My 7 Favorite Quotes from Walden

I love old books. And I love timeless books. Walden is both old and is more relevant than ever. Henry embraces solitude, simple living, and nature. And living in a society where we compare ourselves with the biggest and most beautiful houses and the fastest cars. Just one cm behind that façade where everything seems so beautiful, we find stress and pain.

Except for the “Start Here”, I have never mentioned the book Walden too much. It is one of my favorite books. And this article will contain my favorite quotes from it, and why I love them so much.

Books are the treasured wealth of the world and the fit inheritance of generations and nations.

The first time I completed a book was when I was 23 years old. I did try to read Harry Potter and all the other “must-read” fiction books. That everybody seemed to love. But still, to this date, I have never finished a fiction book. As lame as it seems. No one told me that I could learn whatever I wanted from books. Or maybe I didn’t listen at that time. 99.9 % of the stuff we want to do, has been done and the chances that somebody has written a book about their doing or achievement is pretty big.

I loved being a mason apprentice. Because I could just show up and learn from the best. The best ones were expected to teach their craft. And I feel the same way about reading. I can read books from the very best people in their fields, and learn from their mistakes. And books will tell you that stuff is possible because they have done it. No need to worry about your friends or mom who will tell you your idea is insane. Just go and read another book that will tell you it possible.

The cost of a thing is the amount of what I will call life which is required to be exchanged for it, immediately or in the long run.

I believe that in the western world we are addicts to consumption. We keep buying stuff while we complain about not having enough time during the week. We never ask how we can get more time. And I believe the answer is in our consumption.

Your life can also be exchanged with the maintenance of the thing we buy. And on a big scale, it can be the difference between living a free life or struggling 30 years to pay off your mortgage.

Whenever we choose to go in one direction, we also reject the other path.

When I bought a boat, I also bought into the idea of spending some days of my life maintaining this boat. And if I had three kids, a wife, and a demanding job, it would probably be hard to find time to do it. And not disappointing anyone by choosing to repair on the boat instead of spending time with the family or job would be hard.

A man is rich in proportion to the number of things which he can afford to let alone.

I believe that this quote could be the very start of the FIRE movement. When we are kids we are told that to be “rich” we have to make an insane amount of money. Which is the biggest lie we could ever be told.

In western society (especially in Denmark) it doesn’t need much education before you have a salary of +20.000 DKK post-tax salary. And that education is free, paid for by the government.

If we can afford to “let things alone”, it is quite easy to live off 10.000 DKK/month. And before you know it, you are financially independent.

Every generation laughs at the old fashions but follows religiously the new.

This quoted has saved me a lot of time, money, and frustrations. Fashion is one of the weirdest things I don’t get. The one thing I hate the most is the feeling of being in a hurdle where we just do what everybody else is doing. Just because that is what we are doing. And that is the fashion in a nutshell.

I try to wear clothes that I can wear on every occasion. I want to go directly from my work to a 50-year-old birthday and on a date with my girlfriend in the same outfit.

I want it to be timeless. The outfit that I’m wearing now is something that I can wear 10 or 20 years from now.

If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them.

Action > dreaming.

Financial independence can seem like a distant goal. If you save 50 % of your income, you will be financially independent in 12-15 years. Even though it is less than half of the period you normally had to work it can seem like forever.

So take action. I don’t care how small steps you will take. Just take it. Even though you are unsure about the direction. We will never know that we have chosen the wrong path if we haven’t started walking.

However mean your life is, meet it and live it; do not shun it and call it hard names. It is not so bad as you are. It looks poorest when you are richest. The fault-finder will find faults even in paradise. Love your life, poor as it is. You may perhaps have some pleasant, thrilling, glorious hours, even in a poorhouse. The setting sun is reflected from the windows of the almshouse as brightly as from the rich man’s abode; the snow melts before its door as early in the spring. I do not see but a quiet mind may live as contentedly there and have as cheering thoughts, as in a palace.

Happiness comes from within. And no money will make our lives any sweeter. Financial independence is a worthy goal. But don’t expect that every problem of yours is going to vanish.

It will bring us more flexibility and maybe a less stressful life.

But being miserable on the journey and expect everything to be okay on the other side is not worth it.

No matter how bad you are doing, remember that too is going to pass. Everything is.

Stay cheerful.

Things do not change; we change

This very similar to a Stoic and Buddhist quote, that goes like this:

“We cannot control what is happening to us, what we can control is how we respond to the event”.

Which is something that I remind myself about often. In Denmark, we have this thing called the “pyt knappen” which could be translated into “the nevermind button”. It is easy to get pissed when something “bad” happens to us. But the only thing that we can control is how we respond to the event.

We can’t affect it.

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Cut the Period You Reach FIRE in Half, Book Review

I have never read a book from cover to cover before I turned 21 years.

But reading since then has change my life radical. Being able to learn from the best minds in this world is something I love. A book can be distilled knowledge from people who have researched a topic their entire life. And I’m able to learn that in 5-10 hours by reading their books.

I still find that astonishing.

This article will be a review of the book:

Life Cycle Investing: A New, Safe, and Audacious Way to Improve the Performance of Your Retirement Portfolio

Why this book?

Because it have made a huge difference on how I approach my investing. And it has been the reason why I might cut the period I reach FIRE in half the time.

If we just research a little about how to achieve financial independence. We learn that it is wise to buy stock index funds, in order to diversify. And if we want to diversify further, we can add bonds into the mix.

Now we have chosen our assets.

Is there another we can diversify aswell? YES!

We can diversify on time.

The stock market can be extremely volatile in single year. It can go 50 % up, but it can all so go 50 % down. If we start to look on longer time periods, like 5, 10, 15 or 30 + years, the stock market will become less and less volatile.

If we know that we want a million dollars to declare us self financially independent. With an allocation on stocks and bonds of 80 % stocks (800.000 $) and 20 % bonds (200.000 $). It would be way more ideal if would could loan the money upfront as young. And pay of the loan till the day we retire.

If a +50 % stock market crash happens early in our life, it wouldn’t be that catastrophic, because we will have time to rebounce. But if it happens when we are +50 years old. Then we are fucked.

When we are young, we don’t have that much money. So how can we get harder exposure to the stock market as young?

By leveraging.

The authors of Lifecycle Investing tested a leveraged strategy against a normal target date fund. This is where you pick a retirement date, and then the stock allocation ramp down from a 90 % stock allocation to 50 % when we retire. And they tested it against a fixed stock portfolio of 75 % stocks and 25 % bonds.

They tested it with different stocks and bond allocations to see if there was different scenarios where the traditional way would be better. With a stock allocation 200 % – 83 % (moving from a 200 % to 83 % stock allocation in retirement) we will have the same worst output as a 75 % stocks / 25 % bonds, but a median return there is 63 % higher, and in the 90th percentile it will be almost 100 % bigger returns. 

There are many more different allocations in the book.

But the biggest takeaway is even if we are really conservative about your retirement. It can still make sense to leverage early on.

Then the allocation would be like 200 % stocks moving to a 32 % stocks, and the rest would be bonds. By doing so we are likely to end up with 22 % more, than a traditional conservative allocation of 50 % stocks and 50 % bonds.

Lifecycle Investing will appeal to you, if you have bought into the idea of index investing to become financial independent, and want to take it a step further.

The worst enemy with this strategy will be our own psychology. When shit hits the fan, we need to stay calm, and follow our plan. And not everybody can handle that with a 200 % leveraged portfolio.

But if we think we handle the rollercoaster ride, we can diversify with time by leveraging as young. And reach our FIRE number earlier.