On Personal Finance - Uninterested Approach
I am asked quite often for personal finance advice. I will say, somehow, the tax system and retirement accounts are a pretty big hobby of mine. This document is intended to be a catch-all for friends and family that may ask me questions on their own personal finances and also a reflection of what I believe and would like to stick to.
This only works if you can leave the money alone for a very long time. The market will crash, sometimes badly. Assume any money invested is gone.
Here is the main idea: maximize your income, keep expenses flat, put the difference in a total market index fund, and never touch it. If you aren't going to read the defense, at least internalize that to the best of your ability.
You don't need to think about this as much as you think you should
With all things that you feel should be added to your life, the best way to add them is by making them invisible. Ignore those around you buying and selling stock, keeping up with CNBC, offering you insight on the macroeconomic climate and where interest rates are going. These things are for them, people that enjoy that hobby. It is important to see these things as what they are for most: a gambling hobby. I will give you a great way to observe this: the next time a coworker enlightens you about his stock pick that 10x'd, ask him what his thesis was. He will have some obscure reason for buying, but there will be little to no correlation to the reason it shot up. These people are gamblers, the loudest are the winners. These people have no information advantage.
Your goal is to set your personal financial system up and never think about it again. The below tells you how.
Never touch individual stock
Let's go back to that coworker, Jimmy. Jimmy invested $1,000 into Nvidia. Jimmy has never read an earnings report, he is not even completely sure what their product line is. How did he make money? Jimmy got lucky. Most individual investors lose, Jimmy happened to get lucky. And it isn't just Jimmy. Around 90% of professional fund managers, people that do this full time, fail to beat the market over 20 years (granted they need to worry about much more). You are not going to beat them on the weekend.
So those guys love spending their time in corporate books, but we tend to enjoy our kids, what should we do instead? We invest in index funds. Rather than betting on individual companies, you own a small slice of the entire market. You don't need to know who wins. You just need to know that over time, the United States will do pretty well.
The only fund you need to know is VTSAX, Vanguard's Total Stock Market Index Fund. If you're already at Fidelity, FZROX. At Schwab, SWTSX. All the same thing. Three reasons it is the right answer:
It is almost free to own. VTSAX charges 0.04% annually in fees. On $10,000 that is $4 a year. Most actively managed funds charge 20 to 30 times that, and they don't outperform. You are paying for nothing.
It owns everything. 3,700 companies across every sector and size. One purchase and you have the entire American economy working for you.
Vanguard is structured differently from every other financial company. It is owned by its funds, which are owned by its investors. There are no outside shareholders to extract profit from you. The incentive is your return, not theirs.
Set up automatic contributions. Never look at it.
I Just Need to Save More
You most likely do not have a savings problem, you have an income problem, or an expenses problem, or both. One of these is worth obsessing over.
In your life you will find you often have two options: discipline or its alternative. Human discipline is a finite resource. What I see most often is someone white-knuckles a budget for 6 months and then blows money on a somewhat stupid purchase. This is one mistake over the course of 6 months. We are not built for sustained deprivation of what you genuinely enjoy, the entire consumer economy and capitalism exists because this is how we are wired.
Due to this, at some point it is best to accept your faults in terms of spending. If someone does no cardio but obsesses over their caloric intake, it is much harder than doing them both evenly. Because of this, the math is pretty simple: maximize the gap between what comes in and what goes out. Do this by attacking both sides, but weight your energy towards income. A raise scales forever. Cutting expenses requires you to be a different person every day for the rest of your life. You make the income decision once and continue as you are now.
Of course, this does not mean spend freely. To make this work, it must mean spending flatly. The goal is to never let your expenses grow as fast as your income. The gap should widen with every raise or job change.
Lifestyle Creep
The above advice depends on one thing: the gap between income and expenses does not stay the same forever. The concept I think about daily here is the hedonic treadmill. Humans have a baseline of happiness we return to no matter what — good event, bad event, baseline. The shoes, the car, the bigger house. Each one feels like it raises the floor and each one doesn't, not for long.
So what does this mean practically? When you buy a new pair of shoes for anything past their utilitarian value (utility can be pure function, but also design), you are optimizing the purchase for the one day of happiness you get the first time you wear them. That's the whole return. Day two it's a pair of shoes.
The tricky part is rationalization. Us humans can rationalize anything, my nice Stratocaster can explain that to you. It is important to not rationalize utility in places it is not. You will often see people explain how their new Escalade was a smart purchase for them because of X or Y. No, it was not.
Every time you get a raise, there is a little guy on your shoulder ready to consume it — lifestyle creep. The Escalade, bigger house, nicer restaurant, each one feels like a reasonable upgrade and each one permanently raises your floor. Whatever makes you happy now can make you happy forever.
Debt
If you follow the above concepts, you most likely will not have debt. Things come up and the past you may not be the same as you are now. Luckily, debt is a pretty simple fix (to write out).
Not all debt is the same, and treating it like it is will cost you. There are people that will tell you pay off everything: this is stupid. If you understand debt, you will not feel like you have to, if you do not understand debt, you will.
You should never, ever, have meaningful floating credit card debt. Credit card debt and interest is deeply exploitative, there is a reason people get so many benefits from spending money on a card, most likely your coworker is subsidizing your trip. Pay it off immediately, aggressively, before you do anything else in this post.
Below the threshold of ~6%, I believe the math changes. A mortgage at 5% or a student loan at 4% is cheap debt. The market has historically returned around 10% nominal (imagine this 10 is 6 after inflation) annually over long periods. Paying off a 4% loan early instead of investing the difference is leaving money on the table. Carry the cheap debt, invest the gap.
Now Setup
Before any of this, have 3-6 months of expenses sitting in a high-yield savings account. Otherwise the first car repair puts you right back on the credit card you just paid off.
Step one: Employer 401k up to the match. If your employer matches 50% of what you put in, that is a 50% return on your money the day it lands. Nothing else in this post beats that (other than paying off high debt, do that!). You most likely have one, and if you think you don't then please ask your boss.
Step two: Roth IRA to the annual limit ($7,500 in 2026). This is your most valuable long term account as a young person. Tax free growth, tax free withdrawal in retirement. Roth contributions (not earnings) can be pulled out anytime, penalty free. If you make over ~$150k single or ~$236k married, you can't contribute directly. Look up "backdoor Roth" before you do anything, or the IRS will charge you 6% a year until you fix it.
Step three: If your health insurance is a high-deductible plan, max your HSA. The HSA is the best account in the tax code. Deductible going in, tax free growth, tax free withdrawal for medical expenses, and after 65 it works just like a regular IRA for anything. If you don't have a high-deductible plan, skip this.
Step four: Back to the 401k and max it ($24,500 + employer match in 2026).
Step five: Anything remaining goes into a standard brokerage account at Vanguard. Same fund. Keep going.
Build your emergency fund up to 3-6 months of expenses somewhere along the way, in a high-yield savings account. Don't invest it.
This is meant to be a simple beginner guide. If you make $200k, have equity comp, or run a business, or are even interested in the topic past its utility, this post isn't for you.
This is obviously nothing new, it is essentially what most people would tell you, Boglehead approach, with a bit more focus on behavior and controlling what you can.