A One Percenter’s 7 Best Financial Decisions

A One Percenter's 7 Best Financial Decisions

Just the other day, I posted my 7 biggest financial mistakes. These errors in judgement have cost me around $100,000 over the past 14 years or so. My attitude towards these mistakes are that I can’t change the past. Sure, it hurts to think about them from time to time, but I am optimistic about the future. I tend to focus on the future because I can control what happens to me, to a certain degree.

However, to balance the costly mistakes over the past several years, I wanted to highlight my better financial decisions that I believe outweighed the costly mistakes and have allowed me to be in a decent financial position for the long-run. So, here are my best financial decisions:

Choosing A College Major

I knew early on in high school that my talents were in math and science. I’m only 5’9″ so I was never going to be an NBA star. I had no interest in the arts, literature, history, or political science at the time. I was lucky enough to have parents who stressed the importance of an education and the importance of choosing a major that will be in high demand. I eventually chose to major in Pharmacy.

Knowing Future Career Potential

There are several options as a pharmacist in terms of work setting. Broadly speaking, one could work in the retail setting, the hospital setting, or the pharmaceutical industry. I never felt a desire to work in the retail or hospital setting so I’m glad I not only chose a path with a high career potential, but also chose a setting that I love… corporate America.

I feel that if you apply yourself, network, and make your goals known, the possibilities are endless. This has led me to significant promotions and job changes.

A Career In High Demand

The demand for jobs in each of the settings for a pharmacist vary widely. It was once believed that the demand for pharmacists will remain high due to low college enrollment coupled with an aging society. However, over the past decade, more and more pharmacy schools opened and enrolled a significant number of students.

As a result, the demand for pharmacists in the retail setting has diminished. The same goes for the pharmaceutical industry. The industry is going to very tough times and as a result are laying off 10’s of thousands of workers.

However, I have continued to expand my skill set, so that I can continue to pursue industry positions in several different types of roles.

Setting aside retirement at an early age

As soon as I got my first job, I opened up a Roth IRA and began contributing to my 401k. I always knew the power of compound interest and knew that if I can shovel as much money as I can at an early age, it would pay off in the long-run.

Multiple Income Streams

Though I only have 1 job currently, I invested in 2 real estate properties over the past 6 years in the hopes that these would generate income once the properties are paid for. Although I may gripe about the rental properties, they have proven to be a valuable asset in my portfolio. I also have a significant investment portfolio that I can shift to dividend paying stocks if I ever needed the cash as another income stream.

Continue To Invest In Up And Down Markets

I’ve had too many friend and family recommend pulling my money out of the market and parking it in money market accounts. I’m thankful I didn’t heed their advice because I would have missed out on significant gains since the market bottomed out in late 2008.

Additionally, I knew people who were too scared to invest in the market during that period and beyond so they stayed on the sidelines missing the opportunity to buy investments at rock-bottom prices. I take a slow and steady approach so I continued my 401k and IRA contributions.

Invest In Age Appropriate Investments

I was never scared of the market and could always handle market fluctuations. Thus, I have always had my investments in very aggressive accounts. I am still invested in aggressive accounts, but will continue to shift this allocation as I age and my situation changes. Because of these early aggressive investments, I have seen significant gains over the past several years.

There are probably a few more good financial decisions that I’ve made, such as buying a home close to family which saves on day care costs, but I decided not to include these because I know that not everyone has that luxury. The ones I described above are decisions that I believe everyone can make with careful planning and personal reflection.

I also did not include things I did not do, such as taking on more debt than I can afford, because the list of things I did not do would be exhaustive. This could include things like, I did not become a drug addict, or I did not gamble.

Anyway, what about you?  What decisions have you made that were financially rewarding?

About The Author

Edwin is a marketer, social media influencer and head writer here at I Am 1 Percent. He manages a large network of high quality finance blogs and social media accounts. You can connect with him via email here.

28 Comments

  1. Michelle

    I would say going to school has definitely been the most rewarding so far.

    Reply
  2. Dollar D @ The Dollar Disciple

    Getting a marketable degree is extremely important and I think is also the #1 best financial decision I have made, too. Though, I could have picked something more lucrative, I suppose. Still, it’s paid off immensely.

    I would also add that going to a cheap public university was another good decision.

    Reply
    1. iam1percent

      A public university is definately a cost-effective option worth considering…

      Reply
  3. Jonathan

    For me, it actually extends further back than college – when I was in middle school and high school I got interested in various technical hobbies, teaching myself photoshop, basic programming and web design, and even some 3D computer modeling. While none of these things directly relate to the work I do now as an engineering consultant, these skills have made me an invaluable asset to my [small] company – especially programming. I’ve made a bunch of Excel VBA applications that have made much of the analysis we do a breeze, compared to the hours or days it would have taken previously (and error rates are lower now). Additionally, I made an app that I sell as a small side income and am looking at partnering with a friend to develop a more substantial app.

    Other than that, right around the time I graduated college and started working I learned the value of saving and investing, and have basically banked and invested all extra money since.

    Reply
    1. iam1percent

      I agree…I probably knew I was good at math and science in grade school.

      Reply
  4. Nick

    Good stuff. I think the way you go about career is probably even more important than the particular career choice. I’m convinced that people who really crush it can make money in virtually any industry. Definitely agree with pretty much all of the choices. Way to go!

    Reply
  5. so

    Law school FTW. Quadrupled my income in three short years.

    Close seconds: getting married to a wife who loves Goodwill and doesn’t like Stuff, paying off the house, first few rental investments.

    Reply
    1. PB

      Law School paid of for me and my husband as well, but you see so many people graduating from law school today where it does the opposite- they graduate with mountains of debt and no job.

      Reply
      1. so

        Yeah, I agree. Too many folks don’t do the analysis before starting, and get into piles of debt. I was lucky enough to get a full ride and do well, but the debt burdens folks take on are ridiculous.

        Reply
        1. iam1percent

          You got a full ride? That’s awesome! You must be a brainiac!

          Reply
          1. so

            I’ve had good fortune. Like everyone else, some days I’m a brainiac and others, I can’t find my car keys or remember what I did the day before.

      2. iam1percent

        Yes, I hear the job market for law grads is bleak…market is saturated I guess…makes you wonder about the value of the degree

        Reply
    2. iam1percent

      Good choice on law school, though I hear its hard for new grads to find jobs.

      Reply
      1. so

        the answer = perform in school. If you are in the top 10% of your class, usually (although in NY the market is way saturated) you can find a decent gig. GPA stays relevant for a long time in the legal job market, too…

        Reply
        1. iam1percent

          I’ve heard the same thing. Unlike other professions, it seems that GPA is a metric that is used in the legal job market.

          Reply
  6. Matt @ RamblingFever Money

    Sounds like pretty basic and common sense decisions you’ve made. Seems like it shouldn’t be that hard for everybody to be able to make these kinds of decisions. My only question for you is: do you have a passion for and love what you do? Or was your career path choice based mostly on money reasons? I hear of too many people who earn great incomes but hate their jobs.

    Reply
    1. iam1percent

      Matt, you read my mind and I plan on posting on this later. Do I have a passion for what I do? No. Do I like what I do? Yes. Yes, its a trade off..but I see many people who chase money, but are not happy. ON the flip side, I see people who love their jobs, but struggle financially.

      Reply
      1. so

        This is a hard subject for me, too. I don’t think you have to adore what you do — I think you only need to like it and be challenged by it and be juiced by the action of what you do. It’s hard to “love” work. Love your wife, love your kids, love your dog (or cat, if you MUST), but work is trading labor for $ to fund the rest of your life.

        in my humble opinion.

        Reply
        1. iam1percent

          I agree with you here…I think you only need to like what you do unless your job is your #1 priority. For me, faith and family are higher, so being able to provide for them financially is more important than my “love” for a job.

          Reply
  7. Money Infant

    Learned as much as I could about ways to make money without working for someone else. Could I have made more money in law or medicine or engineering? Sure. Would I be as happy? Hard to believe. The nice thing is that this path is a never ending education and a very rewarding challenge. Self employment FTW.

    Reply
    1. so

      ” The nice thing is that this path is a never ending education and a very rewarding challenge. ”

      I feel that way about the law…

      Reply
  8. Jeffrey

    I still can’t believe how poorly people deal with their investments in down markets. They do all the wrong things! Ugh!

    It’s pretty cool to hear all the things you’ve done right. Most are very fundamental, and give us all something to shoot for.

    Reply
  9. Leigh

    Thanks for sharing! Of your 7 best financial decisions, I have done the following:

    1) Went into a technical major at a reputable college that I was well-prepared for.

    2) I did internships throughout my college years. I opted to work in the corporate world instead of going to grad school and so far, I am glad that I did as I have thrived in this work environment. I definitely have a passion for what I’m doing at work (most of the time).

    3) I chose a career (software) that happened to be in high demand when I graduated from college and is still doing well.

    4) I also set aside retirement money at an early age. I contributed to retirement accounts while in college, where possible, and contributed to my 401(k) enough to get the match in my first year of working full-time. In my second year, I maxed it out and I am on track to do that again this year. I love running the numbers to see how this will pay off for me in the long-run and how much flexibility this will provide later.

    5) I don’t have multiple income streams at the moment, so I will say that the 5th item on my list is saving 100% of my bonuses and living off of 50% of my net monthly salary, which is allowing me to buy a condo now and to feel very comfortable if for some reason, I want to quite my job.

    6) I actually hardly ever watch the market and just let my 401(k) contributions plug along each month. I make other index fund purchases whenever I have the funds dedicated to do so.

    7) I have my target asset allocation set at 87/13 right now, which I will adjust slowly each year and as my assets grow.

    Reply
    1. iam1percent

      You sound a lot like me! I just saw your financial stats on your site…you’re making good progress!

      Reply
      1. Leigh

        Thanks! I’m hopeful that when I’m your age, I will also be a millionaire and I’m enjoying reading your story.

        My current projections say that’ll take about me to age 40 by myself, but there are still plenty of variables and that is quite a ways off at this point…

        Reply
        1. iam1percent

          With your discipline and attitude, you will have nothing to worry about. Am I that old? 🙁

          Reply
          1. Leigh

            Haha, no you’re not old, I’m just young! 😉

  10. Bob

    Wonderful list. Your (and many commenter’s) decisions sound very similar to mine.

    Making those decisions could not have happened without someone else there.

    My parents – supported my siblings and me in whatever we wanted to do – just do it the best you can. Encouraged us to go to college but we chose state schools. Worked every summer and went through on a cash basis, no loans. When I graduated my father shook my hand, reminded me that I/we owed no money, and wished me luck. Learned early on to spend less, save more.

    My wife – She has the same attitudes to finance that I do. Spend less, save more, then budget it and enjoy it.

    FYI – In 2007/8, I increased by 401k and investment contributions. A friend asked our 401k advisor about switchin to cash and his response was “so when are you going to go back in?” He stayed in the market.

    Reply

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