I just wrapped up another personal finance seminar with a great group of law students. After two full days of leading class, my voice is hoarse and my body is sore.
And, I had so much fun.
Can’t wait to do it again!
Here’s a recap of the ground we covered.
If you’re interested in learning more about my personal finance course for law students and young lawyers, please reach out.
I’ve taught law students and lawyers, both in-person and virtually, and would be happy to discuss how I can help you or your group.
My favorite part of class is when my students share their Tiara Goals.
We spent the first portion of class talking about money mindset. Without the right motivations, none of the other tools matter.
Without a doubt, this is always my favorite part of class.
When I say I’m on a mission to convince you that talking money is not taboo, I think of my students sharing their goals.
I get so energized by hearing their goals. My students report the same sentiment after learning what drives their friends and peers.
Over the years, my students have shared countless impactful stories. As unique as these goals can be, it’s remarkable how most of us want the same things in life.
Year after year, I hear the same motivating forces:
- Spend more time with my family.
- Travel and enjoy experiences around the world.
- Stay healthy and fit.
- Provide for my children and my aging parents.
- Work for a cause I believe in.
- Have time to volunteer.
- Enjoy more hobbies like baking, golf, jogging, sewing, and pickleball.
I also regularly hear one thing that my students, and the rest of us, don’t want:
- I don’t want to be stressed about money.
Isn’t it telling that year after year, most of us want the same things in life?
I’ve yet to hear anyone say that they dream about working endless hours and not taking their PTO.
Be specific, but not too specific, when you think about financial freedom.
When we talk about what we do with financial freedom in class, I encourage my students to get specific without being so precise that the goal becomes restrictive.
When we’re thinking about goals related to financial freedom, the idea is to focus more on big-picture, core values.
There will be a time and a place to strategize how to get there. The point here is to help define what you’re even trying to get in the first place.
For example, instead of “spending more time with family,” I would suggest something like, “never miss my child’s soccer game or dance recital because of work.”
Instead of “travel around the world,” I would suggest “at least one overseas trip of at least 2 weeks per year.”
Adding that little bit of specificity will help you visualize what you’re striving for with your money decisions.
Don’t get discouraged if you think you are not close to financial freedom.
Even when you feel like financial freedom is only a distant dream for you, it’s important to actively think about what you want out of life.
I’d even suggest that the further away you feel from financial freedom, the more important it is to think about what it would mean for you.
When you’re at your lowest point, visualizing what you would do with financial freedom is a helpful escape.
If you haven’t ever actively thought about what you would do with financial freedom, hopefully hearing about what my students shared in class will encourage you to do so.
Don’t forget to write down whatever you come up with.
I suggest you share your version of Tiara Goals with your friends and loved ones. It’s OK to keep some of your goals private.
By sharing, you will get the benefit of them cheering you on. You’ll also hopefully encourage them to share their goals with you, which can be very inspiring.
Budgeting is all about generating fuel for your ultimate goals in life.
Following our chat about money mindset, we launched into budgeting.
The essential purpose of making a budget is to generate fuel for your ultimate goals in life. This fuel is what feeds your savings, pays off debt, and grows your investments.
It’s not easy to track every penny. It’s not enjoyable to realize that your dollars are disappearing on stuff you don’t care about. But, these are crucial steps on the way to financial independence.
Learning how to create a budget that you’ll actually stick to is so important that we practiced implementing a Budget After Thinking in class.
Debt and credit are essential parts of a healthy financial life.
After focusing on the fundamentals of budgeting, we moved on to debt and credit.
Most of us have (or will have) some form of debt, whether it’s credit card debt, student loan debt, or mortgage debt.
With the right tools, we can attack that debt and eliminate it as quickly as possible.
Just as important, we can appreciate how we got into debt in the first place so we don’t make the same mistakes again.
When we talked about credit in class, we emphasized that credit impacts our largest purchases in life, like buying a home or a car. For that reason, it’s essential to understand how our credit history impacts our credit score.
From there, we explored why credit cards are a privilege.
I am a big fan of using credit cards responsibly to earn free travel. If you don’t overspend and pay your bills in full every month, credit cards can be a useful tool.
Student loans are front of mind for most law students and young lawyers.
Of course, no personal finance seminar geared towards law students and young lawyers would be complete without addressing student loans.
This year, we focused on the changes to federal student loans. We learned how to navigate paying back loans while advancing some other important financial goals, like investing.
Building wealth through investing.
Following our conversation on student loans, it was time to talk about building wealth through investing.
When it comes to investing, the key is to let compound interest work its magic.
With time on your side, you can concentrate on low fees, the proper asset allocation, and consistently fueling your investments.
Using an online calculator, we saw how even seemingly small contributions to our investments will make a huge difference over the long run.
This point demonstrates why we begin with budgeting before we talk about investing. Remember, one of the main purposes of your budget is to create money for your investments.
Every dollar that you invest rather than spend early in your career will lead to massive wealth if given enough time.
Real estate is my favorite asset class.
Finally, we discussed real estate, a topic that I am very passionate about.
We learned how to analyze when the time is right to buy a home (and when not to buy a home). We then saw how having a strong money foundation is key to qualifying for the best mortgages.
From there, we moved on to real estate investing. With real estate, investors benefit from cash flow, appreciation, debt pay down, and tax breaks.
For people pursuing financial independence, there may not be a more powerful strategy than buying a small multifamily property, living in one of the units, and renting out the others. This strategy is known in some circles as “house hacking.”
With this one decision, you can eliminate your housing costs entirely, which is traditionally the largest expense in our budgets.
That means you can repurpose the money you had been spending on housing to other goals, like paying off student loan debt.
At the same time, you have a long-term asset that you can keep for years after you decide to move out. That asset can kick off monthly cash flow, which can be saved for other investments or used to pay for current living expenses.
Money is nothing more than a tool.
In the end, I encouraged my students to recognize that money is nothing more than a tool that can be used to build a life on our terms.
When we learn how to use money in this way, we control the circumstances. The circumstances don’t control us.
Being good with money involves consistent choices. I can’t make those choices for you, but I can give you the tools to properly think through and evaluate whatever dilemma you face.
I left my students with one final request: keep the conversation going with your loved ones and friends.
Talking about money is not taboo. We can all learn so much from each other if we are just willing to share and listen.
There’s no reason to struggle with money decisions alone.
Our journeys towards financial independence should not be solo missions.
We can achieve financial wellness together.
All we need to do is think and talk about money.
If you’re interested in learning more about my personal finance course for law students and young lawyers, please reach out.
I’ve taught law students and lawyers, both in-person and virtually, and would be happy to discuss how I can help you or your group.