Here’s my personal finance strategy.

It’s not perfect but it works for me.

The Process:

I acquire after-tax earned income using high income skills (mostly tech and businesses).

I invest that money into assets that produce passive income, mostly through equity structuring rather than debt structuring.

I stabilize the assets to produce cash flow.

Every week I update my net worth on a spreadsheet, itemizing each asset and liability, their effective values based on my ownership, interest rates, and date of inception for a wholistic view.

I sort the spreadsheet largest assets at the top, largest liabilities at the bottom.

I worked for Dave Ramsey before. I do advocate for reducing consumer debt, paying down smallest to largest.

This means I’m paying my smallest debts on the spreadsheet first.

The only time I deviate is when I need to pay off a certain debt to free up cash flow.

I also save for an emergency fund. I put a twist on it because I account for risk (unique to my circumstances).

I save several types of emergency funds for certain circumstances. The amounts vary but are often capped. The rest goes towards investing or paying down debt.

I don’t overleverage. Debt to income ratio is very important to me.

Whenever my DTI is above 10% I stop investing and pay down the debt.

Why?

Because my debt can (and does) eat away at my monthly cash flow.

So if I’m not careful I can just forget and be losing money.

Another thing is one of those emergency funds I mentioned is just a discretionary buffer.

I usually spend it at the end of the year, usually on paying down a debt or buying something big. I was going to spend it anyway but if I didn’t then good for me.

Every dollar that comes into my hands has a purpose.

And I make financially sound decisions based on my circumstances, accounting for risk and solid principles that help realize monthly cash flow.

I own 90% or more of every asset in my portfolio free and clear.

I negotiate this because I like to own shit.

I did this all through hustling, equity deal structuring and building the right business partnerships.

Lesson here is I don’t use debt when I don’t need to.

I’ll leave you with this.

Financial responsibility promotes financial wellness.

What’s most important is that I learned from others and built up a “common sense” strategy that has been working for me.

Also I don’t invest in things I don’t understand or in businesses with a human characteristic that I just don’t want to deal with.

The list is exhaustive.

I stick to what I know, and what I understand. That’s it.