The 7 Golden Milestones to Financial Freedom

Updated: Jul 27


Cover photo: At Shoreham Beach, England, shortly after Belle and I were married. If I hadn't built up any savings, I'd never have been able to apply for a UK Visa, which has a steep financial requirement of £62,500 in savings for spouse visas if you have a non-UK income.


Everyone is working on the 7 Golden Milestones to Financial Freedom. At its core, this is a checklist, and during my airline pilot years, checklists have often saved the day. After changing careers to finance during a recession, my thinking was, why isn’t there a checklist for dealing with money? This gives me the opportunity to use the best of both systems.


Money is easier than most life skills because you plug yourself into a system like this and after the initial setup, it takes care of itself. The adjustments are infrequent and relatively easy once you put it on autopilot.

Like many of us, I've made some big financial headaches for myself which might have been avoided if I knew better and had Golden Milestones to aspire to. Here's my top list of financial calamities:


  1. Paid an expensive private university education for a trade job. Total Cost (with interest): over $70,000.

  2. My house which I sold at a loss after 7 years. Total Cost: $12.5K loss + $9K improvements + $5K broker fees = $26,500.

  3. Auto loan on a sports car which I then sold at a loss. Total Cost (with interest): $31K + 2K sales tax, but regained $16,000 when sold, at a loss of $17,000.

The issue was, back then, I had no checklist or concept of how to boost or apply my earnings, but not anymore. Below is the result of a "money checklist" version of a lifetime of these kinds of lessons. Every article on Golden Goose Guide explores these in more detail.

1. First Golden Milestone – Start Your Journey

Our beachside boardwalk journey last week in Bournemouth, England

The very first part of the path is the easiest one, because it’s right under your nose, but you have to be the revolutionary of your own life by taking the first step.

Lao-Tzu's proverb,"The journey of a thousand miles begins with a single step," captures this milestone perfectly.

Like any good traveler, we will need to be light, adaptable, and complete while preparing for your journey. First we need to take this jumble of accounts, passwords, paychecks, bills, loans, insurance, taxes, and possessions and restructure them to be faster, transparent, painless, and automatic, so you realistically know where you stand at any given time. Set up a bookmarks category and app folder for "Accounts" to keep track of anything that causes cash to be paid out or received, and use a password manager. Set up notifications with your bank to catch when bills arrive, and pay them immediately or even better, automatically. Use a strong password manager for all of your accounts to defend against hackers.


I recommend a bank with personal finance tools who is also a broker, so you can easily transfer between cash and investment accounts and track your net worth. If you use credit cards, use a cash back card issued by the bank which plugs into your calculations automatically. Then set up all your bills to pay automatically online. Add everything to your monthly "Finances" to-do list. Take control of your personal email and phone notifications and unsubscribe or turn off all the junk, advertisements, and distractions. Now if something important comes through, you're less likely to miss it.


Now that you've gotten organized, the best way to stay the course is to track your scores over time in the 'Money Games' using your bank's personal finance tools, since they manage and protect your banking data already. I don't recommend any budgeting apps that require you to give up your bank account log-in details, unlike most personal finance websites that collect affiliate income from these apps, because that does not follow Golden Milestone #5 - Get Financial Security. Unless it's issued by your bank directly, using one of these third-party apps might cause you to be liable if your account is compromised.


If you're buried in debt, nothing is more motivating than seeing your net worth finally rise above zero - I know because it took me years of paying student loans to watch it happen.


The most important scores to start with are:

  1. Monthly cash flow, to see how far you're in the money or out each month

  2. Net worth, to see your progress toward repaying debt and financial freedom

  3. Credit score, to give you more lucrative credit card options

Think of it like checking the scores for your favorite team. It's the only way to know whether you're winning, or whether someone else is winning at your expense.


If you're really up for a running start, start with our very first article here and read them all from beginning to end, just like a book. A link at the bottom of each article will guide you to the next article.


Warren Buffet's words of wisdom: "Someone's sitting in the shade today because someone planted a tree a long time ago."


Complete Golden Milestone #1 - Start Your Journey by becoming a Golden Goose Guide Member (subscribe at bottom of this article), which is completely free.


Please introduce yourself, tell us your story, and let us know you've achieved Golden Milestone #1 - Start Your Journey in our 'Welcome and Introductions' group in the Forums!

2. Second Golden Milestone – Build Ownership

After seeing your score for ownership improving, you will find that you’d like to skip straight ahead to the Sixth Milestone and become debt free. I’ll offer the best ways to skip ahead (see my next article linked at the bottom, "Go From Rags to Riches in One Grand Move"), but depending on your situation, it may require some patience while the rest of the milestones take effect. Please don’t be discouraged in this milestone if you have little to no savings because the rest of the milestones will create a snowball effect, leading back to this one!


Investing at its core is a simple concept. You’re simply taking what you’ve saved and putting it to work in businesses that generates a profit while you kick back and track their progress just like you’ll track yours. This is a cause for celebration, as your savings created capital where there was nothing. Capital is the lever you'll use to boost your income, as it's savings converted into value-creating ownership through investing.


Investing allows you to be the business owner instead of the employee. If you own $10,000 in shares, it's like owning a $10,000 business of your own. Have 100K? Now you're the proud owner of 100K worth of business. If the company does well, your share of the business becomes more valuable. The difference is you can choose from hundreds of the most successful businesses in actual shares using a low-cost index mutual fund, so as not to put all of your eggs in one basket.


In the US, you can start investing tax-free with a 401(k), Roth IRA, Traditional IRA (or a tax-free ISA if you're in the UK). Only if you've maxed out your tax-free savings account contributions for the year, open a taxable brokerage account. Ideally, you want to start saving a minimum of 10% of your income to build ownership and financial security at the same time.


Have piles of debt? Start at 1%, which is the first step. Then raise the percentage after cutting expenses in the next milestone. After reducing your costs, you should start seeing a surplus that goes directly into your savings and is reinvested when it pays you. Each time you get a raise, add the new percentage toward investing.


Once we crush debt in #6 - Repay Your Debts, you can raise that savings percentage to save toward #7 - Win Financial Freedom.


What about other forms of ownership, like starting a business, or buying real estate? Those can work, but they come at a high personal cost to be successful. The simplest and lowest-cost way by far (and Golden Goose Guide recommended) is opening a tax-free investment account, as anyone can succeed at investing using a broad, low-cost index mutual fund, such as for the S&P 500. I don't recommend ETFs, as they track the index rather than provide total ownership of the shares.


Complete Golden Milestone #2 - Build Ownership by opening a tax free investment account and making your first investment by saving at least 1% of your income. In time, this program gives you the capability of saving 50% of your income or more, putting you on a shortcut toward complete financial freedom.


Please let us know your progress on #2 - Build Ownership in our '7 Golden Milestones' group in the Forums!

3. Third Golden Milestone – Save Money

Jam-jar budgeting - who knew jam could save so much

Focus on each of the most expensive categories, chipping away at the most expensive items in your life since they often take the longest to change. Some of them, like changing insurance, will pay you back hundreds or even thousands for an small investment of your time. As an example, here's what I did to save money before starting Golden Goose Guide:



  1. Housing (sold house and moved into rental: 44% savings)

  2. Taxes (use tax-free retirement accounts: 24% savings)

  3. Transportation (sold new car and bought old car with cash, remote work: 91% savings)

  4. Food (shop at Costco and Trader Joe's, less carryout: 60% savings)

  5. Insurance (changed insurance providers: 30% savings)

  6. Healthcare (market healthcare instead of employer plan: 57% savings)

  7. Entertainment and Travel (credit card points and housesitting: 38% savings)

  8. Debt Payment Interest (paid off student loan and mortgage: 100% savings)

  9. Education (undergraduate in-state tuition: I missed out on 57% savings)

  10. Apparel and Services (secondhand or wholesalers: 60% savings)


Remember the advice about automatically paying your bills in Start Your Journey? In Save Money, you want to do the opposite for anything that isn't necessary. Spend too much money on unecessary things from Amazon? Remove your saved credit card details, so it's not as easy as one click. The ultimate training for saving is paying in cash. Have you ever paid rent or your mortgage payment in cash? It's shocking to see such a large bundle of money being paid out.


Use jam-jar budgeting, putting your budget amount in clear, labeled jam-jars for each spending category, visually see your progress, and when it's gone for the month, it's gone. Reward yourself for going under budget by transferring to your favorite category ('Travel Fund', for me). Belle's favorite is fashion, where she finds the best secondhand deals with sellers on Depop.


Many of the best things in life are free, like family, friends, or enjoying the great outdoors.


This is like unloading the weights from the backpack you’ve been carrying around. After running through this Golden Milestone, you should have a surplus of cash. Rather than spend it, do you know what should be the number 1 "expense" on the list? It should be investments. Investments is Ownership and buys your future self time.


For this, Ben Franklin has sage advice: "Beware of little expenses; a small leak will sink a great ship.”


Complete #3 - Save Money by saving at least 10% of your income. Use this surplus to pay off any high-interest debt first; otherwise, keep raising your investment percentage. Investments will turn around and pay you back multiples of the investment. Even if you're starting at zero, super-savers who achieve a 50% savings rate can reach #7- Win Financial Freedom as early as about 15 years away. If you're trying to be a super-saver, see if you can move saving and investing up to your number one "expense". You'll make money with money.


Please let us know your progress on Golden Milestone #3 - Save Money in our '7 Golden Milestones' group in the Forums!

4. Fourth Golden Milestone – Maximize Your Income


These articles will cover tactics and strategies for most importantly, doing work you enjoy, but also achieving an income that represents the best of your talents, skills, and long-term decisions on education. For this I use a Japanese concept called Ikigai, which means "reason for being". The key is to find the intersection between what you love, what you're good at, what the world needs, and what you can get paid for.


We want to find the true value of your time and see how it can be used as a lever to move your income. Time is even worth more than money, because it gives you the ability to learn enough to offer something extremely valuable to the world. Just like you can invest in businesses, you can also invest in yourself through education or skills to unlock the next door of opportunity.


Warren Buffett offers this: "Ultimately, there’s one investment that supersedes all others: Invest in yourself. Nobody can take away what you’ve got in yourself, and everybody has potential they haven’t used yet."


In another interview, Warren says: "If you improve your communication skills, I will guarantee you that you will earn 50% more money over your lifetime."


For example, my master's in finance and knowing how to code, in particular, allowed me to move to a more stable and rewarding career. Right now, I'm working on my CFA exams, the most highly respected professional investment designation.


Complete Golden Milestone #4 - Maximize Your Income by finishing an educational life goal or career goal that you've always wanted to accomplish, using Ikigai as a guide to make sure you will be compensated as a result. Education (formal or self-taught) is the quickest way out of poverty or to raise your income.

Please let us know your progress on Golden Milestone #4 - Maximize Your Income in our '7 Golden Milestones' group in the Forums!

5. Fifth Golden Milestone – Get Financial Security

Most think that only the wealthy need protect themselves. However, this is a key lesson for anyone from college student to billionaire. The lesson is: It doesn’t matter how much value you create today, if it’s taken away for the rest of your life. That could be governments, shady money managers, university marketing ploys, or the person suing you after a car crash.


Check that everything of value you own has some kind of protection or insurance in case calamity strikes. This extends from a car or a house to investment accounts, which should be insured (check with your broker). If they aren't (i.e., cryptocurrencies), you don't want to put more than 10% of your money in it, following the "don't put all your eggs in one basket" proverb mentioned earlier.


In our wise friend Warren Buffet's words, “Build your castle with a moat around it.” Another of my favorite quotes from Warren is, "Predicting the rain doesn't count. Building arks does."


  1. Use a strong password manager for all of your accounts to defend against hackers (such as Apple's iCloud Keychain)

  2. Move investments to low-cost index funds

  3. Stay on top of any tax liabilities

  4. Health insurance (US: High-deductible ok if low risk, and savings covers 2x)

  5. Home or rental insurance

  6. Vehicle insurance (liability-only for low value cars)

  7. Bank account insurance (US: FDIC, UK: FSCS)

  8. Investment account insurance (US: SIPC, UK: FSCS, some brokers have additional)

  9. Disability Insurance

  10. Life Insurance (if you have dependents. This can be removed if your savings is sufficient)


Complete Golden Milestone #5 - Get Financial Security by checking that anything potentially expensive is insured to give your family financial security in the short-term. Also, save up at least 6 months of expenses in the form of liquid (easy-to-sell) investments.


Please let us know your progress on Golden Milestone #5 - Get Financial Security in our '7 Golden Milestones' group in the Forums!

6. Sixth Golden Milestone – Repay Your Debts

Financial Fitness: Debt Paid Off (red) and Net Worth Skyrocketing (dark blue) - demo chart from YNAB

This milestone happens when you successfully drive all of your debt back to the fiery depths from whence it came. This is a huge relief and that stress evaporates after making it this far. I know, because I finally reached this milestone after paying off my student loans. I call becoming debt-free Financial Fitness, because it's like finally dropping those extra pounds of weight and running up the iconic stairs while shadowboxing in Rocky.


This wasn't possible until I sold my house and got rid of my mortgage, which enabled me to move within walking distance of work to rent and commute by foot at less than half the total cost. Because the stock market returns outpace home prices over time, homes are illiquid (difficult to sell), and homes have high transaction, maintenance and upgrade costs, I've been far better off investing my money in the stock market for ownership in value-creating businesses. Renting gives me flexibility and the option to save up and buy a house in cash later.


Mortgages start out as mostly debt and a small piece of ownership. Homes have the potential to create value by renting it out, which I used by renting out an extra room, but if you keep upgrading your home to a newer, larger mortgage, you are paying mostly debt interest, increasing expenses and fees, and gaining very little ownership (it takes 20 years of a 30-year mortgage just to reach 50% ownership).


Debt is ownership for someone else, so it runs exactly counter to the philosophy of this website, which is to build value-creating ownership for yourself.


With any debt, find out the Total Cost of the loan. After all, you wouldn't buy anything else without knowing the sticker price. This also helps to compare one loan to another. Debt providers typically only show you the balance (the payoff amount), but that doesn't include interest.


Total Cost = Balance + Interest


Payment Calculator for Mortgages, Car Loans and Other Term Loans

Payment Calculator for Credit Cards and Other Revolving Credit Loans


Credit card debt is designed to be a treadmill. Unlike a home or auto loan, the "minimum payment" actually extends the loan's life and increases the Total Cost like a balloon. It's a fixed percentage (usually around 2%) of the balance. If you can't change out to cheaper debt (transfer to lower rates), you'll want to prioritize paying off your debt with the highest interest rate first.


If you only paid the minimum payment ($191) on $6,000 of credit card debt and you're paying the highest penalty interest rate of 30%, this can inflate your loan to an incredible 33.5 years and $19,030 using the BarclaysCard repayment calculator (this is the only credit card issuer I've found willing to show this). Some of us might be grandparents before paying off their credit card using minimum payments.


If in the above scenario, you instead pay a fixed amount of $500 per month, we change the situation drastically. Total Cost drops to $7,049 and you're paid off in a much more manageable 1 year and 3 months after paying nearly triple the minimum payment. Pay 2x the minimum payment to pay in under 2 years, or 3x the minimum payment to pay off in just over a year.


Warren Buffett says, "The most important thing to do if you find yourself in a hole is to stop digging." If you're carrying any credit card debt over from month-to-month, switch to using a debit card or cash until the credit card debt is paid off. If you have good enough credit, transfer any balances to a card with an extended 0% introductory interest rate.


You’ll find that you can always train for any Golden Milestone to increase your speed towards Win Financial Freedom, but becoming debt free in Golden Milestone #6 is like the tipping point in the marathon. Without that backpack full of weights, you’ll accelerate toward the finish line.

Complete Golden Milestone #6 - Repay Your Debts by paying off all your debt, including your home mortgage, auto loans, student loans, credit cards (paid when due), or any other long-term indebtedness. Debt-free means completely debt-free.


Please let us know your progress on Golden Milestone #6 - Repay Your Debts in our '7 Golden Milestones' group in the Forums!

7. Win Financial Freedom

When your investments pay you enough to cover your cost of living, you have reached the "Crossover Point". The Crossover Point is where your investment income exceeds your expenses, without taking money out of your Nest Egg. The term was originally coined in the book Your Money or Your Life.


This means you rely on nobody else, including an employer's paycheck or additional wages, to support your same lifestyle for the rest of your life. You can provide for yourself by owning things that pay you, and anything that pays you more than your cost of living adds to the accelerating snowball of wealth. Anything you’re doing at this point is better because you have complete flexibility, and occupational stress like the kind I dealt with as a pilot is not even on the map. Financial Freedom is the finish line in the marathon.


The finish line is to hit the Crossover Point using the dividends paid by a low-cost index mutual fund that owns the FTSE High Dividend Yield Index, which is like being a franchise owner that collects a percentage of profits from its partners, except you've delegated all the headaches of active management.


As of June 30th, 2020, it pays a 3.63% yield and protects against future inflation through capital gains (most importantly, as your expenses grow with inflation, so will the value of your nest egg and fund income). Minus fund expenses, it's 3.55%, meaning if you have $40K in expenses per year, you'll need to save at least 40,000/0.0363 = 1,101,928 or just over $1.1 million.


The formula for your Nest Egg is simply Expenses/Yield. Just divide the Dividend Yield you see reported in percent by 100 before plugging it in.


If your Nest Egg was baked as a cake, the 'principal' part of your cake is your investments, while the yield is your dividend income, like the icing on top. The idea is to give the icing time to reappear through dividends so you don't ever eat the cake, because the cake size determines the amount of icing.



But what's the average? In 15 years of existence, the FTSE High Dividend Yield Index averaged above 3% per year. So your margin of safety is 40,000/0.03 = $1.3 million. No complicated retirement calculators needed, just simple division. As you can see from this long-term chart using the S&P 500 (which has a lower yield but correlates), yields are low right now by historical standards.


The downside to any income solution like a high dividend fund is lower capital growth. Because more profits are paid out instead of reinvesting, it will likely be outpaced by the broader market, which includes younger, faster-growing companies that pay no dividends. Therefore, if you're still earning an income, you should stay in a broad, low-cost index mutual fund like the S&P 500. Golden Milestone #7 - Win Financial Freedom is here just to prove that you can make enough sustainable income to Win Financial Freedom if you depended on it.


You might ask, but worst-case scenario, what if a bear market crushes our account, and they cut dividend payments during a hardship, like a recession (or a pandemic)? Here are my recommendations:


  • The more diversified and high quality the fund, the less impact during a downturn. The FTSE High Dividend Yield Index holds 140 companies, so it's considered highly diversified.

  • The average bear market since WWII knocks the value of US stocks down about 30%. Just hang on for the ride and stocks will recover. If dividend payments (icing) drop during a big recession, you still have your principal (cake) as a safety net. This is why you should save and reinvest the extra dividends above 3% in the good years.

  • Dividend payments have been paid for over 100 years, so let the index do the work of dropping companies that suspend payments, keeping resilient payers, and adding new dividend payers.

  • Golden Goose Guide doesn't recommend ETFs, because ETFs only 'track' the index and break the GGG #1 ownership rule.

  • Golden Goose Guide doesn't recommend rules of thumb for retirement that depend on the stock market's continued advance to keep from withdrawing the whole portfolio (i.e., the Trinity Study) over time, as my profession has taught me that returns are not guaranteed and "past performance does not guarantee future results." In other words, if you try and make it to the end of your life with no money left over, one black swan event and you're likely to end up short.

  • If you're an intermediate-level investor or above, learn Roundabout Investing.


The more adventurous of you are probably thinking, "I like the idea, but I also want to take risks and strike it rich by buying the next Google or Netflix." Not to worry, you can still try. Set aside no more than 10% of your money for "mad money trading". Alternatively, if you wanted to boost your income with anything especially risky like high-yield corporate bonds or Mortgage REITs, you have to use the same 10% "mad money" bucket.


Complete Golden Milestone #7 - Win Financial Freedom by saving up enough investments to reach the Crossover Point. This is a project with personal goals, so I use a percent complete to keep track, so you can keep your net worth private. Therefore, if you are 50% of the way toward your Nest Egg goal, you can be anywhere from a barista earning $20K per year to a doctor earning $100K+, but it all depends on your spending level as to the size of your Nest Egg, because dividends will have to support your spending.


For example, if you're a full-time housesitter and saving loads of cash, you might be well on your way to achieving Financial Freedom even on a lower income because you are saving more and spending less, though I'd factor in an average cost of housing in your Nest Egg spending, since housesitting is a temporary arrangement.


Please let us know your progress on Golden Milestone #7 - Win Financial Freedom in our '7 Golden Milestones' group in the Forums!

You can work on any of the milestones at once. Drawing from my flight background, I’ve prioritized them to first put out any fires, figure out where you're going, and organize a safe landing. I've finished all of the Golden Milestones except Win Financial Freedom. You can use your own expenses from last year to gauge your progress: Nest Egg/Net Worth shows your percent completion. How close are you?

How to complete each Golden Milestone, in summary:


  1. Start Your Journey: Become a Golden Goose Guide Member (sign up below), it's free!

  2. Build Ownership: Open an investment account and start investing at least 1% income.

  3. Save Money: Save at least 10% of your income.

  4. Maximize Your Income: Finish an educational life goal or career goal that you've always wanted to accomplish.

  5. Get Financial Security: Save up enough cash or investments to cover at least 6 months of your expenses.

  6. Repay Your Debts: Pay off all your debts.

  7. Win Financial Freedom: Save up enough investments to reach the Crossover Point.

But why can’t we have only the one step we talked about? This one sounds glorious: 1. The One Quick Cheat for Lazy Slackers I’ve given this some thought and will prove to you in the next article (link below) that it is actually possible to use one quick cheat in certain circumstances. It falls under the 2nd Golden Milestone – Build Ownership. If you'd like to take a step out of the finance world and see more about our personal life, long distance relationship and adventures since I quit my airline captain job and moved to England, please subscribe to our YouTube Channel: 4000 Miles Together


If you enjoyed this article, please subscribe, share, or leave your thoughts in the comments below. You're invited to join our Golden Goose Guide community and chat with us in the Forums in the Wix App!


-Golden Goose Guy

Next Article #3: Go from Rags to Riches with One Grand Move

Previous Article #1: Win the Gold in the Money Games of Life


#StartYourJourney #Start #WinFinancialFreedom #Freedom

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