Expert Interview with Todd Tresidder About Financial Freedom and Focusing Your Finances on Values and Security
While he was an entrepreneur in the investment management industry, Todd Tresidder noticed a contradiction in what got him to his own financial independence and what was normally taught. From this contradiction, Todd found motivation to create Financial Mentor to teach financial freedom and wealth building. With his economics and investing background, Todd has a vast amount of expert advice to share. He talked with us about financial freedom, the everyday decisions we make that get us there and stuff versus experiences.
Your bio mentions your childhood entrepreneurship – what was your very first job?
If you’re asking about my very first business, then it would be delivering newspapers. I started with one paper route and used the money from that route to buy a motorcycle, which then allowed me to take on two more routes so I could deliver three times as many papers in the same amount of time while having fun riding my motorcycle in the morning.
If you’re asking about my very first W2 employment, then that would be working in a gas station as a kid. I started by pumping gas after school and by my senior year in high school I was the weekend mechanic and service manager, hiring and firing my schoolmates.
What advice would you give 20-somethings just starting out, even teenagers, to set them on a good path to financial freedom?
The formula for financial freedom is deceptively simple. Make more than you spend and invest the difference wisely. Literally, that is everything you need to know to build wealth. The rest is just details.
In practical terms, what that means is you should always work toward increasing your earning capacity by increasing your skills and increasing the value you can deliver to others. If you do that every day, it is just a matter of time until you’re several levels above any competition and in high demand. This will translate into greater earning capacity, which is the first part of the simple wealth equation.
Stated another way, you must produce the wealth in the first place, and that comes through increasing your earning capacity.
The second part of the wealth equation is translating that income into assets you control. This is achieved by developing personal financial management skills that result in savings and growing investments.
How have some things changed over the years that makes retirement planning different than it was a few decades ago?
Increasing longevity has changed everything about retirement planning. When Social Security was first created, the average life expectancy was age 65. Now a healthy couple at 65 can expect at least one spouse to survive into their 90s. This is critically important because the old model of saving a nest egg so you could spend it down in retirement made sense when the retirement time frame was only 10-20 years, but when your expected lifespan in retirement extends 30+ years, there is no safe amortization rate for your nest egg. In short, our careers are representing a shorter portion of our total lifespan, and that fact is profoundly effecting every aspect of retirement planning – from required savings rates, to safe withdrawal rates, appropriate investment strategy and more.
Briefly, how does FinancialMentor.com help someone gain financial freedom?
FinancialMentor.com solves all the problems and complications that naturally occur when you implement that simple equation that leads to financial freedom.
In other words, the equation may be simple, but we are emotional human beings with all kinds of complicating needs and desires that get in the way of getting what we want out of life. We are not robots, and life complicates simple formulas when put into practice.
FinaicalMentor.com also provides tools and resources for the wealth-building journey like calculators and recommended reading lists along with tons of free educational content and a podcast to learn everything necessary.
Love that your focus is on “experiences of life, not toys and goodies.” It’s an important philosophy, so how can people separate life experience from frills and flash?
If you desire the appearance of wealth – mansions, flashy cars and designer clothes – then the spending that comes with that lifestyle will virtually guarantee that you never experience true wealth and personal freedom. Your desire to lead a rich lifestyle will cause you to consume whatever income is produced.
Most people who achieve wealth have a high value on freedom and security, which causes them to save instead of spend. They don’t experience saving money as deprivation because they’re actually spending on exactly what they value most – freedom and security. It is just a different way to spend.
The frugal saver spends on security and life experiences, whereas the lifestyle junkie spends on stuff. Each person’s spending reflects a completely different set of values.
Stated another way, as long as you value stuff over life experience, then you will be permanently on the financial hamster wheel. If you want freedom, then the starting point is to get clear on your values and what matters most so that your spending reflects those values.
What is your view on spending in America, the products and accumulation you see around you, and how it effects our financial well being?
Most people are mindless consumers swayed by advertising and social trends to pursue false happiness at their financial detriment. The result is credit card debt, a hectic lifestyle and a confused lack of fulfillment.
Corporations want us to believe that product X will make us more attractive so they can maximize their profits – not yours. People pay for grocery carts full of expensive, pre-processed food when they could get far more nutrition for far less money if they ignored the marketing sales pitches.
A wealthy, healthy and fulfilling life starts with clarity about your values and what is important to you so that you aren’t swayed by fashion trends or advertising. Your spending must honor the truth inside of you – not outside influences – if happiness is your goal. It may be a cliché, but the stuff that brings true happiness can’t be bought with money.
What is a financial habitude?
“Habitude” is a mashed-up term I use to describe the habits and attitudes that determine your daily behavior. Nearly everyone reading this article will have more than enough money pass through their hands during their lifetime to become fabulously wealthy and free of any financial concerns. However, only a few will actually achieve financial freedom.
The difference between the winners and losers is literally determined by the hundreds of small decisions you make every day, mostly mindlessly. Very few of your daily decisions are truly conscious. Most are decided on auto-pilot by the habits and attitudes you’ve adopted.
I teach people to consciously shape those habits and attitudes to produce the goals they want on auto-pilot. It is the absolute easiest and most secure path to financial freedom.
Would you share a bit about your education products?
I offer free, cheap and expensive so each person can pick what is right for their needs. For the free stuff, you can learn from over a thousand printed pages of education on my site in the “tutorial guides” found in the header at FinancialMentor.com. If you don’t like reading or have a long commute, then I have a free podcast as well. Additionally, I offer targeted solutions to specific financial problems for cheap in my books available at Amazon, and for people who want personalized guidance, I offer financial coaching and the 7 Steps to 7 Figures course.
How does someone know when it is right to reach out to a financial coach?
Financial coaching is a personalized service, which makes it expensive. Like anything else, you should only do it when it puts more money in your pocket than it costs. I wrote an entire article here explaining who will benefit from financial coaching and who won’t because it is prohibitively expensive. And for all the people who shouldn’t buy it, I explain what they should do instead to maximize their financial education dollars.
Where do you see yourself down the road?
My goal now is to convert the knowledge I’ve developed from my own path to wealth and the 15 years I’ve been coaching others to do the same into product and book form. I want to help millions of people instead of the few hundred I’m limited to when giving personal attention. That requires me to leverage technology by packaging my knowledge into affordable products delivered around the world through the internet so that I can serve more people.
I love the wealth-building game like a child loves playing Monopoly, so I have no desire to leave the field or “retire.” This is my passion and my gift. I just want to expand how many people can benefit from this knowledge.