During your early years of saving for financial independence, the savings rate is your most important number. Sure, having a high rate of return is fun, but it shouldn’t be your priority.
I know how Dave is wired. We talk about how we’re going to retire early and save most of our income. He’s very interested in personal finance. His habits are different from mine, though.
In his mind, he’s killing it, and his cryptocurrencies will for sure enable him to retire before 45. Of course, a 50% return on investment in one year is impressive.
Big returns are sexy, and they give you the feeling that you’ve received ‘free money.’ While big returns are every investors’ dream, it’s not something that you should focus on at the beginning of your journey.
Compounding interest is awesome. It means that your returns are also generating.