Money Series: How to decide how to make money and invest

When you have a vision for your ideal life and you know how much is enough, the next step is to decide how to make the money and invest it. This requires strategic thinking. Strategy is not some fancy pants thing that war admirals or executives on 200k a year get to do. It’s something you do already. Strategy is how we achieve our goals. It’s about putting yourself in the best position to succeed.

Let’s get started!

How to decide how to make money

Before we can think about investing, first we need money to invest. How we get this money is largely up to us. We get money when we deliver something of value to others. There are many ways to do this, so to help you decide how you can deliver a lot of value to others in a sustainable way (aka, make a lot of money over a long period of time), here are some suggestions.

1. 🧠 Decide you want to make money

2. 🔧 📖 Learn how to make money

The best way to learn how to make money is a combination of two things: learning by doing, and learning from those that have gone before you.

🔧 Learning by doing

No two successful people started their working lives the same way. The one thing they have in common is that they started. So just start! Labourer? Great. Washing dishes? Brilliant. Collecting golf balls on the driving range. Excellent. Mr. Beast? You’ve got it made. When you practice delivering something of value to others, over time, you get better. More money usually follows.

Opportunities to learn by doing in NZ/AUS:

📖 Learning from those that have gone before you

There is one way to do this that towers above all others, in terms of outcomes. It’s free and the people you learn from don’t even have to be alive.

When combined with learning by doing, reading bestselling books is the best way to learn anything, in my opinion. I love a good podcast, but books go deeper and inspire action. This has much to do with the way we read a book—entirely at our own pace and rarely in the one sitting. Slow learning sinks in and tends to trigger action.

It’s hard to get a book published, so it already needs to be really good just to end up in print. Then, to become a bestseller, it needs to be crazy good. A bestselling book is no accident—it means it’s helped a lot of people. You can be the next person it helps.

Some of the best books I’ve read on how to decide how to make money:

Bonus points if you read bestselling books that were published more than 5 years ago, since these books are more likely to contain timeless information that will stand the test of time.

There are other things you can do to help you decide how to make money, of course. However, these two—learning by doing and learning from those that have gone before you—will have the biggest impact. There’s always something else to learn. Even if you have already decided how to make money, I’d recommend continuing to seek out those that have gone before you, dead or alive.

3. 🩻 Understand yourself better so you can find work that compliments who you are at this moment

You don’t need to go to therapy to do this (though it does help)! Understanding yourself better will help you choose work that plays to your strengths. An easy way to deliver something of value to others is to do what you’re interested in or what you’re good at. Many of the things we’re good at started as things we were interested in. Over time, you’re more likely to get paid more to do what you’re good at, which will help you get to ‘enough’ sooner. Understanding what you’re good at also helps later on with deciding what to invest in.

I took these answers and summarised the themes using their words. I’ve shared these below, not to showboat and parade my strengths, but as an example of how I’m continuing to figure this out too:

  • Communication & connecting with people—connecting people together.
  • Asking great questions—great in conversation.
  • Disciplined—likes to create systems and processes to follow.

Questions to help you work out your strengths, and to give you clues as to what work you might have an unfair advantage doing:

  • 10 hobbies or interests you’ve had in the last 10 years
  • 5 things family and friends ask you to help them with
  • 3 things you might do if you had 3 hours free this Saturday morning
  • Any topic you’ve read (or own) more than 3 books on
  • 3 times in the last year you’ve felt like you were in a flow and really enjoying what you were doing
  • 3-5 things people have paid you to do outside your day job

Don’t filter yourself. Write it all down!

Bonus step

Other helpful questions to consider:

→ Based on how much I currently earn, how much could I invest each month? 
→ If I did this, how long would that take to get to ‘enough’?
→ Am I comfortable with the amount of time it would take?

How to decide how to invest

Our money grows faster when it’s invested, compared to leaving it in a savings account or stashing it under the mattress. If you don’t want to be working full time into your 60s and 70s, you need to invest. Now that we’re making some money, we can decide how to grow it. For the time being, ignore the question of ‘what should I invest in’. We’ll come to that. Let’s look at the how.

Start by reviewing your answers to these earlier questions: 

Choose your preferred variation of the questions. They will both get you to the same destination. 

If you haven’t jotted down some quick answers to these, do this now. It’s okay, I can wait a paragraph break.

Now that you’ve got your answers, hold them close 🫂. They will protect you when you subject yourself to all the flashy things you could invest in. Without a compelling vision for your ideal life, and a decent understanding of yourself as you are, you could get lucky like gamblers sometimes do. What is more likely is that you will invest in a knee-jerk way, allowing your emotions to guide you. As an investor, this is a recipe for disaster. Fortunately, this is far less likely to happen to you compared to the average person, because you’ve taken the time to mitigate the risk. Mitigating risk might make you yawn, but it also might make you wealthy.

I’ve shared my personal answers to these questions below. There is no right or wrong way to answer them. You’ll know you’ve done it right when you’re like “Yep, that’s it.” Like everyone, I’m a work in progress, so these answers are evolving, but they are what I know to be true today:

  1. What vision do I have for my ideal life?
    Answer: Being able to do what I want with my time, not having to work for money, helping people be better versions of themselves, spending time with my partner, family, and friends, interesting experiences
  1. Who am I?
    Answer: Communicator, likes connecting with people and connecting people together, asks lots of questions, disciplined, likes creating processes and systems, long term thinker, risk averse, likes to feel in control

Exploring what to invest in

Finally, the time has come to start researching what you could invest in. The easiest and most effective way to do this is—yep, you guessed it—to read a couple of bestselling books. 

As you learn, you will feel a very strong urge to make quick decisions. It’s not your fault. Almost all investment platforms and products are designed and marketed to make you feel like this. Counterintuitively, this is the time to slow it right down and keep an open mind. We’re in no hurry here. Wealthy people make important decisions intentionally, which often means slowly. There aren’t many decisions that are more important than deciding what to invest in. Well, there are, but we’ve already covered that in this series.

Think about how your answers to the two questions above relate to the different things you could invest in. Try this…

→ Ask: What would my life be like if I put all of my life savings into that?
→ List some details of what your life would be like.
→ How does the reality make you feel? Would you be happy as that person? Does it play to your strengths?

Work your way through each type of thing you could invest in. Here is what I realised, as it related to the vision I have for my ideal life and who I am:

  1. 🏠 Real estateCons: A huge time investment, I don’t like the idea of going into massive debt to invest, I’m not that interested in going deep to learn about it and develop an unfair advantage over other investors, I don’t have an interest in learning how to become a handyman so I can fix things myself, I don’t want to have to manage tenants and a property manager (yes, they have to be managed too), it’s time-consuming and costly to sell. Pros: Once the mortgage is paid off it could pay me rental income, my brother is great at fixing things and knows builders, fun idea to own my own home or investment property, people will think I’m cool.
  2. 📈 Index fundsCons: Slow return on investment, incredibly boring to invest in and people will think I’m boring. Pros: Low maintenance, low cost, easy to liquidate, rewards patience, closest thing to a sure thing in the long term as far as returns are concerned, pays dividends.
  3. Individual stocksCons: High risk, small chance of very high returns, real chance of losing everything, large time investment in perpetuity, requires maintenance. Pros: Exciting to invest in, easy enough to sell, small chance of very high returns, pays dividends, people will think I’m fairly cool but could be cooler if I also owned my own home.
  4. CryptoCons: Extremely high risk, volatile, humans are still understanding its place in society, largely unregulated. Pros: Learn about something new and interesting, get in ‘early’ on something that could become more mainstream, tiny chance I could make a shit ton of cash in a short amount of time and use this as proof of my intelligence, bro.
  5. 🚀 Starting my own businessCons: Huge time and financial investment, high risk, doesn’t suit the lifestyle I want, tried this already in my 20s and didn’t really enjoy it, I prefer working for others. Pros: I like taking ownership of my work, small chance I could create a successful business that helps a lot of people and generates an income, I could hire people I wanted to work with.

Index funds suited my strengths and vision for my life the best. So that’s what I decided to invest in. I have many friends who have a high risk tolerance, enjoy responsibility and like doing things with their hands, so they tend to invest in real estate or start their own businesses. 

Do small tests

If you’re not sure what to invest in yet, that’s okay. Do small tests. 🧪

When I first had a hunch that index funds would suit me best, I invested $30 into the NZX50 index fund via Sharesies. I watched it go up and down in value for a couple of months and I paid attention to how this made me feel. I had read some books on index fund investing so I understood why this was happening. With this knowledge, I didn’t panic when the value went down. Just as importantly, I didn’t get too excited when the value went up.

Another test I ran a few years back relates to real estate. My partner and I thought we might like to buy a house, so we opened up a 90-day notice saver account and started putting money in every time we got paid. One thing you’ll learn when you are researching real estate is that a regular savings account is actually a really good place to save up for a house deposit, if you plan to buy in the next 7ish years.

When we realised we didn’t want to go into so much debt to buy a house and that investing in index funds (me) and a business (her) were going to get us to ‘enough’ in a way that was consistent with our vision for our ideal life, we took the money out and redistributed it to index funds and her business.

You will take a few odd turns along the way, but that’s okay. You’re learning! You don’t have to pick one thing from the start. There’s a lot to be said for trying a little bit of everything and then deciding where to focus.

My hope for you is that when you are deciding how to make money and invest, you will avoid the temptation to look outside of yourself for answers. Instead, start with a vision and a curiosity to understand yourself by looking within.

Next steps



Thanks to Hamish Bulsara, Laura Cheftel, Christine Chow, Cynthia Gao, Cathy Zeng and Emily Zhu for reading drafts of this.

Also to Dave Cameron, Sierra Truong, Claire Twyman, Adam Walmsley and Pippa McCormack Wolf for reading a very early draft of this.

Disclaimer: Like your all-knowing uncle telling you the latest stock tip, this should not be considered financial advice.

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