Personal Finance Learning Guide

<<< Section 6A: Savings

<aside> 🗒️ In this section: In this section, we show how to put the basics (what money can buy you, money mindsets, income, and saving) together to grow wealth through the "Money Flywheel".

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What is the Money Flywheel?

"Money Flywheel"

The money flywheel is a way to think about your personal finances. It behaves like pushing a heavy wheel up a hill - difficult to start moving, but once it starts going downhill, is difficult to stop. Here's how it works:

1. **Income AKA Making Money** - In order to begin moving the flywheel, you need to first make some money.
2. Money Mindset - Next, you begin to turn the flywheel by thinking about money correctly ("Actually, I'm Good" and "Pay Yourself First").
3. Saving - The money mindsets allow you to further begin to accelerate the flywheel by saving your money.
4. Enjoying What $$ Buys You - Use the money that you've saved to buy things.

Where the magic happens is the flywheel effect: once you begin enjoying what $$ can buy you, you want to make more money, which in turn makes you recognize how important your money mindsets are, which then allows you to save even more money.

How do you make the flywheel go EVEN faster 🏎️? Check out the next section on investments and Section 9 on investing strategy.

To see how debt slows down the flywheel ☹️, check out our section on reducing debt.