In this episode of MarketFoolery, Chris Hill chats with Grant Sabatier, founder of Millennial Money, a site dedicated to helping people on their financial independence journey. (Millennial Money was acquired by The Motley Fool in October.) Grant talks about how he went from losing his job during the Great Recession and staying with his parents to achieving financial independence by the age of 30, the lessons he learned along the way, the changes he made to how he approached work and life, how you can do the same, and much more.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.

This video was recorded on December 15, 2020.

Chris Hill: It's Tuesday, December 15th. Welcome to MarketFoolery. I'm Chris Hill. Something a little different today, we are having a day-long investing conference around our flagship service, Motley Fool Stock Advisor, so while I am busy with that, I wanted to bring you an interview I did earlier this month with Grant Sabatier.

You may be familiar with Grant, he's the Founder of Millennial Money, one of the most popular sites for anyone looking to achieve financial freedom. Starting Millennial Money was not in Grant's plan when he graduated from college in 2007. He had a good paying job in Chicago, but then the Great Recession hit, pretty soon he was unemployed and back at home living with his parents. He spent months looking for a new job, he had no success, but finally things started to turn around.

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Grant Sabatier: There are two things. The first thing was that, it was at this time I started realizing that my parents had gotten a little bit older, they were still working, they were stressed about money. I was invited to a July 4th picnic, actually, in 2010 where I went to, you know, DC suburbs with a lot of my parent's friends. And I was the only mid-20-something there. And anyone else was probably having a lot more fun than me, and the only thing anyone, I was listening to their conversations, anything anyone was talking about was retirement. It was this golden pot of money at the end of the rainbow, everyone was talking about, when are you going to retire, when are you going to retire. And here I am looking at my parents who were still working, and their friends who were still working, and everyone is stressed about money and I was stressed about money. That I had the simple idea of just writing down what I had been taught about money.

I just made a simple list, just where did I go wrong, where did we go wrong? And the first thing I wrote down was that time is money. And I looked at this, and, you know, I had my philosophy major hat on. And I was like, you know what, this is ridiculous. Time is not money; time is so much more valuable. You can always go out and make more money, even me being unemployed, I knew that, but you can't get back your time. You know, I'm not going to be able to get back my mid-20s and the next 30, 40 years of my life. And so, why are we making this massive trade-off for money? And the entire personal finance foundation is built on this idea.

So, once I realized that that was a complete joke, then I looked at the second thing I wrote down, which was to save 5% to 10% of your income. And here I just did some back of the napkin calculation on my $50,000 salary that I had had when I got laid off, and realized that I was never going to be able to retire if I only saved 5% of my income. And so, here was another ridiculous piece of information. And this got me down the rabbit hole. I just realized that I needed to learn a lot more. I Googled "best money books," the first book that came up was Your Money or Your Life by Vicki Robin. I read in August 2010. Completely changed my life. Realizing that whenever you're working, you're trading your life energy for money, really resonated with the philosophy major in me. I saw it as a blueprint to building a life that I loved.

Vicki Robin, the Co-Author, is now a really good friend of mine and she wrote the foreword to my book. And it's really funny, because she actually laughed, she's like, yeah, that was the intent of the book, but I had no idea that a millennial would come along and his takeaway would be, not only should I save 50% of my income, but I need to try to figure out how to make as much money as quickly as possible. She said that wasn't her intention at all, but that's what I read into it. And so, here I had this grand plan, but still I didn't have a job.

So, the second big impact was I was just doing a search on my phone, I had an iPhone that I had bought in 2007 when it came out. And for the first time, I saw a Google mobile ad in the results, and I was like, what's this? And so, I just Googled "Google mobile phone ad," and the first thing that came up was an article by eMarketer that said, jobs running Google ad campaigns were projected to grow 300% in the next 10 years. And then the second result was actually a Google website called Google Adwords University at the time. I clicked on it, watched the two-minute intro video. And more importantly, I saw there was a certification exam that you can take for free and get certified to run Google ads. And so, I didn't have anything better to do, and here was potentially a growing field. So, I overprepared, I watched all the videos on Adwords University and a couple of YouTube videos, took the test, passed, put that certification of my LinkedIn profile, I literally didn't even know what job to apply to and searched for "jobs running Google ad campaigns," applied to a job in Chicago. After applying to over 200 jobs at my parents' house and not getting a single callback, just that free Google certification got me a job at a digital marketing agency. And I was out of my parents' house, saving over 50% of my income, and I was off to the races.

Hill: So, I was about to say I've heard similar stories; I haven't heard similar stories. I've heard similar numbers in terms of people saving money. Can you give me a couple of examples of what that sacrifice looked like? What are you giving up when you're saving 50% of your salary?

Sabatier: Yeah, it's a great question. So, it's important to remember here that I'm a 25-year-old guy who has a girlfriend, but you know I have an immense amount of flexibility and freedom in my life. And so, immediately, I knew that saving actually was an opportunity, it wasn't a sacrifice. And so, the hardest thing throughout my entire financial independence journey and becoming a millionaire in five years, it wasn't learning the tactics, it was living my life differently than my friends and then my parents. I mean, you have to think -- so, I moved to Chicago, I needed a car, because my job was in the suburbs, and so I bought an $800 Nissan Maxima on Craigslist. One of the cheapest, most reliable cars that I could find. And I rented an apartment that was $800. And so, it was a two bedroom, so I could have a little office, but it was a really crappy apartment. And in fact, it was so crappy that my wife, then girlfriend, wouldn't even come over and hang out in it, talked about it, made fun of me all the time. And my car was so crappy that when I picked my mom up at O'Hare Airport, when she came to visit, she literally, for the 40-minute drive into the city, made fun of my car and worried if it was safe the entire time.

And so, during this journey a lot of my friends -- you know, I got invited to go to Coachella around this time, I didn't go, because I decided to save the money. On weekends, I wasn't going to Chicago Bulls games with my friends anymore, I was side hustling. That first year I had 11 different income streams, because I started seeing my net worth go up and my takeaway was, I need to find as many ways as possible to make money. And so, my friends that enjoyed making money in their free time, we became really good friends, and my other ones who wanted to go out and drink and go to the sports games and go to the music festivals, we became less good friends. And so, it really kind of filtered out a lot of people in my life.

Unfortunately, I ended up making a lot of trade-offs that looking back I wish I hadn't made, but you know, hindsight is always 20/20. And in fact, where I'm at today at 35, over 80% of my net worth has come from investing gains from that time period. And so, I'm very grateful that I did decide to make those sacrifices.

Hill: I want to ask you a couple of things about investing, but first, I'm curious, when does the lightbulb go off, both, in terms of starting MillennialMoney.com and writing a book?

Sabatier: Yeah. So, that came much later. So, I was on this financial independence path. For that first year coming out of my parents' house, I was working for a digital marketing agency, but I was side hustling on the side. And I realized pretty quickly if I wanted to take that next jump in income level, I needed to start my own company. So, I left the full-time job, I started my own digital marketing agency, and then I started a second one that was focused on higher education. So, I was in these two different verticals and scaling those companies. And I ended up having over 30 employees as I grew those businesses. But what happened is, I actually reached financial independence faster than I thought I would. So, I became financially independent shortly after turning 30. And what I mean by that is I had $1.25 million in liquid assets, which was a little bit more than 25X of my annual expenses of about $45,000. So, I still wasn't spending very much money and I was saving to invest. But what ended up happening is, I reached financial independence, I looked back and realized how much I had learned on this journey, and all of my friends, or most of my friends were still in debt. They were still paying back their student loans; they were in credit card debt.

So, here I had amassed all this money and done all these things, but we as a society and we as millennials, hadn't moved the needle much at all. And so, I saw an opportunity just to share what I had learned, and I had never built a website for myself, but I was still traveling to my clients a lot. And so, in 2015 I launched MillennialMoney.com just to share my story and what I had gone through. And I had bought the domain in a domain auction a couple of years before and thought it was a great brand, very relevant, good alliteration, you know, I knew a fair amount about building brands because of my marketing background. And it actually became the perfect confluence of all of my skill sets, because I never built a website for myself, but I built them for so many different law firms, and consultants, and universities that when I built my own, I was very intentional and purposeful about every single step that I took from how I wrote the content, to how I designed it, to how I built it.

I launched in 2015, and it wasn't until early 2016, so about a year later, that I started getting those first reader emails. So, I knew that traffic was growing, but I started getting those reader emails. You helped me save $13,000 in the last year. You saved my marriage. I now feel like I can reach financial independence at a young age, thanks for inspiring me. And those emails filled me with so much more joy than any amount of money that I had made, that it was like my purpose in life, at the age of 32, had just shown up. I mean, it was a perfect alignment. And I realized that this is what I should be doing with my life.

And so, I started doubling down, writing more, the media started to take notice. In 2017, that's when you get The Washington Post first writing about me and my story. And it took off like wildfire, man! It was being on NPR. And since that time, I've done over a 1,000 media interviews across 50 countries. It's just been an incredible journey. And from that, I doubled down and spent more time, built out a team to grow the website. And then from that I got the book deal with Penguin Random House and the opportunity to -- you know, two of the biggest questions that I got asked were, how did you do this? And I had a 13,000-word blog post that outlined a lot of the steps I took. But the second question was, how can I do it? You know, Grant, I'm not 25, I grew up differently than you, I've got two kids. And so, I decided to write the book, so I would never have to answer that question [laughs] again and could just point people to the book. And now it's in over 10 languages all across the world and I get emails every day from readers, many in languages that I have to translate just to get a sense for what they're saying, and I feel very grateful to be able to share this mission with the world.

Hill: You've got millions of readers around the world coming to the website, you're getting the questions, as you mentioned. What has surprised you the most in terms of the topics? And that can go in a couple of different directions, one can be, wow! I'm getting a lot more questions about this than I thought I would have. Or on the flip side, are there things you've written about that you just think, wow! Nobody is really asking about this.

Sabatier: That's a great question. So, the first thing is the interest in side-hustling. So, I was one of the first people, back in 2015, writing about side-hustles and using that keyword, and ranked for it very well early on. It was something and I was just talking about ways to diversify your income, and you know, I saw this opportunity, particularly, pre-gig economy with the online space growing, just to build money in a lot of different ways. And so, I like to say that it's never been easier in history to make enough money to live a life you love. That doesn't mean it's never been easier to get super-rich or you know, it's still difficult to make money in a lot of ways, but if you're scrappy and you are creative, I mean, there are so many ways to make money out there and it's constantly changing. I mean, you just compare the life that we live today to 100 years ago, our great-grandparents, and the quality of life is insanely high. We can live incredible lives with very little money. And so, the interest in side-hustling early on was so strong, and that's really only continued.

And the second thing is, I started to get emails from people who resonated with the more mindful approach to money. What they had seen is their parents getting into debt and being strapped down and being tied to a mortgage, into a job, into debt, and coming out of college, even I get emails from 16 years old, 18 years old, people who are starting so early on this path. They realize now that there's another way to live. And I think just this narrative of, you know, get two car loans and buy the biggest house that you can afford and take out the most student loan debt, that narrative is so pervasive in our culture, just being able to see and hear from someone who did something a little bit differently. I mean, did something a little differently with a liberal arts degree. And this is one of those things where younger people, especially, realize that saving is an opportunity, it's not a sacrifice. And so, they're off to the races very early on, and they're able to set themselves up for life so much sooner.

But interestingly, you know, I've gotten over 40,000 reader emails in the past five years. I've put them in a Gmail folder, I haven't even been able to read all of them. But often, you know, when I want some inspiration, I go in just to see what people are asking. And 90% of the time people aren't saying, thank you for teaching me how to increase my savings rate 1%, what they're saying is, thanks for inspiring me, thanks for giving me hope, thanks for showing me that there's another way to live, thanks for helping me realize that just because I have different dreams and desires than my parents and friends, you know, I'm not alone.

And so, you know, I'm just one part of a much larger movement, and was writing about this fairly early. That's been a big shift toward people being more intentional about their finances and spending and realizing that money is freedom, having enough money in the bank gives you more time and space and options to live a really rich life, that doesn't mean you have to have millions and millions of dollars in the bank. It means you have enough money that if you don't like your job you can quit or change your job. If you don't like where you live, you can pick up and move somewhere else. If you don't like the relationship you're in, you can leave your partner and go have some freedom and space. So that's really what it's about, this idea of financial freedom. And that's why, even though it's such a generic title, the reason I called the book that, because that's what it's really all about.

Hill: In terms of investing, do you invest in the stock market, and if so, what does that look like?

Sabatier: Yeah. So, very early on, you know, I was a Jack Bogle fan. So, I found him very early in 2011. And so, I knew that index fund investing, investing in a total stock market index fund, VTSAX [Vanguard Total Stock Market Index Fund] specifically, was where I wanted to put most of my money. And so, I started putting as much as I could into index funds, but I wasn't an idiot, and I realized, you know, the University of Chicago, actually when I was there in 2003, we were the second school to get Facebook after Harvard. And we actually had the user number that we were in our profile. And so, I was user number 17,318 on Facebook, and so I was very early on on that. So, once in 2011 I heard that Facebook was going to go public, it was a no-brainer to me that I needed to invest in it. Unfortunately, I didn't have as much money as I have now [laughs] to invest in it, so it hasn't grown as much as you would have expected, but it was a part of a portfolio. And so, I knew that that was a no-brainer.

And so, I had allocated about 10% of my net worth to invest in individual stocks. Thankfully, over time, I'm actually not a big fan of rebalancing. I don't believe in, you know, selling over performing assets, especially individual stocks. And so, you know, over the years, as I've acquired other individual stocks, like, Amazon, obviously, Facebook, some Apple, you know, those have grown to be a pretty considerable part, an outsized part of my portfolio, which in hindsight, exposes me to a lot more individual equity risk. But I believe in these companies even more than I believed in them when I invested, and so it's not something that I share super-openly, but in my book, I actually laid out every single dollar that I made each year and how I invested it each year in one single chart. So, you can see all the stocks that I bought, what I paid for them, and most of those I've held. You know, occasionally I'll get an email from a reader, because that was five years ago, [laughs] and they'll do the calculations on my portfolio and it's really, really funny, because I haven't disclosed my net worth since 2015, and people kind of do those calculations and I get really funny emails about it quite often.

Hill: So, you graduate before the Great Recession, you know what that kind of economic event looks like, you're investing in the stock market. Take me back to late-March 2020, what is going through your mind as an investor as you see the stock market falling off a cliff?

Sabatier: Yeah. So, I actually made a couple of mistakes in March of 2020. First off, my money has continued to grow and compound since reaching financial independence. And then Millennial Money, as I started growing it, started making money as well. Ironically, I didn't start a personal finance blog to make money, but I did realize, as I was growing it, that I could make money off of the website, and so I was investing that money as well. So, my financial position was very strong going into March of 2020.

However, one of the biggest things that I realized or I actually I had known was that I was so overexposed in individual equities. And so, I made the snap judgment call, as the market was declining, to sell about 30% of my Amazon individual stock position, take it out, wait three weeks, to keep that cash, but I thought that investing it in a more diversified way longer-term would be a bigger benefit.

My thinking with the pandemic, which was incorrect, was that we don't know what this thing is, but the last thing we're going to see is more Amazon delivery drivers showing up at your door delivering packages with the pandemic on the cardboard box. You know what I mean, at this time when people thought it might be on surfaces, so that was my misjudgment. So, I sold about 30% of my holdings. Thankfully, I bought into the market at a very, very low level with that. And so, you know, with the gains over the past several months, I've recovered some of what would've been those gains, but it hasn't grown as much as if I would have just held on to that 30% of Amazon.

Hill: Well, Grant, I hate to say it, but you're the only person who made an investing mistake this year. [laughs]

Sabatier: [laughs] I view it as a pretty small one actually, relatively. Because I did actually invest pretty low as well. I had some cash so as things started turning around a bit and the market started going up, you know, I was trying to get in actually more individual equities then I've previously held. So, I invested in Walmart, I invested in Zoom. I've been a Peloton rider for over a year-and-a-half, and so I put money in Peloton, and a few other stocks. So, I'm actually, I have about 16 individual equities that I'm holding now, which is about 10 more than pre-pandemic.

Hill: We got just a minute or two left. What's 2021 holding in store for you?

Sabatier: So, I'm super excited that Millennial Money was acquired by The Motley Fool. I think it couldn't have been a better partnership and acquisition. You know, it was one of those things, as the site grew larger and larger all around the world, so did the moving pieces, and so I had a team of seven and we were all working, you know, 60, 70 hours a week to steward the website and the mission and I realized that to get to the next level I would need to hire 25 more people or find someone to partner with, and so I felt very grateful to partner with The Motley Fool.

And now, we just had one of our calls today, and incredible faces on the call, incredible people involved in this in scaling it, and we've got some amazing things in store for 2021 that are so far beyond my own vision of the site, so I'm excited about working with The Fool team in 2021.

I'm also excited about the market. I think it's going to be the greatest year of returns in the last 50 years. So, I think we're going to come out of this pandemic, people have been sitting on so much cash, you know, savings rate over 30% most months, I think it's going to be a banner year post-vaccine, and we're going to see Q3, Q4 of 2021 just be gangbusters across the board at all cap levels.

And so, I'm excited to be an investor. I'm going to hold. And I'm excited to see some of those gains and start traveling a bit more.

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Hill: If you're looking for information on how to save money, how to find the best credit card or insurance plan, investing strategies, retirement planning, and a lot more, click on over to MillennialMoney.com.

As always, people on the program may have interest in the stocks they talk about, and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear.

That's going to do it for this edition of MarketFoolery. The show is mixed by Dan Boyd, I'm Chris Hill, thanks for listening, we'll see you tomorrow.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.