Many years ago, one of mentors told me a story about his divorce. Don’t worry, this isn’t the typical “ugly” divorce story and the story does have a happy ending. As you’ll see, this is actually an investing lesson wrapped.

This particular mentor was a multi-millionaire. He didn’t have an easy life and actually had to file bankruptcy on two different occasions throughout his journey. He never quit and continued learning from his mistakes. He ultimately accumulated a significant net worth and a very large annual income.

One of the biggest lessons I learned from this mentor was on my first trip to his home. I had imagined a very large expensive home with the finest furnishings. I imagined he would have several fancy cars in his driveway. I also imagined he would have a full time house keeper cleaning and cooking for him.

I was shocked when I pulled into his driveway.

His home wasn’t large by any means. An easy estimate of value put the home at $220,000. There were no fancy cars in the garage or driveway. In fact, he drove an older SUV. And as you might probably guess, he didn’t have a part-time, or a full-time house keeper. You would never know he was a multimillionaire.

He never explained why he chose to live so conservatively considering his income and wealth, but it was easy to see the lessons he learned during his two bankruptcies led him to a very conservative lifestyle. I do know that he didn’t have a mortgage on his home and was completely debt-free. He would never ever have to visit the steps of bankruptcy court again.

At some point in our time together, he shared a story about his divorce.

Apparently his wife became frustrated with all of the hours he worked each week. He had several different businesses and business commitments. These commitments required 70 plus hour work weeks. He loved his work and wouldn’t cut back his work load despite her unhappiness.

His wife ended up filing for divorce and when he received the divorce papers, his immediate thought was…

“Who is going pay for this?”

Hint: This is the lesson.

He was well aware of how expensive his divorce would be and he immediately started to think about having someone else pay for this expensive legal process. Within a week or two, he had put together a very big promotion for one of his businesses. His plan was to use this promotion to generate the money needed to cover the cost of his divorce.

This is definitely not how the average person thinks.

The average person would pay for the cost of the divorce out of their own savings and income. The average person’s divorce would become one of the most expensive situations they would go through because it would derail their wealth building and retirement savings.

My mentor saw this instantly and was determined not to let the divorce bring the same financial setback.

This story taught me a very valuable lesson. The lesson is to structure your life to have other people pay your expenses. If you want to buy something or have a large unexpected expense, stop and figure out a way to have someone else pay for this on your behalf.

Within the next year or so, my oldest daughter will be choosing a college. We are currently shopping for a rental property for her. This rental property will be used to pay for her college. This means the family living in her rental property will actually be paying for her college.

My retirement savings account is funded each month by rental income from various properties. This means the families living in these homes are actually buying shares of stocks and index funds for me each and every month. I don’t have to save a penny for my retirement, because they are doing the saving for me.

My mentor’s divorce story became one of the biggest financial lessons of my life and I’m hoping it might be helpful for you, too. What are your expenses? How can you structure things so that other people pay for these expenses?

You do not have to be the one to pay for everything you want in life. Stop paying for things directly out of your pocket. Instead buy assets and use the income from the assets to pay for the things you want.

Now for the happy ending…

After my mentor went through this divorce, he realized his ex-wife was correct. He had been working too much. He decided to reduce his work hours, and believe it or not, ended up repairing his relationship with his ex-wife and ended up getting remarried! Really!

Even better, he still had all of his wealth because he didn’t use his money to pay for the divorce!