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  • Writer's pictureMark Walmsley

Set For Life by Scott Trench Summary

Updated: Mar 8, 2021

Set For Life Book

Set for Life provides a three stage process to help folks in their 20s achieve financial freedom before they turn 40. Learn how to save 50% of your income, 2x or 3x your income in 3-5 years, track your financial progress, and build frugal and efficient habits to make the most of your lifestyle. Key insights:

  1. Stage 1 – Achieve $25,000 in wealth through frugality

  2. Stage 2 – Moving from $25,000 to $100,000 through smart housing choices and income generation

  3. Stage 3 – Moving from $100,000 to financial freedom through investing

  4. Pursue a career that is in demand, pays well, and you have talent for

  5. Commit to self-education forever (perhaps 1 non-fiction book per month)

  6. Focus on continual improvement in your daily habits and financial position

  7. Make trivial decisions quickly, and save your brain power for important things

  8. Give yourself the chance to be lucky by sharing your dreams and projects

  9. Don’t try pick individual stocks, the competition is too good. Invest in index funds

  10. Cut out your expensive habits – make your lunch and don’t buy daily coffees

Book details

Full title: Set For Life: Dominate Life, Money, and The American Dream, by Scott Trench

Length: 194 pages, or 8 hours and 24 mins on Audible

Buy the book (USA): Amazon (book, Kindle, Audible)

Buy the book (AUS): Amazon (book, Kindle, Audible)

Introduction to Set for Life Summary

Trench’s clever three stage framework reflects the entirely different strategies need to move from broke to being financially independent. The three stages are:

  1. Achieve $25,000 in wealth through frugality

  2. Move from $25,000 to $100,000 through smart housing choices and rapid income growth

  3. Move from $100,000 to financial freedom through investing

The overall strategy to achieve this is to:

  • Accumulate real assets that produce income and increase in value (these could be property, shares, or businesses).

  • Invest your capital/real assets as efficiently as possible to maximize income and/or growth.

  • Design a lifestyle that costs as little as practical, such that passive income from your income-generating assets can pay for it.

The following three key insights summarize his approach.

Key insight 1: Stage 1 – Achieve $25,000 in wealth through frugality

The Plan. Trench’s stage 1 plan is for you to learn to live frugally; and with the savings pay down all your debts, and then save $25,000. This $25K is around one years living expenses (if living frugally), or what he calls your financial runway – the time you can live of savings without working. From Trench:

“For most folks with nine-to-five jobs that pay median wages, the pursuit of early financial freedom depends on the ability to preserve earned income. The hard truth is that the first step in the process to escape the rat race is – and always has been – to begin preserving capital. Frugaility. Savings. Penny pinching. Living on less.”

Why is being frugal so important to wealth creation? Firstly, it allows you to pursue opportunity. Suppose you have a job offer that pays a little less, but has much better growth prospects. If your current lifestyle requires all your income you literally can’t afford to take the job. Second, tax systems favor the saver over the spender. If you earn $3 and pay 33% tax, then you only have $2 left. But if you save $3, it is equivalent to having earned $4.50 to start with.

The psychology of frugality. Trench also talks about the psychology of frugality as it relates to achieving financial freedom. He contrasts someone that is happy to work and spend for 40 years and live a comfortable life; with someone willing to be forgo niceties now, to retire at 20 years early at say age 40. A deep emotional commitment to achieving early financial freedom is key. From Trench:

“This directly applies to disciplined spending. Just because tickets to the big game or a great concert are on sale, even at a great price, doesn’t mean you should pounce on them. Instead, ask yourself the following question: Is that event/trip/item so important that I’m willing to delay my financial freedom in order to purchase it?”

If you don’t answer regularly answer ‘no’ to the spending question above, then you probably aren’t on track for early financial freedom.

Saving by knowing how we spend. Before we get frugal we’d need to know where our money is going. Trench provides a breakdown of average US spending as shown below:


What should be obvious is that if you want to preserve your income (aka save money), then you need to start by saving on the big spend items. These are housing, transportation, food, insurance/pensions, healthcare and entertainment. Trench notes that you can save a lot here as shown in the table below.


Consider housing which is currently 33% of the average American’s budget. By renting a small place, with a few flat-mates, you might be able to reduce this cost by 40%. You can see other strategies and amounts in the table above. Taken together you could reduce your total outgoings by 25%. Which on a salary of $50,000 equates to $12,500 per year.

Saving by DIY. Trench’s next tip is to do it yourself. Don’t get mechanics to change your oil, plumbers to fix simple leaks, accountants to file your taxes, or financial advisers to handle your money. Learn how to do these things yourself. Recall from above that $1 saved is $1.33 earned.

Three progress steps in stage 1. Okay, now for the key steps in stage one. You’re going to do this by being frugal as discussed above.

  1. Build an emergency fund of $1,000 to $2,000

  2. Pay off all your bad debts (credit cards, fines, high interest consumer debt, payday loans)

  3. Save $25,000 in accessible capital (savings in a bank)

Having the $25,000 you are now able to buy a first property, pursue a new job opportunity, or start a new business with enough income to last you 12 months. Final words from Trench:

“You need to cut out anything that does not bring you happiness from your spending – including much of what middle class America purchases. You need to take pride in living frugally, in handling your own problems, and in making choices that save you tens of thousands of dollars each year and result in a healthier, happier, wealthier, and more exciting life.”

Key insight 2: Stage 2 – Moving from $25,000 to $100,000 through housing and income generation

House-hacking. Trench spends a lot of time in this part of the book looking at how to optimize one’s need for housing to fast track wealth creation. He describes three housing methods and their annual net cost which are summarized below (note a duplex is a two-family single building residence):

  1. Renting a unit

  2. Buying a house

  3. Buying a duplex, renting out the other half

Trench’s analysis indicates that buying the duplex and renting out the other half is best option by far. The rent received lowers the mortgage payments, and by owning the property you still benefit from house price appreciation.

Set for Life doesn’t cover other options like buying a unit and renting out spare rooms – a viable option when you are young. As with option 3 above, the rent received contributes to the mortgage payment. Nevertheless the key takeaway here is to get creative in trying to turn your need for housing into either a smaller expense, or the beginnings of your wealth creation portfolio.

Making more money. Trench states that if you’re in a conventional salaried position associated with Government, health, education, or the military then your abilities to rapidly progress through the ranks to higher paid roles are limited. For folks in this category, the key to wealth creation is living frugally, investing your wealth wisely, and working building your income as fast as possible.

Trench’s main focus in this chapter is the young and ambitious, who may not like their job, but is seeking to work toward upper-middle class income levels. Trench describes his own situation as case-in-point. He joined a Fortune 500 company out of college and took less than 6 months to decide he didn’t like the work, and there was little chance or rapid salary growth.

“So, what did I do? I quit my $50,000 per year job to pursue my dream of financial freedom and real estate investing. I joined a tiny startup with just two employees and joined the tech industry, using my financial background as an entry point. I took a pay cut at the time, so that I could have exposure to opportunity. As a result of this change, and a ton of hard work, I was able to triple my salary in just two years.”

Even after completing Step 1 – saving $25,000 above this is a risky decision. And not one that is for everybody. Nevertheless Trench is basically saying you’ll need to change your job if you want to significantly accelerate income growth. You just don’t have time to wait for promotions in most normal industries.

Three steps to more income. Trench proposes three general steps to rapidly increasing income as described below:

  1. Develop highly sought after skills. Look for skills like software developer or technical trades that offer pathways to higher income without requiring years of college and expensive tuition debts.

  2. Take control of future income. If you don’t have high and increasing income after step 1, consider switching to performance-based pay – commissions for example. But be prepared to work harder and smarter than your peers. Whilst the upside can be unlimited, the downside can be brutal. Know thyself and only take this step if you think you can achieve it.

  3. Find synergies between work/lifestyle/investments. If you’re handy with tools, consider living and fixing houses. If you’re in real estate, then grow and manage a property portfolio. If you’re web-savvy and have a passion, perhaps try monetizing a blog or Youtube channel is the go.

Whatever you consider in step 3 above, ensure there is effective overlap between work/lifestyle/investment. If you’re an accountant with a passion for vintage Ford Mustang’s, then trying to start an online store selling hip-hop apparel doesn’t sound very wise.

At the end of Stage 2 you should be saving thousands of dollars per month on the back of your high income job and frugal lifestyle. Once you are through $100,000 in wealth you are ready for the next stage.

Key insight 3: Stage 3 – Moving from $100,000 to financial freedom through investing

The formula. The formula for financial freedom is pretty simple.

Assets x Return > Lifestyle

If you need $50,000 per year to live, and your investing in equity index funds paying dividends of 4%, then you need a starting equity position of $1,250,000. Such that:

$1,250,000 x 0.04 > $50,000/year

If you are investing in real estate and can achieve 6% returns, then you only need $833,333 in property assets such that:

$833,333 x 0.06 > $50,000/year

As you get older, and assuming you don’t plan to leave all your wealth to your kids, you can plan on a safe withdrawal rate of around 1-2% of your capital each year.

Track your financial progress. Trench discusses some simple ways to track your progress towards financial freedom through a few key metrics. These are net worth, spending, and income. Tracking spending and income is pretty simple. To track spending you can link your bank accounts to tracking software and get a variety of reports. Tracking income is even easier – look at your pay slip, or bank statements if you have multiple sources of income. Track these things each year to measure progress. Net worth is different.

Simple net worth. The simple way to calculate net worth is simply your assets minus debts. Let’s consider an example for a young couple.


With assets of $310,000 and debts of $255,000, the couple has net assets of $55,000. And that sounds pretty good. However, …

Real net worth. Trench observes that the goal isn’t to build net wealth, the goal is to retire early. And to achieve that outcome you need income producing assets, not just any assets. So let’s again consider the young couple.


Compared this way, this young couple has real net worth of -$225,000. Yes, that’s a minus. So this couple is a long way from achieving financial freedom. The key insight here is to remember the maxim that an asset is something that puts money in your pocket, a liability is something that takes money out.

So this implies having minimal/no debt, modest cars and housing, and prioritizing wealth accumulation in income producing assets like shares, bonds, or property owned to rent out.

Other insights from Set For Life

4. Passion versus Pay. Follow your dreams only if they pay well and you’re prepared to do the work to progress up the ranks. Otherwise, find a career that is in demand with income growth potential. History majors aren’t going to earn as much as software engineers.

5. Read and self-educate forever. This little gem from Trench is totally aligned with Eruditeable. The point is simple. If you want accelerate your path to financial freedom, you need to accelerate the accumulation of knowledge that leads to it. So whether it being a better manager (there are books for that), better salesman (books for that), better productivity (…), better investor (…), better at personal finance (…), and so on. Make it a plan to read a non-fiction book every month from now until, well, forever.

6. Focus on continual improvement. From Trench, “In this book, we seek early financial freedom and a large income that will speed up that objective. To increase you income you will have to improve. And you will have to improve rapidly and continuously. You’ll have to read, learn, network, and experiment. You’ll need to find new ways to automate your job and take on more responsibility as fast as you can. That’s reality. That’s what you need to accept.”

7. Make trivial decisions quickly. This approach to life frees up time for other more important things – whether in your personal or professional life. The corollary to this is to make important decisions very carefully; especially if they are irreversible.

8. Give yourself the chance to get lucky. If you are working a complementary side-gig, be prepared to talk about it often. Tell acquaintances at the gym, folks you meet on your public transport commute, or when walking in the park. You never know who or what other people know. You might find you big break in the strangest places.

9. Invest in index funds. If investing in the stock market don’t attempt to buy individual stocks or time the market. It is a zero-sum game played against full-time professional competitors who are much better resourced than you. Instead buy the market via a low-cost index funds.

10. Cut expensive habits. Do you really need to subscribe to Spotify, Netflix, Amazon Prime, AppleTV, HBO, and Disney+? Or do you need season tickets to your NBA/NFL team? Or to eat out at a restaurant/takeaway several times a week and regularly buy your lunch at work? Or daily coffees from Starbucks? When you socialize do you need to buy alcohol from the venue at hugely inflated prices? The point is that there are lots of expensive habits that can be easily rationalized and reduced.

Why you should read this book if you’re under 30

If you start young and are committed, achieving financial freedom before 40 is a realistic option.

If you don’t really care, then you might still be working a 40 hour week into your 60s. That’s a huge difference.

Set for Life maps out a three stages of wealth accumulation. From $0 to $25K, then from $25K to $100K, then from $100K to financial freedom. The optimum strategy for differs for each phase, and Set for Life does an excellent job of providing useful strategies and steps.

Relationship to other Eruditeable books

#1 – The Algebra of Happiness. This book notes that wealth = equity, or in this case financial security. Set For Life is the practical guide for Australians’ to gain financial equity, and thus have wealth in their lives.

#3 – Atomic Habits. This book provides guidance on how to turn money saving ideas into permanent good habits.

#4 – The Defining Decade. This book highlights the importance of not wasting your 20s and getting started early with your personal and professional life. In so doing it reinforces the key messages in Set for Life.

#6 – The Magic of Thinking Big. This book encourages you to think big in relation to your goals and dreams and realize that almost anything is possible.

#10 – 50 Economics Ideas You Really Need to Know. This book will help you understand how our modern capitalist economy functions. Understanding opportunity cost, incentive structures (financial planners for example), and more will give life to some of the concepts in Set For Life.

#17 – Crucial Conversations. This book will help you navigate difficult conversations with partners, financial advisors, your bank manager, or even your kids when you say no.

#19 – Gifts Differing. This book will help you understand folks different approaches to finances in their daily lives. Some will want the summary only, others will want to review every bank statement in detail. And others will want to spend on feel good items (holidays, experiences) and others to save to invest. This book will help you understand and celebrate these differences.

#22 – Never Split the Difference. This book will show you how to get the mortgage rate you want, the price on your used car, and many more things.

#24 – The Seven Principles for Making Marriage Work. This book will help you approach your relationship generally, and financial discussions specifically, in a manner that enhances your marriage/partnership. That’s a good thing, as financial stress is a leading cause of relationship breakup.

Book resources

About the author

Scott Trench is a perpetual student of personal finance, real estate investing, sales, business, and personal management.

He is also a real estate investor, an executive at a large online corporation, salesman, real estate broker, and author. Through a solid understanding of money management, calculated risks, and a lot of hard work, he has created financial freedom for himself as well as a successful real estate business in just three years after graduating college. He hopes to now share the knowledge he has acquired so that others will have the tools they need to repeat his results in just 3-5 years, giving them the option to go anywhere they want in the world, work any job, start any business, or finish out the journey to financial independence and retire young.

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