Luxury Food is a Scam

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Every year, the Vancouver Rowing Club hosts an event they call Champagne & Caviar. It’s NOT really Champagne and caviar. We’ve gone a couple of times now, and it’s basically all-you-can-drink prosecco, other miscellaneous sparkling wines, and a lot of tobiko. Technically speaking, there’s no actual sturgeon caviar, and only about 10% real Champagne. However, with tickets priced at a very reasonable <$30, NO ONE CARES. Why? Everyone there knows it’s “close enough” and just as good! There’s no need to pay more! Let me explain.

Marketers are mostly responsible for why common things cost so much. They’re why industrial diamonds are cheap (and are literally known as bort), but an engagement ring can be $36,537. They’re why a fancy lobster dinner can cost $60 or more, even though lobsters used to be prison food. They’re why a Rolex can be $31,625 when there’s literally no reason for anyone to wear watches anymore. It turns out people like Veblen goods, and like to pay more to feel rich! It’s the most glorious scam ever orchestrated in the name of capitalism, and it’s working! Luckily, we see it for what it is. Usually.

Well, as someone who fell for luxury goods and luxury foods for years, I believe we should savour the cheap shit. I have yet to taste a $500 Champagne that gave me more satisfaction than 25 bottles of decent $20 cava. Yet, to the average consumer, everyone claims to love Champagne, all without even knowing why, how it’s made, its history, or even where it comes from! I think that’s fucking insane. I mean, doesn’t that sound a bit like pursuing someone else’s idea of value, and not our own?

Admittedly, I fell for this again just a few nights ago. Being a food nerd, I was excited to visit a restaurant that served jamón ibérico de belotta because I’d never had it before. On paper, it sounded amazing. Iberian ham from free-range pigs fattened on acorns, roaming dehesas their whole lives… I don’t know how, but they somehow made ham — the most common thing ever — into something almost romantic. I fell for it hard. As I watched them carve 60g off a jamonera centerpiece, I couldn’t wait for these wafer-thin slices of top-shelf charcuterie to blow my mind. Surely, this would make run-of-the-mill prosciutto seem like Purina! Schinkenspeck might as well be Spam! I chuckled at my culinary superiority, lifted the first slice to my mouth, and took a bite. Any second now, this would be the best thing I’d ever eaten… Yep, any second now… I swallowed. Huh. Um.

That was it?

This happens all the time. I touched on this in “Bitching and Wining”, but there’s so little difference between cheap food and expensive food, there’s really no reason to EVER pay more than $20 for a meal. Wanna try sturgeon caviar? Not for $125/10g, you don’t. Try ikura for $20/113g. I think I actually prefer it. Truffles for $275/oz? Literally everyone I know prefers fake-as-fuck truffle oil. I’ve never understood the appeal of real truffles. Every time I’ve had them, they’ve either overpowered my food or added a dirt-like component. Maybe rare cognac is your thing. Louis XIII cognac is $3,300/bottle. As someone who’s had it twice, meh. It’s not even that rare. Right now, in the Richmond suburbs I live in, I know of at least two bottles within walking distance. You’re paying to seem rich! It’s all just marketing!

I’ve had “the good stuff”. It’s a rip-off. It’s one of the reasons I’m in debt. Expensive food only tastes better because we take the time to taste it. I’m not saying you should live off 7-Eleven beef teriyaki anytime soon, but I’ll leave you with this: For some reason, 7-Eleven beef teriyaki was a better food experience to me than dining at Lasserre.

It turns out once you see through all the bullshit, food is food. No matter how rich you get – as Bill Gates once said – “it’s the same hamburger”. I’d rather pay $5 for it instead of $500.

Let us know what you think in the comments.

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Space Is Your Greatest Asset

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Everywhere you look now, space is at a premium. Parking a car in Vancouver for three hours can set you back $21. Fifty square feet of storage in Toronto can cost you $193/month. According to Rentseeker, my 3-bedroom in Richmond would rent for $1,644! Somehow, we’ve all just accepted that space is expensive, even though the price for renting that space is often flat-out stupid! What if we decided to end the madness? What if, instead of being gouged for square footage, we found a way to make our existing space work for us instead of the other way around? Well, listed below are a few ways you can cash in. You don’t need to live in a mansion either. I’m just a regular guy who recognized an opportunity. You might realize there’s been a cash cow in your backyard all along.

First, the obvious: Get roommates. You don’t have to live alone. I’ve done the math, and by March 2018, I’ll be back to “no rent and no bills” because of what I make from them. I’m sacrificing my home office to make it work, but not really. I’m just moving my office to my currently underutilized living room. To get even more advanced, consider getting into Airbnb if you have a spare room! Here’s an article about it. For the nitty-gritty, here’s another! If that all sounds too stressful, rent to friends because you can still make extra cash in unique circumstances. We still “put people up in our storage closet for about $300/month”, and my friends all know they can come to me if things ever get weird, like if they suddenly get evicted or a relationship splits up. This was my first step. If you’re willing to bring other people into your space, you can profit immensely.

In another example, this book describes how its author uses an MRP (Multi-unit Residential Property) to live rent-free. He even advocates going as extreme as buying a fourplex, renting out three units, and living in only one! In 1999 though, he bought his first duplex and started paying into it. The property was $109,000 in Calexico, CA and his monthly payment was around $900. He lived in one apartment and rented the other for $800/month. That $800 plus his $100 “rent” went straight into home equity! I suspect he’s doing quite well now. This is common and basic optimization of real estate. You probably know a bunch of people doing something similar right now.

I also discovered you don’t need a full room or apartment available to make money. When my dad died, I sold my van, took over his car, and now my parents’ two-car garage in New Westminster has one space open. (I live a few towns over in Richmond.) Remember how expensive storage can be? Well, I know someone desperately in need of storage space. Instead of gouging them though, I’m letting them use that space for $50/month. It’s slightly less convenient for everyone because I’d have to accompany them whenever they need access, but they’d save (and I’d earn) hundreds! It’s win-win because I get to profit, they get to save, and I’ve effectively done a favour for them! It’s great!

Live near an event space? Here in Vancouver, near our local fairgrounds, residents open up their driveways for people to park. Last I checked, the fair itself charges $20 for parking, so let’s say we charge $15/car. Well, if you have a property width of 14.5 metres and a large enough backyard, YOU CAN PARK FIVE VEHICLES LEGALLY. $75/day for a month? That’s over $2,000! Everyone should be doing something like this! You can even monetize a small patch of dirt on the sunny side of your building! I’d gladly pay $50 for a garden space during the summer if I didn’t already have one. We all have access to space that’s “ours”, so let’s use it!

These are just a few examples, but every bit of space in your home should have a job. Let it make money for you. I’m a few thousand richer every year because I abide by that. Can you do the same and live rent-free? Tell us in the comments.

Can’t Handle FIRE? Try To HEAL!

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It’s 6 in the morning and I’m on a SkyTrain headed into Vancouver. From the looks of it, I’m the only one not on his way to work. The suit next to me is reading Bloomberg articles on his phone, and half the passengers are nodding off. I can’t imagine most of them want to be here. I’m listening to Taylor Swift on my iPhone and enjoying the ride because I have nowhere I need to be. My only goal for today was to write this, and I can do it from anywhere! This is the story of how I found freedom and lifelong happiness at 29. Hopefully, by the end of this post, you’ll be on your way too.

If you haven’t heard of FIRE before, it’s an acronym in personal finance writing that stands for Financially Independent, Retired Early. The Physician on FIRE guy? Not actually on fire. He’s just a family man who achieved financial independence at 39. You see “FIRE” kicked around a lot on the MMM forums too, and it’s a goal of many. It turns out most people don’t actually want to work for a living! I mean, given the choice between lounging by a pool in Guadalajara and a lifetime of office drudgery, most of us would be marching out on our bosses and guzzling Corona in no time! Well, I’m here to tell you things aren’t actually that simple. You might not actually want FIRE! To understand why, let’s take a closer look at its definition.

FIRE is generally defined as the stage a person reaches when the return on their investments is enough to cover their living expenses. A quick bit of math you can do to figure out your FIRE number is to take your annual expenses and multiply by 25. (If you spend $25,000/year for example, your FIRE number is $625,000. Start saving.) The reason for this is 4% interest is a generally accepted estimate of how much you can reliably make off the average portfolio. It’s somewhere between too-safe 2% GICs and somewhat-risky 7% index funds, and 4% just kinda became the default number. At any rate, I have no reason to dispute its logic. 4% certainly makes sense to people far smarter than I. However, FIRE is no longer a goal of mine. Part of the reason is the numbers are outside my grasp — I’ve done the math and I have no delusions about my ability to save — but I’ve also grown up a bit and experienced a different view of retirement. I now know what it’s like to barely work at all, and what I’ve found is it actually totally sucks! I needed to create value in the world to feel fulfilled, and sometimes, people were willing to pay me to create that value! Why wouldn’t I take the money? So what if someone might define that as “work”? Retirement sounds great on paper, but do you never want to work for anything ever again and just lie back and consume? Fuck, no!

With this in mind, I started optimizing my lifestyle. I needed freedom whenever I wanted, some work to feel useful, autonomy in my professional life, and enough money to have fun. FIRE wasn’t the solution because many FIRE followers try to frontload all their earning towards their early years working brutal hours, then they putter around not knowing what to do with themselves as soon as they retire! The Mad Fientist retired at 34, spent months travelling, then “realized it wasn’t making him happy”. Mr. Money Mustache basically went back to work doing construction and managing rental houses. If FIRE is so great, why are so many success stories plagued with ennui or employment akathisia? Well, it’s because full-on, work-hard-now-to-never-work-again FIRE is just too extreme. Fundamentally unbalanced, it takes too much effort in early life and too little effort in later life. In theory, it’s a great goal to work towards, but maybe there’s a better solution that can give you the good life now. I call it “HEAL”.

HEAL stands for Half Employed, Adjusted Living. It’s my way of describing a balanced lifestyle that involves half or less of a typical 40-hour workload, and adjusting your lifestyle to afford that freedom. You can achieve HEAL in a variety of ways, even if you’re young. For example, you can bump your income up so you only work 20 hours a week and spend the same as before, or you can go frugal so you can live off 20 hours of regular pay. For most, going frugal is easiest. Part-time work and frugality are key to HEAL. Some people even bump up their income and go frugal, and those people have it made. Though they might even achieve FIRE, they know “no work” isn’t the goal. What you want is the freedom to only work when you feel like it.

Here’s my situation: The last time I calculated my monthly spending, I arrived at $1,948.18. I’m bringing on a second roommate in a month or two, and the rent I charge him will cover my entire Bills category, eliminating at least $447.29. This puts me at just over $1,500 I’d need to cover in income. Working 20 hours a week at my low-pay liquor store job would net me about $1,100, and the remaining $400 could easily be covered by any photography booking! In fact, since I bill $400/hour to shoot weddings, even a single 8-hour booking covers me for 8 months! (The photography work is spotty, so I’m hesitant to provide monthly numbers. It fluctuates from $0 with no bookings to months like April 2016 when I somehow earned $6,353.41 without even shooting a wedding.) Naturally, any excess income from photography goes straight into paying off my debt, and once that’s taken care of, I’ll be trying to max out my TFSA! I’ve got this whole “HEAL” thing down! I’m “Half Employed” and my “Adjusted Living” made ~20 hours a week work for me!

If HEAL sounds good to you, here’s some recommended reading. First off, if you’re still unconvinced that you might actually want to work for the rest of your life, check out our previous blog post, “I Want You To Half-Retire (HR)”. Finally, consider picking up the Marcus Arce book, “HALF RETIRE – How to Escape the Rat Race Without Waiting to Win the Lottery!” At a cursory glance, the math in it checks out. I’m using strategies from it already.

By realizing I wanted HEAL and not FIRE, I’ve freed up my younger adult years to do whatever I want while working just the right amount to be even happier. Click the links in this post and all over this blog, and read them. People need work, and yes, I do intend to work even when I no longer have to! If you think of Work as a dirty word, it’s because you need a better job!

At 29, I’ve found the lifestyle I intend to have forever, and I didn’t even have to worry too much about retirement. What the heck is stopping you?

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.

How To Get Your Kid Set For Retirement

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I’ll just cut to the chase: When your kid is born, put $12,400 in an investment generating 7% interest, and they’ll be a millionaire by 65. I know that sounds crazy, and I’m making a LOT of assumptions, but you can find all the justifications for my logic in this post here. Again, this is presented as data ONLY. Listen up, new parents. It’s time to make your kids millionaires.

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All of these equal $1M:
0 – $12,400 x 65 years of 7% growth
1 – $13,200 x 64 years of 7% growth
2 – $14,100 x 63 years of 7% growth
3 – $15,100 x 62 years of 7% growth
4 – $16,200 x 61 years of 7% growth
5 – $17,300 x 60 years of 7% growth
6 – $18,500 x 59 years of 7% growth
7 – $19,800 x 58 years of 7% growth
8 – $21,200 x 57 years of 7% growth
9 – $22,700 x 56 years of 7% growth
10 – $24,300 x 55 years of 7% growth
11 – $25,900 x 54 years of 7% growth
12 – $27,800 x 53 years of 7% growth
13 – $29,700 x 52 years of 7% growth
14 – $31,800 x 51 years of 7% growth
15 – $34,000 x 50 years of 7% growth
16 – $36,400 x 49 years of 7% growth
17 – $38,900 x 48 years of 7% growth
18 – $41,600 x 47 years of 7% growth

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By this logic, you should actually reconsider sending your kids to university! The average four-year university undergraduate degree costs $84,000! DO YOU KNOW WHAT THAT CAN DO FOR A 23-YEAR-OLD? Invested at 7% interest – (I know some of you are still skeptical, so here’s further justification from someone far smarter than me) – THEY’D HAVE OVER $500,000 IN THE BANK BY 50. Wait 10 years more AND THEY’RE MILLIONAIRES. Here, crunch some numbers and get back to me. What’s especially wild is these are essentially set-and-forget investments: NO FURTHER CONTRIBUTIONS NEEDED! How are NO new parents doing this? It’s goddamn insane! Index funds, FTW!

If I’d known at 18 what I know now, I would’ve skipped post-secondary entirely. One of the richest and most successful people I know didn’t have any formal schooling AT ALL. Another friend is an artist and is set to retire with $800,000+. It turns out financial success isn’t all that linked to skills or intelligence at all. All you need is (a little) Money and (a lot of) Time!

If you completely ignored my post about not having kids, don’t ignore this one. Making a new millionaire from scratch costs $12,400 and your kids will be grateful forever. I don’t know about you, but that sounds like the best damn deal I’ve ever heard.

Wishing you and your kids riches,
Unconbentional

The 5 Love Languages, and How Knowing Them Can Save You Money

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This is gonna be the sappiest post I’ve ever made, so buckle up. There ain’t no brakes on the love train. I’m gonna show you how to improve your relationships AND save a boatload of money. You don’t even need to read this book! Since I’m a huge fan of book summaries, let’s see if I can knock this out in 700 words. It’s time to make YOU sexy and rich.

Listen, unbridled generosity sucks. In this article, I discouraged people from spending money on their loved ones when there are so many free ways to show you care. “Be generous with your time,” I said. Well, love is a tricky thing, and I was foolish to oversimplify. The fact is: EVERYONE EXPRESSES AND ACCEPTS LOVE IN DIFFERENT WAYS. In Chapman’s book, “The Five Love Languages”, he outlines the five main ways people show and accept love: quality time, devotion, physical touch, words of affirmation, and gift giving. Take a wild guess which one’s my least favourite.

Anyway, how I express love – in the past, gift giving – wasn’t necessarily how my friends or partners RECEIVED love. In my mind, because I’m such a cheap bastard, a gift that cost me MONEY was a big fucking deal. I once bought a $500+ smartphone for a partner, for instance. To her, my gift wasn’t valuable because that wasn’t a form of affection that spoke to her. Needless to say, that relationship ended quickly.

This doesn’t just apply to romance either. After some reflection, I realized I also don’t give a shit about gifts, and in many cases, took my family’s generosity for granted. They put me through my post-secondary, for example, and I really didn’t VALUE that at the time (though I do now). My mom also performs unexpected acts of service for me to show her devotion, but these usually end up inconveniencing me in annoying ways, like that time she decided I needed a tune-up and I was like, “Uh, where the fuck is my car?”

Whether you’re trying to save money or not, it’s important in any relationship to figure out what forms of generosity really speak to your loved ones. Expensive gifts or events are almost never the solution. One of the worst offenders to come to mind is going out for a movie together. “Hey, let’s go spend quality time together by staring at a screen and not talking for two hours! This is how people form close bonds!” Ridiculous, right? There is, however, a caveat in all this… I mean, what if your partner ACTUALLY accepts love in the form of gifts? Like, what if, in all sincerity, that’s what you have to do to keep them around?

Well, decide if that’s worth it for you. No lies, this’ll probably fuck with your FI plans, but life’s about more than money. If necessary, communicate that giving gifts isn’t how YOU show love, and hope they understand. It’s rare to find relationships where your “love languages” align, but now that you’re aware of that, you can: a) stop blindly throwing money at things and events in the hopes that someone will like you, and b) start communicating in a way that will make your relationships stronger!

Figure out your “love languages”. Learn how you each GIVE and RECEIVE affection in a way that’s meaningful. Do your best to keep money completely irrelevant. This won’t make you rich overnight, but it’ll help.

In my monthly spending breakdowns, I used to have a line item for gifts, but I don’t anymore. My relationships are better than ever. As always, keep more money in your pocket and use it on what REALLY matters. Besides, if you have to constantly buy out your loved ones, you’ve got bigger things to worry about. Here’s to a richer and happier you.

Penny-Wise, Pound-Foolish

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If you’ve been following Unconbentional for a while now, you know I love introducing minor changes to your spending so you have money to invest. I’ve talked about saving amounts as small as $2/day cycling or 26¢/coffee just so you can keep adding to your bottom line. What I haven’t told you up ‘til now is that most of this is useless if you’re still an idiot about large “one-time” expenditures. Obviously, that’s common sense for a lot of you, but maybe it’s not because if I’m reading this right, the average Canadian is still blowing $40,100 on their new vehicles! As if that wasn’t enough, the current trend is fuel-guzzling SUVs over a regular “fuel-efficient” car! Don’t even get me started on rent. Some people I currently know spend as much as $1,500/month on living expenses when a little thinking-outside-the-box could turn that into $300! Here’s some quick math, if only to make you reconsider your next major purchase. I firmly believe that ANY purchase over $100 should be: a) something that SAVES you money, b) something that EARNS you money, or c) an EXTREMELY special occasion. (“Friday night” doesn’t count.) I know you know this already, but it’s hard to argue with numbers. Here we go.

A $40,100 vehicle represents the money you’d save on gas alone from about 55 years of cycling 15 KM a day instead of driving, or 301,125 KM. The circumference of Earth at the equator is 40,030 KM, so that $40,100 SUV you just bought is equivalent to what you’d save by circumnavigating the globe 7.5 times by bike. If we’re talking about saving 26¢/coffee by buying one size down every time, we’re talking about 154,230 cups of coffee you’d need to do that with, or 422.5 years of one cup a day. By a single dumb decision – buying a new vehicle LIKE SO MANY CANADIANS ARE DOING – you’ve potentially nuked 154,230 tiny good decisions, OR just shat all over the savings from multiple lifetimes of cycling. Remember, shiny things are stupid. Beware the one-time expenditure.

This is only one example, but my point is you can’t pat yourself on the back for tiny good decisions anymore. You need to do the math on big purchases, and really think about how long it took you to get there based on your frugal decisions. The other day, I was hosting a dinner party and spent $101.46 on two lobsters. I’d have to choose a Subway 6” sandwich over a much tastier sushi lunch 20 times to make up for that, and it kinda hurt to fork over that money. Sure, I’d mentally congratulated myself every time I bought a cheap sandwich, but I destroyed the benefit of ordering 20 of those in one night! You just don’t win as long as you keep making major purchases. If you’re frugal six days out of the week and go hog wild every Friday, YOU’RE NOT ACTUALLY FRUGAL! That puts you in the same boat as everybody else!

Don’t be penny-wise, pound-foolish. Saving nickels and dimes really don’t add up to much. Don’t let one or two big-ticket items set you back years of penny pinching. If you’re not careful, it takes only a day or some asshole car salesman to ruin your financial future. Watch out.