Open

New Year-type resolutions aren’t my thing. If I should be doing something, why not start now?

{This conceit, that I think, measure, ponder and then act is an act of self-delusion. Leave me alone.}

Discovering a few new emphases (note the subtle re-framing) meant the last few days of torpor weren’t wasted.

One point is really clear: life will become a series of enterprises, attempted and failed, with the object of creating ongoing income. Some will require more work than others, some will be disproportionately valuable WRT work input, others the reverse. (Meaning lots of work for less income.)

The one common factor is that everyone I meet is now a potential customer or provider. That sounds brutal, I know. But we’re self-protective animals, and even the most altruistic of relationships have some element of utility.

I’m open to everyone.

Through the Looking Glass

Your job is your most valuable asset. I stole that from Dave Ramsey, but figure that an attribution will make it okay. Your job, as Dave might say, creates the boundaries of your life, not in a spiritual way, but in most practical ways.

For instance, if you spend more than you make, you’ll have to make up the difference with borrowing or sale of assets. Borrowed money removes the control you have over that part of your income you need to pay the interest, thereby reducing the value of your job. Every hour you work then becomes less your own, and more someone else’s. Banks and payday lenders and car dealerships happily encourage you to spend much of your working day working for them.

Your life boundaries get a little tighter with every reduction of your income.

On the other hand, spending less than you make expands your life’s boundaries. Money saved or invested is a down-payment on freedom. Let’s think about a job as being a tactic to get where you want to be in life. The idea is to make the job optional.

This theme is important to me at the moment because I am pretty much obliged to work every weekend for a while. When you’re already working 55 hours a week, the additional eight or ten raise questions, like ‘Is this Sunday night really worth the one-off increase in my pay check? Wouldn’t I be better creating something that pays me when I’m NOT working?’

Of course I would. When you work for an hourly wage or even a yearly salary, you only get ahead to the extent that you can save and invest. It’s a (frightening) example of diminishing returns, because we all have only limited time. This extra hundred bucks needs to be re-earned every weekend, hour-by-hour.

There is be a better way. There is a way to expand my income with every hour spent, not limit the ratio to 1:1.

I plan to walk through that looking glass into a much smarter world.

Money, It’s a Gas

In a perfect world, folks would have a clear idea of their finances. We’d all face up to our money – or lack of it – regularly and dispassionately. But the world is not like that. We’re not like that.

Money creates enormous roadblocks in people’s lives. Too little of it is an obvious problem, but too much can be destructive as well. It’s part of my journey to figure out how to place money in its proper place in our lives, in my life to start, and hopefully others thereafter.

A few thoughts: One, there are way too many people in America who live from payday to payday. Secondly, way too few people have any kind (let’s underline that) any kind of savings. Thirdly, most of these people have no plan to change either of these predicaments. Hope and, well, more hope is their preferred tactic.

This will not work.

On the basis that the way you think is more important than anything, we need to find a new way of thinking about spending, saving, debt, rainy days and the most important element, our incomes. My thinking is to create recurrent income separate from your wages or salary, growing the passive income to eventually supplant whatever you make from your job. That’s what I’m doing.

But you need not follow my plan to the end to make a difference. Creating even a small amount of recurrent income can make a lifetime of difference, and here’s an illustration:

I Tweeted earlier that in the next forty years I’ll spend more than $30,000 dollars on electricity. That figure will be way under, because I simply multiplied my current bill by 480 months. Inflation, increased energy costs and who knows what else will almost certainly make that much, much higher.

Now imagine if you created $65 per month of recurrent income for yourself. You would never have to worry about paying the electricity bill ever again, which would be a relief to many. And the money from your salary that would otherwise go to paying the electricity bill could be used for something else. Saving for emergencies for example, reducing the principal on your mortgage or adding to whatever retirement arrangements you have.

$65 dollars per month, $30,000 dollars overall, and that’s before compounding. Small change, big outcome.

Just a Little More

What just happened.
What just happened.

How is your year going so far? June, here we are, beginning week twenty-three of 2014. The summer solstice is in three weeks. Independence Day here in the US in a month. My yearly dental check-up is in eight weeks. Slowing time isn’t an option, so onwards we march.

Time has my attention of late because there seems to little of it. I suffer the usual human dilemma, which is that life happens while we’re planning other things. Planning is in my blood, and, I’m guessing, in yours too. We tend to overlook the immediate while contemplating the future. Being in the moment doesn’t come naturally. Keeping still and observant requires lots of energy and perseverance. Ironic, eh?

I am wrong about there being a lack of time. There’s infinite time, at least for our purposes. Time does have a direction, however, which makes life like those sushi restaurants in Tokyo with the conveyor belt that runs endlessly right in front of you. Spot some gorgeous fatty tuna and you’d better grab it while you can.

A little more available time would mean doing more of the stuff I have planned. My plans currently revolve around creating ways of making income disproportionate to the amount of time spent. In my own case, I spend eleven hours a night at my job. It’s a linear relationship between hours and dollars. The smarter way to occupy one’s day is to create multiples of dollars for each hour worked…ideally, multiples of recurrent dollars. Let’s call it an asymmetrical paycheck.

This makes the whole idea circular – I need more hours to work at creating more hours.

Simplicity tells me that the way to make this happen is to eat the elephant one bite at a time. (Awful metaphor. I certainly don’t advocate eating elephants. They’re too tough. Kidding.)

One hour at a time. Small efforts, consistently. One customer at a time. Conscious leverage.