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The most powerful way to think about money | Paula Pant



Financial expert Paula Pant explains how you can afford anything, but not everything.

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It’s oh-so-easy to look at shiny, quickly rewarding options for your money as a ticket to financial independence. A big hit on the stock market; a hockey sticking cryptocurrency; an app that can put you on the path to easy street. But truly building financial independence is a life-long process, says Paula Pant, the host of the Afford Anything podcast.

Think of your finances like a tree. While the leaves and fruit are grabby and exciting, they aren’t where the tree’s strength lies: that’s in the roots. So too do healthy finances begin from a core base: figuring out what you value most, what you truly want to afford.

From there, you can make the long term plans to see that come to fruition. With a stable, value-driven approach and some discipline, a world of freedom can open before you. You may not be able to buy everything, but you can buy anything.

0:00 Afford anything (not everything)
1:03 First principles thinking
2:30 Financial independence
3:35 Simple steps to independence
4:31 The 20% rule
5:18 Survive a scary economy

Read the video transcript ► https://bigthink.com/videos/how-to-afford-anything/

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About Paula Pant:
Paula Pant is the host of the Afford Anything podcast, an award-winning show with more than 24 million downloads. It was named by the New York Times as one of “7 Podcasts Your Wallet Will Love.”

She is also the founder of Afford Anything, a personal finance brand with more than 75,000 newsletter subscribers.

She is a Knight-Bagehot Business and Economics Journalism Fellow at Columbia University.

Pant is frequently featured in financial media including Money Magazine, the Washington Post, Oprah.com, CNBC, Fortune, Marie Claire, Marketplace Money, Men’s Health, Real Simple, Outside Magazine, Cosmopolitan, the New York Times, and more. She’s spoken at the “Talks at Google” series and guest lectured at Georgetown University. She lives in New York City.

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34 Comments

  1. Why is the answer to “you can’t afford something” always “you can’t afford it”. why is it never “how do I work out how to afford it?”,or “how do I earn the money to live the way I want to?” It is almost like there is a deliberate effort to encourage people to not think outside the box. To be slaves to their monthly pay packet, and not question the monthly pay packet. How is this talk helpful? This 2nd grade math. Yes, 1+1=2. I know that, everyone knows that. The advice I want is, “how do I change 1+1=2 into 1+x? X= all the things I want in life.

  2. So her financial advice is to earn more money, spend less money, and thus save more money… and you people are celebrating that in the comments? THAT'S the advice needed to be told?

  3. “The pursuit of Financial independence is for everyone”.

    And the attainment of financial independence is for the 1% who were either born into it or sociopathic enough to sacrifice everything worth living for to acquire it.

    Money advice from someone born into money does not apply to people who were born into poverty. Social mobility has taken a battering due to the greed that fuels the accrual of vast sums of wealthy. It doesn’t matter how many times you divide the pie, it’s still only 1 pie.

  4. Most of us can't afford anything and this is how the 'system' is set up to function. All these guru how-to shite is BS and also comes from this system.

  5. Form the perspective of the society, passiv income should be viewed critically and not be glorified.
    In general I wish that passiv income was more taxed then active income.

  6. Good video, good advice, however the whole "if you're not making much money, make more" is hard for a single mom in college. lol. but good video nonetheless.

  7. Useless advice. The median income worldwide is $850 USD per year. The myth of "passive investment income" is an aspiration built off the back of modern-day slavery.

  8. Which investments exactly? I've been contributing to my 401k for over 20 years, it's not enough, and the value can drop 20%-30% overnight. From what I hear, day trading is a great way to gamble away all of your savings.

  9. I'm totally against teaching people about taxes and money! More for me! I rather you keep yourselves busy wondering what is in a politicians emails, get offended, be hard to work with, etc.

  10. I realized that the secret to making a million is saving for a better investment. I always tell myself you don't need that new Maserati or that vacation just yet. That mindset helped me make more money investing. For example last year I invested 80k in stocks (with the help of my Financial Advisor of course) and made about 246k, but guess what? I put it all back and traded with her again and now I'm rounding up close to a million.

  11. Wealth = Income / Expenses

    ~95% of time to increase income
    ~5% of tim to reduce expenses

  12. Despite the economic downturn,I'm so happy☺️. I have been earning $ 60,000 returns from my $7,000 investment every 13days.

  13. Ok, let's get this straight. Did she really say that once you achieve FI, you may choose to e.g. "become a full-time parent"? Honestly? What percentage of people achieve FI and are still able to have kids? 😀Or, once you achieve FI, "you can do whatever you want". No, you cannot. Because, also according to her definition of FI, passive income covers BASIC needs. Not the WHATEVER YOU WANT TO DO needs… Please, stop these stupid pep talks, these help nobody.

  14. I think this whole year a lot of things are going wrong. Gas is outrageous, food is high and rent is steadily going up. I think people are starting to be selective on what they spend, the economy is crazy right now! I read about people grabbing multi-figures monthly as incomes in investments even in this crazy days in the market, any pointers on how to make substantial progress in earning? I would appreciate

  15. Money is an invitation to GREED! After the global nuclear war, if man survives, money will be a thing of the past. Ringing Cedars.

  16. Every choice you make comes with a trade off , you can afford anything but not everything. You can have that thing but not an endless series of "ands"
    First principle thinking – getting to the root – person Values , what matters most
    Trunk of tree – the philosophy of life what type of life you want to live
    Stems, objective or goals
    Branches – Strategies on how to obtain those goals
    Leaves – Tactics and products
    FI- financial independence
    Potential passive income- money that comes to you through sleeping through investing . You can make decisions without a sweat

    Achieving financial independence
    Grow the gap – grow the gap between what you earn and what you spend
    -two ways to increase the gap . Earn more or spend less or both
    Invest the gap. Everyone should aim and invest 20% of your income or increase your savings rate by 1%
    Repeat – this is a lifetime practice money management happens for life

  17. Interesting stuff here. There's a book that Vicki Robins wrote called "Your Money or Your Life" that has similar elements, but think of your spending as using up your life energy. Convert your salary (after taxes) into hours worked, and then view all purchases as the # of hours you need to work to afford it, and then decide if it's worth it. That helps to frame your perspective on spending and hopefully helps keep your expenses down. That car which costs me one year of my life, is it worth it?

  18. I think one of the most important things to understand about money is that in the big picture, capital is not a finite resource. If someone has more, it's not because they "took it" from you. That's just not how capital generation works. If we get beyond this archaic mindset that money is a finite pool, and thus the "have-nots" have been somehow robbed by the "haves," it would do wonders for our flawed perceptions of alleged "income inequality," and the conversations (or class envy) that are a result.

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