My FIRE Journey: Patrick from the Daily Upside on securing your financial future with the stock market
Patrick, from The Daily Upside, shares his journey from investment banking to FIRE.
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“...in 30 years, would I be upset with myself that I took a risk to pursue something I was passionate about? The answer was an emphatic no.”
Happy Friday and welcome to our new recurring series on Think Save Retire: My FIRE Journey. We love hearing stories of how people found FIRE, and what their lives look like now that they’ve made the leap. Today, we’ll be hearing about going from investment banking to working for yourself from Patrick at The Daily Upside.
From Wall Street to your inbox, how Patrick made the transition to The Daily Upside
Patrick: I moved to New York City right after graduating from college. I began working in investment banking, a notorious profession known for grueling hours and a cutthroat culture. But as a young professional eager to make my mark, investment banking was a great first job. As an analyst, the lowest rank on the totem pole, I would routinely put in 100-hour workweeks and pull “all-nighters” to get all my work done.
Overall, it was a great experience and I got to work on some very cool projects and rub shoulders with some of the best leaders in corporate America. The job also taught me a few important lessons about investing and financial discipline.
Most people know that living in a big city, particularly New York City, can be incredibly expensive. Rents for a one-bedroom start at over $3,000 a month in many neighborhoods. So getting by, let alone saving any money, can be very challenging.
The biggest thing I noticed is just how difficult it is, even for professionals, to keep track of their personal finances. In New York, the culture tends to be “flashy” and people often spend money on extraneous items such as watches, fancy clothes, and weekend getaways. If you are not able to avoid those trappings, you could easily forget to save any money at all. At the end of the day, there is a very big difference between spending money to make money and spending money to LOOK like you make money.
After seven years of investment banking, I was ready for a change. I had always wanted to start my own business. The idea of having my own company that I was 100% responsible for was very appealing. But as a risk-averse person, the process of walking away from a well-paying secure job was a very daunting decision. And for good reason, there is no perfect time to quit your job. Benefits like health insurance and upward career mobility are very valuable. But ultimately I asked myself, looking back at my life in 30 years, would I be upset with myself that I took a risk to pursue something I was passionate about? The answer was an emphatic no.
So, I took the leap last summer and left investment banking to pursue a media venture called The Daily Upside.
What I learned from investment banking
Whenever I talk to people wanting to learn more about personal finance, I always introduce them to the 50/30/20 rule:
- Spend 50% of your income on necessities such as housing, groceries and healthcare costs.
- Spend 30% to enjoy yourself including going out to dinner, vacations and other entertainment.
- And save the remaining 20% for retirement.
This isn’t a hard-and-fast rule, but it’s a good guidepost for the minimum amount you should be saving.
The other thing I learned while working in finance was the power of investing. Specifically, the power of compound interest. Albert Einstein called compound interest the 8th wonder of the world for a reason. Over time, compound interest can be your biggest tool towards achieving financial freedom.
Where my FIRE led me
Once I stepped away from the fast-paced life of investment banking, The Daily Upside was born. The idea behind The Daily Upside is to curate the most important financial and economic stories from the day before, and deliver it to readers in email format. But it’s more than just that. The goal is to inspire interest and cultivate knowledge about the stock market. With every story there is a “takeaway” so readers can learn how to start thinking about events and trends from the perspective of an investor.
It’s important to note that, we don’t give recommendations to buy individual stocks. We simply try to educate people about companies and trends so they can make their own investment decisions.
One of the big reasons I was inclined to start this company is that there are so many websites out there that promise to find you the next Amazon. I always get frustrated when I see ads like that, because everyday investors are getting tricked by people who just want to make a buck. If someone knew what the next Amazon was going to be, they wouldn’t tell you!
The Daily Upside is all about encouraging investors to form their own opinions. We believe one of the best investments out there is a low-cost index fund that tracks the broader market. If you do end up buying individual stocks, make sure to diversify!
What’s next for me is 100% up to me
At the end of the day we know that money isn’t everything. It is, however, a great tool that can give you flexibility in your life to pursue what is important to you. And of course, it is a key ingredient for a fulfilling retirement!
The best investment you can make is in yourself. The second best: the stock market. Happy retiring!
Check out The Daily Upside here. It’s completely free and you can unsubscribe at any time!