3 Things Dumb People Do With Their Money (It’s Not What You Think)

3 Things Dumb People Do With Their Money

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When it comes to the plethora of personal finance blogs out there, many tend to focus on the seemingly small things to increase your net worth, such as skipping your daily Starbucks, or avoiding the shiny new car.

While I agree with those whole-heartedly, the things I’m talking about today go far beyond that.

Financial Freedom

Deep down, each of us has a dream of becoming financially free. Rather than relying upon an employer for your sole income stream, we want to live life on our own terms. Whether you want to have loads of discretionary income to show off or just a modest lifestyle, I feel safe in saying that everyone wants a life where you don’t have to worry about where the next paycheck is coming from.3 Things Dumb People Do With Their Money

Rather than investing in the things that ultimately allow us to achieve financial freedom, we’ve all been fed lies that we now blindly accept as truths. People have told us for so long that by doing these things, you’ll be set financially: Paying off your home early, staying out of debt, and saving money.

That’s ridiculous.

You heard me. I just said that paying off your home, staying out of debt, and saving money are dumb. What kind of lunacy am I preaching?

I could nitpick the fact that we’re all doing dumb things — throwing away money on things that don’t matter. Eating out too many times each week, or spending money on this or that. But the reality is, when it comes to the big-picture, we have this illusion that having a home free and clear, and being debt-free is going to fare well for us in retirement.

You can’t eat bricks

Forty years from now, your home is paid off, you’ve placed a little bit of money aside into savings, and you’ve worked hard to pay off all outstanding debts. Can you retire?


The closer we inch towards retirement, the more we should begin to fear. This fool-proof delusion that we’ve had for so long suddenly starts holding less water. We begin to realize that having a paid-off home does nothing for us.

What will you eat in retirement? You can’t eat bricks.

Paying off all debt isn’t something to be scoffed at. What an accomplishment! And yet, you can’t retire on no debt. We soon begin to realize that as we approach retirement, we need more than no debt to be able to have any reasonable level of financial security. No debt is a level of financial security, but a pathetically low one.

You need money

The truth is, you’ll need something more than being debt-free when it comes time for retirement. Money. And the way you earn that is by changing the way in which we think.

Instead of paying off your home, you need to pay it off when you have a passive, residual income.

Rather than throwing money at a bank account of bricks, competing against 3% or 4% inflation, your money needs to be an investment that makes you additional money and continues to grow.

Instead of staying out of debt, you need to race into as much positive good business debt as possible.

Assets vs. Liabilities

There IS a difference between good debt and bad debt. Bad debt is what drives consumerism. Consumers buy liabilities. They buy “things” that go down in value and don’t make you any money (cars, the newest cell phone, clothing, etc).

Good debt, however, does the opposite. I place my hard-earned money into investments and they, in turn, make me more money than the cost of the initial debt I purchased.

Real estate is a classic example. You go into debt to buy an investment property, rent it out, have a positive $300/month cash flow, and eventually, enough equity to roll into future properties.

Also read: How my wife and I bought 4 rental units in 3 months

Another outlet for good debt is investing in business – be that your own business ideas, or someone else’s. Invest in the things that you believe in. Sure, it’s high risk. You could lose money, or it may not work out in your favor. But by pursuing a business, you’re better off than following three antiquated ideas that are guaranteed to not get you where you want in life.

If a little bit of good debt makes you some money, what does a lot of good debt do?

Take a look at the wealthiest people in the world. All of them experienced going into debt, then managing said debt, to stimulate their own personal economy. Many times, these businesses grow to create jobs for people, and stimulate economic growth as a whole.

Listen, it’s not that saving money is a bad thing. In fact, part of good financial stability is having a considerable nest egg at all times for when (not if!) the fecal matter hits the rotating oscillator.

Saving money is not bad. It’s just that this money needs to be invested instead. Your money needs to be working for you at all times. Every dollar placed into an investment is a little employee working hard on your behalf to make you even more.

If you don’t get your money working for you, you’ll always be on one side of the equation trading dollars for hours and hours for dollars. Whether you’re an attorney making $800 an hour, or a janitor making $8 an hour, you’ll still be in the same boat. If you don’t work, you don’t eat.

One of my favorite quotes states it perfectly:

”If you don’t find a way to make money while you sleep, you will work until you die.”
-Warren Buffet

Think Differently

Instead of following these predefined rules of the past, I’m suggesting three very different rules. Pay off your house later, after you have a residual income. Get into as much positive debt as possible. Invest your money so that it can work for you.

It’s time for you to get your money working for you and begin your path to financial freedom.


    1. Bryce | Sane Cents

      Glad you approve, Brian! We think so too. 😉

  1. P

    This one has a different approach to looking at 💰.
    Thanks u.
    Future work out of home person.🤓

    1. Bryce | Sane Cents

      Thanks P! That’s what we like to hear. If we keep thinking about money like the 99% of people out there, we’ll end up like the the majority of people — broke, unhappy, and living paycheck to paycheck. We try to do things a little differently. Thanks for stopping by!

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