When most people talk about finance and reaching financial freedom, they usually don’t talk about 1% returns. In fact, in purely financial terms, 1% returns are pretty bad. But I think this is because we all tend to focus only on financial returns in the pure, numerical sense.

Becoming wealthy is not about the big, eye-catching returns. It’s actually about the small 1% returns that nobody will ever notice.

My story is a story of 1% returns. I’ve very openly shared how I used to have a net worth of >$-500,000. Today, while I am not at financial freedom, my financial well-being both objectively and subjectively are much, much improved compared to the beginning. This is not the result of a miraculous stroke of luck or magic breakthrough moment. Rather, it’s the result of 1% returns put in every day. 

Below, I share five undeniable ways that 1% returns will make you wealthy in the long run — all employed by yours truly.

1) Increase your financial knowledge by 1% each day

As doctors, personal finance can seem overly complex. But this is just because we lack education. So, the first step is to educate ourselves. Our time is limited so this seems overwhelming. But the good news is that you don’t need to be a financial expert by tomorrow. In fact, there’s no time limit at all. So, create a plan of 1% gains in knowledge.

Here are the two best ways to do this:

• Pick a personal finance book. My recommendations for the best ones to start with are The Millionaire Next Door and The Psychology of Money. Read 1% of the book each night before bed. I’d say the average personal finance book is about 200 pages. So, read two pages a night. That’ll easily allow you to read one personal finance book each year.
• Pick a personal finance blog. Read one post each day. That’s it. It should take five minutes. 

2) Increase your savings rate by 1%

You may know the general rule of thumb recommendation to save 20% of your gross (pre-tax) income for retirement. 

For someone just learning about this “rule,” the idea of creating a savings rate of 20% can seem downright daunting. Especially when your current savings rate is 0% or negative, like mine was when I started.

But no one says you have to go from 0% to 20% in one month. Challenge yourself to save 1% of your income the first month you run your budget. Then try to increase your savings rate by 1% each subsequent month. I’m willing to bet that you barely notice these 1% increments. And before you know it, you will have a healthy savings rate of 20% or more to put toward your financial freedom.

3) Invest 1% of your savings

Sometimes I speak with physicians whose issue is that they have trouble creating a savings rate. That is the major limit on their planning for financial freedom. For them, the above advice is most apt.

However, sometimes I speak with doctors who are amazing savers. Some are even better than me. But when I ask how they invest their money, they tell me that it is all in a savings account or money market fund. Often, they tell me they are scared to invest because it seems risky and they’re waiting for “the right time.”

Unfortunately, both of these issues are equally dangerous.

So, for the latter group, my recommendation is to invest 1% of your savings rate into the market every day. Of course, you can increase the amount to 10% every week or something like that if you wish.

The strategy here is exposure and habituation. You are scared to invest because it feels risky. But in fact, not investing is the riskiest thing you are doing for your future. So, learn about index fund investing and creating your asset allocation. Then, invest 1% of your funds into the market according to that allocation using low cost, broadly diversified index funds. It will seem dangerous the first few times. But ultimately, you will see that your world does not implode, that the overall long-term trend of the stock market is up, and that investing is not that intimidating.

4) Create 1% of your clinical income in side gigs

Side gigs tend to seem like things that “other” physicians do. They seem foreign and scary. Plus, you wonder, “What makes me so special that I can create a side gig or that someone cares about my opinion?” The answer to those questions are the same: Who cares! Go for it!

Establishing a side gig has a number of powerful effects on physicians:

• Builds another stream of income so you are not solely dependent on your clinical income
• Evokes a sense of empowerment as you experience success in a new field
• Widens your network of contacts within the health care world
• Creates new opportunities for more side gigs that you may never have imagined

I can say all of this because I experienced all of these emotions before starting a side gig. I also experienced all of these benefits after starting!

So, I challenge you to build a side gig(s) that earns at least 1% of your clinical income. 

For the average physician making $200,000, this would amount to making $2,000 in your first year. This is hardly a life-changing amount. But remember, 1% returns often seem this way at the beginning. Keep building and who knows, your side gigs may eventually exceed your clinical income. You can find a comprehensive list of feasible, worthwhile physician side gigs here.

5) Use the 1% margins of your day

This is just an overall great productivity rule that I follow. We all have small slices of the day that are a waste. I’m not talking about the hour that you relax and catch up with your partner before bed. Or the time spent for self-care or playing with any kids. That’s not a waste. That’s important.

I’m talking about the 30 minutes here that you zone out on your phone. Or the 15 minutes there that you spend deciding whether to watch TV or do some work but end up doing neither.

In all, maybe this adds up to 1% of your whole day. I say you need to start using that 1%!

There are a couple different ways to take this. First, you can use this time to do the first thing on this list. That is, improve your financial education. You can easily read a blog post or two pages in a book during this 1%.

But I prefer to think of this in terms of investing. I want my money to be working for me all the time. Even during this 1% of the day that I may be wasting. Then it doesn’t feel like such a waste.

Investments create passive income. Income is money you make while you sleep. Or while you’re working your day job. That’s the point. You make it 24/7.

My main investment vehicles are index funds according to my set asset allocation and direct real estate investment in cash-flowing rental properties.

For instance, our rental properties pay us via cash flow, equity pay down, tax benefits, and more every second of every day.

In sum, tell me your financial 1% habits and I can tell you if you will reach financial freedom. It’s that simple. But it’s obviously not easy or else everyone would do it.

The main issue is the iceberg effect. As mentioned above, we see a financially free physician and think they had a magic breakthrough, got lucky, or came from wealth. And while occasionally that may be true, it’s much more likely that we are just not seeing the 1% returns that built their financial mountain.

So, focus on your 1% returns and the financial freedom will take care of itself!

How have you worked to increase your net worth? Share your strategies in the comments below!

Jordan is a graduating fellow in plastic surgery at NYU.

Illustration by Jennifer Bogartz