Money Management

7 Powerful Lessons for Achieving Financial Independence

By  Opher Ganel

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The Path to Wealth Starts with Getting Your Mind Right

As I’ve shared elsewhere, I experienced financial hardship as an undergraduate and graduate student, and then as a postdoc. Thankfully, I never dropped into outright poverty.

As I see it, being wealthy isn’t defined by a specific number of zeros in your net worth. It does require and mean that you’ve achieved financial independence. You could be wealthy with less than $1 million net worth if your expenses are low enough. On the other hand, you may not be wealthy with a $10 million net worth if your expenses exceed the ~$300,000 a year you can reasonably expect from a portfolio of that size.

After years of focus, work, and grit, we’re well along the path from hardship to wealth, though not quite there yet. Here are 7  lessons I learned along the way, including some surprising ones, very different from conventional wisdom.

7 Lessons to Make the Path to Financial Independence Shorter and (Somewhat) Easier

At the end of the day, knowing stuff isn’t enough to generate breakthrough results. Otherwise I’d already have lost a bunch of weight :). What’s required is a combination of 3 things:

  • Knowledge (yup, can’t escape that one)
  • Mindset (knowledge can help you identify this, but you have to apply that knowledge in the right ways)
  • Accountability and support (to keep you present to your commitments and in action to accomplish what you set out to do)

Here are my 7 lessons that will help you achieve breakthrough financial results.

1. Set money aside routinely

After articulating your financial goals, you need to make a plan for how to achieve those goals, and identify the monthly amounts you need to set aside for each. Then, each month put aside money for short-term goals in safe places (e.g., savings account, certificate of deposit, money market account, etc.).

For longer-term goals, invest the money based on your personal willingness to accept risk. However, note that if you don’t want to risk any investment losses, you will forgo the growth stocks can deliver and will need to set aside a lot more.

2. Budget intelligently

As I discuss here, there are many ways your budgeting can fail. Use the tips I provide in that article to avoid those pitfalls.

Note that successful budgeting isn’t necessarily about cutting expenses (though that is an important tool at times). As often stated by Ben Le Fort, it’s more about aligning your spending with your financial goals and priorities.

Spending money to gain valuable new skills, or to outsource low-skill tasks to buy yourself time increases your net result. You should see such spending as an investment, rather than a cost to be cut.

3. Use debt, but never become its slave

Using credit cards to buy things you don’t need with money you can’t afford is a quick way into a debt spiral that can eviscerate your financial future. This is how you become a slave to your debt.

Instead, use debt intelligently to invest in things that help you earn more, spend less, or both. For example:

  • An education (see next lesson for more about this);
  • Appreciating assets (e.g., growing your business);
  • Income-generating assets (e.g., rental properties); and/or
  • Reducing your long-term costs (e.g., using a mortgage to buy a home).

4. Get a degree, but be smart about it

In some arenas, you don’t need a college degree. Building a business in plumbing, roofing, carpentry, etc. is one example . If this is your path, you’re better off spending 4-5 years and $100,000-$250,000 growing your business than getting a degree.

However, in many fields, an education opens doors and gives you knowledge, skills, tools, and networking connections that can provide a lifetime of increased income. Still, research shows that in most fields, 10 years post-graduation your results are almost independent of which school you attended.

Thus, consider carefully if paying $70,000 a year for 4-5 years at an elite private school is a good investment. You may do better attending a good community college for two years, and then transferring to your state’s university system. Your cost may be 75% lower, and your degree and education may well provide comparable long-term results.

5. Consider starting a business as soon as you can

Not everyone who drops out of college will go on to build the next Microsoft or Facebook. Graduating, gaining a few years of on-the-job experience, and building a professional network will improve your chance of success.

Having said that, staying as an employee for your entire career will likely generate a far smaller lifetime financial result. Thus, if you have what it takes to take on the risk of starting a business, do it as soon as you can reasonably expect to succeed.

6. Diversification is good in income streams, not just investments

When you invest, it’s a good idea to spread your investments across multiple assets and asset classes. This usually reduces volatility and risk while offering near-comparable returns.

The same holds true for income streams. Consider building multiple ways for money to flow into your accounts by building an investment portfolio, starting a side hustle, buying rental property, etc.

However, keep in mind that adding income streams increases takes time and effort. Even after you set up a new stream, it takes time to manage. Thus, follow these guidelines:

  • Only add income streams that provide a high enough return on time and money invested to justify the effort;
  • Add one stream at a time so you don’t get overwhelmed by the knowledge, skills, and experience you need to gain.
  • Don’t add more streams than you can manage in the time you’re willing to devote to them.

7. Take time off to recharge, but don’t just goof off

Taking time off periodically to rest and recharge is critical to avoid burnout. However, try to use such vacations to learn new things and broaden your experience. Also, keep your eyes and ears open for new opportunities. You might see how someone else’s business in your industry does things differently. That might spark ideas on how you can make your own operation more efficient and effective.

Talk with people you meet. One of them might become your next mentor, partner, client, or business-referral source.

The Bottom Line

Overnight success is a myth. Financial and business success is a long road, with ups, downs, and pitfalls. Long-term, your success will depend on what you know, but more so on how you use what you know. The above are 7 lessons I learned along my own financial journey that could help make your journey smoother and more successful.

Disclaimer: This article is intended for informational purposes only, and should not be considered financial advice. You should consult a financial professional before making any major financial decisions.

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About the Author

Opher Ganel

My career has had many unpredictable twists and turns. A MSc in theoretical physics, PhD in experimental high-energy physics, postdoc in particle detector R&D, research position in experimental cosmic-ray physics (including a couple of visits to Antarctica), a brief stint at a small engineering services company supporting NASA, followed by starting my own small consulting practice supporting NASA projects and programs. Along the way, I started other micro businesses and helped my wife start and grow her own Marriage and Family Therapy practice. Now, I use all these experiences to also offer financial strategy services to help independent professionals achieve their personal and business finance goals.

Connect with me on my own site: and/or follow my Medium publication:

Disclaimer: In order to make Wealthtender free for our readers, we earn money from advertisers including financial professionals and firms that pay to be featured on our platform. This creates a natural conflict of interest when we favor promotion of our clients over other professionals and firms not featured on Wealthtender. Learn how we operate with integrity to earn your trust.

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