I’m on a financial journey just like all of you. The only real difference may be that I record my thoughts and feelings about my progress publicly. I do my best to be as authentic as possible. By sharing what we know, we’re able to learn from others. I think we all have blind spots that need illuminating.
There’s one new observation I’ve learned since starting Financial Samurai in 2009 and leaving Corporate America in 2012 that I’d like to share with you. It’s a realization that lends weight to the power of positive thinking.
WILLING YOUR WAY FORWARD
When I first left Corporate America, all I wanted to do was survive comfortably and not regret leaving a well-paying job. I didn’t want to be an embarrassment to my family, friends, ex-colleagues and online community. I committed to at least three years of blogging before deciding whether to return to the salt mines.
I was making about ~$80,000 in passive to semi-passive income from real estate, CDs, and dividends. It wasn’t a bad income, but it wasn’t enough to live a high life if I stayed in San Francisco. My home’s property tax bill alone was around $18,000 a year at the time.
But I also believed I could make at least $50,000 a year online with my then ~125,000 monthly pageviews. After taxes, a total income of $130,000 equaled around $95,000 a year, enough for me to maintain my lifestyle with perhaps ~$5,000 to spare. You’re supposed to spend most of your money and not save for retirement in retirement right?
For the first six months in early retirement, I was very happy to live off my existing income streams. The ~$11,000 a month in gross income allowed me to travel at will. The motivation to make lots of money dissipated due to a sudden abundance of time.
It was only after the first edition of my severance package book was published in the summer of 2012 that I started thinking about making more money. Writing the book left me exhausted because it took a team of three an enormous amount of time to write and edit. Sales from my book started flowing in at a pace of ~$500 a month and I began to experience the intoxicating joy of receiving reward for effort, a correlation I’d been missing since the financial crisis began in 2008.
The desire to make more money returned.
Instead of being satisfied generating 125,000 pageviews a month online in 2012, I set a goal to generate 500,000 pageviews a month by 2014. I knew that if I built more traffic, revenue would naturally increase. Therefore, I set a new ambitious goal of generating $250,000 a year in revenue to accompany the 500,000 a month in traffic (~$42 CPM or 4.2 cents a pageview).
The funny thing about getting to 500,000 pageviews and $20,833 a month in revenue is that I didn’t change any of my actions to get there. I continued to post 3-4X a week on average and respond to comments when needed. I never got on television to share my story. Nor did I reach out to major publications to see if they wanted to syndicate my work. All I did was develop an abundance mentality where I told myself I, too, deserved to generate such figures due to the quality of my content.
By the summer of 2014 I had achieved both traffic and revenue targets. The $250,000 goal was selected because it represented the $250,000 base salary I left behind in finance. I felt that if I could match my base salary, I would have achieved a great deal because blogging is so much more fun and requires less work than working a day job in finance from 7am – 7pm.
Of course, my old job provided great benefits such as 401K matching, profit sharing, and healthcare, but I didn’t really care because as an entrepreneur, I had other benefits such as being my own boss, tax-deferring $53,000 into a SEP IRA or self-employed 401k, and plenty of expense deductions.
After generating ~$20,000 a month, I went back to my old habit of saving at least 50% of my after-tax income because I still don’t live off more than ~$90,000 a year after tax. It may be strange, but I’ve had this constant rate of spending for at least 10 years now with no desire to spend more. Check out my post on easy ways to boost savings and control spending.
Given my blog appeared to have so much momentum, I thought, why not shoot for 1M pageviews a month? To my surprise, by the first half of 2015 I was on target to generate 83,000 pageviews a month without changing my production schedule or spending any money on marketing. I was pumped!
The only thing I did was publish a new 180 page book called The Best Of Financial Samurai to help people get their financial lives in order and create a passive income stream for charities focused on educating our youth.
THE MENTAL DOWN SHIFT
Then something happened during the summer of 2015. I went to Cambodia to see the temples of Angor Wat, Malaysia for a wedding, South Korea to explore the DMZ, and Taiwan to see my mother who so happened to be visiting her mother. During my time in Asia I was reminded how happy people were living on much less.
When I got to Taiwan, I realized my dear mom was renting an old apartment with no bedroom windows on the outskirts of Taipei. She mentioned she was paying only about $550 a month in rent. Immediately I thought of finding her a more luxurious apartment in a more central location for much more. But my mom was happy with her simple apartment and told me not to worry.
I stayed in one of the windowless bedrooms for five nights and was so happy because I was not only spending time with my mother and grandmother whom I hadn’t seen in a while, but also eating pounds of freshly picked lychee sold from the back of a farmer’s truck right outside. I had no panoramic ocean views like back home. There was no TV or internet access either. All I had were undecorated white walls with an AC unit that allowed me to sleep like a baby after walking around all day in humid 88 degree weather.
Although we lived simply, we found joy in simplicity. Incredible food, basic shelter and spending time with loved ones is all one really needs. Here are some pictures I took at the Shilin night market where they have the best street food and sell anything you can think of.
At some point during the flight back to the States, I thought to myself, What’s the point of grinding so hard to make more money? I’m not any happier earning more than when I made much less after leaving my day job in 2012.
My entire mentality about challenging myself to always grow and make more money went completely away. I already had enough to be happy with my non-online income streams supporting the way. Downsizing to a smaller home in 2014 freed about $50,000 a year in cash flow because I rented out my old home of 10 years.
I remembered telling myself when I started Financial Samurai in 2009, If I could just make $1,000 a month, I’d be ecstatic! Now $1,000 a month sounds like nothing. Such a sad, sad statement. It’s amazing how quickly our expectations change.
After changing my mindset to “enough already,” my traffic and revenue stopped growing for the rest of 2015. In fact, a couple of my main revenue sources started declining! If you read my 2016 goals and predictions, you’ll see language about expecting negative net worth growth and a likely decline in my online business revenue by 15%+ as I worried about a global slowdown.
I stopped thinking in terms of abundance and started thinking in terms of scarcity, even though there are three billion more people online I could potentially reach. I psyched myself into not finding other ways to grow, so I didn’t until more recently.
CHANGE YOUR MINDSET
Believe there is more than enough for everybody to prosper. When you have an abundance mindset, positive things start to happen. You start doing things that bring about positive change. Because you see positive results, you continue to build momentum until you achieve and surpass your goals. Any feelings of jealousy about other people’s success start dissipating because you realize life is not a zero sum game. Just because someone else wins, doesn’t mean you can’t win too.
Now that I’ve been out of Corporate America for four and a half years, I realize the biggest reason why people adopt the scarcity mindset is because people realize that no matter how hard they try at work, their upside is capped. There is no reward for taking excess risk. As a result, people don’t bother and cruise to a mediocre career and lifestyle. This is why everybody should have a side-hustle until they can make a full-time living on their own. At least you have an outlet to experiment on things you really care about without fear of financial failure.
If you want more, change your attitude! Don’t let the Debbie Downers and the “woe is me crowd” hold you back. If you pay attention, you’ll notice they tend to hang around each other to find comfort in their own misery. Exorcise these people from your life. They’ll always have some excuse as to why things can’t be done.
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