In my book, You Only Live Once: The Roadmap to Financial Wellness and a Purposeful Life, I explain how YOLO mindset can be helpful when applied to financial decisions today to create the life of our dreams tomorrow.
As millennials, YOLO living wasn’t something we created. It was a lifestyle we saw our parents live. They bought bigger homes and larger cars.
I saw my parents, and many of my friend’s parents, use their home’s equity like ATM machines. There was a belief that housing prices would continue to rise and the markets would continue to rally upward.
The good times would keep on coming.
That’s until the Great Recession of 2008.
During the recession, I saw family members and friends lose their homes and jobs. I heard from people who saw their retirement savings depleted.
Financial experts chastised people for overextending themselves. They stated people bought homes they couldn’t afford, invested in risky stocks, and financed luxury cars foolishly.
It was during this time, we adopted YOLO as our generation’s mantra to live through the uncertainty shaped by the Great Recession.
We used YOLO feverishly to explain our beliefs about living and spending.
I recall the Thursday nights taking shots of tequila at the bar and yelling “YOLO” knowing full well I had to be up in a few hours to go to work.
I remember waiting for a friend at a store watching him swipe his credit card. He’d say, “YOLO,” as the cashier tendered the sale.
Now, I have a different view of YOLO.
It’s no longer about impulsiveness or an excuse for irrational behavior.
I’ve also begun hearing my friends say, “you only live once,” when they share their latest business idea or purposeful project to pursue.
Using YOLO to achieve financial goals and create your dream life
Today is as good as any day to build our dreams and create wealth. Things surely have changed. The choices we make today create the life we live tomorrow. So, YOLO!
Envision your dream lifestyle
You first must get clear about the vision for your life. When you only live once, you realize you get an opportunity to create a meaningful life filled with many moments. You’re less impulsive and more focused. What do you envision doing at retirement that you can be doing today?
Envision the life you want to live at retirement and make better financial decisions that support living that life sooner.
Pay yourself first
Start small, but be consistent. When you only live once, you understand the importance of saving early so you can benefit longer from the power of compounding interest – earn interest off the interest you’ve made previously. Your money starts working for you.
Automate your savings each pay period into an account set aside for an emergency. Saving at least $25 per pay period is a good start.
Pay off debt
Create a debt payoff strategy based on your debt. When you only live once, you’re aware that debt reserves your future time to work rather than fun. Debt doesn’t just happen. It’s the result of the decisions you’ve made to spend more than you make and a heavy reliance on credit.
If you have credit card debt, use either the debt snowball or debt avalanche method. Consider debt consolidation loans or a debt management plan.
Find ways to make additional payments by cutting expenses, making more money at work or through a side hustle, and using that money to pay off debt.
When you only live once, you are spending money on things that matter and add value to your life. Do an expense inventory by writing down all your expenses (i.e. utilities, rent, gas, entertainment, groceries, subscriptions). Negotiate for better rates. Cancel services. Have a budget for food and entertainment. Learn how to lower your expenses and spend more mindfully.
Reducing your expenses is very powerful as it saves you money today and limits the amount of money you’ll need tomorrow.
Invest in your future
Investing increases your ability to create wealth. Retirement is a period in your life where you’re not dependent on a job for your income. It’s can be any age you set for yourself, an age when you become eligible for government benefits, or a period when you physically can no longer work to make income. Learn how to retire well and invest intentionally.
Start with your employer-sponsored 401(k) plan, stock purchase programs. Look into index funds and direct stock investments through an online brokerage firm.
Remember, you’re not a trader. Your game is long-term returns, not short-term thrills.
You can learn more about applying YOLO into your financial life and grab a copy of my bestselling money book wherever books are sold.
Now, let’s live well today and plan for a better life tomorrow!