The Jared Dillian Letter

Take the Pain Out of Your Next Big Purchase

It’s OK to dream big.

My dream is to build a giant, amazing house. I’m buying a big piece of land for it right now.

But I’m not building right away. I want to have more money set aside, so I don’t have to take out a big mortgage.

I'm a big fan of setting financial goals, working toward them, realizing them, and then setting new ones.

What are your dreams? You should set financial goals for all of them.

Give Your Dreams a Timeline

Say you want to buy a Porsche. Great! How much money should you have in the bank before you buy?

You need 10 times the amount it costs. That’s right—if you are buying a big, expensive toy for yourself, you should have 10X the cost already saved.

So maybe you don’t buy a new Porsche. Can you live with a cheaper, used Porsche (or boat, or RV)? If you are considering a $50,000 toy, you should have half a million in the bank. If you don’t, then make that your goal… and start saving.

Don’t become a slave to monthly payments to pay for a toy.

Your dreams may be more modest right now. If you want to go out to an expensive dinner that's going to cost $300, my guidance is to save $3,000, and then it will be no big deal.

Whatever your financial dream is, define it, work toward it, and enjoy it when you realize it.

So, get to work.

Delayed Gratification

Everyone's dream is a comfortable retirement. But it's easier to save for a car or a trip. That's because these are tangible, immediate goals.

When you're 22 years old, you're not really thinking about when you're going to be 72. It's harder to save for retirement because it is farther away.

Yet there is this thing called delayed gratification. And it will feel so much better when you do it.

Maybe you want to go to grad school. Have you ever thought about saving the money first and then applying?

Ninety-nine percent of people do it in the wrong order. They want to go to grad school now, so they borrow a lot of money.

What if you just wait? What if you work for five years and save up a bunch of money and you pay for grad school?

You can do that. Don't take out loans. Save first.

Stupid but Awesome

I like buying fancy stuff.

There's a watch I want to buy, and it's expensive.

Sure, I could just buy it. But that’s no fun. Instead, I save every week because I set financial goals.

My goal is to save 10X the price of the watch. When I get there, I will buy the watch and have a lot of money in the bank.

Whenever you want to buy something extravagant—totally stupid but awesome—save 10X the cost of the item before you buy it.

Why? Because when you do buy it, it will be painless. It will not be a stretch.

People stretch to buy things. Just like with a house.

If you do have to take out loans to buy a house, make it your goal to pre-pay your mortgage.

And for an idea to make home ownership a little cheaper, listen here.

Jared Dillian
Jared Dillian


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