3 More Money Lessons I Learned by Age 40

A financial planner who has seen a lot and reflected on what brings his clients happiness and fulfillment shares some secrets to success.

A very happy woman sits in her kitchen looking at her laptop.
(Image credit: Getty Images)

Editor’s note: This is part two of two parts. Part one, published in October, includes Lessons 1-2.

Welcome back to my five lessons that I learned about money and life by the time I turned 40. Check out part one if you missed it last month. Here are lessons three through five.

Lesson #3 - You Have the Power to Give Meaning to Money

For thousands of years, society has placed a cultural significance on money. To the external world, money conveys status, fame, power, intelligence, success, and other things to people who have it. If you aren’t careful, society and the external world around you will define the meaning that money has in your life.

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But here’s a little secret. There’s a second and less discussed meaning of money, which is very personal and entirely internal. It’s part psychology (how you think and feel about it), part utility (how you use it), and part subjectivity (personal choice). When money and how you use it is aligned with your values, the person you want to be, and the life you want to live, it gains real meaning in your life.

For the happiest, most fulfilled people I know, money isn’t about fame, power, or status.

Money is freedom.

It’s freedom from financial worry and stress. It’s the freedom to choose how, where, and with whom you spend your time. It’s the freedom to define the person you want to be and the life you want to live. Money, and more important, your plan for it, is the freedom to confidently control and shape your future.

The right plan for your money is all about giving you the freedom to live life on your own terms. Of course, money isn’t everything, but if used well, it can give you the freedom to do almost anything.

But — and it’s a very big but — that freedom isn’t free.

Lesson #4 - You Set the Price of Your Financial Freedom

I define financial freedom as having enough passive income and the wealth to generate that passive income to cover the lifestyle expenses for the life I want to live. It’s when work (trading time for money) becomes optional. And that freedom has a price.

Think about it this way. If you need $40,000 per year of income to maintain your lifestyle, you need roughly $1 million to achieve financial freedom. At $80,000 of income, you need $2 million, and at $120,000 you need $3 million. Your number is the price you are placing on your financial freedom. As your lifestyle expenses increase, so does the price.

Most people struggle to achieve financial freedom because they can’t keep the price from rising. So they continue to increase their lifestyle expenses, adding to how much wealth will be required to create the passive income they need to cover their expenses. George Foreman summed it up nicely: “It’s not at what age you want to retire. It’s at what income.”

This doesn’t mean you shouldn’t buy a nice house, car, or lake house. It simply means you should be aware of the impact these decisions will have on your freedom, how you spend your time, and the quality of your life. You set the price of your financial freedom, and every decision you make is either making your freedom more or less affordable.

Lesson #5 - Miracles and Money Have a Lot in Common

At some point in my relationship with my clients, I ask them one question: “What is a miracle?” The most common answer is that a miracle is something we can’t explain or didn’t think was possible. I prefer to use Charles Eisenstein’s definition: “A miracle is something that is impossible from one’s current understanding of reality and truth, but that becomes possible from a new understanding.”

Many of us, myself included, enter our adult lives with limiting beliefs or a limiting mindset that stems from lessons we learned as children. In fact, the subconscious thought patterns that govern our financial decisions are formed by age seven. These subconscious beliefs, values, and attitudes determine our individual money stories — what we believe to be true and what is possible with it. In essence, your story determines what you think is a miracle (and impossible for you to influence) and what you think is possible (and within your sphere of influence).

If we are open to exploring our money stories and taking action to change them, we can create a new narrative around what is possible. And I can honestly say that once you figure this part out, you will unlock the unlimited potential of money to be a powerful tool to help you define, shape, and express the person you want to become and the life you want to live.

Your decisions are the only way you can influence your life, and the quality of those (financial) decisions will determine the quality of your life. As Ralph Waldo Emerson so eloquently put it, “The only person you are destined to become is the person you decide to be.”

Your next decision can change your life. What will it be?

 -        Brent Weiss, CFP, CHFC, Co-Founder, Facet Wealth

Facet Wealth, Inc. is an SEC registered investment adviser headquartered in Baltimore, Maryland. This is not an offer to sell securities or the solicitation of an offer to purchase securities. This is not investment, financial, legal or tax advice. Past performance is not a guarantee of future performance.


This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Brent Weiss, CFP®, ChFC®
Co-Founder and Head of Financial Wellness, Facet

Brent Weiss is co-founder and Head of Financial Wellness at Facet. His belief that financial wellness is essential to living well and that all people deserve access to the kind of financial advice that can lead to an enriched life has been the driving force behind the firm's mission and vision. He is dedicated to enabling greater access to innovative, next-generation planning solutions and technology that can improve the quality of life for all people.