Watch Now
Listen Now
In this episode, I’m joined by Jack Raines, author of Young Money: A Field Guide to Finding Wealth and Purpose in Your Twenties, for a conversation about what happens when traditional financial advice focuses too heavily on accumulating money and not enough on using it well.
Jack’s story begins with turning a $6,000 Roth IRA contribution into nearly $400,000 during the SPAC boom—and then losing $150,000 in about five minutes. But the more important lesson was not about investment selection. It was recognizing how much of his time, attention, and emotional energy the market had consumed.
We discuss why time may be a more valuable asset than money, when saving less can be reasonable, what the FIRE movement gets wrong, how to distinguish uncertainty from genuine risk, and why a good life may be best measured by the memories and moments of nostalgia created along the way.
Sign up for my newsletter so you can easily reply to my emails with your thoughts or questions for the podcast:
When investing stops serving your life and starts consuming it (00:40)
Jack graduated from college shortly before the pandemic and began working remotely in corporate finance. Bored at home, he discovered special purpose acquisition companies, or SPACs, and started trading both their shares and warrants inside his Roth IRA.
The timing could not have been better—until it was not.
Over roughly nine or ten months, Jack turned a $6,000 contribution into nearly $400,000. His father suggested taking half of the money off the table and moving it into an index fund, but Jack believed he was close enough to $1 million that he should keep going.
A few months later, he lost approximately $150,000 in about five minutes.
The financial loss hurt, but the experience taught him something more consequential: active speculation had consumed his life. He was constantly analyzing positions, checking prices, losing sleep, and riding an emotional roller coaster tied to numbers on a screen.
I share that I began my own career as an individual-stock analyst and once owned a collection of individual stocks. Today, my portfolio is intentionally simple. During unusual periods such as the financial crisis and the early stages of the pandemic, it was tempting to believe that obvious individual opportunities were everywhere. But resisting those opportunities allowed me to stay with a strategy that did not require constant attention.
That leads to the more important question: When does investing stop serving your life and start consuming it?
Jack believes the answer depends partly on opportunity cost. Unless managing money is your profession—or the portfolio is large enough for incremental returns to materially change your circumstances—the hours spent researching and trading may have a poor payoff.
Someone with a $50,000 portfolio could produce an extraordinary 100% return and make $50,000. But developing a valuable professional skill might increase that person’s annual income by the same amount and continue producing returns throughout an entire career.
The relevant comparison is not simply one investment against another. It is the potential return from investing your time elsewhere.
Why the opportunity cost of time matters more than the opportunity cost of money (06:40)
Financial planning is good at demonstrating the future value of a dollar. It is much harder to demonstrate the future cost of an experience someone never had.
Jack argues that money is fungible and replaceable. Income can fall and later recover. Net worth can rise and decline. Time, by contrast, is a continuously depreciating asset. Every hour spent is gone permanently.
That does not make traditional financial guidance wrong. Jack contributes to his retirement plan, receives his employer match, and believes young people should build savings. His concern is that reasonable advice can produce unreasonable behavior when applied without considering someone’s life stage.
A person’s early twenties often combine several unusual conditions:
- Income is relatively low.
- Future earning power may be much higher.
- Fixed expenses and responsibilities are limited.
- Friends are nearby and generally living through the same stage.
- Many experiences are inexpensive but difficult to recreate later.
Someone earning $60,000 at 23 may have an opportunity to take a trip, move to a new city, or participate in an experience with close friends. Saving the money may be financially optimal on a spreadsheet, but it also carries the nonfinancial cost of giving up something that may not remain available.
Jack is not arguing that every young person should save less. His framework depends on individual circumstances. Spending more today is easier to justify when the money supports a genuinely meaningful experience, high-interest debt is not accumulating, and the person has a realistic path toward higher future earnings.
Someone whose income is likely to rise from $60,000 to $150,000 may be able to compensate for modestly lower savings later. Someone without that earnings trajectory should be more cautious.
The larger point is that money exists to fund some form of fulfillment—either now or in the future. The difficult task is deciding which version of yourself will benefit most from each dollar.
What it means for memories to compound faster than money (10:05)
One of my favorite lines in Jack’s book is that memories compound faster than money.
The idea builds on Bill Perkins’s concept of “memory dividends” from Die With Zero. Financial compounding is easy to calculate. We can enter $10,000, an assumed rate of return, and a time horizon into a spreadsheet and see what the investment may eventually become.
The compounding of experiences is harder to quantify.
A meaningful experience provides value when it occurs, but it may also continue producing returns through stories, relationships, and moments of nostalgia. A trip with friends does not end when everyone returns home. The memories can be revisited for decades, strengthening the relationships among the people who shared them.
Jack believes that one useful objective for life is creating powerful future moments of nostalgia across its different stages.
These experiences may also be unusually inexpensive when people are young. At 22, a shared hostel room, inexpensive food, and an unplanned train trip might be an adventure. At 42, recreating that same experience may require better accommodations, more complicated travel, arrangements for children, and time away from greater professional responsibilities.
The argument is not permission to finance experiences with credit-card debt. Jack draws a clear line between saving less and actively burying yourself in expensive debt. His advice is primarily directed at people who have the capacity to spend but are so committed to frugality that they struggle to permit themselves to do so.
Good financial habits compound, but so can excessive deprivation. I have met diligent lifelong savers who reach retirement with more than enough money but find themselves psychologically incapable of spending it. Practicing intentional spending earlier may be part of learning how to use money well later.
The goal of financial planning should not be limited to minimizing the probability of running out of money. It should also consider the probability of reaching the end of life with substantial wealth and avoidable regret.
What the FIRE movement gets right—and where it goes too far (14:59)
Jack and I share a skepticism toward the more extreme versions of the financial independence, retire early movement.
At its core, FIRE begins with several constructive ideas. Saving aggressively can create flexibility. Reducing unnecessary consumption can make people less dependent on a paycheck. Financial independence can give someone greater control over how to spend their time.
The problem arises when those ideas become a wholesale rejection of work and the present.
Jack describes a version of FIRE in which someone minimizes every expense, avoids experiences with friends, and remains in a job they dislike solely to leave the labor force as quickly as possible. After reaching the target, that person may continue living the same restricted lifestyle—only now without work.
That raises a more fundamental question: Is the problem employment, or is it the person’s relationship with a particular job?
Jack also points to a social consequence that receives less attention. Someone who retires in their late thirties may find that nearly everyone else in the same life stage is still working, raising children, and building careers. Financial independence does not automatically provide community, purpose, or people with whom to spend the newly available time.
Leaving work also increases dependence on the portfolio. A severe market decline early in retirement can disrupt a plan built around decades of withdrawals, especially when the person has deliberately limited future earning power.
Jack’s alternative is not to work forever in a miserable job. It may be to change careers, take a sabbatical, reduce hours, or find work that provides more autonomy and purpose.
People generally need something meaningful to do. Financial freedom should expand the range of worthwhile activities available to us—not reduce life to mere subsistence.
How to distinguish uncomfortable uncertainty from genuine risk (18:50)
Uncertainty and risk often feel identical because both create anxiety about an unknown outcome. Jack distinguishes them by asking what the downside would actually mean.
Consider losing a job at 25. Someone living with roommates, spending a few thousand dollars each month, and supporting no dependents may face an unpleasant period. But the person can reduce expenses, find temporary work, learn a new skill, or pursue another job. The experience may be uncomfortable without being permanently damaging.
The calculation looks different at 40 or 45. A person may have a mortgage, children in private school, car payments, and a lifestyle requiring tens of thousands of dollars each month. Leaving a well-paid job to pursue a speculative venture could create real consequences for the entire family.
The distinction therefore depends less on age itself than on commitments, fixed costs, and the ability to recover.
Jack believes many young people overestimate career risk because they compare the potential pay cut or immediate setback without considering the possible long-term upside. Leaving investment banking for a lower-paying startup may reduce income today, but it could create new skills, relationships, equity ownership, or opportunities ten years later.
Even an unsuccessful entrepreneurial effort might provide experience that leads to greater responsibility and compensation in the next role.
The practical question is:
Am I nervous because I do not know what will happen, or am I nervous because a bad outcome would cause serious and lasting harm?
That is similar to the distinction investors should make between volatility and permanent loss. An uncertain outcome is not automatically a dangerous one.
How “living life backward” creates clarity when several paths seem reasonable (23:03)
One of Jack’s challenges is a tendency to move from productive introspection into destructive rumination. When every choice appears plausible, thinking longer does not necessarily create a better answer.
In his early twenties, Jack disliked his job, knew he would eventually attend graduate school, and had no clear picture of what should come afterward. A conversation with Dr. Jim Jackson, a former pastor and executive coach, gave him a more useful framework: live life backward.
The exercise begins by identifying the experiences, relationships, and accomplishments you would be unwilling to leave life without. Then determine the order in which those things need to happen.
For Jack, backpacking around the world was not merely a vague aspiration. He wanted a specific type of inexpensive, spontaneous travel that made sense while he was young, single, and free of major obligations. He had already secured admission to business school, had enough money to avoid financial danger, and knew his long-term career would be shaped largely by what happened after earning his MBA.
Earning another $50,000 before school would probably have little effect on his lifetime financial outcome. Missing the window to travel could mean never having the experience at all.
Thinking backward made the order of operations clearer:
- Travel while that form of travel still fit his life.
- Take business school seriously when the time came.
- Focus more intensely on earnings and career development afterward.
The framework makes time the variable against which every goal must be measured. It also forces people to acknowledge that they cannot do everything. Without assigning goals to particular stages, “someday” can quietly become never.
How status games distort career choices and definitions of success (27:39)
Living backward requires understanding what actually matters to you. That becomes difficult when preferences are borrowed from peers, parents, employers, or social media.
Jack believes everyone is susceptible to status games because people naturally compare themselves with those around them. The internet makes the comparison set effectively unlimited.
Someone can always find another person of the same age who appears richer, more successful, more attractive, or more adventurous. A 29-year-old might compare himself with someone who followed the traditional finance path and earned far more money. He might then compare himself with an entrepreneur who sold a company. Meanwhile, the entrepreneur may envy someone who spent those years traveling and building friendships.
There is almost always a life that appears better from a distance.
Jack’s solution is not to eliminate comparison entirely. Instead, he recommends collecting a wider variety of experiences and relationships. Young people frequently choose careers based on a narrow worldview shaped by their hometown, parents, college classmates, or the most visible jobs in their immediate environment.
But labor markets change. A career with limited financial upside ten years ago may become enormously valuable, while a prestigious path can lose relevance. It is difficult to predict which particular occupation will benefit most from future changes.
Experimentation helps people discover work they find genuinely interesting. Once the work itself provides some internal reward, the appeal of prestige and comparison tends to weaken.
This also creates a competitive advantage. Someone who enters an industry only for status or compensation will compete against people who are fascinated by the underlying work. The person who loves analyzing companies, studying markets, or solving technical problems will tolerate the effort required to become excellent because the effort does not feel entirely like sacrifice.
The status seeker is playing for the visible reward. The genuinely interested person also enjoys the game—and is therefore more likely to win it.
Changing jobs or fields also provides evidence that future changes are survivable. The first reinvention is intimidating. After someone has successfully changed paths once or twice, uncertainty becomes less paralyzing.
Why “Am I having fun yet?” is a serious question at every life stage (33:03)
Jack closes Young Money with a deceptively simple question: Am I having fun yet?
Fun does not mean avoiding hard work or spending every night going out. Its definition should change as a person moves through life.
In his early twenties, fun meant inexpensive adventures, late nights with friends, college football, and the unpredictability of backpacking. Recreating that lifestyle a decade later would no longer provide the same satisfaction. What once felt exciting could begin to feel aimless or exhausting.
Later stages may create different sources of enjoyment:
- Building professional expertise
- Making progress in a career
- Raising a family
- Developing a meaningful side project
- Strengthening a marriage or friendship
- Learning something difficult
- Contributing to a community
Jack does not view stress as inherently bad. Hard work is often necessary for fulfillment, whether the work occurs in a career, relationship, education, or personal project. The meaningful distinction is between effort that feels connected to something worthwhile and effort endured without a convincing reason.
People usually have an internal sense of whether the activities filling their days are producing engagement, pride, or fulfillment. When the answer is consistently no, that is a powerful signal that something needs to change.
“Fun” is not the opposite of discipline. It is evidence that daily actions are aligned with the priorities of the current life stage.
Using money to create a life worth remembering (36:15)
I close by asking Jack what listeners should consider if they want to know whether their money and time are serving the life they actually want.
His answer brings the conversation back to nostalgia.
Money is one input into how we use our time. The objective is to combine those resources in ways that create meaningful moments now and memories that remain valuable later.
The questions to ask are:
- Am I using money to create meaningful experiences in my life today?
- Am I building relationships and memories I will value in the future?
- Am I preserving the financial capacity to continue doing so over the next several decades?
Someone who answers yes may already have a healthy relationship with saving, spending, and time. Someone who answers no may have a spending problem, a saving problem, or a broader problem with the direction of life.
A good life probably involves making the most of each stage rather than imposing one definition of success across an entire lifetime. The experiences will change, and so will the sources of fulfillment. The goal is to keep creating moments future versions of ourselves will be grateful to remember.
Or, as we put it near the end of the conversation: perhaps we should all be doing a little more nostalgia maxing.
Resources:
- Young Money: A Field Guide to Finding Wealth and Purpose in Your Twenties
- Jack Raines’s Young Money newsletter, featuring essays on behavioral finance, markets, work, and life.
- Jack Raines on X.
- Jack Raines on LinkedIn
The Long Term Investor audio is edited by the team at The Podcast Consultant
Submit Your Question For the Podcast
Do you have a financial or investing question you want answered? Submit your question through the “Ask Me Anything” form at the bottom of my podcast page.
Support the Show
Thank you for being a listener to The Long Term Investor Podcast. If you’d like to help spread the word and help other listeners find the show, please click here to leave a review.
I read every single one and appreciate you taking the time to let me know what you think.
Free Financial Assessment
Do you want to make smart decisions with your money? Discover your biggest opportunities in just a few questions with my Financial Wellness Assessment.
Disclosure: This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.
The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Plancorp LLC employees providing such comments, and should not be regarded the views of Plancorp LLC. or its respective affiliates or as a description of advisory services provided by Plancorp LLC or performance returns of any Plancorp LLC client.
References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.
Please see disclosures here.
