- A reductive process you apply to expenses.
- A multiplicative process you apply to assets via compounding.
Driving these processes is, first of all, will-power or the ability to delay gratification. You need to put in some mental effort to motivate yourself to save money to commit to the reduction of anything in life. Secondly, you need some open-mindedness and knowledge to multiply your money better. This requires a degree of risk-taking and trying out new stuff.
Because you seldom find a combination of willpower and open-mindedness in the same person, this is probably why so many folks fail in the self-help domain. It is also the reason why authors and trainers can thrive in these areas: demand for training and books is perennial but it seldom leads to people being able to solve their own problems completely.
Here are two areas that I still struggle with :
a) Health and Nutrition
I am still recovering from a nasty gout attack that struck my right knee for the past few days. A week ago, I went to meet a few friends in the pub and had a really nice $17 ribeye along with some alcohol. The result is over a week worth of pain and a $50 medical expense. If I can exercise the same discipline to FIRE as health and nutrition, I would not have to go through all that suffering.
Intermittent fasting the equivalent of budgeting in FIRE. You reduce your intake of food to 8 hours out of every day and get to burn fat the rest of the 16 hours. This led to a 0.5 point improvement in my blood sugar.
While you can't grow your nutrition, you can multiply the variety of your food intake. This, I do not do well in my life right now because I think a diabetic at my age should find a way to get better nutritional supplements. What prevents me is the sheer amount of MLM and corporate-sponsored research out there that confuses a lot of issues.
Personally, I hope this matter will be resolved soon with a proper meal replacement like Soylent which can be a hit with hacker types in the US. This is almost the equivalent of a nutritional robo-advisor.
b) Knowledge and Meditation
I can tell that Naval Ravikant is a really spiritual guy because he promotes meditation a lot.
Meditation is the reduction of stray thoughts. As someone who failed in picking up meditation quite a few times in my life, I am aware that this is something that requires quite a bit of self-discipline. This is possibly something I need to pick up again soon. It's getting harder to keep my mind clear as I always have a financial programming problem I have to solve every day.
The second process is of course reading and the accumulation of knowledge. Reading is probably the most important skill in the modern world, but I see many problems even with folks who self identify as voracious readers. In this sense, we should try to aspire to what Navikant or Munger does which is to multiply the mental models that you have. Over time, you will have a number of models in your toolbox to tackle life situations - it can compound your personal effectiveness.
Doing this is hard. You have to read stuff out of your usual comfort zone or you may disagree with politically. I have issues even with financial experts who read only finance books - you get this tool blabber on and on about Warren Buffett but lack the historical depth to know that richer folks like Jacob Fugger exist.
Reading opens the mind.
These days, I find my own personal disdain for English Literature unsustainable once I realised that the obsession of Mr. Darcy by Victorian era chicks was due to the passive income he derives from Pemberly Estate. Sometimes when I mention this to English Literature types, I do not know they are impressed or totally disgusted by my ability to reframe their holy religion solely in solely monetary terms.
The trope of female hypergamy is so big I wonder why this is not taught to boys in secondary school.
The Mr Darcy of the Past is the Christian Grey of the modern era.
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