The Other Ben and FIRE, or One Final Note About Income

Do not wait; the time will never be 'just right.' Start where you stand, and work with whatever tools you may have at your command, and better tools will be found as you go along.

“What’s your FIRE number?” I asked.

“$600k CAD. And yeah, it’s based on my spending when I was in Vancouver. $24k CAD.”

We both knew Unconbentional was wrapping up, so Ben and I were having one last chat on Facebook Messenger. I couldn’t help but feel dwarfed by his success, but I was also happy a peer had made it as far as he did. In his updates, he told me he’d switched companies and was now working in One World Trade. He sent pictures. The view was spectacular.

I think he caught the tone of my recent posts though. I certainly didn’t feel very successful, though I was apparently okay at setting goals and making progress. That was better than nothing, I posited. Ben typed back.

“Mostly I’m just saying, don’t be too hard on yourself or too impressed by me, since I don’t feel like I’m being very disciplined. But also, it shouldn’t be about discipline very much anyway; mostly it’s figuring out what you actually value.”

He sent numbers. His spending was up, but he was saving 55% of his income to reach FI. Moving to NYC for a better job helped him double his monthly savings, but I was surprised to see he was spending more than me after converting USD to CAD. He wasn’t “thrifty”. Meanwhile, I was saving a comparatively paltry $250/month, but I’m not making six figures a year.

“A huge part is earning a lot,” he said. “You have much lower expenses, but like… having a high salary really makes it easier. I think I’m still on track for my goal by 33.”

We said our goodbyes and I signed off. I wouldn’t see him in person again for at least a few months, but it was nice knowing I could always get him in a chat box.

Ben will reach FI at 33. I’ll never retire, but I’ve learned that’s okay. We were on different paths. And yet, for three brief years, we were able to meet in the middle. We had the blog. It made us better friends, and I’ll be forever grateful. To YOU though, thanks for joining us on this ride. Coming up with new ideas to blog about made us better people and more financially savvy. We wouldn’t have done it without you. I hope I’ve helped.

But wait! One final thing needs to be said, and this might be the most important piece of advice yet if you’re pursuing FIRE. Read on, and goodbye.

*****

Income matters a lot. The best thing you can do to guarantee financial success is to earn as much as possible. I know that sounds super obvious, but consider BC’s average hourly wage for 2018 is $26.76. Now, look around. I know Ben, but I also know people working for minimum wage. My liquor store job pays me $14/hour, and I’m only able to make that work with other sources of income. I should aggressively seek a raise or find something better paying! Your wage is your responsibility! In a world where dropshipping or blogging can make enough for a person to thrive, the Internet has given us a level playing field and you should use it! Here’s 50 jobs over $50,000 without a degree. Guess what: Ben doesn’t have a degree either. He learned everything he knew from the Internet.

Think of the Internet as your ever-present personal employer; one that works for you around the clock as an endless source of money as long as you do your part. Use it to look for a better job. Do what I do and find clients for your side hustle. (I sell wedding photography packages up to $4,995/day.) Network with productive, frugal, financially savvy people. Learn how to boost your income!

It’s possible to get there by saving – read this on how to live in Vancouver on $18,451 for 2 – but you’ll always kick more ass as a higher earner. Ben gave me permission to publish his 2018 spending: $44,278.98 USD, and that’s for one person in NYC! The people in the link above, Steph and Cel, can live for 3 years together on Ben’s 2018 spending, and Ben’s still banking 55%! (FYI, a large portion of Ben’s recent spending has been for travel. $7,607, to be exact.)

Go to Google and look up the average salary in your area right now. Now, match it. Exceed it if you want. We’re playing for keeps. If you’re there already, go ahead and push a little further. A lot of us are too comfortable where we are because we’re afraid of change. I’m here to tell you if you’re reading this, you have Internet access and thus, all the tools required to substantially increase your income and savings rate.

If you’re finding it difficult to save, don’t relax. Not yet. I’m following up on wedding leads and asking the right people about furthering my liquor career, and it’s my “day off”.

Don’t get comfortable. Keep climbing. Work harder if it’s healthy for you to do so. Increase your income. You can control how much you save, but Ben lives a big life and banks cash like a champ. Do you want to be him… or never retire like me?

In three years of Ben vs. Ben, there’s been a clear winner.

Thank you for reading Unconbentional.

Advertisements

My Five Streams of Income

Untitled design

According to this, “65% of self-made millionaires had three streams of income” and “29% of self-made millionaires had five or more”. Meanwhile, this article starts breaking down “7 different income streams”, but some of their recommendations are things most of us should be doing anyway, like investing. Other ones are downright odd. Do you consider your spouse’s salary as a stream of your income? I don’t. I don’t think you should either.

For this article, I’m laying out the five streams of income I actually count. If you count my index funds or the fact I’m technically a SOCAN-recognized composer who’s only earned pennies in royalties, I have more. I’m mainly counting my side hustles that actually put money in the bank though. This is how I make my money.

My main gig is I’m a wedding photographer. My smallest package is $990 (two hours) and my largest package is $4,995 (twelve hours). My secondary gig is as a liquor store clerk, making a paltry $13.50/hour. I could choose a more lucrative job, but this is pure fun for me. I could spend all day talking about wine, and I’d actually be less happy making $20/hour doing something I didn’t care about. My third gig is as a landlord. In March, I’ll be looking after two renters/roommates, and you should know this is actually more work than I thought. For now, any rent money I make is going back into renovating the property. Both bathrooms need to be redone, but this is an investment for the future. A beautiful bathroom will enable me to charge more for rent once my friends move on. My fourth gig is I write for pay now, and make $0.15/word on assignments. This is currently super fun for me! I can do this anywhere I want, and if I had an idle gig where I’m just needed as a warm body — think security guard or exam invigilator — I could be earning twice the pay for the same hours! In just one week of November, I was able to bill a startup $225 for three short blog posts. I’m looking at developing this as one of my main sources of income in the next few months. My last gig is a questionable one, but it technically counts as investing. This one deserves its own paragraph.

Early in November, I started dabbling with cryptocurrency. I now own small slices of Bitcoin, Ethereum, Litecoin, and IOTA. In just six weeks of casual trading, I’ve put in $800 and I’m somehow $500 ahead. Before you drop everything and throw your life savings into Bitcoin though, you need to understand the technology and the risks. This is why I consider my cryptocurrency investing a “gig”. I read this and this in the past month, and I stay up-to-date on trends. It’s a job. I don’t advise you getting into cryptocurrency blindly. Everyone thinks they can time the market, and people have lost their life savings believing that. I’m fully aware I could lose my entire investment at any time. If you try this, proceed with extreme caution. I know friends of friends who have lost $10,000. Know the risks. This, as a hobby, is my fifth and final gig.

You’ve heard of “fuck you money” (FU$), but I love the idea of my multiple “fuck you jobs”. Liquor store lays me off? That’s fine. I can replace a whole month of clerk income with a single wedding shoot. Roommates moving out? A little extra writing, and I’ll still make my strata payments on time. When new roommates move in, rent will actually go up because of the shiny bathrooms! If I lose my entire crypto investment? My index funds are still making profit, and I’m sure I can come up with something to make up the loss, like renting out my camera gear. I truly believe YOU CAN ALWAYS MAKE A BUCK. With full-time employment becoming less and less stable, diversifying your streams of income is just as important as diversifying your investments. It’s just the smart thing to do!

Remember: “65% of self-made millionaires had three streams of income”.

How’d you like to be part of that statistic?

Let’s Check Back In With Our Artist Friend, or Why Inflation Sucks

18985132_10154489876787116_92292044_n

Those of you who have been following us for over a year might remember “A”, our mysterious artist friend who made only $700/month, but who also found a way to set herself up for a luxurious retirement in the future. When that article came out, some people were understandably pissed. It “isn’t applicable or attainable for everyone, and is really more based on fortune than hard work”, one reader said. Well, she’s not wrong. Living like we do isn’t attainable for anyone not willing to put in the work to optimize their lifestyle. And “hard work”? Please. Smart work is where it’s at, and being frugal is the result of a lot of that smart work.

“A” is still out there plugging away, and two things have happened since we last spoke with her: 1) She makes more now, and 2) some modest lifestyle inflation has crept in! Let’s take a look at her numbers.

A year later, her art is still her main source of income, but “A” is also knee-deep in side hustles. She now teaches art a few times a week, and professionally walks dogs on the side. Her monthly income is now $1,000. Rent is now $300, up from $200 last year. (She started making more, so felt it was only fair she contributed more to her household.) She eats well, though frugally. Her personal spending budget went up to $75 from last year’s $50. Her vacation fund is currently $100/month, and that all goes into planning future trips. As if that wasn’t enough, she also donates 10% of her income to charity – apparently, you don’t need to be a billionaire to pull a Jim Pattison – and somehow, through ALL THESE ADDED COSTS, she HASN’T tapped her $14,000 emergency fund, and she’s actually ADDED $5,000 to her savings and investments! With roughly $60,000 in the bank and her investments churning away at 7% return, she’s now on track to have $839,000+ by 65!

Now, for some people, this might all seem pretty extreme, but what if I told you a lot of math is actually working against her, and us as well? What if I told you WE SHOULD ALL BE SAVING LIKE THIS IF WE WANT TO RETIRE? Unfortunately, because inflation is a key concern for retirement, we should all be aiming for close to $1M in 30-40 years! (Here’s a post to help you with that.) Assuming an average of 2% inflation per year, “A’s” future $839,000 is worth only $387,000 of today’s buying power when she turns 65 in 2056! Because “A” is somewhat of a genius though, she’s accounted for this. Assuming even that she spends all $12,000 of her annual income to support her current lifestyle, her “$387,000” is enough for 65-year-old her to live on FOREVER as long as it’s invested in something generating just 3.1% interest, which could be a VERY real number for someone investing conservatively in old age! For “A”, the math checks out! For the rest of us, we need to save and be frugal AT LEAST as much as “A” is doing!

At 26, “A” has saved and invested enough that no further contributions are needed to support her lifestyle in old age. She could just blow all her work income until 2056, then sit back and relax. I want this for you too!

If you’re a millennial, you NEED to account for inflation in your retirement plan. Here’s a handy calculator. The reality is becoming a millionaire in our lifetimes is no longer an unattainable dream, but PRACTICALLY A REQUIREMENT to Retire For Good someday! How well prepared are you?

If you need help running your numbers, message us on our Facebook. We’re already helping followers plan for their future, and it’s a lot of fun for us! Seriously, we just want to help.

Is full-on retirement seeming unattainable now? It’s not the end of the world. In our next post, we break down MY plan for the future. I expect it to seriously annoy the naysayers.

You’re Closer To The 1% Than You Think

screen-shot-2016-12-02-at-8-56-20-pm

You know it’s true. The vast majority of you reading this are fortunate as fuck. Before you all jump down my throat, I’m not directing this post at people living below the poverty line. I’m aware people are struggling in Canada and the US. This isn’t about them. I’m directing this at people making an average salary in Canada and still think of “The 1%” as some sort of financial demon keeping them from their goals. What if I told you, on a global scale, you ARE The 1%? Before you read any further, see how you stack up on GlobalRichList.com.

The average Canadian income is about $49,000/year. By salary, this puts the average Canadian in THE WORLD’S WEALTHIEST 0.65%! FYI, it only takes $42,000/year to be in the Top 1%. Why the fuck is everyone complaining? You might be envious of your neighbour pulling in $70,000/year, but don’t act like you’re a victim of a broken system. The truth is You Are Rich. You ARE the broken system. You don’t really want more money. You just want to be richer than your peers.

If we’re measuring Net Worth and not Annual Income, that gets trickier. It takes $770,000 USD to be in the Top 1%. Are we really angry at these people though? These people are just your home-owning neighbours who’ve worked hard to pay off their mortgage. This is Normal Wealth in North America!

When I first put forth the idea of writing this post, people got mad at me. “You’re ignoring people who live in Real Poverty,” they said. “Not everyone is as fortunate as you!” You know what? They’re right! I’m talking out of my ass. Richsplaining, if you will. Here’s what I’m going to do about that.

If YOU are in The 1% on a global scale – that’s everyone who makes over $42,000/year in Canada – go donate 0.1% of your Income to a charity of your choice. This should run you less than $100/year, and I recommend donating to a charity that supports the LEAST wealthy countries of the world. Africa’s not doing so great, for instance. Put some money there. Maybe you’d rather support a local cause that you and your friends can see some benefit from. Fund a community garden or donate actual money to a food bank instead of schlepping off your cans of 8-year-old Chef Boyardee. Just do SOMETHING. Whatever you demanded of “The 1%” before, YOU DO NOW. Us middle-income earners are juuuuust wealthy enough to make the world a better place at minimal loss to our own goals, and we’re juuuuust socially conscious and numerous enough to have some connection to the people we’re helping. Don’t call on “The 1%” to fix the world. They’re already doing that. If you want social change, it starts with YOU.

On a global scale, you’re incredibly wealthy. Start acting like it.

Tell us who you’re donating to in the comments.

Income vs. Outcome

img_1916

Impulse spending used to be a huge problem for me. How else could I explain all the weird crap I own? Why do I have pink Docs? Why did I spend $60 on a “Dreamy Trudeau” sweater? WHY DO I HAVE SIX PLAYSTATIONS?!? I’m slowly learning though. With most of these purchases, I didn’t consider the true Outcome of owning them. By the end of this post, I’ll get you thinking about your Income vs. Outcome too.

I’m lousy with impulse spending because my photography job has largely destroyed any intelligent relationship I had with money. When I landed a photography booking, it’d usually mean at least $2,000 in the bank, so a $400 PS4 wasn’t a big deal. I started a day job again in the past year though, so my relationship with money became healthier. Instead of using my $2,000/day metric for making purchases, I think of my $13.50/hour at the liquor store. (And that’s really more like $12/hour since I bank my raise.) Now, I always consider my Income and the expected Outcome of my purchases. I’ll give you an example. I may be going a little overboard with quantifying unquantifiables, but bear with me.

Let’s take the $60 Trudeau sweater. I think it’s hilarious, but it’s still just an item of clothing. I wore it about 10 times in the past year. Every time I wore it, some stranger would make a remark about it and we’d banter on a bit, have a laugh, and go about our day. The sweater is also kind of a dated joke, so I expect that to happen less as time goes on. In three years, I’ll probably wear it 30 times. Since I’m calculating for $12/hour from the liquor store after banking my raise, the sweater is essentially costing me 5 Working Hours. Is wearing that sweater 30 times in three years worth 5 hours of stocking, mopping, and talking about wine? Well, I actually enjoy my day job, so I say yes. The answer would be vastly different if I hated that job, but the key thing to note is I’m comparing my Income to my purchase’s Outcome, and deciding whether it’s worth it or not. Even though the sweater ranks among my dumber purchases, I still think it was worth it!

What about a night of moderate drinking at the pub? I went out last night and blew $40 for four hours of drinking with friends. That’s about 3.3 Working Hours. Wait, 3.3 Working Hours for 4 Drinking Hours? That doesn’t seem worth it. Besides, I drink enough that alcohol isn’t the hilarious roller coaster it used to be, and it’s really just something to do while socializing. I could take the alcohol away and probably still have just as good a time! The Outcome wasn’t worth the Income I was putting into it! Well… fuck.

I encourage you to do this mental exercise every time you’re about to make an impulse purchase. Gonna buy a $500 Apple Watch? Is it worth how much you have to work for it? That’s for you to decide. Shelling out $60 for a fancy dinner? Is it worth 3 or 4 hours of Income? Is the Outcome – two hours of eating great food – worth it in your mind? Maybe you’re buying a BBQ. $400 of Income becomes an Outcome of countless summer days gathering with friends making perfect steak after perfect steak. Sounds good to me! Try to always consider your Income versus your expected Outcome with every major purchase. It’s the only intelligent way to spend money.

Hopefully, you’ll find yourself spending a lot less.

Optimizing Your Lifestyle for Maximum Cash Flow

13087731_10156949468330691_6406866155608990719_n

You can ALWAYS make an extra buck. Craigslist has no shortage of odd jobs, and I’ve already talked about having a 10-to-2. However, what most people don’t realize is we’re living in a massive pool of abundance and there are more ways to make money than you think. Even now, after weeks of relentless optimizing, I’m still finding ways to cash in.

I make cash on trash all the time. Old iPhones can trade in for $400+ in some stores, and there are always Craigslist postings. I have tons of junk lying around too, and I’m always selling stuff off. For instance, who wants my Rock Band 1, 2 and 3 (PS3), Rock Band 4 (PS4), and all my attachments including guitars, drums and mic? Make me an offer. I want that stuff gone now, and that cash would look damn fine in my mutual funds. This isn’t limited to your obvious stuff either. Are your folks getting rid of unused furniture? Do you have collections of comic books or Magic cards from your childhood? With some light digging, I unearthed my entire “Y: The Last Man” collection signed by Pia Guerra. I wonder how much that’s worth. What used to be important to you probably isn’t that vital now. Get rid of your shit.

My girlfriend and I are also exploring Airbnb. We discovered I have an aunt who’s an absentee homeowner in Surrey. It’s a one-bedroom in a nice neighbourhood. Close to a mall, restaurants nearby, a block from transit. We’re thinking about taking in guests for $60/night. We’ll also have a listing for our place in Richmond. If we get a booking for Richmond, we’ll stay in Surrey. If we get bookings in Surrey AND Richmond, we’ll crash at my mother’s place in New Westminster. Instant hundreds per month. If you can handle living with an extra person as a roommate, it’s even steadier. I live with my girlfriend and a roommate, and they pay rent to me. I literally make money living at home. I have negative rent.

I also hire housecleaners. I know I should just man up and do it myself but every three months, I shell out $120 to get my place hotel-clean. This isn’t a company, but friends of mine who happen to need an extra buck. In a brilliant twist, giving people work means they’re more willing to help you out too! People I’ve hired have given me photography work on multiple occasions. Obviously, you can be the housecleaner too. My friends clean the whole place in three hours. That’s $40/hour. Offer to clean at your friends’ places. Trust me, they’ll always appreciate the help.

Finally, do you have anything you can rent out? I do. I have a strong network of professional photographers who rent equipment from me. Cameras, lights, backdrops, etc. I rent my gear out for less than rental houses do, but still make $100+ for each camera rental. The Canon 1D X I own can go for $275/day at a rental house! I charge $150. It’s a win for everyone.

If I went bonkers and utilized ALL these sources of income, I’d be up $1,000+ every month! Do you have trash you can turn into cash? Do you have an extra room you can turn into a cash cow? Do you like the idea of making $40/hour for something ANYBODY can do? If you’re motivated to make money, you can ALWAYS do it. Stop marathoning “Breaking Bad” for the sixth time, get off your ass, and turn Making Money into a game.

What are YOU missing? Tell us in the comments.