How to Make and Grow Your Money the Simple Way (Not Just For Freelancers)

Play episode

If you can’t see the player above, click here to listen.

Subscribe with just one click! New episodes are released every Friday anywhere you get your podcast.

Originally for this post and episode of the “How To Freelance” mini series, I thought I’d dive right into different types of retirement plans for freelancers. Then I changed my mind. What’s the point of asking people to save money, or ways to save money without understanding the big picture of money. I use a very simple approach to grow my money everyday. In this article, I’ll summarize what the key points and credit the folks and mentors who taught me everything along the way.

Disclaimer: I haven’t talked much about money on Part of me felt like 1) I’m really not qualified to talk about it, 2) There seems to be endless articles on the internet anyone can browser and read for months and 3) I haven’t made it by the common standard - but I’ll say that I’ve figure out a way to live off what I have for a very long time, without having to a substantial income to keep it going. I talk to my friends and family privately about these tips and tricks all the time, and I’d like to publicly share some of my learnings finally on the podcast.

A bit about my background: I became obsessed with personal finance books in my very early 20s. My parents didn’t teach me a thing about finance or personal investment while I was growing up. I knew I had to learn so much more on my own. It was an exploratory process. As an immigrant living in America, I had to be proactive about managing my own money since the age of 17. I have many people to thank for who helped me realize that the answer is NOT Wall Street, or a personal advisor, or some scammy report you buy for hundreds of dollars.

This subject can often be controversial. I welcome your comments, debate - hopefully with the intent for us to all get much smarter about making money.

Understand your spending pattern and behavior - do the math, don’t just guess the number


Pull out your credit card statements, mortgage statements, etc, take a look the average spend over the course of say 12 months. Credit card spending is important because there may be some spikes as a result of unexpected events, this is why I don’t suggest averaging spending based on just a few statements. You want to see the big picture especially if you have a house and kids.

It’s important to go through these exercise a few times a year to understand changes to your spending. It doesn’t have to take long as it’s easy to spot unusual activities, or simply services, software, memberships you no longer need and should get rid of.

Get rid of the excess stuff without sacrificing the quality of your life

I drive the same car from 2008. I’m still not interested in jewelries and I don’t care for brands and items that are “just in” for the year. I do love buying clothes from the sales rack (which can be a problem too) but I’ve gotten better at not going shopping as much. :)

Between 2017-2019, I went through several rounds of significant clean-ups, mostly for my clothing items and donated them to several charities. I recommend Dress for Success, women’s shelters, Big Brothers and Sisters, etc., are great resources. Most recently, my partner and I gave away our elliptical machine and a stationary bike to free up a room inside our home. It felt super liberating.

Since I turned 30, I started to appreciate fewer, better things. Though I haven’t gone through the true Marie Kondo process or the Swedish Death Cleaning, understanding the mindset of keeping life simple - as it should be - is a huge step forward for me.

By the way, I do spend money on things I enjoy. I have a wonderful gym membership at Lifetime Fitness, a place I go nearly everyday (and sometimes twice a day). If you Contact Me, I’m happy to share my favorite Zumba instructors with you for the Massachusetts area, plus I’ll send a free pass your way. The pass should work anywhere in the United States.

Other than that, I spend money on learning new things such as books, courses, and plenty of domestic and international travel. I often combine my work as a podcaster and freelancer as part of my trip. It’s my version of a travel diary, where I get to travel and interview people in person and later share on my podcast with 200+ episodes.

Start investing in 401K right away (with employer match, say yesss!)

Start saving for 401K as soon as possible. I started when I was 23 at my first job. Many employers match 25% (that’s 25 cents on the dollar). As soon as you start your job, open a 401k account and start contributing as much as you can.

When you switch employer, you can get your money out of your old 401K to a new one straight away. It’s also called a rollover 401K (which you can’t really touch or spend) until you are age 59.5. Vanguard manages rollover like a pro and it’s a matter of a phone call and filling out some paperwork. Most of these companies that offer rollover 401K makes it very easy for you.

Here’s an article for those of you who wonder “What the pros say: Should I contribute to my 401(k) or pay off debt?” :

A few good words on Vanguard (if I may)

(Disclaimer: I’m not an affiliated with Vanguard)


If you like me and find yourself dipped into several investment companies, consolidating them will save you time and headaches later on. As for me, Vanguard is simply the best. It offers a variety of funds you can invest in, including my favorite index funds (Total Market Index Funds, S&P 500 Index Funds, etc.) which we will cover in just a second.

At Vanguard, I have my regular non-retirement investment, retirement investment (rollover 401K), Roth IRA and Sep IRA (which I opened since the starting my own company Feisworld LLC). Vanguard has a very responsive and kind customer service team, it’s never been a long wait for me to speak someone on the line.

In terms of investment strategy and if you don’t have a clue, Vanguard financial advisor will answer the basic questions for you. If you are looking to have a team actively manage your assets at Vanguard, they’ve lowered their minimum investment to $50,000. Their services received very good reviews on Nerd Wallet.

I sign up for Vanguard’s personal advisory service in my early 30s. Their team helped me rebalance the assets and made sure it was appropriate for my age, my goals. They sent reports to me every quarter. I learned a lot from the experience but I decided to stop my service after two years because my investment is quite straightforward. If you are below the age 40, Vanguard (or other investment companies) will recommend that you keep most of your money in stocks. That’s not a surprise because stocks give you the most growth and loss. Beyond age 40 and depending on life changes, I may return to their personal advisory service to see how I can make appropriate changes to my investment.

Index fund is the answer. Ditch “actively managed” mutual funds.

Regardless of who you choose to hand your money to, how you invest your money is KEY.

Screenshot 2019-08-04 21.43.30.png

Ditch the mutual funds, the advisors who promise to “beat the market”. Stop wasting the money you don’t have.

My favorite type of mutual funds are the Index Funds. I have exclusively contributed to index funds through Vanguard since the very beginning, such as a a very popular choice which is the Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX)

The expense ratio is only 0.04%

The expense ratio is so often overlooked. For normal people who aren’t working in finance and investment, the 1% management fee sounds insignificant. Not only it’s 25 times the expenses compared to Vanguard Index Funds, it can cut your return by half.

Why ditch “actively managed” mutual funds? Or why are so many people (still) working with personal advisors?

To fully understand the math, the psychology behind actively managed funds, read Ramit Sethi’s article How Mutual Funds Work. For the time being, here are some key points from the article plus some of my research findings.

Year (left column) and Return (right column)

Year (left column) and Return (right column)

  • Mutual funds are typically managed by a fund manager, who picks all the investments in the portfolio. This is often a big selling point for beginner investors who don’t have much experience and would rather place their faith in an “expert” in the mutual fund world.

  • Many funds charge an expense ratio as well as possible upfront fees in order to be run by an “expert”, but they rarely beat the market.

  • Warren Buffet once answered the question “How would you invest if you only had 100K”, he replied with index funds.

  • Index funds are not the only form of passive investing, but they are the most common form. An index fund defines the stocks (or bonds) it owns by owning the same stocks as those that are included in known and measured indexes, such as the S&P 500 or the Russell 2000.

  • Always invest defensively! In other words, don’t lose money if you don’t have to. Because most people reading this post aren’t making multi six figure income, many of the premium investment opportunities aren’t available to you. With a regular salary between 50-200K per year, it’s import to invest defensively.

  • Try Google “S&P 500 Average Return”, you’ll find an article such as the this one. The S&P 500 Index originally began in 1926 as the "Composite Index" comprised of only 90 stocks. According to historical records, the average annual return since its inception in 1926 through 2018 is approximately 10%. The average annual return since adopting 500 stocks into the index in 1957 through 2018 is roughly 8% (7.96%).

  • Index fund has consistently beaten most other mutual funds. Investors, fund managers who say they can aren’t being truthful.

Automating your money (thanks Ramit Sethi!)

Automate your money, or what Ramit calls it the “Building a Bulletproof Personal Finance System” worked for me.

Here’s what I did for over ten years every time I received a paycheck:

  1. Contribute to my 401K (I did between 5-10% depending on my salary and spending at the time)

  2. I always like to max out my Roth IRA so I made sure to set aside additional 5% from my paycheck just for that. For example, Roth IRA contribution limit was $6,000 in 2019

  3. I organize my credit card payments so they are due on or around the same day. You can pick any day of the month to pay for your credit card (for most services, and some will offer at least a few options). There’s no “best” date, generally I find the first 1-2 weeks to be helpful. My rent was due at the end of the month, so choosing a date between the 7th - 15th was helpful.

I haven’t been living paycheck to paycheck for many years, and I continue to be a conservative spender and a disciplined saver. This habit became especially helpful when I started freelancing full-time in January 2016. I had much more than a year worth of savings to allow me choose freelance gigs more freely, and take breaks as needed.

Mr. Money Mustache is another personal finance guru many people enjoy learning from. Using a slightly different system, he teaches you how to retire forever on a fixed chunk of money:

Diversity Your Income, or better, create more scalable income

What does it mean? Income diversification for most people means that they should seek income outside of their one and only full-time job. Dorie Clark covers this topic in great details during our interview.

How do you start? Perhaps you are a nights and weekends warrior doing graphic design for a client or two, that’s an additional income to the full-time job you have. If you have certain skills you want to market or test out but you don’t know how to get your first few clients, isn’t a bad option to start. In fact, many US-based, experienced freelancers are on Upwork making very good money. But there are also offshore resources that are charging 1/10 as much as you do. While the competition is there, Upwork is a good way to practice and find out what you are good at, and what you might want to do and explore. In addition, you can build your portfolio and meet clients who become long-term customers.

Create more scalable income - If you have a blog, start writing about the books, services, products you love! Many of the companies you subscribe/purchase from may offer affiliate program. This means that they may give you a unique URL, a code specific for your blog readers, podcast listeners. All the sales are then trackable, and you get paid with a small or sometimes significant percentage of referral fee.

If you don’t want to start with the products and services you use, you can open an Amazon affiliate account just to see how it works. The payment is often proportionate to the price of the products. For example, affiliate income is a small for books, but significant for camera equipments.

Additional reading and resources I love:

My current income streams are:

  • Different consulting clients I have from different parts of the US

  • One on one consulting

  • altPodcasters Mastermind

  • Future 2019 and on: Online courses is one of my main focus areas. Both courses mentioned here are still work in progress including, and a brand new Overseas Chinese Marketing course with Steve Yang from

The majority of my income at the moment comes from consulting, which is a version of trading time for money. I have a lot to learn and practice to be more aligned with a scalable income model. I have a good feeling that I’ll be making lots of progress in 2019.