Life-Changing Lessons from JL Collins' A Simple Path To Wealth

When it comes to getting your finances in order, you can go about it the easy way or the hard way. In his book The Simple Path to Wealth, author and financial expert JL Collins outlines the simplest and most practical ways to make your money work for you, and not against you. Instead of struggling and trying to go it alone, these tried and tested tips will ease your anxiety when it comes to handling your money. 

Here are some practical key takeaways you can apply to your life right now to get your personal finances back on track. With a bit of effort on your part, you will be on that golden path to financial freedom before you know it!

Learn the basics 

The majority of people will put off learning the basics of personal finances because they find them either too complicated or too boring. However, learning even the bare minimum can mean the difference between you working for your money, or your money working for you. If you spend just a few hours learning the bread and butter of handling your personal finances, you’ll be able to make big decisions regardless of your money, rather than because of it. 

Don’t get enticed by complex investments

Especially if you haven’t learned the basics. Though investing opportunities may sound tempting, meddling in something you’re not sure about is the best way to lose your money. JL Collins recommends sticking to simple financial investments that you can easily understand, which are detailed in his book. 

The Golden Rule of personal finances

If you want to put yourself on the path to financial freedom, there are some very simple rules you need to follow. 

- Spend less than you earn. 

- Invest in whatever you have left. 

- Avoid things that will put you in debt. 

It’s that simple. 

The best thing that money can buy

Forget fancy cars and a big house. The best thing that money will ever buy you is your freedom. Freedom to make choices independent of the number in your bank account. Freedom to work for people who respect you, and vice versa. Freedom to spend time doing what you want. Freedom to live your life exactly the way you want to. 

Many people make the mistake of thinking material possessions are the best things money can buy. But would you rather live a luxurious lifestyle you can barely afford, constantly worrying about your finances, or live with the security of knowing that you have everything under control? 

Don’t worry about what you can’t control

Worrying about things that are out of your control is a waste of your time. It may be hardwired into you to seek possible solutions to problems that haven’t even happened yet, but it will not benefit you in any way. Instead, focus on and appreciate what you do have, including this present moment. 

Debt isn’t normal

Just because most people have debt in the Western world does not mean that it’s something you should follow blindly. What’s more, racking up debt over the years buying unnecessary things that you cannot afford puts you on the path to financial ruin. Purchasing liabilities – items that you will have to pay to maintain; a new car, a ridiculously expensive house – will weigh you down financially. More than you’d ever imagine. 

What is a stock anyway?

There’s lots of talk about investing in stocks and shares, but do you know exactly what you’re putting your money into? A stock, quite simply, is a small piece of ownership of a company. These companies make up the stock market. The owner of your stock is the owner of the company. 

Most people lose money in the stock market

And the main reason for this is a combination of arrogance and ignorance. People tend to trade with their emotions instead of following a proven strategy. They wrongfully believe they can time the market, pick individual stocks, and choose the winning financial managers. When they let go of these three common mistakes, they can adopt a simpler and more successful strategy for accumulating wealth. 

There are two stages to investing

The two stages of investing are, simply put, the accumulating wealth stage and the preservation of wealth stage. When you’re working hard and saving your money, regardless of how old you are, you are in the accumulation stage. When your income is slowing down or you don’t have any income anymore, you are in the preservation stage. 

People often mistakenly think that when you’re young, you’re naturally in the accumulation stage and when you hit retirement age, you fall into the preservation stage. Don’t make this mistake. Your stage is not always linked to your age. 

Flexibility allows you to take bigger “risks”

The more flexible the lifestyle you have, the more easily you can tighten your belt and cut costs when things “go wrong.” When your income slows down or stops, or the market goes down, you will be able to stay afloat and even prosper while others are drowning in their debts. If you are able to create new income opportunities for yourself, are prepared to move somewhere less expensive and are robust when it comes to your lifestyle, you are more likely to thrive when others are struggling to survive. 

Find out where you are with Social Security

You can even track where you are with Social Security. Visit to track your earnings records safely and accurately. 


Just like the title of his book, The Simple Path to Wealth, JL Collins outlines how to get onto that path in a simple, practical, easy-to-follow way. 

As long as you’re willing to apply these key takeaways, put in some effort, and possibly make some life changes, you too can be on the path to financial freedom. 

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