Want to Succeed? Then Stop Making Everything So Fricken Complicated

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want to succeed keep it simpleDo you want to succeed financially? How about physically, mentally, and spiritually? The very thought of succeeding in each one of these categories can be daunting, and can often stress people right out of trying before they even get started! The truth though, is that becoming a success in each one of these categories does not have to be difficult. In fact, becoming financially, physically, mentally, and spiritually fit can actually be quite simple!

Our Tendency to Over-complicate Life

If you want to succeed at shedding 20 pounds of extra weight, what is often the advice of the experts? Many of them will point to a specific 90-day exercise program that will require 1.5 hours of your life every day, not to mention a strict rationing of foods defined on a one-page list. With this method, you must completely change your life in order to accommodate this new workout schedule and eating pattern. With such a radical, complex change, the chances of success are actually quite minimal.

The same often happens with our financial investments. In order to succeed financially, we often think that we need to find the next hot stock or some special formula that will allow us to beat the market. Believe it or not, all of this effort typically leads to under-performance in the market and leaves us with minimal gains after years of investing!

Avoid the Short-term Financial Traps

You may or may not realize it, but there are many short-term traps that might seem financially beneficial, but are actually hindering our ability to become wealthy. As an example, here is a short list of items that are killing our ability to succeed financially:

  1. House Hopping – There are many of us that believe a bigger, more expensive house is our ticket to a huge net worth. This is simply not true, and I’ve already proven that on this site. The best way to wealth is to stay in the home you own today, pay off the mortgage, and then use that cash flow for heavy investing for your future.
  2. Bank Jumping – I have many friends that switch banks every six months just so they can earn an extra $100 from that new bank. In my opinion, this is just a distraction from the big financial picture that we should be focusing on, and totally not worth the $100.
  3. Credit Card Rewards – Yes, credit card rewards are nice, but should they really be the central focus of our spending from month to month? More often than not, we are probably overspending by hundreds of dollars just so we can earn ourselves a $20 reward.
  4. Individual Stock Investing – Some believe that the only way to earn a decent investment income is by picking and choosing those amazing companies that seem to grow their share price month after month. The truth is, many have lost their shirts with this mentality.

The Beauty of Keeping It Simple

I have recently heard stories of highly successful CEOs that just seemed to just drip with success everywhere they went. What everyone else considered to be extremely complex and difficult, these individuals often made it look unbelievably simple. And, more importantly, they often had unexplainable success with this simplicity.

When one of these CEOs was asked how he turned the company around after a seemingly dire situation, he was happy to share his methodology, and it went something like this:

  1. Get a customer
  2. Make them happy
  3. Get a referral
  4. Repeat

How simple is that? By keeping his objectives simple and concise, this CEO was able to succeed greatly. In order to succeed in any area of life, simplicity is often the best answer.

Simplify Your Investments

Personal finance does not need to be complicated either. This should be your big picture focus:

  1. Get out of debt
  2. Invest in Index funds within your company 401(k) or Roth IRA
  3. Invest a portion of your money into your business or real estate
  4. Reinvest your earnings

That’s it. Stop focusing on making an extra hundred bucks with your credit card or with a new bank. In the grand scheme of things, the effort just isn’t worth it. Instead, if you want to succeed in personal finance, just keep your efforts simple! If you want to succeed financially, just get yourself out of debt and stay out of debt. Then, use that extra cash flow to invest and when you start earning more returns, invest that money too. Honestly, the whole process is super simple and has generated countless millionaires. Use this simplicity as your guide, and you will be very likely to succeed as well!

What do you think of this simple approach? Is it working for you?

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25 comments to Want to Succeed? Then Stop Making Everything So Fricken Complicated

  • Rock solid advice here. I absolutely believe in the simple approach. It doesn’t need to be complicated, stay in the same house forever (I can paint and renovate if I’m bored with the surroundings), get out of debt, spend small, invest large, retire young.
    Emma | Money Can Buy Me Happiness recently posted..My 2015 Financial Goals

  • Felix Money

    One of my favorite sayings of all times, that I heard in school over and over again from my English teacher, is ‘simple is best’. I still think about that often, when I overcomplicate things. I’ve only upgraded houses once, but kept the old one as a rental. If I upgrade again (better neighborhood, same square feet or similar), I will keep the current house as a rental as well.
    So far, I’ve only invested in rental properties and now a business, and some individual stocks (I know you advise against them, seemed like good speculation at the time). I don’t have a 401(k) or anything similar, as I’ve aggressively invested our savings in real estate the last few years, but it’s something I would like to do in the future. I feel like I’m lacking without those tax advantaged accounts, and I’m getting older.
    Great advice!
    Felix Money recently posted..Which version of myself do I want?

    • I didn’t really learn this until last year. Luckily I didn’t make any radical purchases trying to strike it rich. The best way to become wealthy is by doing it simply and slow. It’s not super fun, it’s not super exciting, but it is always the most effective in the long run.

  • This article is good timing! Looking and looking for hours at how others do this money thing or that is becoming draining. Your last four steps(except investingin realestate/business) are exactly my goal. But it doesn’t feel that simple. My mom used to say I would use up all my time trying to find shortcuts to things only to waste.
    Dawn recently posted..Day 1

  • Great message with this! I am one of those people who over think and over complicate everything but I’m learning that things don’t have to be so complex and now that I know what I have to do, I just need to take it one step at a time instead of trying to focus on everything at once. For me the first step is getting out of debt and increasing my savings rate. Then the next step will be to increase my investments and let time takes it’s course.

    • Exactly. Focus first on getting out of debt, then beef up the savings, and then figure out how to invest simply and effectively. Not complicated, not exciting, but it will build your wealth year after year!

  • Although I like to go in depth and make things complicated when it comes to saving and making money, that’s my hobby and I enjoy doing it.

    For the average person, I always recommend something simple.

    Pay off your debts first -smallest to biggest (snowball effect)
    Then invest in a low cost index fund in one or two tax sheltered accounts. Done.
    Mr. SelfReliance recently posted..Hanging you out to dry

    • Exactly! I recently heard of the One Page Financial Plan, which is precisely what I was talking about here. Have a long-term plan, but keep it simple. Thanks for the comment, MSR!

  • I love the idea of keeping things simple, including finances. But sometimes you need some background knowledge to make the decisions to streamline and simplify. I agree with your examples though. Sticking with a good plan is the way to build wealth.

    • Some background, but not much. And, once you gain the minimal knowledge necessary, just stay consistent and you’ll be miles ahead of the general population!

  • Kathy

    I basically agree with you on everything except investing in individual stocks & bonds. With index funds you get a whole bunch of not so stellar stocks along with a few real good ones. When the market goes down the tendency is for people to panic and then get out of the fund after the value has decreased. The fund has to redeem shares in order to give the people their money which decreases the value further. And if you are looking for dividends for income, the dividend oftentimes must be cut due to the shares being sold. During the last meltdown, we held individual bonds and dividend paying stocks and while our net worth on paper went down, we didn’t lose a dime because we continued holding our shares and the dividend and interest income just kept on flowing into our accounts. Perhaps it isn’t the right approach for everyone but it has worked great for us.

    • Thanks for the comment, Kathy. Holding onto Index funds would essentially do the same thing – depending what type of fund you have of course. Basically, investing simply for the long term typically beats out short term stock purchases. I think we can agree with each other on that one.

  • K.I.S.S.
    Keep it Simple, Stupid

    Best advice ever. Applies to all scenarios!
    Mrs. Maroon recently posted..Like Bills Through the Breeze… This is the Money of Our Lives

  • I know I’m one of those people who tend to make everything more complicated than it needs to be. At least I’m conscious of the tendency, so that helps me take a step back at times and remind myself that simple is good. I think simple is half the battle–get that done, and every task feels easier, psychologically and physically.
    Kurt recently posted..Simple Guides Big Sale!

    • You’ve got it Kurt. I tend to over-complicate things too, which is how I got the idea for the article! 😉 You are exactly right though – just take a step back and think about the main things. Beyond that, the little stuff won’t really make that much of a difference. Thanks for the comment!

  • Hallelujah. That’s it. Nothing more. Following that advice has helped our household become quite comfortable.

    Here are other facets of personal wealth we can consider working on with the same simple approach:
    1. Staying fit & healthy to avoid medical costs and give us more quality time in this world
    2. Being a perpetual student to ensure we remain relevant to both ourselves and others by being the best “us” we can be.
    Free to Pursue recently posted..Top 12 Life-enhancing Books

  • […] Want to Succeed? Then Stop Making Everything So Fricken Complicated [Life and My Finance via Rockstar Finance] […]

  • I completely agree that the simplest way to do something is often the best way. However, for us it’s been pretty simple to still earn credit card rewards at the same time! Instead of pulling our debit cards out of our wallets when making purchases, we just pull out our credit cards instead. We buy what we need and don’t go out of our way to spend more on the cards (except last year when we bought a car and talked the dealership into letting us put a chunk of the purchase price on our credit card- even though we had the cash- so we could earn rewards). We always pay in full every month. We don’t really consider it to complicate our financial lives very much, but I guess it’s probably not for everyone.

    • Thanks for the comment, Dee. There are a select few of us that can keep the credit card spending in check, but if it is at all tempting to spend more than usual just to get a few points, the credit cards should just be done away with.

  • This is spot-on!

    It seems to me that some people (especially professors) like to study things in complicated detail because they’re interested in it, and examining the details is a good excuse to spend time on that subject. Other people then like to look smart, so they follow along. And soon, you have a tidal wave of overcomplication–and people accept that as normal!

    Most things–including investing!–aren’t really difficult, once you get to the heart of understanding them. The simpler you keep these things, the better!

    This is absolutely great insight, Derek! Keep up the great work!

    • Thanks FS! Getting ahead is so simple that it’s just crazy how people get hung up on credit card points and bank offers. In the grand scheme of things, a hundred bucks for signing up at the bank is not going to make you a millionaire, but simple action in the stock market most likely will.

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