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My Four-Pronged Strategy Towards Financial Prosperity

18 May 2008 29 Comments

Hello. I am 25 years old. I have now been out of college for three years. I have worked for two different companies, one with 100,000+ employees and one with fewer than 15, in two very different industries. I began investing my own money four years ago but didn’t really understand investing until two years ago. I bought a house in 2006 and sold it in 2007 because I got married.

When compared with the average 25 year old, I’d say I am in a good place financially. I do not have any debt, have some money saved, and have already started saving for retirement. Additionally, I have experienced many different kind of investments personally in my short life, both good and bad. I have learned some painful lessons and enjoyed some nice luck.

I have compiled everything I have learned into what I call my strategy towards financial prosperity. Since I’m sure some people will be quick to criticize, I’ll make it clear that in no way do I consider myself an expert. I have much to learn, and I am more eager than anyone to continue to learn. This strategy is my version at 25 years of age. It will undoubtedly change. I encourage you to continue reading and see if such a strategy might apply to your life and your journey towards financial prosperity.

Prong #1: Career – Active Income

Your first and most important component of your financial strategy is your job or your main career. This is my source of money that funds my lifestyle and my savings. My goal is to absolutely excel and achieve towards more responsibility and more money.

Additionally, my goal with my career is to have more freedom. This may be in the form of my own business or simply more freedom in my job. Such freedom will allow me to pursue other investments, other hobbies and other things in my personal life. More time, in my opinion, is equal to more money in many cases.

Related articles:

Prong #2: A Second Income Stream – Passive Income

Creating a second income stream can be difficult and takes a combination of an entrepreneurial attitude, creativity and hard work. This second form of income can be anything from a blog, an e-business, or a cash flowing real estate property. The main thing is that this income is “passive” which means it doesn’t take eight hours of work, five days a week to achieve. Furthermore, the income can be a couple hundred dollars a month or a couple thousand dollars a month. The goal is any amount of additional income with minimal work to achieve it.

Creating a second income stream is a high priority for me at this point in my life. This blog that you are reading is one possibility (I’m not there yet), and I have a couple other e-business ideas.

One of my passions is to help others find passive income stream possibilities. I will be producing much more material on this blog regarding this subject in the near future.

Prong #3: Real Estate

Real estate is tough game right now. For most people, real estate should not be considered more than a place of residence. In many markets, it could be several years before we begin to see regular appreciation in real estate prices; therefore, the idea of making money in real estate is difficult. However, I don’t believe it’s impossible.

My goal, currently, in real estate is to find a depressed property in a great location where I can unlock some value. I am not going to make money on a house simply by buying it at a good price and holding it. More work is required than that.

I’m looking for a house in a great neighborhood, in a great location that will continue to thrive in the future. I am trying to avoid any developments that have a high rate of foreclosures (most neighborhoods developed in the last few years have higher rates of foreclosures). The worse shape the house is in, the better because I know most buyers are not going to be willing to buy a “project house.” I am hoping I can find a house that needs a lot of work, and can do some renovations or repairs to bring the house to its true potential.

I will continue to blog about my journey to find an undervalued house.

Prong #4: Trading and Investing In Stocks

Lastly, I want to earn a strong return on my money that I have saved. I have retirement accounts and a regular brokerage account where I have investments in stocks. My minimum goal is to outperform the market. In actuality, I am setting my sights higher: I want to achieve 20%, 30%, even 40% returns on my investments.

My strategy is to find the best investments, and to bet big on them. I have no interest in diversification. If I wanted to do this, I’d simply by an index fund and track the broad market.

More articles on my investment strategy:


As a 25 year old, my goal is to work hard at my career, work hard creating a second stream of income, combining my place of residence into a value-unlocking investment, and outperforming the market every year with my equities portfolio. The combination of these four prongs should provide a bright future financially. Even if one prong fails to materialize, one of the others can make up for it.

What is your financially strategy? What “prongs” make up your plan of attack? If you haven’t formulated your strategy, there is no better time than now!


  • James said:

    Another great article.

    At 16, I formed an Internet business, which continues to have profound passive income… In fact, I never thought it would go this far (I program and design modules for software, so it's better than a blog since I write once, sell anytime… and provide updates every year or so). Now, this took a lot of work, and definitely a lot of high school Friday nights to maintain…

    The 4th point is the one I'm working on. I think in this environment, there's a lot of dust settling and definitely A LOT of deals to unlock. I would wait and see how things pan out and buy maybe a couple hundred shares of some stock, because I think the markets could be lower a year from now.

    Real Estate is the big "if" because it could be a few more years before prices level down… But, I find equities (stocks) much cooler, and the dividends can sometimes be better…

    There are 3 categories to making money today:

    Internet, Stock Market, & Real Estate

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  • kevin duffey said:


    I'd love to hear more details on your internet business. I am a former software developer, so I have an interest there as well.

    Agree with you on real estate. It is a huge IF and is by far the least emphasized "prong" in the article.

  • Dividend Growth Inve said:

    If you could rent the real-estate that you bought, who cares where the price is over the next 5 years?

  • top investing strategy said:

    Three of the best investment strategies to utilize include purchasing real estate at a bargain price, working on a piece of real estate to increase its value, as well as a double digit cap rate.

  • Alex said:

    start young, be bold.
    Even if you stumble, if you’re young, you have time and energy to get back up.
    I’m 19 right now, but I’m aiming high just like you.
    Great article!

  • Coop said:

    Duff, this really opens up for much needed brainstorming. I think some people are just not willing to take that step and really “put out” the much needed effort to achieve the kind of goals you are talking about. As I am getting ready to graduate college, the passive income is probably next on my list at the moment. Great article though and great site for 20 year olds who are very eager to earn a good income.

  • Liza said:

    I know this post is old, but I wanted to comment on it.

    Being almost 2 years out of college I'm starting to realize that even with a great paying job and two 'passive' incomes, saving is tough. Especially when it is combined with loans and monthly bills.

    I do think your ideas are great. I don't think the real-estate idea is the best idea ever pursued, though it is pursued the most often. I was fortunate to have two hobbies that can create money with minimal work; teaching music privately and babysitting. Both of which really only require the time invested actually doing the jobs. But not everyone can be so lucky.

    However, because I was a music major, and my college math credit was music theory, and I'm not a huge fan of economics, I don't know shit about the markets. I don't know where to start investing my own money into individual markets, and I certainly don't like to pay to have someone else do it either. But I'm lucky to have 401k option and company matching.

    So although your post is extremely interesting, Real Estate just won't work because of a current credit crunch, Working the market takes more than a general knowledge and creating another income stream isn't always attainable. Even if someone didn't have a hobby that could make money, finding a part-time job with a full-time job is difficult because of the number of jobless competing.

    Love the advice, I'll keep earning my money, budgeting, saving and reading your posts to try to learn more. 🙂

    Maybe a follow up on this to see what has worked out for you would bring more interest in these ideas.

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  • bobby said:

    Thats a great plan I think! Keep it up, Lysine for Cold Sores

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    I keep wondering… what exactly happens to the economic foundation over the global market when reinforcements like globalization policies turn in? Are economical mechanisms converting to profitability under uniformity standards? Are they speculating some strong points of the areas and enhancing policies so as they generate more profit there? However, globalization brings a touch of evolution. After all, it means lining up weak economies to the stronger ones. We do acknowledge live in the era of profits and CFDs. And we also live in an era of free choice, opportunities and strategies. There`s no succeeding without a touch of anticipative thinking in the end.

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