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

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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.

Career Burnout and What To Do About It (Pt. 1)

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This article took weeks to write, and is coming to you in parts. In researching for it and wading through hundreds of reader messages, I was forced to reexamine certain assumptions I’d made about career choices and burnout. I learned lots. For the sake of keeping this post concise, I’m making “burnout” a catch-all spectrum ranging from “losing passion in a job” to “being unable to do a job because of exhaustion”. In all cases though, burnout WILL most likely happen to you, so here’s how to manage it. That’s what this post is ultimately about.

I heard from a wide variety of people on burnout. Some were entrepreneurs like me, who’d found their dream job only to realize it wasn’t all sunshine and ponies. Others went down the more practical route and chose a well-paying job over their dream job, only to regret it. Others chose very lucrative day jobs that ended up taking a major toll on their health. One respondent almost died when job stress drove his blood pressure to 240/120, and stories like that were COMMON! As we go on, I’ll be peppering my insights with reader messages. Enjoy.

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“I used to be an engineer and now I’m a train driver and hate it”, “M” wrote. “it has ended up where I have to work very anti social hours which I hate. I’m at work on Friday night until 1 am Saturday morning which is my day off. Then straight back to work at 5 am Sunday. Also I have to deal with a lot of very horrible people. Just yesterday someone literally took a shit on the train. Have to deal with drunks, fighting and I’ve even had an attempted suicide. Also I find my work very boring and unrewarding.”

I asked him how much he made.

“Minimum wage for someone over 21 in this country is £7.50 per hour before tax which is 20% at the moment”, he said. “I trained for many years as an engineer. I worked for various companies where I enjoyed the work but couldn’t find somewhere that paid enough. I was earning about £20k. I now earn £34.5k”.

Ah, fuck. Another case of The Golden Handcuffs. FYI, £20,000 is $33,000 in Canadian dollars and £34,500 is $57,000. Now, you MIGHT anticipate my response being my usual condescending arrogance, but given what I’ve learned, I’m actually NOT recommending “just live frugal and go back to engineering”. Granted, $33,000 is TOTALLY LIVABLE, but here’s the catch: I’ve now heard from people who burned out at their dream jobs too. What’s stopping that from happening to “M” if he goes back to engineering, and for less pay too?

I recommend building up some “Fuck You Money” first to afford extra flexibility. “M” is burned out now and maybe other jobs to recharge are necessary, but he needs a cash cushion to fall back on. One reader wrote in, feeling as though her job cost her her personal life, and she now longs for “a simple coffee shop job”. Fuck, do that! You know how millennials are now notorious for job-hopping? IT’S BECAUSE WE(‘RE LUCKY ENOUGH TO) SEEK SELF-ACTUALIZATION AS OUR FIRST PRIORITY. I say work where you’re at while the money’s good, save all you can, and when you have enough to fuck off and change gears ENTIRELY for a few years, do it. Life wasn’t meant to be lived doing the same thing every day for 40 years. The most interesting people I know have had 5+ jobs. No matter where you work, you’ll inevitably run into some form of burnout given enough time. When you can’t take it anymore, get out and do something new. It doesn’t even have to be a total departure from your job. Maybe scale down your hours and work on that 10-to-2 on the side.

My life story has already involved MANY career changes, and I’m only 28. I burned out when I worked in the film industry, and at one point, that was my dream job! I’d wanted to work on movies since I got my first job at a video store, and there was literally a point in time when I could walk down the aisles and go, “worked on that, worked on that, worked on that”. It was pretty goddamn cool. I rose up in the ranks, from starting as an indie film PA to working on NBC’s lighting team during the 2010 Olympics. I even became an IATSE 891 permittee. And yet, the long hours made that job unsustainable. I left a job that paid $400+ a day, five days a week, in order to work less than 30 days a year as a photographer, DRASTICALLY cutting my income. Why? I had the Fuck You Money to do it. Build up your FYM. Think of it as your Freedom Fund. It’s your freedom to work wherever, for whatever, whenever!

Now, here’s the scary thing: I -know- I’m gonna burn out with photography someday. I already kinda have, since I say no all the time now. Yet, I’m not worried. One reader mentioned that burnout doesn’t have to be permanent. You can take a few years off to do something different and go back to a career, whether you love it or not. Now, that’s an important point. Our career lives now are different than career lives in the past. Millennials have so many options now, it’d be silly if we didn’t at least explore SOME of them. My point? Here’s your TLDR:

Build up Fuck You Money. Use it to explore job opportunities you think you’d enjoy. Burnout isn’t permanent, and you can jump back into an old career anytime you want. Don’t be scared of change, and beware of golden handcuffs.

In the meantime, I’m preparing for the very real possibility I may hate photography someday, even though I love, love, LOVE it now. Crafting a Plan B as we speak.

More insights coming your way in Part 2.

Do The Thing You Hate Most

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Six years ago, I was a little shit. I know I’m still impetuous and entitled now, but you should’ve seen me when I was 22. I was no-fucks-given personified.

My photography business was doing well. I was already shooting for thousands on good days, hundreds on bad days, and I was working part-time on film sets. I knew I had a solid skill set, and I never saw myself settling down for a Normal Job. My rule back then was “I don’t get out of bed for less than $200”. That’s not my motto anymore, but it summed up how I felt at the time. I thought I was too good for regular employment, whatever that was. I was THAT millennial.

Things changed in 2010. I realized my income, as decent as it was, couldn’t keep up with my uncontrollable spending. NBC had just let me go after the Olympics wrapped up, and I found myself without a day job and paying real bills for the first time. I applied at a liquor store because I liked fancy wine, and they hired me. Suddenly, the entitled millennial found himself working for $10/hour when he was used to billing $2,000/day, and to top it all off, it was Real Work. Mopping, taking out the garbage, cleaning windows, stocking shelves, unloading orders… all that shit. I hated it.

Mopping 8,600 square feet every day was what I hated most. I couldn’t see the point in it. Why not mop every SECOND day? Maybe every third day? No one’s actively shitting on the floor, so why did it need to be pristine? I still did it though. Not with enthusiasm, mind you, but I did it. I’m glad I did too. In retrospect, it wasn’t a big deal at all, but it’s paid off in unexpected ways.

After I retired for two years, I wanted to get back into casual liquor store shifts. I missed talking about wine, and I also needed to actually go outside once in a while. I remembered the mopping, and dreaded it. So goddamn stupid, right? I hated mopping. Then, the big day arrived: I had to fucking mop.

I dragged my sorry ass to the back and got the bucket. I poured in the Mr. Clean and whispered obscenities as I did it. I wheeled everything out to the front, and slapped the mop down. I was gonna get this motherfucker clean, but I wasn’t gonna like it. It’d take forever, I thought.

I was done in 15 minutes.

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I’m telling you this story not because I became some sort of Mop Wizard™, but because I truly believe attitude is everything. Simply acclimating yourself to an unpleasant situation somehow makes future unpleasant situations less shitty. My current store is about 3,500 square feet, HALF the area as my old store, and mopping it is a breeze! For one, I’m used to mopping now, and two, it’s 50% less work! Because I was used to how bad something COULD be, an average unpleasant task was now nothing! Experience at something makes future situations easier!

This applies to basically everything. Hate cleaning your apartment? Do it all the fucking time, and cleaning the house you buy 15 years from now will be easier because of it. Hate budgeting? The more you do it, the more likely it is you stop overspending because you’re so aware of it, you don’t want to put in the extra work to add it all up. Pretty much always, the stuff you HATE doing is stuff that NEEDS to be done. This goes back to personal development too. Just the fact you’re doing SOMETHING often means you’re making progress, and progress is happiness!

Whatever you hate doing is what you need to make the most progress on. Willingly allow yourself some difficulty in life. The more difficulty you let in now, the easier the rest of your life becomes. For all you nerds out there, think of life as an RPG. Experience is key.

If you’ll excuse me, I’ve got 3,500 square feet to mop. See you all in 15 minutes.

On Millennials and Maslow

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Let’s just get this out of the way – I’m a lazy, entitled #millennial, and I’m everything wrong with this generation. Here’s why that’s not so bad. For this story, we’re going back a month to when I stumbled across this article on Maslow’s hierarchy of needs. I hadn’t thought about Maslow since Psychology 11, but remembering what I learned had me thinking for weeks: What do we millennials value, and why do we seem so entitled? WHY DO PEOPLE HATE US?!?

Well, I figured it out. Hold on to your butts.

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We, as millennials, need to work either smarter or harder than the previous generation, and the reason why comes from how we look at Maslow’s hierarchy. In his iconic pyramid, he illustrates five basic categories of human needs – physiological needs, like food and rest; safety, as in security of employment or property; love, as in human relationships; esteem, like feeling respected; and finally, self-actualization, like doing whatever the fuck you feel like because it makes you happy. It’s important to understand the visual because each category supports the next one. You can’t get self-actualization if you don’t have security, for instance. Actually, you know what? That last sentence was just plain fucking wrong, and it hurt me to type that. Millennials HACKED Maslow, and here’s how.

If you’re in your 20s, when was the actual last time you felt “secure”? You’ve known for years that everything teetered on the brink of disaster, ready to all crash down the moment your workplace decides to restructure or your landlord decides to renovict. Security is a thing of the past, and we all know it. What once were basic securities, like owning a house, is literally impossible now for most of us. We do not have Security.

You know what we DO have though? Adaptability. Our parents were mostly content to dedicate their entire lives to a steady paycheck and pension, but we know WE CAN DO ANYTHING. It’s not like Burger King is paying us a living wage anyway, so we go out there and do what makes us happy for peanuts. WE’RE ACHIEVING SELF-ACTUALIZATION TO EARN THE SAME AMOUNT OF MONEY. That’s what most people don’t get! AND we’re increasing our potential to earn instead of locking ourselves down as a wage slave! This is literally the smartest thing we can do!

Look at the pyramid again. Under Love, we have things like family and relationships. Most of us are delaying starting a family for a variety of reasons. Pessimists say it’s because we have no money, but I, as an optimist, would like to point out most of us just have different goals. I don’t want kids because my life is awesome already! Right at this moment, it’s within my means to just fly to Mexico for a week and not hurt my employment or relationships! Why would I change that AND THROW ANOTHER HUMAN BEING INTO THE MIX so I can feel fulfilled?

Our parents started building the pyramid the way it was supposed to be built in 1943: security first, happiness later. At the time, Maslow’s hierarchy resonated with millions. I’m here to tell you it’s fucking 2016 and Maslow is out of date. Pursue self-actualization now, and figure out a way to make it pay. C’mon, you’re resourceful and have Internet access! You can do it! Just start with a 10-to-2, work your fucking ass off, and you’ll experience something previous generations couldn’t: Creating Your Own Security with Something You Built On Your Own. It’s the best feeling ever.

My first job was as a video store clerk. I think it was less than $10/hour. My mom makes $15/hour, and she figures she’s doing okay. You know what the most I’ve ever made in one day was? $4,484.03, and it was doing something I loved. If $15/hour is okay, I’m banging angels. And what about Ben? I can’t release official numbers, but he learned programming on his own and will see FI by 33. Ben and I saw Maslow’s pyramid, catapulted ourselves to the peak with middle fingers in the air, and we’re building from the top down for a complete pyramid we can be proud of. I encourage you to do the same.

You WILL have to work smarter or harder though. It’s not easy to make a living as an artist, writer, craftsman, or entrepreneur. I’m hoping you’ll pick a job for yourself you’re so passionate about, you’ll ALWAYS itch to be working on it. You’ll probably also need a Day Job. Pretend the hours you grind out in the office are part of your Real Job, giving you enough money to get by until you can get back to your Passion. Ignore the naysayers. They don’t believe in what you’re doing BECAUSE THEY COULDN’T DO IT. Why would you listen to someone who ignored their potential? They’re still at the bottom of the pyramid wondering where the fuck we got our catapult.

As long as you have a roof over your head: self-actualization first, everything else later. The more you know who you are and what you want, the more you’ll come to define yourself instead of letting your job do it for you. Remember to work from the top down. See you in Mexico.