candle charts too early is not good and a thought experience about time in the market.