One of the key ways to FIRE is to save and invest aggressively. You've forecasted your misery, therefore, you know that by the time your misery becomes a reality, you'll have invested enough money to retire early and break free from the grind.
Obviously, if you don't forecast when you'll be miserable, you're probably not going to invest aggressively today to have the optionality to break free in the future. As a result, you'll just end up bitter and angry at life, turning to internet forums or social media to vent your frustrations about how life isn't fair.
The thing is, we all know life isn't fair. Everybody starts with certain advantages and disadvantages. It's up to us to figure out how to make the most of what we have. Learning how to become a competent investor is key for financial freedom.
Investing Is Always About Understanding Your Opportunity Costs
Since mid-2025, I've been itching to buy a new car to replace my 2015 Range Rover Sport. When I bought the car for $60,000 after taxes in December 2019, I set out a goal to own it until it turns 10 years old, and buy something new. 10 years is a respectable amount of time to own a depreciating asset. And after 10 years, surely, there are more safety features as well.
However, I faced an opportunity cost on whether to spend a seemingly ridiculous $120,000 out the door for a brand new version of my vehicle. Spend $120,000 and gingerly drive a fresh-smelling car where I'd be too afraid to park at the grocery store due to the dings, or invest $120,000 of that amount in my children's 529 plans and custodial investment accounts.
What was more important? A new car I don't need, or fund my children's investment accounts to provide them insurance in the bleak future when no jobs are available due to the AI takeover?
Obviously, when I frame it this way, investing the $120,000 is a far easier decision. Who wants to have disillusioned kids who feel like losers because they can't find a job after college and must live back at home with us? The $120,000 could turn into $350,000 in 15 years. Therefore, investing more than the gift tax exclusion amount is the way to go.
So I thought it would be healthy to provide more examples of how easy it is to convince ourselves to invest aggressively, instead of spend.
The Math Is So Obviously On Your Side, It's Almost Embarrassing
Before we get into more stories, let's talk about why investing aggressively is the closest thing to a cheat code that exists in finance. And no, this isn't some get-rich-quick thing. This is just history.
Bull and bear markets: a brief, humbling history
Since 1928, the S&P 500 has gone up in roughly 73% of all calendar years. You win almost three out of four years just by showing up. People drive to Las Vegas every weekend with worse odds (<50%) than that and feel lucky.
Here's how bull and bear markets have historically broken down:
Bull markets (sustained gains of 20%+):
- Average duration: about 4.4 years
- Average gain: roughly 150% from trough to peak
- Longest run: the 1990s bull market, which lasted nearly a decade and returned over 400%
Bear markets (drops of 20%+):
- Average duration: about 9.6 months
- Average decline: roughly 33% peak to trough
- Worst modern example: the 2007-2009 financial crisis, down about 57%
So the typical pattern is: endure about 10 months of pain, then enjoy 4+ years of gains.
Stock market crashes feel catastrophic while happening, and they look like minor blips in hindsight.
- The 1987 Black Monday crash: -34% peak to trough. Recovered within 2 years.
- The dot-com bust: -49%. Brutal if you owned internet / tech. The S&P took about 8 years to fully recover.
- The 2008-2009 financial crisis: -57%. The worst since the Depression. Recovered by 2013.
- COVID crash (Feb-March 2020): -34% in 33 days. Fully recovered in 5 months.
The median bear market decline is around 30%. That sounds scary until you realize the median bull market return is over 100%. You're giving up a dollar of temporary pain for two or three dollars of eventual gain. Every single time you panic sell, some calm person on the other end of that trade is thanking you.
The hardest part of investing isn't math. It's psychology. It's convincing yourself not to do something stupid when the news is screaming that the world is ending. The people who stay invested through downturns are the ones who end up wealthy. The people who sell and “wait for things to calm down” are the ones who end up bitter, posting on Reddit about how the market is rigged.
Invest through the bear markets and the dips. Invest when you're scared. That's when the real compounding begins.
Invest Aggressively Or Suffer Through Years Of Micromanagement And Humiliation At Work
Let's say you work in the international business arm of your company that sells products into Asia. You're Indian American based in San Francisco and the VP of Sales into India. It's a pretty darn good fit as your product is expanding rapidly.
However, the Senior VP of Global Sales is a 60-year-old white guy based in New York City. He's on your ass every morning, sending you emails at 5 a.m. expecting you to respond within 10 minutes with updates on how the throughput numbers are going. He then expects a full report of what you did for the day before you go home. The micromanagement is intense!
Then one summer, the Senior VP decides to fly out to San Francisco to visit you and the troops. Instead of giving an encouraging pep talk like William Wallace does in Braveheart before battle, he waves you over to stand next to him. Confused, but excited, you think you're going to get some type of public recognition for all the hard work you and your team are doing.
Instead, the Senior VP starts mocking you in an Indian accent by saying you need to do a better job connecting with “your people.” He calls you “Abu” instead of your real name, Nilesh. And then begins to talk about how filthy New Delhi was when he went to visit the office, and how he was scammed into buying a silk carpet that wasn't silk at all.
The entire time, you just keep your mouth shut and bear his bashing of Indians and the country, which is supposed to be embraced as the biggest growth driver of your business.
Screw This Guy! Time To Save And Invest More
He chalks things up to “cultural differences” but you don't give a crap anymore. The disrespect has gone too far. You decide right then and there you've had enough of his microaggressions. As a result, you vow to max out your 401(k) and boost your saving rate to 50% so that you can break free within 5 years, instead of 10.
You pray to goodness that the Senior VP gets outed for some type of office indiscretion beforehand, and gets fired. Screw that guy!
Let's see, freedom from a terrible boss in 5 years or spend more money on expensive watches, fancy dining, luxury cars, and private school tuition. The choice is obvious. Freedom in five years for sure! You decide to not only stop buying wants, you sell your timepieces and downgrade your car to a Honda Civic. You then pull your children out of $45,000 a year private grade school and send them to public school.
You've suddenly gone from saving and investing $50,000 a year to $100,000 a year. Further, you've cut your expenses by $100,000 a year as well. FIRE in five years is all but an inevitability.
Invest Aggressively Or Watch Your Ex Win
You're 38, recently divorced, living in a one-bedroom apartment in Austin. Your ex-wife got the house. Not because she deserved it more, but because your lawyer was hungover during mediation and you just wanted the whole nightmare over.
She remarries within 18 months. Some beefcake named Brad who sells commercial real estate and drives a lifted F-250 with a $1,000/month car payment. You see the wedding photos on Instagram because you forgot to unfollow her sister.
Now here's where the story splits.
In version one, you respond by leasing a BMW M5 for $1,100/month, buying a Rolex Stainless Steel Daytona for $21,000, and taking a girl you've been on three dates with to Paris because you want to feel like the man. You are Brad, just with fewer Instagram followers.
In version two, you take one look at Brad's smug face in that wedding photo and decide, quietly, rationally, and with complete clarity, that the best revenge is being free. You move your saving rate to 45% and max out your Roth IRA. You decline brunch, stop getting bottle service, and start cooking at home four nights a week. 100 pushups and sit-ups after dinner becomes your routine.
Meanwhile, Brad is doing what Brads do. He's leasing a boat he can't afford. Overextending on a vacation home in Scottsdale. Financing furniture. Buying rounds for people he barely knows. Commercial real estate commissions are lumpy, and Brad spends them like they're guaranteed. He's not building anything. He's performing wealth.
You're Financial Fit In The Future
By the time you're 44, your investment accounts cross $2,000,000 and are compounding fast. You've paid off your car. You've also met someone extraordinary, not because you were trying to impress her, but because you were living with intention, and that kind of quiet confidence is magnetic. She has her own 401(k), her own savings rate, and her own opinion on index funds versus active management. You two argue about Roth conversions and it feels like foreplay.
You work because you want to. Brad, on the other hand, is about 30 pounds heavier, stretched thin across two mortgages, and fighting with your ex about money every other week. The marriage held together by joint HBO passwords and resentment is starting to fray. Turns out financial stress is the number one cause of divorce, and Brad never met a dollar he didn't immediately spend.
You don't even think about Brad anymore. But when you do, you smile.
Come Up With Your Underdog Narrative
I understand it's hard to delay gratification and make sacrifices for financial independence. Life is short, and we want things now.
To overcome the YOLO mentality, you need to come up with an underdog story and believe it. It doesn't matter how prosperous you get. Always believe your underdog story if you want to stay hungry.
Here's what I sometimes tell myself to commit more capital:
- I did mediocre on the SAT, so I'd better invest in bright founders with high test scores and fancy college degrees who are smarter than me.
- Despite writing about FIRE since 2009, I hardly get credit for kickstarting the modern-day FIRE movement. If recognition isn't coming, more capital has to.
- As a public high school and college graduate, I don't have the installed base of powerful connections to advance. So I need to work harder to build relationships and gain access to tier 1 venture funds.
- With two kids of small stature, they're unlikely to get recruited by top high schools and colleges for sports. So I max their 529 plans and custodial accounts to make sure they have options when it matters.
Your underdog narrative doesn't have to look like mine. It just has to be real enough to sting a little. Find the chip on your shoulder, and put it to work.
You Don't Invest Aggressively Because Life Is Too Good
Not having advantages in terms of abilities, intelligence, skill, or identity can actually be a gift. Given your disadvantages, you rationally end up saving and investing to one day give you and your children the advantages you never had.
But thinking you have advantages is also a dangerous place to be. It's precarious. You can lose them quickly through a sudden layoff or accident. Maybe the next political party that comes to power deems your group to have too many advantages, and sets up gates accordingly.
The one consistency in life is change. So it behooves you to save and invest as aggressively as possible for yourself and your family. Because once your passive income covers your desired living expenses, life takes a huge step up in quality.
Micromanager pissing you off? See ya later. You negotiate a severance and take a lower-stress job because your rental portfolio is generating $50,000 a year in net income.
A colleague got promoted and rubs it in your face by writing platitudes on LinkedIn? Good for them. They still have to show up on Monday. You don't.
Kids get rejected from every top 50 university despite great character and top grades? No worries. They can go anywhere and still pursue their passions because they've got a $500,000 investment account behind them.
Invest Before You Spend
Investing aggressively should be your default setting, not something you get around to after spending. In any given year there's roughly a 73% chance the S&P 500 goes up. You win almost three out of four years just by staying in. People go to the casino every weekend with far worse odds and feel like high rollers.
So the next time you're torn between investing and spending on something you don't need, think about the opportunity cost. Think about Brad, 30 pounds heavier, stressed out living paycheck to paycheck. Think about the boss who called you by a different name and made fun of your accent. Think about the bear markets that lasted 10 months and the bull markets that ran for years right after.
Once you sit with it long enough, investing aggressively stops feeling like a sacrifice. It starts feeling like the only rational move.
Readers, is investing aggressively each year your default setting? If not, why not? Why don’t more people invest aggressively for their future when doing so can lead to more options, more freedom, and less stress? Aren’t those outcomes worth investing for?
Track Your Finances To Invest More Aggressively
If you want to invest more aggressively, you first need to know where your money is going. Empower offers free financial tools to track your net worth, monitor cash flow, and analyze your investments all in one place. I’ve used their dashboard since leaving my day job in 2012, and it remains part of my regular routine.
If you have over $100,000 in investable assets, including savings, brokerage accounts, 401(k)s, IRAs, and other accounts, you can also get a free financial check-up with an Empower professional. It’s a no-obligation review designed to uncover hidden fees, allocation gaps, tax inefficiencies, and missed investing opportunities.
The more clarity you have over your finances, the easier it becomes to invest with confidence and build more freedom.
Here’s a post sharing how my free Empower financial review went, along with a current giveaway of my signed bestseller, Millionaire Milestones, once you complete yours.
