#36 | FU Income

Life had become crazy busy for a while, but it's starting to calm down again. As things calm down, I've been able to evaluate the past few months. One of the insights I've discovered is a deeper understanding of FU Money.

JL Collins didn't coin the term, but he's where I first heard it. Just like his article, linked above, I hadn't known what FU Money was, but once he described it, it made perfect sense. It was something I was aiming for too. Or at least I thought I was.

The more I think about it though, the more I think FU Money itself is kind of bulls--t. Although I thought FU Money was my goal, I've never been able to incorporate it into my financial strategy appropriately. The first issue I have is that retirements accounts have typically been my first avenue of investing. But as the balance of my retirement accounts increased, I never felt like that would be considered part of my FU Money bucket.

If I wanted to say FU to my job and go on a self-funded sabbatical adventure to discover myself, what I want to live off of my would my retirement accounts? Not really. I wouldn't want to cash them out and take the penalty hit for withdrawing from them before retirement. Instead of funding retirement accounts, let's say I funded a non-retirement brokerage account. Would that make a difference? Doubtful. I wouldn't want to sell my wealth-generating assets to cover my monthly expenses. I wouldn't be comfortable missing out on the opportunity cost of not benefiting from compounding interest or returns. The milestone I would have to reach to feel secure is the 4% rule threshold.

But if I waited until I reached the 4% rule threshold, then I would call that retirement money, not FU Money. I imagine FU Money is when you have enough in assets and cash that for any reason, you can quit your job without worrying about the scramble of immediately finding a new income stream. Retirement could be a side effect of this short-notice quitting, but retirement is an all-or-nothing scenario. When you retire, you retire for good. If you come back out of retirement, then that means you drained your investment accounts before you were ready to retire.
Plus, retiring early is extremely hard. There are quite a few people in the FIRE community who have retired early, but to retire in your 20s or 30s usually seems to be a direct result of penny-pinching to the point of depression. Or at least a significantly decreased life satisfaction.

What's the answer then if FU Money seems like a reasonable goal but doesn't' actually fit my model? Figuring that out has inadvertently become my current focus.

Over the past three months, I've been focusing on several different side projects. The first was a commercial real estate project that I had been watching for years, but the time had finally come to execute. This particular project will kick off a healthy but not retirement-worthy monthly cashflow. The second project was starting a side business doing online selling with my wife. This project doesn't produce passive income, yet, but creates an alternative revenue stream. And the goal is to grow the revenue stream enough that we can hire employees and helpers and start working on converting it to either a leveraged income or a completely passive income. The last project(s) was a few individuals in my technology network who reached out to me for freelancing. Freelancing is something that I've always done since college graduation, but I had a year-long drought in projects. The income generated from these projects tends to be very short-lived but usually significant in size than other side-gigs. At this point in my career, I also manage other resources with these gigs and charge a markup for my resources time instead of direct billing for my time. So I consider this leveraged income.

For the past year or so, my focus was on adding to my investment account balances. However, for these projects, the entire focus has been on created alternative income streams. Income streams that pull the monthly burden away from the 9-5 income stream. These income streams started making me think about FU Income. They didn't increase my investment account balances one bit; there has been no impact on my net worth. But yet I still feel more secure now than I did just a few months ago.

So I dug deeper. My net worth is already large enough that I feel like I have preliminary FU Money. But even with that net worth, I'm not interested in cashing out any of my existing portfolios to cover my monthly expenses. So it's FU Money that is untouchable if I want to say FU.

I was trying to sort out all of this, and it finally hit me. I had discovered FU Income. Between these three new income streams, I can cover the majority of our monthly expenses. That means if I quit my job overnight, to be entirely income-to-expense neutral, I could get a minimum wage job and still maintain my current lifestyle without decreasing my assets.

Another angle I started thinking about was the golden egg-laying goose. The moral of that story was to have patience in receiving a golden egg every day. The protagonist loses patience and kills the goose hoping to extract all of the golden eggs hiding inside, only to discover there are no golden eggs inside, thus destroying their future golden egg income. In my opinion, prematurely tapping into your FU Money is equivalent to killing your goose. Except instead of impatience being the motivation, needing to eat the goose for daily sustenance is the motivation. Although it's not a selfish motivation, the outcome is the same. With the purpose of FU Income instead of FU Money, I equate that to pursuing more geese instead of pursuing more golden eggs.

So now, I know what my focus moving forward should be. I have surpassed having FU Money. I must now focus on creating FU Income so that I can genuinely gain the financial independence that I seek.

(Written 2019.12.07)

#35 | Heroes & Soldiers

Recently I was talking to someone at work, and we started discussing the topic of heroes and soldiers in regards to performance reviews and who gets recognized. I hadn't heard this metaphor before, but it made perfect sense. I wanted to explore the concept a bit more.

The breakdown is that at work, you have heroes, and you have soldiers. Your heroes are the ones who come in to save the day. If your production system is down, they figure out how to bring it back up. If a customer is angry and demands immediate attention and resolution, the hero calms them down and satisfy their expectations. Whenever things are in trouble, the hero enters. The problem is solved, congratulations emails are sent out, and praise showers start. The celebrations begin.

Soldiers, on the other hand, are the ones in the trenches every day. They keep the world going round. They handle hundreds of customers without letting things escalate to the point of needing a hero. They create feature after feature, with constant in-depth analysis, and deliver every time. Frequently, these folks might not enjoy the spotlight of being a hero. They might even crumble when the spotlight finds them. But they don't need the spotlight to become essential members of the team.

Which then gets around to our conversation topic. How to recognize and reward everyone appropriately? Before my work conversation, I would frequently think about people in terms of being top performers, medium performers, and the occasional short-lived bottom performer. Everybody fit comfortably into these three buckets. But over time, I've noticed that some top performers struggle to get proper rewards. Their stats and KPIs would be consistently at the top of the charts. They always worked on essential tasks and were goto people for their areas. They had all of the indicators that should make them easy to reward, but the best rewards always seem to bypass them.

On the other hand, other top performers seemed to walk into their rewards. Their managers would make little effort and bam -- instant-reward. There always seemed like a disparity in contributions and ease of awards.

That's where the heroes versus soldiers metaphor clicked for me. Being a top performer helped to secure a promotion, but it wasn't the primary factor. The more critical trait is to be a visible hero. Even if you were a hero/soldier shining in the spotlight while digging into the daily trenches, the hero aspect of your output is what justifies the promotion.

Then I started thinking back at my previous jobs and evaluating myself. At my first job out of college, I was a complete soldier. I was the guy who sat in my office toiling away, avoiding any visible spotlight while carrying the burden of workload for the team. Everyone who knew the intricacies of the group realized I was a top performer for the team. No one outside of the group knew what contributions I was making. Because of that, I gained a lot of valuable experience, and it launched me as a professional engineer, but my career growth was very stagnant.

In comparison, I've now come to embrace the spotlight. I still bear down and toil away in the trenches when needed, but I'm also known to be the person who steps into the foreground to save the day when a crisis occurs. I've learned how to play both roles. I'm confident that the hero part of my deliverables has made the difference from my first job. My career growth has reflected this difference in approach.

I find it somewhat discouraging. If I would have known at my first job, maybe I could have done things differently. Even now, as a manager, I might be reaping the benefits, but that's not enough. I tend to hold my team to high expectations leading a lot of them to be top performers, but some are heroes, and some are soldiers, but all, in my opinion, are deserving of recognition.

But at least I've made this realization. With realization comes the ability to plan a countermeasure to this anti-pattern. Once I figure out that countermeasure, I'll be able to be an even better leader and make sure I keep all top performers engaged and happy so that everyone can keep us marching forward towards victory.

Project success isn't won by only the heroes performing great feats of strength, but also by the soldiers putting in the grind and showing up strong every day.

(Written 2019.12.06)

#34 | Why I Side Hustle

I started talking about this in a different article but then realized that the content was diverging from the article's intended topic. So here we are, a followup post.

Ever since I graduated from college, I've been a hustler. There has never been a time when I did not have a stable and well-paying job, and I jump around companies very infrequently. I've worked at three companies over 16 years in the tech industry, which is almost unheard of these days. A lot of my tech peers jump to a new company every two to three years.

Why do I side hustle? I've had a lot of friends, coworkers, and acquaintances make comments or give me looks asking this very question. Like most things in life, there is no single response.

Probably the most significant impact my side hustles have done is to expand my skill set. At every job, there is a lane we are expected to stay in — some list of responsibilities and tasks we are supposed to perform for our given role. If someone wants a promotion, they might look at the position above theirs and start executing against that list of responsibilities and tasks. But everything is very narrow. Seldom have I seen an environment where you are encouraged to do everything and anything possible. Engineers should engineer; support should handle customer interactions; sales should sell the product, etc. Expanding it further, people working in technology don't have any reason to deal in real estate, to perform market analysis for the food industry, or any number of non-technology related situations.

When I freelance in technology, I'm able to perform every job task, wear every hat. For example, I've learned quite a few skills that now make me better than a lot of product managers, even though I've never held a product manager title. The same goes for support, customer relations, or project management. When I resell online, I'm able to branch out of my industry and start thinking about things like small scale supply chain, procurement, inventory management, distribution, popular trends, and marketing.

Instead of becoming narrowly-focused on my one role within my day job, I'm able to become a well-rounded individual.

Another benefit of the side-hustle is the network that you create. Some people go to meetups, some to conferences and conventions. Some people try to work with every outside vendor or client. Those are all fine, but to me are a bit shallow from a professional sense. When I network professionally, I want to know how well someone can perform in completing their assignment, and I want to showcase my ability to execute. What better way to do that then to have real projects working with real deadlines. Even if it's an internal project like my online reselling where I don't have a client or a contract, it's still applicable. If I meet someone who sells on the same platform as I do, I can pitch a collaboration to test their abilities and follow through. If I need some help with SEO, I can reach out to professionals for advice.

By having real projects to work on, my networking is more accurate to life and all-encompassing to any facet of a professional need.

And the last benefit is financial, which is also the least important to me. Typically side hustle income goes into one of two categories. The first category is fun-money. This category is usually the case if I earn only a few hundred dollars. That can pay for a few nice dinners or a couple of months of Starbucks. Or maybe a treat for my wife or kids. It can even be something bigger like a laptop or iPad that will dual-purpose in both professional and personal or combined to help pay for a vacation. The second category is investment money. This category comes into play when the income generated reaches thousands of dollars. I love it when I can max out my IRA contributions from side-hustle pay; it feels like my "after 5" work is going towards my long term goals. It's even more exciting if I can generate enough side-hustle money to fund a more substantial investment.

When I can funnel my side-hustle money into an investment, I'm directly converting my limited time into cash, then into passive income. When the passive income is large enough, it allows me to buy back my freedom. I'm not just trading time for consumer goods or experiences but instead trading time today for freedom tomorrow. This exchange is a balancing act because tomorrow may never come, so you don't want to exchange too much time. But the entire purpose is to Financial Independence is to gain freedom, so being able to act directly against that goal is motivating.

Some people may think I'm crazy, or I juggle too many projects when I don't need to because of my day job. But I see these side hustles as a way to expand my skill set, expand my network, and to help buy my freedom.

(Written 2019.10.23)

#33 | Go With The Flow

I've been obsessing about my release schedule recently.

I spent six months pre-writing my blog posts, sometimes having up to a month worth of posts written and scheduled. I had a rigid schedule of releasing a new post every Thursday. I like this schedule because it is a way to give the reader something on a relaxing Friday before starting their weekend.

I always had the intention that if I missed a Thursday, that would be fine. But I knew that wasn't true. I'm the kind of person that once I miss once, the drive will fade enough that I'll lose my momentum. Next thing I know, three months go by and nothing. I need the schedule to stay motivated; any will do.

When I picked up writing again, I considered a weekly release rate was burnt-out levels of output. I thought once a month would be better. That seems very doable. If I write a single post once a month, that would be easy. Sounds good!

Then I started thinking about the yearly article count. When releasing weekly, I would have 52 posts. That's a good number. When releasing monthly, that's only 12 posts. Sometimes I can write a dozen articles in a couple of weeks, so spreading the release of those out over a full year didn't fit.

My thoughts next went to a variable schedule. Something where if I have one or two posts queued up, I post monthly. If I have three to six posts queued up, I release every other week. And then if I have over six posts queued up, I would go back to weekly. That way, if I became inspired, I could release weekly and fade to monthly over time. It sounded genius.

Or not. I was getting my headache. This internal debate is how my brain works. I started spending more thought on HOW I would release my posts than WHAT would be in them (hence me taking an entire post on this topic). I'm going to try my hardest to let the obsession go and adhere to my original schedule: release on Thursday anytime I have something written AND to not fall off the wagon again for three months if I miss a week.

Forget the schedule. Just let the thoughts flow! Sometimes you just must let it go and see where things take you.

(Written 2019.10.19)

#32 | The Loss Of Focus

In the last post, I talked about my busy period and how it related to the philosophy of Boredom. This time I wanted to talk about how it impacted my Personal Control Book.

I've talked about how I organize my PCB. The guts of the PCB are within Trello. Life Focuses, Beacons, Areas of Focuses, and Projects are all kept within the Trello boards and cards. Then for my weekly updates, I keep them on a private Confluence page.

It's all very well set up, organized, and executed; until it's not.

I can admit that for a few months, I didn't touch Trello. I neglected all of those Projects with nicely laid out tasks. As new projects came in, I didn't consult Trello to see how they fit into my Life Focuses. I stopped all activity within Trello and stopped logging in. I still kept up my weekly updates, but Trello didn't exist to me.

This lapse is okay. I didn't abandon Trello or the PCB, and I still recommend them. I'm again using them today.

Overhead explains the lapse. Any system is overhead, even useful ones. Maintaining the system is energy that seldom is spent directly on whatever project you're trying to complete. So it needs to be viewed this way.

Let's imagine that your system is your car. To keep things running smoothly, you must maintain it. It needs oil changes, tuneups, and washes. Changing your oil does not get you to your destination faster. But not giving your car a tuneup will eventually cause you to be stranded away from your destination.

But life is not perfect, and we only have so many hours in the day. When we hit our most intense time crunches, that overhead involved in maintaining the system becomes a hindrance. If you need to get to your destination in an hour and it's an hour's drive away, you don't have time to take the car in for a tuneup. The tuneup can wait.

What I did was I kept the focus on the weekly updates, only because they helped me navigate my tasks and help prevent any from falling between the cracks. I shelved the rest of the PCB until I could breathe again.

As I'm writing this, I'm in the recovery phase. I've managed to include all new projects into my Weekly Update. Only about half of those have a Trello board, but any new projects will get one. I updated the boards that already existed. I even enhanced my Weekly Update now that I got to see how it performed under high stress.

I think it's critical that even when we get buried with life and start to feel like we're losing focus, we are prepared. It might seem chaotic, but we have the system. If we properly maintain our system before hitting chaos, it'll provide its value and serve its purpose during that chaos. It might start to break down, but a sound system will hold through until the turmoil dies down, and you can start maintaining it again.

(Written 2019.10.19)

#31 | When Life Happens

Recently my life has been seeing a flurry of projects. My life has been anything but Boring. I wanted to address that in direct correlation with my Boredom is my Goal philosophy.

Before this current explosion of activity, my life was getting pretty Boring. I had three ongoing projects according to my Personal Control Book, but making progress against those goals was not all-consuming. I was spending a significant amount of time every night reading graphic novels. I was staying on top of all household chores, and the house was impeccably clean and tidy. I was going to bed early every night and naturally early every morning.

It was amazing.

And then an opportunity blitz hit. I haven't touched a graphic novel in a long time, and a couple of new ones are piling up waiting for their turn to be consumed. I'm going to bed late, waking by my alarm, and sometimes slogging through my morning routine to get the day rolling. The house feels cluttered and chaotic and frequently doesn't get the much-needed attention it deserves until the weekend.

"But I thought your goal was to be Bored! Why would you take on these projects instead of saying 'NO'!"

That is a direct paraphrased quote.

It might appear that I lost my way, but I don't see it that way. Instead, I see things as life happening. Each opportunity that I said "yes" to somehow fit into my Life Focuses as defined by my PCB. They might have been all different, with different actions required, and different outcomes. But, with the help of my PCB, I could quickly evaluate each opportunity and figure out if they fit or not. If it didn't, I could reject it. And some things I did decline. If it did match my PCB, and that opportunity needed immediate action, I could accept it with confidence.

So I was prepared for the chaos. It was an organized and managed chaos.

It goes beyond that, though. Throughout the entire experience, my focus was always on figuring out how to make things Boring again. I keep my graphic novels in eyesight, teasing me to get back to them. I have held my morning alarm at the same time, to prevent myself from falling too far out of my routine. These actions, among others, have helped to make sure I defined a realistic scope for each project and pushed hard to close the project out as soon as possible. It helped motivate me to reevaluate a plan so that once immediate action was no longer needed, I could shelf it. It kept me sane, knowing that this wasn't my new norm and that every week, my goal was to close out more tasks than open new ones. I knew that as long as I kept my Boredom is my Goal philosophy close to my heart, this insanity was just temporary.

We can't control life, nor can we control what is presented to us: opportunities or otherwise. We can't control other people or the unfolding of events. We can't control time and magically create more. But we can control ourselves and how we react to the world. So when life happens, if you've mentally and philosophically prepared yourself, you can roll with it, embrace it, and thrive with it.

When life happens, go with the flow!

(Written 2019.10.19)

#30 | The Company We Keep

This topic isn't very original, but it's something that I started thinking about recently. It's essential to think about the people surrounding you.

The reason why I've started thinking about this is a trifecta of scenarios.

The first is one of the reasons why I ended up taking a 3-month hiatus from the blog. Some real estate opportunities presented themselves, and it was a chance to put some foundational components into my Financial Independence life goal. The opportunity involved engaging in a part of real estate investing I hadn't done before, so the process was very new and intensive. I can't recall how many times I was talking to someone more experienced would say: "When you did due diligence on XYZ, what did you find out?". And I would scramble to not sound like a complete newbie with a stalling response like "That's a good question, let me check with my wife to see what she's found out." Even though we were scouring the internet for advice, there was still much more to know, and we were consistently a few steps behind.

In our defense, most of our contacts knew we hadn't done a project like this before. We were typically upfront with it on the first introductions. But it was still not the most flattering place to find ourselves time and time again. Sometimes my wife or I would start to get self-conscious, but I would remind us that everyone starts at the beginning. Everyone knows that, and so it was vital for us to always present the most professional and capable versions of ourselves in these situations. Every person we talked to was a future long-term contact. I wanted them to view us as new but reliable up-comers, someone they would want to know for our potential. On the flip side, we wanted to recognize them for their experience and guidance. Within this particular investment and throughout the entire process, we wanted to surround ourselves with competent people, while proving that we were worthy of joining that network. Having that network will be invaluable for future endeavors.

The second scenario is the FI meetups I had mentioned a few posts back. At the time of writing this post, we have only gone to two of their monthly meetups, but I already feel good about the company we can keep there. Everyone is at a different stage in their FI journey. Some just heard about financial independence and are working on converting the management of their finances. Some have already retired early. And then the majority seem like they are like us, somewhere in the middle.

While going to these meetups, I've found a good portion of the conversation does not revolve around finances, investing, or anything directly related to FI. But that does not matter as I don't feel that's the purpose of the meetups. Instead, we can surround ourselves once a month with people who understand this niche mentality. They understand the financial motivation of skipping the fries and drink to save a few bucks. They appreciate finding free or cheap entertainment instead of looking for pay-to-entertain activities. Even when talking about our side hustles, they understand the motivation. I've hinted at some of my other friends about our side hustles, and I get the impression they feel we are crazy. The people at the FI meetups understand the potential in a side hustle. Those are the people I want to surround myself with, people who encourage me to achieve my highest potential instead of feeling crazy for trying to maximize my accomplishments.

And the last scenario is my Personal Control Book "coaching" (if it can be called that just yet). Essentially, helping people to perform their own PCB Setup.

Besides the motivation to continue developing this PCB concept, I'm finding a new group of people worthy of knowing. People who, although they may be at different phases, just like the FI-folks, have a desire to be more focused and productive in their lives. People who want to set goals and accomplish them. People that feel there is a lot to do in life and want to make something worthwhile. This coaching concept is very new, but it's exhilarating to start embarking on this journey. The real estate network is solely an investment group. The FI meetups involve joining an existing community. PCB coaching is a chance for me to help build a community of like-minded individuals. The honor of helping to bring together what I hope will be a fantastic group of people is very humbling.

Although I love meeting new people and I'm friends with individuals from at all different points in their lives and different cultures, ideologies, and mentalities, making sure we keep close the right company is an invaluable action.

(Written 2019.10.19)