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The Simple Dollar Book Review

Five things I’ve learned from reading The Simple Dollar By Trent Hamm

The Simple Dollar was a pleasant read with plenty of relatable examples that helped me grasp how everyone should evaluate how they are spending their money. I’ve thoroughly enjoyed reading it and found a few topics in particular which resonated with me and encouraged me to share my success and failures with everyone.

Click Here to purchase The Simple Dollar by Trent Hamm

What is your view of success? Don’t be constrained to the populist view of success as career/materialistic, instead define your own version and work for that.

The Simple Dollar helped me realize the importance of defining my own version of success and standing by it, not simply adopting what society views as success. It helped me establish what I wanted for my family, what my core values are and be confident to stand by them. I was relieved to not be afraid of whether I’m measuring up to other people’s version of success.

I worked on defining what my long and short term goals are, making sure they were directly relevant to each other. Long term goals were monumental and inspired me to want to achieve it. Short term goals were realistic, achievable and encouraged me to reach my long term goals.

Through this process, I ran across another motivational book, The Miracle Morning by Hal Elrod. I used the Miracle Morning process to inspire me to wake up early every day to have a purpose, to see what my goals are and how I will make progress on them every day until they are achieved. There is a synergy in both books, allowing me to really focus on what success is and how the work I put in now will have long term results.

Don’t spend time building up loyalty to your company, instead build it with those you work with. The company will fire you the moment they don’t need you, but the relationships you build you can take with you anywhere

Having worked in the IT contracting industry for over 10 years, I’ve experienced how fluid the contracting gig can be. How seemingly long standing contracts can go away rather quickly, with each contractor scrambling to find other opportunities. No matter how much time you have spent at a company, working hard to achieve promotions, developing more efficient processes, it can all go away if there are layoffs, mergers, contract changes, etc… These external factors are typically out of the hands of most employees. We simply cannot control those external factors but it will behoove us to take advantage of what does remain. The moments we spend with our coworkers and the memories of them will remain. Realize the relationships you build will make a lasting impression on you and allow you to stay connected with them wherever you go in your career and also personally.

I’ve realized over the past few years I’ve been too busy focused on doing drone/busy work, having my laser focus on accomplishing tasks to fix broken issues and ignoring or spending little time reaching out to my coworkers and collaborating with them. I’ve ignored building sound relationships with my coworkers, and taking the time to hear their struggles and how I can help them. It is much more important to have those relationships, to know who you can turn to for help then thinking you can fix every issue that comes your way. The experiences of building good working relationships will stay with you as soft skills. These soft skills are highly valued and transferable wherever you go. Take the time to realize that the work in front of you may seem important to you now but can instantly be a non-issue the moment your job disappears. What remains are the memories and how you were able to connect with your coworkers to accomplish something together. Take those positive experiences and use them at your next career opportunity.

Develop a habit of scarcity, never let yourself think you have plenty of money to spend on frivolous things. Distribute your money into many accounts that requires funding so you don’t see a large lump sum ready to be spent on anything you want. Make getting to your money difficult, it will give you hesitation to use your money for splurge items

This method has been a very helpful budgeting tool for my family, enabling us to really spend money on things that matter long term and prevent us from making frivolous financial decisions that only give you short term joy.  

Like most American families, my wife and I worked full time giving us two incomes to live off of in the expensive Northern VA region. It was always exciting to see how we could sustain ourselves with one income and have another income to spend/save on whatever we wanted. Since then though, we’ve decided to go towards living off of one income as we prepare to welcome our child into our family. Applying this habit of scarcity has helped us tremendously with setting up these passive barriers to make spending our money on frivolous things challenging while ensuring our money is being spent on things that matter most for us in the long term.

From a high level, strategic perspective we wanted to always make sure our paycheck would contribute to our long term goals. These long term goals were important to both my wife and I and we were committed to sacrificing in the near term for them.

For us these long term goals are:

  1. Pay ourselves every month, to invest our money for the long term
  2. To own multiple moderately priced real estate, one to live in and the others as rental properties to generate positive cash flow
  3. An adoption fund, to have the opportunity to grow our family

Each of these long term goals required significant capital and would take consistent steady saving in order to accomplish them.

All of these long term goals, we wanted to accomplish within 5 year increments. With this in mind, we chose to use Certificates of Deposits (CDs) as an option to ensure minimal risk of losing capital while presenting a passive barrier to prevent us from using it on anything not designated as our long term goal.

From a low level, tactical perspective we wanted to deal with the recurring costs, by creating many savings accounts each with their own purpose (Car payments/Groceries/Gas/discretionary spending/etc…). At the beginning of the month, we would deposit a realistic amount into each of these targeted savings accounts.

Disseminating your money in this way really helps stop you from thinking you are rich and can splurge on anything you want.  

Have a growth mindset, know you can cultivate your qualities over time. Learn to change and grow through application and experience. What is it costing you?

A growth mindset is a method to encourage you to keep learning, that it is absolutely possible to sharpen your current skills or pick up others. I believe having a growth mindset is necessary throughout life so that we can keep on learning and to not be overcome with the negativity or naysayers in the world that will otherwise keep us down.

I’ve been struggling with maintaining a growth mindset for years working in the IT industry. There are so many new technologies being released at such a rapid rate, it is daunting to try to even keep up. Along with this, the fear of being exposed to others that I did not know the latest technologies was frightening. This fear of man’s expectations upon myself played an inhibiting factor for me, that I will never be able to know as much as the next guy.

However more recently I’ve been encouraged to simply take small steps to ramp up and learn new technologies. To not be afraid to say I’m new to the technology and learning as I go. I’ve come to realize it doesn’t take much to be seen as an expert in the field, you simply have to know a little more than the next guy. This openness to learn and talking about it with others I believe encourages others to try to do the same. I encourage myself to learn something new every day or week, to break down that wall of fear of not knowing.

This mentality to measure up against your peers can become toxic if not handled correctly. I’ve come to realize that my identity is not in my knowledge or my career, that does not define me. It is ok for me to not know everything but instead nurture my ability to know I can learn something as long as I put time and effort into it.

If I would have kept a negative mindset it would have cost me more time and opportunities to keep learning, my own cynicism would keep me down and eventually lead me to stress out and into depression.  

Clutter can hamper you from success, distracting you and stressing you. Declutter your life so you can get back that time and use it towards your goals.

I’ve realized clutter does not only mean physical objects but also anything in your life that is distracting you and causing undue stress upon you. Clutter has dependencies on time, time to take care of it, time to shop for it, etc…

I didn’t realize what clutter meant in my life, my wife and I live in a small apartment and we don’t own a lot of stuff. Then I started to track where was my time going? What as I spending time on that didn’t do anything towards reaching my goal. What clutter was standing in my way of success?

A few things stood out which I identified as clutter in my life that my wife may be proud of. I discovered both playing video games and binging on Netflix took up a lot of my attention and my time. They were meant to be a source of relief and outlet but ended up consuming me and causing needless conflicts with my wife.
I know I needed discipline again in my life, to prioritize again my responsibilities as a husband to serve my wife first with my time and attention. Secondly, I needed to focus on using my time wisely towards my goals. Time is the most important resource we have and I’m glad I realized that before too much of it got away.

In closing

I hope sharing my thoughts and experiences will be helpful to everyone and encourage others to keep on learning and spending your time wisely on the things that matter most to you. I’d love to hear back from anyone who also has read this book and their thoughts or anyone else who has found this helpful and would like to share their experiences.

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