Millennial Money – How to Build a Great Financial Life

Read Time: 
15 min
Posted by 
As a third-generation financial advisor, Tom Stadum carries on the tradition of his grandfather and father by delivering comprehensive financial plans, prudent investment strategies, and timely service.
June 15, 2022
TLDR: Millennials want help with their financial problems. So, we built Scale, a subscription wealth management service built specifically around the needs of millennials, by millennials. If you are not a millennial and want to understand them more, read this.

Millennials: The Largest Generation Working Today, But Facing Unique Financial Challenges

We, the millennials, are now the largest generation working today, and need help with our money. We were born in the early 1980s through the mid-1990s and rocked the early 2000s with style. Ushering skinny jeans and leggings into stardom, we grew up during the US’s engagement in foreign wars, lived through many economic booms and busts, and became one of the most educated generations in America. We rode the coattails of our parents, the boomers. The economic world we grew up in was characterized by lower inflation, lower interest rates, robust economic growth (due in part to globalization), falling unemployment, and a booming stock market with lower volatility. But where does that leave us today as we enter what some call the postmodern economic cycle? The postmodern economic cycle is expected to contain higher inflation, higher interest rates, rising real asset prices, greater regionalization, and more active governments. We know the shift is coming. We are grappling to secure our futures as we take the reins on the economy, lead our friends, families, and communities, and manage our own money. But...

How Millennials Can Overcome Financial Challenges

While the macro back drop has been largely great for generations that predate them, we find ourselves in a much different place than our parents. Educated? Check, meaning send your student debt payment on the 15th. kids? Want them to be educated? That’ll be $150k, per kid. New car? $50k. I could go on and on, but the reality is that never in the history of the world has it been easier to spend a lot of money in an instant. Buy now, pay later. It’s everywhere. You probably get served at the least 30 ads an hour while you are awake, no matter what you are doing. It’s hard to get ahead when every waking moment of your day is filled with some brilliant marketer trying to sell you something. In 2022, people’s time and attention are the product. Millennials understand this and are now just starting to get serious about our financial futures. But where do we go to find help? Let’s take a look at the places our parents went, to then understand what we need.  

The Future of Wealth Management: How Millennials Are Changing the Game

Let’s take a walk down memory lane and get you caught up to speed on the origins of the wealth management business, and why people have such a hard time trusting the industry. The modern wealth management business has its roots in product distribution that goes back generations. For example, my grandfather, Cliff Stadum, began his career as a stockbroker in 1961 in Fargo, ND where he sold stocks and bonds to his customers for a commission. The company he worked for at the time, Piper Jaffray, would work with publicly traded companies and municipalities to help finance their operations. If a town in the middle of Minnesota wanted to build a bridge, they’d go to the investment bank at Piper and see if they could get funding. Piper would then see if they could do the deal, and if they could, they would send the offer down to my grandfather to sell to his customers. Times were different back then, but the system was essentially a product distribution network between companies, banks, and people. Where things started to go south in the system is when companies got smarter and smarter in building products, many of which solve some amazing problems, yet the end customer wanted advice.  Wall Street was built to aggregate capital, slice and dice it, and sell products. Main street has a need for products, but as a means to help them achieve their plan. This disconnect between the mission of the large banks and the needs of the people has caused friction and erosion of trust. 

Today, the fastest growing part of the wealth management market is the independent space (what Fjell Capital is!). Independent firms are not tied to banks or product distribution channels and exist to support their client’s needs through advice.  Why are the independent firms growing the fastest? It’s because clients are choosing it and teams like ours are choosing it as well. We have been a part of both sides of the fence and can truly say our independence matters. Fjell Capital is owned locally, and all our profits go back into our business and not shipped off to pay a dividend to a shareholder. Our control of our profits, our ability to create a custom client experience and our fiduciary process sets us apart. It really does matter, and it’s one of the reasons why we are growing so fast. 

But things will look different in the future. Even the largest independent wealth management firms are largely built by baby boomers for baby boomers. I cannot say that we are different in our core clientele, but we are millennial owned and will not be exiting our business in 5 years. This also matters for you. As the industry grapples with incredibly lopsided aging advisor forces, millions of younger clients are looking for a solution that was built for them. That is why we built Scale, a solution built by millennials and Gen Z for next gen clients. Yes, if you are 45, you are a next gen client, and many large firms are trying to figure you out. The future of wealth management will be hyper focused on delivering relevant advice from people like you. We have done the research and know this is true. Also, flexible fee structures that are built to handle different balance sheets and desires from investors will be paramount. Again, we baked the issue of how to pay for advice into our Scale service. The traditional asset-based model doesn’t cut it for a lot of people and we are okay with that. People can work with us how they want, and we’ve found many successful younger families are happy to pay for advice that will put them ahead in the years to come.  

Scale: A Wealth Management Service Built for Millennials

What makes Scale unique is that, in many ways, we built it to solve our own problems. Asking ourselves the question, “if we could build something from scratch, knowing what we know, what would we build?” We wanted something that is not too much work to do, something relevant to what we are all going through, and we wanted it to be fairly priced. So, Scale was born. Scale is our answer to the desire for successful millennials to work with advisors on their terms. Beyond asking ourselves these questions, we also asked our peers. We asked them what they wanted, their thoughts on pricing, and their experiences with advisors. Here is what we found when asking other successful millennials about their money 

  1. A true dislike for financial services – many had terrible stories of working with “advisors”. Some had crappy whole life policies inside IRAs, while others were firmly in the DIY, “I want to control everything” camp. It was humbling to hear that our peers did not like us but sadly we understand where they are coming from. 
  2. Millennial men want control – most millennial men are already invested in crypto, interested in real estate, and know a lot about the markets. They value having control of their assets and are willing to swing for the fences to strike it rich. 
  3. Millennial women want to be empowered – millennial women are asked to do it all, they are expected to raise the kids, make dinner, and make $200k a year at the same time. Millennial women want help and the guidance of the advisor and are not as willing to take risk as their partners are. 
  4. Willingness to pay for advice – with a bad taste in their mouth, millennials would be willing to pay for advice if the service fit what they are looking to do personally. 
  5. Different Balance Sheets – like I mentioned above, millennial balance sheets already look different than Gen X and Boomers. Crypto, side hustles, NFTs, real estate—they are not afraid of alternative assets. 
  6. Suspicion of the system – though they had a hard time putting it in words, our market research group had reservations of the system and were skeptical of it. Again, this comes from personal bad experiences, the COVID-19 pandemic, and widening wealth gaps. 

To sum up what we found, successful millennials and Gen X alike are different than previous generations in their willingness to invest in different asset classes. They have a general distrust for the old guard and are willing to pay for advice if it fits their needs. 

So, this is what Scale revolves around; being relevant to the preferences and desires of you. And the feedback we have gotten from our Scale clients has been a smashing success. One of the reasons why many traditional firms haven’t figured this out is because their service models, tools, and team are just not relevant.  Traditional firms were built for a different market and are trying to force a square peg into a round hole. It’s traditional firms trying to get you a retirement plan when you’re 31 when really the average 31-year-old would likely respond with, “I have two kids and really just want to know where to take my career because I want to be home with them more.” See the difference there? Now, let’s talk fees.

How Fjell Capital Charges Fees: A Fair and Flexible Approach

We charge fees for our service, and we are 100% comfortable with this.  Every team member at Fjell Capital is highly educated and specialized in their work, we have years of experience helping hundreds of families achieve success and have dreams of buying our own dream houses and sending our kids to college, just like you. We are successful and our services cost money. It’s just the way it is. With that out of the way, our clients don’t mind paying fees either. They just want to know what they are paying for and what is in it for them. This is totally normal and is a response to how people have been ripped off by financial companies in the past with conspicuous fees. The fees were not transparent, were hidden inside products, and in many cases, the client wasn’t actually paying the advisor, but rather paying the asset management company. Again, compensating people for their work is incredibly important but it needs to be transparent and understood. Furthermore, with the recent bull market, many advisors are more out of reach than ever with their sky-high minimums i.e., you need $1m liquid to work with us. This isn’t inherently bad, but it leaves out a massive amount of people who can afford to pay fees and want to work with a great advisor but do not have the correct mix of assets to work with them. To us, this doesn’t make sense. If you want to work with an advisor and you own a business or have a large 401K plan and make $200k a year, you should be able to work with a great advisor. We’ll get more into the specifics about our fee structure and philosophy on how fees work but first, let’s take a look at the fees you need to be aware of. 

Here are the fees you need to know about:

Investment Management Fees – these are the fees for the ETFs, mutual funds, and separately managed accounts that you hold. If you own a Vanguard ETF, it’s going to cost you something. Know what these are. 

Advisor Fees – there are a few different ways to pay an advisor. Through the assets he or she manage, commissions on products, or fee for service--like a subscription fee or hourly rate. 

Miscellaneous Fees – yearly account fees, trading costs, etc. 

Tax Efficiency – this is hard to measure but incredibly important. In 2022, your portfolio should be tax efficient. I am amazed at the stories I still hear on this issue. 

Risk Adjusted Returns – Again, this is hard to measure, but basically, you want to have an optimal return for the risk you are taking. Earning a 10% annual return with 70% draw downs is different than earning a 10% annual return with 15% draw downs. You should be compensated for the amount of risk you are taking but not more than you should. 

Your Behavior – for younger people, this is huge. If you don’t save enough money in your 20’s, you could be costing yourself hundreds of thousands of dollars for your future self. Let that sink in. Your behavior can be your biggest win or your biggest failure. 

Fees in the mind of clients, advisors, and thought leaders have been drug through the mud many times. But here is the deal: if you want something that is valuable, you must pay for it. And if you pay for it, you will use the service and value it.  Our philosophy on fees and how we charge them are this: for our Scale platform, we have a monthly subscription fee that starts at $125 per month. For that, you get three meetings a year focusing on: making money, keeping your money, and growing your money. We also charge 0.75% of assets under management if assets are managed by Fjell Capital. Why do we have a combination of fees? We want people to understand how important the planning is. It is worth the money. We also want to earn money for managing assets. If we only charged assets under management fees, we would be blocking out millions of Americans from our services. If we just charged retainer fees, we would be blocking out millions of Americans that couldn’t afford the cash required to pay the monthly fees. Is our way of charging perfect? No, it is not. There is no perfect way to pay an advisor. If this isn’t for you, that is okay. We are more flexible than most in how we charge, and our goal is to graduate all of our Scale clients to our Altitude service one day.  We value the flexibility in our structure and feel it gives us the incentive to do great work while simultaneously opening the door for many families that want help with their finances when they need it the most.

Why Understanding Yourself and Your Values Is the Key to Financial Success

Why do you need to understand yourself and your situation and why do we start there? Well, because a wandering soul is bound to forever wander, but a guided soul is bound to find a path that leads to success. This sounds philosophical because it is. If having money was the goal of life, 99.99% of humanity would have no “purpose.” The system, along with your actions and mindsets, have led you to where you are at today. Many, many people lack direction in their life, a wandering person will probably not end up where they want to go. If you leave your map behind on a two-month camping adventure in the middle of Yellowstone National Park, your destination is 500 miles away, there is about a zero percent chance you will randomly end up where you were planning to go. This example is extreme, clearly, but it paints the picture of people’s finances. They are on a journey with no destination. At Scale, we aim to come alongside you where you are at and start there. Many financial services start with an end-in-mind mentality, but it’s really hard to start at the end if you don’t even know where you are at today. 

So, start with where you are at today and then move on to what you value. This will be a legend on the map if you will, the guiding values that will lead you to where you want to go. If family is important to you? Then your life should reflect that. If financial stability is important to you, then your finances should reflect that. Want to take a dream vacation to Bali? Your life should reflect that. Does this make sense? What you value should be reflected in your personal life and in your financial life. Our goal for our clients isn’t to make them all multi-millionaires. Why? Because most people don’t want that or it’s not practical for their life. There have been so many articles written about the janitor who retires with $5,000,000. I am not sure why this receives so much press, it’s great that this person has retired rich, but we don’t necessarily know if that was the best course for that person. It’s an amazing story, don’t get me wrong, but it also doesn’t help the narrative that you should live for today and tomorrow. Most people spend most of their lives focusing on the here and now and not their future selves, which we will dive into more in depth down below. But leave this section knowing this, it’s about your why. It’s about what you are here to do and finding the best version of yourself. We can give you every tool we have to become financially secure but if you don’t find your why, you will not have the internal momentum inside of you to stick around for the long haul. If you recall from the Yellowstone National Park example, if you don’t have your compass (values) you will eventually get worn out and get stuck, needing a rescue, and in the world of finances, the “rescue” is getting kicked out of your apartment, foreclosing on your home, or being broke in retirement. These events are what everyone is looking to avoid but many are simply kicking the can down the road. Find your why and keep moving, your first step after you know your why? Managing your career, the engine of your financial life. 

5 Tips for Managing Your Career to Achieve Financial Success

Your career is the engine to your financial life, particularly in the early stage of your career. Down the road, you ideally want your career to have less importance as you have sufficient assets that are generating a large portion of your return. To explain in a chart: 

DiagramDescription automatically generated

The y axis is dollars, and the x axis is time, while the g line is the value of your yearly gains as a and the c line is the value of your contributions as a percentage of your money’s gains. Ideally, you want to hit the crossing point as soon as possible. Let me give you an example in dollar terms to help you get the idea of how people end up having so much money later in life, even though they don’t necessarily earn more money than you. Let’s make up two people, Steve and Becky. Both 42 years old, both earn $150,000 a year, and save 10% of their money. The only difference is that Becky started saving 7 years before Steve. A year goes by, and both of their portfolios were up 10%, in dollar terms. Becky’s account grew by $30k and Steve’s by $10k. Same job, same age, both putting $15,000 into their account, yet Becky made $20,000 more than Steve. See what happened there? Because Becky started saving and investing earlier, she is at the point where her money is growing faster than her contributions, in this case by $30,000. While Steve is approaching the point where his money is growing faster than his contributions, his investments grew by $10,000 vs. the $15,000 he put in.

If you can burn this image into your mind, do it. 

This chart outlines why a lot of people fail to get ahead in life. They never hit the point where their investments earn far more than the contributions, they put in. So, why are we talking this in managing your career? Well, it’s incredibly important to harness your early career to and consistently save so that you can enjoy the fruits of compound interest down the road. With that out of the way, let’s get into some tangible ways to manage the engine of your financial life. 

Rule #1: Whenever possible, attach yourself to something that is growing fast. 

Whether that is a person or a company, you want to be working for someone who is going places. Companies that are growing faster than inflation are simply better companies to work for than stagnant companies. Inflation is a beast. If you want to grow your net worth fast but the company you work for is not growing and inflation is at 5%, you simply won’t have the same income-growth opportunities as someone at a fast-growing company. When you work at something or in a field that is growing fast, you are far more likely to earn more, faster. A practical example, we work with a large number of Microsoft employees that work on the Azure business. The move to the cloud has changed our world and the growth at scale this business has achieved is hard to imagine. But you can imagine that working on that project is probably pretty lucrative and secure. From experience, it’s a great place to be. On the flipside, being a VP at a retail chain that is closing stores due to declining mall traffic probably isn’t something you would bet the farm on. 

Rule #2: Don’t get stuck

We talk about this all the time. Don’t get stuck. In your career, in your personal life, with your money, anyplace. Momentum is really hard to produce and is incredibly important to protect in your career. We all will peak at some point in our career, which isn’t necessarily a bad thing, but you don’t want to get stuck and accidentally peak too early. Like I wrote above, if you are working in a shrinking part of the economy, you could be smooth sailing and then suddenly find yourself without a job. I don’t want to say that working in a company that isn’t growing is bad but just know that things that are not growing are typically dying. With regards to your career, know what is happening in your company, in your team, in your industry, and in the economy. If you are stuck in a rut, take a look around and see if it’s time to jump ship. 

Rule #3: It’s who you know

Easiest way to become a millionaire? Inherit it. Said extremely tongue in cheek but you get the message. This is a bit of a sad reality but in many cases, the best jobs aren’t even posted on job sites. You have to know someone who knows someone to find your way into the best careers. Other than interns, every team member at Fjell Capital has been handpicked from a referral. They are each highly skilled socially, emotionally, and professionally, and they’ve clearly demonstrated that in their lives…hence their refer-ability. We are fortunate in this way but it’s just the way it is. So, what should you do? Invest in your network by getting to know people that you admire and offering to take them out to lunch. Ask great questions and be someone who is willing to give first before receiving. One of life’s truths is that we don’t know what tomorrow will bring. You never know when you are going to have to go to your network and ask for a favor, referral, or a job. Be proactive and invest in your network and be known as someone who is willing to help out, no strings attached. 

Rule #4: Acquire unique knowledge

Ever wonder why heart surgeon’s make so much money? In short, they possess hyper niche knowledge and people trust their knowledge and skills to put a metal tool in the very organ that keeps them alive. Heart Surgeons bridge the gap between life and death with their skills. How do they acquire the skills and knowledge to become a heart surgeon? About 15 years of graduate school, residencies, and licensing and certification exams.  They are the textbook example of possessing unique knowledge that is extremely valuable in the marketplace. So, for everyone that is not a heart surgeon, what does this mean for you? Learn things that are valuable. Well, what is valuable? Start with the end in mind. Things that are valuable typically solve hard problems in the world. Taking Microsoft again, they are slashing server costs while creating a much more dynamic technical architecture for companies to be better, strong and more secure. This is a valuable problem that you cannot just walk into without deep knowledge of the space. If you want to make more money in your career, continue to learn what is the most valuable problem to solve and insert yourself there. 

Rule #5: Control what you can control – and always be kind

I remember the first day that Dan started working at UBS, there was a massive reorganization of our region where some people got laid off and some got promoted. Some went out for celebratory dinners, and some went home with boxes of offices supplies in their trunk. You can’t control everything in your career and you need to be ok with that. But there are things you can control, and those are what you can focus on. The best thing to control? Your kindness. Being kind has been something that has propelled Fjell Capital, a wealth management company in North Dakota, on the national stage. We are kind to each other, to our vendors, to our clients and partners. Being nice is a non-negotiable here and it's all about making other people feel comfortable doing business with you, whatever you do, and people notice. In a world that is filled with negativity and division, being kind is something that builds bridges and will put you ahead, personally, career wise, and financially. 

Managing your career at times is like watching paint dry, it doesn’t seem to move or change much. But that is what they want you to believe. Keep pushing to acquire unique knowledge in your field of work, keep investing in your network, be smart, and be courageous to make a change. If you think back to the chart above, you want to get to the point where you are earning tens of thousands of dollars a year in appreciation of your investments—where your money is working for YOU. To get there, you have to manage your career well so you can keep saving and building your balance sheet. Now that you get the importance of the financial engine, it’s time to build out the roadmap of success. Do the easy stuff first though.

How to Get Unstuck Financially and Start Achieving Your Goals

Most people are stuck financially, and they don’t know how to get their financial life moving again. We know this to be true, so we focus on getting some quick wins under your belt before going on to more advanced concepts. People get stuck because their circumstances don’t match their expectations. They will casually be reading about what they need to do to have a great retirement, but mentally can’t handle the thought of getting their money in order when they are stressed about their grocery bill. The prescription to this? Easy wins and disaster avoidance. Everyone’s version of low hanging fruit varies but start small and get some of those easy wins under your belt. This could be increasing your retirement contribution by 1% or opening a brokerage account to start saving $50 a month. These are small steps that won’t materially change your financial situation, but they will start building the financial muscles in your being, and that is the hardest part. Building habits that come from a healthy mindset about money. It’s not so much magically accumulating $100k in your checking account in 6 months, but more so, building the foundation so that you can get there. So, if you ever do get stuck financially, remember, get an easy win under your belt and keep moving on this. Once you have some momentum in your financial life by stacking wins, it’s time to move to the next level and really start marking gains. 

How to Manage Your Finances When Life Gets Complicated

Speaking of setting achievements, have you thought about your savings fund? If the engine of your financial life turned off and you got laid off from your job, would you have enough to cover your expenses for the next several months? How about those summer travel plans? Oh, and what about life, property, and disability insurance? Are you adequately covered so it won’t financially ruin you (or your family) if tragedy struck? And then there is the big picture: retirement. Are you putting enough away to retire not just how you want, but when you want? You also mentioned you want to pay off your remaining student loans, buy a house, take your spouse on an overseas trip, start saving for your 4-year-old's college education, purchase hunting land, and start your own business...are you feeling stressed yet?

I don’t mean to raise your blood pressure with my little anecdote. Instead, I want to make a simple point: life gets complicated quickly. Expenses pile up. Families expand. Careers shift. Needs change.  The world changes. It’s the reality of the life we live on planet earth. The sheer number of things any one of us has to juggle on a day-to-day basis is enough to make a sane person scream. Or worse...freeze. 

How to Overcome Financial Freeze and Get Unstuck

Freeze? Yes, freeze. It’s true that sometimes to move forward, we need to take a step back. But what if we’re not taking any steps at all, forward OR backward? Someone who’s frozen makes no progress whatsoever. I will be the first to say that I’ve fallen into this rut more than a time or two. Whether it was a personal ambition, relational issue, or workplace challenge, sometimes it just feels better to not move a muscle. 

Your personal finances are no different. The relationship between money and your life gets complicated quickly. When complexity starts to increase, confusion usually follows. If confusion extends beyond a certain point, then the “freeze” mentality sets in—better for me not to do anything. We want to offer a solution to this problem by bringing CLARITY and CONFIDENCE to your financial life. Our desire is to take confusion and guesswork out of the equation, lift the emotional burden off your shoulders, and provide simple steps to keep moving forward.

How to Achieve Your Financial Goals by Taking Small Steps

There’s plenty of large-scale achievements that you can shoot for in your finances, but none of those will come without first achieving small victories. Small victories come through discipline and taking simple, achievable steps. When talking about your money, it starts by taking a good look at your personal situation (your job, your income, expenses, assets, debts, etc.). 9 times out of 10, with little extra effort there will be at least one area where you can make a small, but meaningful change. Something that improves the trajectory of your financial life. Spotting these areas for improvement is step one.

Step two is the action phase. I’ve frequently talked to people who are overwhelmed by the number of financial tasks they are trying to juggle, and they don’t even know where to start. As you read this, you may be realizing that you are also that person. Here’s my encouragement to you—you don’t need to take 27 steps today to improve your situation, you just need to take 1. One of our team’s objectives is to bring clarity to your finances, so you become equipped with the knowledge to take action, one step at a time.

Taking action today to shore up your financial life could be compared to preventative medicine. There are things that can be done today that may marginally benefit you in the present but will significantly benefit you in the future. Things like bumping up your 401k contribution by 1% or setting aside $50 each paycheck into an investible 529 education account for your son or daughter. These may seem like small changes today, but with discipline and time, they result in thousands or tens-of-thousands of extra dollars working towards your goals.

Remove complexity and replace it with clarity. Un-freeze and keep moving. Simplify your situation and you’ll find it much easier to take action today and prepare for life tomorrow, and in that, you will avoid the large mistakes that can permanently damage your financial life. 

4 Common Financial Mistakes People Make

First of all, what is a big mistake? A big mistake is something that completely takes the wind out of your sails. There are also two major types of mistakes, mistakes of commission and mistakes of omission. Mistakes of commission are a conscious act that, unfortunately, ends poorly. Mistakes of omission occur when you fail to act and miss an opportunity. And the latter is one that we try and focus heavily on as we serve our Scale clients. 

Let’s drill further into mistakes

There are financial mistakes and there are mistakes that you make that you will regret later in life. We often reference the founder and longtime CEO of Amazon, Jeff Bezos, when talking about mistakes. In the 1990s, Bezos had a successful early career and ended up working at a hedge fund prior to starting to sell books from his garage. So how exactly did he go from working at an extremely successful hedge fund to selling books online? Well, according to Bezos, he felt he would have regretted never trying to start Amazon later in later life MORE than having a successful career in the hedge fund world where he most likely would have ended up earning millions and millions trading and researching. He was driven by his future self and knew he would regret not trying. Clearly it worked out for him. But the lesson here is that some decisions in life, particularly in your 20s and 30s, need to be looked at—and not just financially speaking—through the lens of the purpose and values that drive you as a person. This is super important to understand because you will always be the most successful version of you when you do what you love. Again, you will be much happier in the end if you spend half of your life doing what you love. Having a bunch of money doesn’t equal happiness. I would rather have less money and be happy any day of the week. Finding your purpose and value system is a key component of our process at Scale as it positions you to do your best work while you exchange your time for your money. 

These squishier mistakes, often the ones that you don’t necessarily know you are making, can have a profound impact on your life, particularly as you age. Now what are some financial mistakes that people make they don’t know they are not making? 

Mistake #1: Bad mindsets about money 

Bad mindsets can lead to getting stuck or perpetuating bad habits. People think that changing habits leads to a better future, which in some senses is true, but really, one needs to find the deep sense of “why” behind their mindset about their money, for lasting habit change. If you think, in the deepest sense, that you will always be living paycheck to paycheck, you probably will. It’s hard to get wins in life but start within first and try to understand your mindset about money. From there, cast vision. 

Mistake #2: No Vision 

What is vision? Well, if you are reading this, you clearly can see. The world is a beautiful place. If you were to sit down with your significant other over dinner tonight, what would you tell them is the vision for your financial life? It’s an interesting question but if you don’t know where you want to go, you are not going to get there, simply put. Putting together vision for your financial life will drive the habits that need to be formed to get you to your end destination. You can have a grand vision and still start small. Each journey literally starts with one step. This is one of the most valuable aspects of working with our team. We help people understand what they want to accomplish and will work to execute on the deliverables. 

Mistake #3: Bad habits 

The brass tacks. Bad habits. We all have them and many stem from beliefs about money that were formed in childhood. At the core, people don’t run their personal finances with enough profit margin, which leads to the lack of money to invest in investments, time, etc. I don’t want to spend a bunch of time here because we all know we need to be more diligent and proactive with our money. 

Mistake #4: Lack of knowledge 

Finally, a massive mistake people make is that they don’t invest in accruing knowledge to win at the game of money. People don’t understand how the system works and more importantly, how to use the system for your benefit. There are thousands of companies in the world that are vying for our attention and it’s really hard to say no to their clever marketing campaign and dig in to learn about yourself, your relationship with your money, and how to change your outcome. Lack of financial literacy is a huge problem, and the result is low personal profit margins. Meaning you are funding someone else's dream and not your own.

How to Track Your Personal Profit Margin

Margin, margin, margin...

Have you ever thought about the reasons why a business is valuable? It could be brand reputation, quality of product or service, size of the market it’s serving, or the exceptional management. In truth, all those things may be part of why a company is valued. Each of those contributes to the overall success of a company. But at the end of the day, a core question remains—is the business profitable? Profitability not only keeps the doors open into the future, but it also gives the management team freedom and flexibility. Freedom to choose where to best deploy the extra cash (R&D, paying off debt, salary increases, etc.) and flexibility to do it whenever it’s needed.

Much like a business, you personally have a profit margin—fancy that! Similar to a business, this personal profit margin gives you freedom and flexibility. Unlike a business, you probably aren’t investing your personal dollars into R&D for a new pharmaceutical drug or to increase someone’s salary. Instead, you may be wanting to save a few extra bucks each month or put a chunk of change towards some high interest debt. These things are certainly more applicable to an individual, and I can attest to the fact that they often makeup the core financial goals that someone has.  

Most people never get ahead because they spend all of the cash, they receive each month. It's easy to understand the end result when you realize there is no margin to invest.

Why you should track your cash

Technically speaking, what does “profit margin” mean? Simply put, it’s the amount of money you have left over after all your expenses are paid. Total Income – Total Expenses = Total Profit. Ultimately, you want this number to be positive (you’re saving money 😊), not negative (you’re losing money 🙁). Before you can start adjusting it, though, you need to track it. Tracking is of the highest importance. Our team believes that transformation starts when you track things. How will you know if you are saving money if you don’t know what comes in and goes out each month? Here would be my recommended process for tracking your profit margin: (1) set aside 1 hour each month, (2) download a simple budgeting app and link your bank accounts, (3) review the transactions to see where every dollar is going each month. Getting started really is that simple.

Turbo charging your growth

So, what about adjusting it? There’s two ways you can adjust your personal profit margin: you can increase your income or decrease your expenses. The real challenge is determining what to adjust and by how much. The answer is that it all depends on what you are trying to accomplish. For example, perhaps you work for a single employer and are compensated 100% in cash salary. Let’s say you make $100,000/yr and you want to save an additional $5,000 in an investment account. You could trim back on your annual travel budget and come up with the cash to put towards savings. But maybe you also have a desire to run your own business one day. Perhaps this is an opportunity to start your side hustle and use the second income to put towards savings; maybe this more fully fulfills some of your personal desires than simply reducing your expenses.


Profit margins are a crucial metric to watch, not only for a business, but also for individuals. You may not be running a business, but you are certainly trying to run your life in a manner that’s rewarding. Tracking your cash is a simple step you can take, financially speaking, to move you forward. Once you see what’s coming in and out, adjustments can be made to the income side or expense side to help you get exactly where you’d like to go.

Don't go it Alone Financially

The danger of going it alone: making mistakes.

I am no stranger to the alure of self-dependence. It feels great to accomplish and manage big projects all by yourself. It’s like lifting heavy weights in the feels good to squat more than the person at the other squat rack. But at some point, we start to reach the border of our own limits. If you use poor form and lift too heavy at the gym, injury will occur. Much like physical injuries, financial mistakes can lead to injury that could set you back for one month, one year, or one decade. Those financial injuries occur from poor form or from reaching the limit of your knowledge, time, or stress tolerance. How can you manage these risks? Just like a bodybuilder, you can recruit a “spotter”.

The spotter: prevents avoidable mistakes

As we’ve already stated, money mistakes are made when you accidentally commit an error of commission or omission. Making an occasional mistake is one thing, but the real issue comes when (a) a single large mistake is committed (EX: selling every position in your stock portfolio and not realizing the immediate tax implications) or (b) a small mistake is committed over and over and over again (EX: saving far too little of your income each month but believing that it’s more than enough for retirement). Truthfully, these mistakes can be devastating. They can push retirement off another 5-10 years or prevent you from reaching short-term goals. There is good news though—these mistakes are avoidable. The key is having someone in your life who, financially speaking, can point out poor form and replace it with healthy habits.

Why the spotter helps

To get specific, here’s why having another person to talk to financial matters about is important. First, that individual provides you with alternate perspective. It’s easy to get stuck in your own head and in your own ways. But an alternate perspective might be the thing that’s necessary to help you take your money game to the next level. We’ve all got different backgrounds, upbringings, life experiences and goals. Having someone who’s financially seen, coached, or counseled dozens of other families means you get all the benefits of the knowledge without making the mistakes. Second, a spotter serves as a backstop. Like my example about the tax implications of selling your entire stock portfolio, sometimes you just won’t know what you don’t know. Having someone there to say, “hold your horses...that might not be the wisest decision for you”, can save you stress, regret, and money.


I want to conclude by making this statement: working with an advisor does not equal personal incompetence. Money is a touchy subject, and I believe there is often a negative connotation associated with recruiting an advisor. I think a change of perspective is in order. If anything, recruiting and advisor demonstrates your wisdom and acuity. It shows your desire to improve your current state by having someone (a) provide expertise where you may be lacking or (b) put time back into the day for you to invest elsewhere. Going it alone is an option. But walking along with someone is a compelling alternative.

What next?

If you have made it this far, congratulations, you're over 7500 words deep and now possess the knowledge you need to go the distance and have a great financial life today, as well as tomorrow. But, if you find yourself saying “whoa, this is great but definitely need some help on the execution.” Just text us – 701-491-7600. We built Scale for you and want you to learn everything about us before going to the next step with us. Our clients pay us to help people execute on these strategies, in good times and bad, and we’d love to do it for you. Thank you for checking this out and we’ll see you around!

About us
Fjell Capital is a leading wealth management firm designed to deliver results for people who desire to be excellent with their finances. Starting at $125/month and a 0.75% asset management fee you can work with Fjell Capital. No asset minimums. Learn more about Fjell Capital here.
Subscribe to the Weekend Reads
Received, interested in becoming a client?
Thank you! Your submission has been received!
Something went wrong!
Email Us
Top posts
recent posts
Schedule a 15-minute Call
Our clients enjoy unbiased advice and a low monthly fee. Schedule your free consultation today.
Choose a Time
COntact us

How can we serve you?

How can we serve you? We invite you to contact us today so we can help answer any questions you may have about your financial situation.

Left pointing blue arrow.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
©2022 Fjell Capital. All Rights Reserved.

-------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------