Hey there! Welcome to the Independent Money newsletter 👋 We’ll be exploring the latest financial news and discussing how it affects entrepreneurs like you. Plus, we'll share some awesome wealth creation insights from successful entrepreneurs.

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In this newsletter, we’ll discuss:

• Ali Abdaal’s 5 Financial Mistakes: Ali Abdaal makes more money as a creator than when he did as a doctor. But he’s made some financial mistakes along the way. Below we’ll discuss five of them.

• Jesse Pujji’s gripe with new tax laws: Have you heard about this new tax law? It’s costing Jesse Pujji an extra $1.2 million in taxes. 

• What’s happening at Carry: Save your seat for our upcoming tax workshops and if you’re a Carry enthusiast, we want to hear from you!

Ali Abdaal Reveals His Top 5 Financial Mistakes 

Ali Abdaal revealed his top five financial mistakes. Here are the major takeaways.

Mistake #1: Being late to the investment game

Ali Abdaal started making money when he was 14, but he didn’t start investing until he was 21. 

He explains that even though he was only making a few dollars an hour at 14, the habit of investing is important to build. 

When he started making “real” money at 19, he didn’t have the habit in place, meaning he lost out on three years of investing that could have resulted in significant returns.

Carry can help you set up automated retirement investment accounts, like a Solo 401k and IRA. Then, you can set it on autopilot so that you don’t have to actively invest.

Mistake #2: Spending money on low value things

He shares four main rules he’s learned over the last 10 years:

1. The law of diminishing returns, which states that the more you have, the less you enjoy it. So do you really need to upgrade to that iPad? How much happier will you be?

2. Is there anything else I’d rather spend my money on? He also tries to spend money on experiences because he’s more likely to remember those.

3. Do I really want this thing? Or do I think I want it because society wants me to want it? For example, are you buying the new iPad because everyone is telling you to?

4. Do I really want this thing or do I just like the idea of this thing? For example, are you buying it because you want to feel like an important business person?

Mistake #3: Getting stuck in the cheapskate mindset

He found that even after he started making money, it was hard to get out of the frugality mindset. The biggest problem is that you don’t really appreciate the money value of your time, so you do low value tasks that are actually costing you money because your time is worth more than them.

Also, when you’re younger, your earning power is the lowest it’s ever going to be. So the return on your happiness of spending, say, $20 as a teenager is much higher than if you spent that $20 as a 30 or 40 year old.

Mistake #4: Buying things from unreliable sources

Ali Abdaal shares a story about how he got scammed buying a MacBook Air. You can protect yourself by using reliable payment platforms like PayPal.

He also mentioned that a lot of people have a desire to please other people and therefore rush into a purchase. Don’t. Take your time making a purchase decision. 

Also, only purchase items you’ve thoroughly researched and understand. This ranges from doing research to make sure you’re buying the right laptop to researching and thoroughly understanding how crypto works.

Mistake #5: Misjudging the dollar value of my time

His first few jobs were working as a freelance web developer and designer and he signed a contract for a web development job that was $300, yet ultimately took him three years to complete.

He also explains the difference between absolute and relative income. 

Consider the graphic below. Even though the woman has a higher absolute income ($100k), her relative income is much lower than the guy’s relative income.

So consider your relative income.

Which mistakes have you made? And what were your biggest takeaways?

The New Tax Rule That Entrepreneurs Are Seriously Unhappy About

Jesse Pujji just brought up a great point on Twitter:

While we can’t change laws, there ARE plenty of things you can do to save money on taxes as a business owner. So before worrying about what you can’t change, be sure to check out these tax savings strategies for business owners.

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What’s Happening at Carry?

Here’s what you can expect in the coming weeks

See the full list of events here. ⏰

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If you want more resources on building wealth as an solopreneur/entrepreneur, check these out:

• The Solo 401k handbook 

• Common Solo 401k FAQ

• What is a Solo 401k?

• How to Open a Solo 401k

• Solo 401k Contribution Calculator