Transcription
There was one distinct moment when I decided to save money seriously. And so today I want to share with you my top five lessons on saving money, as I continue on this 8-year journey. So if you're thinking about saving more money, or you're struggling to do so, I think this video will really give you a few new perspectives on saving money that other videos and YouTubers don't even really talk about.
And so it was the year 2016, and I had just gotten my first job teaching in China. It was the blistering summer when I arrived, and it was so hot and so hot. I was remember sitting around this air-conditioned room, and the property manager who would show us our apartments were walking around collecting ID. The reason is because they needed ID to register for the internet, which would cost around $200 a year. I remember the property manager coming up to me and saying, "Leon, ID?" It was this middle-aged man with dark brown hair and wrinkles. I said, "No." I looked him in the eye and said, "No." He had this confused look on his face and he said again, "Leon, ID? Internet?" And I said, "No, to internet." That was the moment when I decided to save money seriously. This was 2016.
Now, first things first. Now in 2025, I have internet, and it's because I realized one thing, and this is kind of the first lesson I want to go through. Well, when I first met my wife, financial freedom was really top of mind for us—well, for me mainly. My wife wasn't too financially literate at that time, but I was this guy that was on fire, right? Financial independence, retire early. And so I walked up to my wife and I was like, "Hey, if we save 80% of our income, we'll be able to retire in like 10 to 15 years, right? All we have to do is sacrifice a little bit of now for our future." And my wife looked at me in the eye and said—after thinking for like 2 to 3 seconds—"So what's the lifestyle going to be like in 10 to 15 years?" And I was like, "Well, we won't have to work, but I mean we won't be rich, but we'll be alive, right? We'll be living." And so she literally looked at me in the eye and she said, "So you're saying that we should live like we are broke now while we're working so that we can retire to live like we're broke?"
Yeah, that that was that was the case, right? The only difference is whether or not we were working. And honestly, I'd probably be working in 20 years because I actually kind of like this job, or I'll be doing some kind of work in 20 years. And my wife was like, "Do you realize that if we have a kid in the future that kind of just throws off all your calculations?" Do you really want to sit there when your son looks at you in the eye and says, "Dad, I want to take piano lessons," and you tell him, "No, we're on the savings plan so we can't." And that really made me sit there and think and reflect on my life decisions. But the most important thing that it made me realize was that I wasn't alone anymore. Being cheap and being frugal is so easy when you're alone because that's your life, but I was no longer responsible for my own life; I was also responsible for my wife and now my son, who's also a year old now. And so I had to get this first lesson: saving money doesn't mean living like you're broke. The difference is saving out of scarcity versus following a reliable plan that will get you to your goal.
And so I realized that yes, saving $5,000-$6,000 every single month and living like I was broke (Canadian dollars) would get me to a point where I could have $5-$7 million when I retire, but I could save $2,000-$3,000 a month and get to $3.5 million, and that would also be a very, very comfortable amount to retire on. And so I'm willing to sacrifice $1 million-$2 million when I retire to trade 25 to 30 years of life that is well-lived. And so that is the first lesson.
The second lesson is something that I learned when I was working as a coach—a financial coach. And so I was coaching this client, and she was broke. And she was broke not because she didn't have money or income; she was broke because she couldn't handle her spending. And so we had to work together to figure out, well, how do you actually make a plan and pay off debt, right? And this was a couple that had $120,000-$150,000 of income per year, but they were in debt; they had no savings. And one thing that we realized together was how stressful penny pinching actually is. And so this is the second lesson: penny pinching, budgeting to the dollar to the cent, is so stressful. Being content while living a humble life isn't; it is freeing. And so the breakthrough that we had when we were working together happened when she really wanted to go home for Christmas. It was a trip that would cost her thousands of dollars, but then I sat down and I was like, "Well, if you didn't do that," and she was like, "Oh man, I I really want to; I really want to go home, you know, we only see them once a year." And I was like, "If you didn't do that, what goal would you be able to meet sooner?" And she was like, "I really, really want to save up for a down payment for my daughter." And I guess not going, I could put those few thousand towards that down payment. I was like, "Okay." And so you're literally making a decision between family—which are important—that you haven't seen in a year versus something you really, really want for your daughter. Which one's more important, right? And she had to sit down and really realize that, you know what, like my immediate family is more important than my extended family. And so right now I need to get my finances together for my immediate family; I need to change my lifestyle; I need to live humbly; I need to be okay with the right decisions, even if they might mean disappointing family that is outside of the regular family that I see or friends. And so the problem that we solved was the problem of our financial identity being separate from our lived identity. So many people make an income and have a lived identity that requires a higher income, right? And so you need alignment between your financial identity, your income, your wealth, how much debt you have, and your lived identity, which is the lifestyle that you've chosen to give yourself. Lifestyle inflation is a thing; you know, we cannot solve that; it's inevitable. We can delay it, but it's inevitable. When we get married, when we have kids, we will inevitably stop spending less money; we'll spend more money. And so it's impossible to spend less money when you have a family, which leads to my third point.
And so I needed to save $2,000 a month to meet my financial goals, and I had to figure out how to do that because I was making like $3,000 a month—less than $3,000 a month—at my first job. And when I switched jobs, however, I immediately made more money because I kept my lifestyle the same; I saved a lot more, and I kept switching jobs, and eventually my income tripled because I was in a different market but doing relatively the same thing. Now, even as I spend more money, I can continue to meet my financial goals. And so I think it's a lot easier to not think about how to cut the next dollar, and instead you want to think about how to earn the next dollar. By the way, if you are enjoying this video, feel free to like and subscribe because I like to talk about money. If you like to talk about money, then let's talk about money together now. So the best way to save money is actually to make more of it and then keep your lifestyle roughly the same, right? As long as your increase in income is bigger than your increase in spending, then you're good to go; you're saving more and more.
Now, that being said, I earn the most money now—I've like this—I'm making the most money I've ever made because of my wife. And a lot of people that I've talked to separate finances between husband and wife, or they don't even talk about finances altogether. I've talked to a couple where the lady has her own credit card debt and the husband has his own credit card debt, and they don't really know what each other's financial situations are. And so there isn't a transparency that should exist between spouses when it comes to finances. And so my wife and I had a very clear understanding that that was a problem because she came from a family that did not have financial transparency, and ultimately that had crazy effects—just ramifications that, you know, the relationship didn't work out, right? And that affected her growing up, obviously, and she didn't want that for our kids. And in the same way, I think my parents modeled financial transparency. And so we started setting shared goals; we agreed on a shared lifestyle; we separated our money roles. And so in our family, she's responsible for spending money; I'm responsible for really a lot of the investing and saving. And so your spouse will make or break you on your wealth-building journey. It does not help if you're the one trying to save money, but your spouse is going out for fancy dinners every single weekend. You need a shared financial goal; you need a shared alignment between your financial identities and your individual lived identities.
What does all of this mean? Well, there's one thing that all of these tips are pointing to, which is the fifth lesson: so saving is hard every single month when there's nothing left; you're trying to like figure out like where's the next dollar coming from to fund your emergency fund. But with a system, it can be automatic. And so the ultimate goal of saving money is to get to a point when it feels automatic, when it just happens, and you're not thinking about it. And six months later, you've got an emergency fund saved up; 12 months later, you're able to invest in the stock market; and 20 to 25 years later, you've retired wealthy, right? Like that would be the best-case scenario, and you're not even noticing the effects of that on your lived identity. And so how do you actually do that? Well, you can have a spending account and a savings account, and you can have your income be split between those two accounts, and you're just spending money from your spending account. And so as a result of that, you're not even thinking about the money that goes into your savings account, and so it's being saved automatically. And that is it, right? Like that is the definition of paying yourself first, but you don't do it intentionally; it happens automatically. And so that's just a part of the system that I have implemented for my life. And if you're interested in anything, leave a comment below and ask me questions; I'm happy to answer them. And I hope you have a great…