My goal is to no longer be obligated to work a 9-5 job to survive. I don’t want to work for someone else, or any purpose other than my own. The problem is right now I’m trading my time for money and then trading that money to pay bills and buy things.
Money is just the middle man as a universal means of exchange. When I fill up my gas tank it doesn’t actually cost me $50. It costs me the amount of time needed to generate that income. Whether I give my all for 40 hours, or I slack as much as possible my salary and wage remain constant, at least in the short term.
Generally speaking the harder you work the quicker you’ll advance, but this isn’t always true. Sometimes you’re given false hope and the arbitrary person who has been hanging around the department longer than you, or a person who was in good with the right people to happen upon a management position above you, may have no intention of rewarding talent, or developing the people below them. Sometimes it’s in their best interest to keep labor expenses down and meet a budget to appease their own manager.
When you’re an employee these are sometimes real issues that you may have minimal control over. Working for a leader who trains you so that you’re a high demand commodity in the job market, but who also treats you in a way that makes you happy to stay is invaluable.
For now let’s just stick with the point that your time/attention/energy is bartered for goods, services, and the servicing of debt. If you value your time and freedom you want to be efficient about what you consume with the money you’ve received in return for your time.
Ask yourself what good are new clothes, a fancy car, the latest electronic gadget, etc? From a utilitarian point of view what purpose do they serve? Should you become a slave for 5 years just to drive a certain type of vehicle? Does that make sense?
As long as your vehicle reliable don’t they all accomplish the same goal, to get from point A to B? What type of insecurity must exist inside of you for you to believe that you need that sort of thing to feel good about yourself?
All the advertisements and social conditioning got you. Your own convictions and identity were too weak to avoid the suggestive ideals of someone who had something to gain from influencing your buying decision, and manipulating your values to align with their own agenda.
When time is money and we value our freedom it only makes sense to minimize expenses. If you’re financially abundant it’s a different story, but if you’re in debt like me, then do whatever it takes to get out as quickly as possible.
The mathematics of compounding interest should be enough to make this obvious. Just take a look at an amortization schedule and you’ll see that after all the interest, you’re sometimes paying double, or more than the principal balance by the time you’ve paid the debt off, and in the beginning almost the full payment goes towards interest.
Let’s look at a quick example. If you were to purchase a home today and take out a mortgage for $200,000 over a 30 year term with a 4.50% interest rate how much would you have paid by the time you paid it off, assuming you make no principal payments for the life of the loan? $364,813.42. And that’s before taxes, before insurance on the property which the bank will require, and before PMI insurance on the loan itself. Don’t forget closing costs, utilities, repairs and maintenance, etc.
My solution was to buy a multifamily home so this massive purchase actually generates some rental income that handles a nice percentage of the expenses for itself, but that’s a topic for a different day. The bank has the magical power to lend out 10 times what it has on deposit and charge you interest on top of that money they type into existence on the computer. If you had the power to do this every $1,000 you had would be like having $10,000, and you wouldn’t need the bank to lend you anything!
I once read a comment on yahoo finance that said credit cards are an IQ test, and I definitely feel like there’s massive truth to that. If you can comprehend the mathematics of debt and interest as mentioned above, you’ll avoid it as much as possible. So what are some ways to eliminate or reduce expenses?
1) Do not pay for cable television. If you work 40 hours a week you’re not around enough to watch much of it anyways. Purchase an HD antenna and enjoy 20+ channels for free. I bought an outdoor antenna off of amazon (Winegard HD7694P High Definition VHF/UHF Antenna) and have it wired to all the TVs in my home.
All I had to do was find where the old cable company line was attached into the cable box, which for me was located on the outside of the house, detach that and plug in the antenna there. The signal then went to everything already wired.
Make sure the antenna you purchase is both VHF and UHF to ensure you pick up as many channels possible. Also check out this website (https://www.tvfool.com/?option=com_wrapper&Itemid=29) to understand which direction your favorite channels are coming from and aim the antenna in that direction. If that isn’t enough most networks offer shows through their websites and you can use Google Chromecast HDMI Streaming Media Player to send them to your TV over your wireless network. Lastly a compromise may be something like Netflix, or Rabbit TV, in addition to livestream websites where you can find pretty much anything you’re looking for. Better yet, find someone who already has Netflix and is willing to share their access with you.
2) Shop around for cheaper insurance. Geico was the best deal for me when it came to auto insurance. Also, I shopped a few local insurance brokers who found a great deal on my homeowners insurance policy. Reoccurring costs add up in the long run when you’re over paying a few dollars on this bill, a few dollars on that bill, over a period of time. Make sure you’re not paying any more then you have to for the right amount of coverage.
3) Utilities: My utilities are now free thanks to energy deregulation and an energy provider who offers free energy after referring 15 people to make the switch. These people are also guaranteed 2% annual savings on their utilities and they too can earn free energy by getting 15 referrals of their own.
I’ll be honest with you. It’s easier said than done to get people to make the switch. But if you commit to it for a period of time and keep having the conversation with people you know eventually you can earn free energy too. And until then you’re at least getting a 2% savings. Since those who I’ve referred have helped me save money I am giving back and helping them earn free energy as well.
If you’re interested in switching utilities to save the 2% or want to try to earn free energy for yourself I can help you with that. As of this post this only applies to those in the following states in the US:
• New Hampshire
• New Jersey
• New York
• Rhode Island
• Washington D.C.
If you’re interested, then make the switch through the link below, and get in touch with me letting me know you did. Do it right now. I’ll keep track of those who switch over through this post and put you on a list so whoever is at the top of the list, I’ll place their referral link here until they reach their goal. Here’s a link from the person at the top of the list right now Free Energy Opportunity. After he reaches his goal it’s on to the next person. I know it’s easier said than done so I’m here to help.
4. Avoid foreign ATM fees at all cost. They add up over time.
5. If you eat out frequently make it a habit of ordering water. Too much high fructose corn syrup is terrible for you and causes inflammation on a cellular level. Alcohol can rack up your tab quickly and isn’t the most healthy thing for you either. I know you can argue tap water isn’t exactly a purely healthy option but at least it’s free. And whatever you do, don’t drink diet. Aspartame is terrible for you. I’ve read that aspartame is literally the fecal matter of genetically engineered Ecoli bacteria. Not sure how much truth there is to that but the association should be enough to prevent you from ingesting it.
6. Never make any major purchases without first searching craigslist. When you shop at a retail store you’re paying for the massive building that is being leased, you’re paying for the maintenance, the decorations, the sales people, the presentation of the product, and everything else that goes into allowing the operation to exist, plus a little more so that business can make a profit.
When I buy something all I really want is that item. I don’t need the presentation. If someone has it and is looking to get rid of it then that’s the way to go. Especially because you can negotiate price and avoid sales tax. If I could tell you how much I’ve saved with this one tactic alone the number would be huge.
Garage sales are another way of finding huge savings. Both are also a great way to make a profit by picking things up extremely cheap and turning around to sell them for significantly more. But that’s a whole other topic for a different post. Right now I’m focused on saving money. In the future I’ll discuss ways of making some extra cash outside of working a traditional job.
7. If you know you’re going to make a major purchase and you can’t find that item on craigslist then buy a discounted gift card, (GiftcardGranny) and try to find additional savings and promotions on top of that. Also download the app RetailMeNot for a collection of discounts at all major retailers (RetailMeNot).
8. If you’re carrying a lot of credit card debt and you have decent credit, apply for this card for 18 months, transfer all your balances here and start paying it down immediately (0% interest card). If you’re not disciplined enough to do this, apply for a personal term loan and term out the debt. A term loan is not revolving so you won’t be able to keep adding more to it as you pay it off. This will force you to pay the balance down.
9. Not everyone will agree with me on this one but as someone who can take cash and make it grow through various investments and business models I do not max out my 401K contributions. I need money now and I’m trying to get out of debt. Yes, I contribute and as much as I can, but at the same time if I can use that money now to make more money I’m not locking it away for 50 years.
This formula is basically stating that money is worth the most to me right now. $1 today offers more value to me than telling me you’ll give me that same $1 next month because if I had that dollar today, I could earn interest on it and have more than just $1 by next month.
Also, as mentioned before, I’m in debt. Who am I to be stashing big money when I’m paying a horrible amount in interest to the banks. Tomorrows not guaranteed and the stock/bond markets could crash any day.
The house of cards may one day collapse. or it may not. Even if it does I can’t tell you exactly when it may, or may not happen, therefore I can’t profit from speculating even if I’m “right” about it one day collapsing. You can place that bet every day for years and go broke before it actually happens. Then if it does, were you right? Even after losing it all placing that bet at the wrong time? Timing is everything.
Back to the point. If I can pay off debt faster then I’ll be able to save at a much faster rate in the next 5-10 years. Now I know this doesn’t agree with whole compound returns mathematics but I’m still putting money away and I’m generating money now with the funds that would have otherwise been locked up, so there’s a return on that investment.
They’re in different kinds of investments and generating more money today to get me out of debt faster and to save more in the future. Also, I’m learning so much more by finding ways to make money than I would learn by dumping it into a 401k account, forgetting about it, and thinking my retirement is all set.
The things I’m learning now will help me to continue to make money later on when I need it, outside of the 9-5 job. That experience is priceless. Is it all starting to come together now? I hope so.
10. Think long and hard about any purchases that will do nothing to help you generate more profit. Yes, these are absolutely necessary to a certain extent, but at the same time, how much could you have saved over the past year if you toned it down with buying things you don’t need? How about the past 5 years? 10 years?
My guess is, like me, you could have had a nice chunk of change lying around today if you were more disciplined with buying stuff and throwing money around. The key is balance. I’d much rather travel, learn something new, have a great experience, or be part of something exciting than I would buy random stuff.
All the consumer garbage out there that clutters your home and ends up in the trash anyways. You don’t need it. It won’t make you happy. It’s not the solution to your problems. Keep your money and let them keep their made in China slave goods. The less we demand the less that will be produced and the world will become a better place. Place a priority on production first, and consumption second.
That’s it for today.by