Happy New Year! Time always moves faster the older we get. One day I’ll lose my mind and hopefully these journal entries will jog my memory. I’ve put together this 2013 year in review to take a quick look back at what I did well on and where I failed.

Although less than 20% of my life is discussed in my writing, I hope it’ll be enough to jolt the other 80% alive if I forget. If not, the thousands of pictures I take every year will.

2013 started full of promise and ended way better than expected. I was looking for a conservative 9% increase in the S&P 500 to 1,551 after a 13% year in 2012 and we closed up 30%! I became more bullish after my target was achieved in the first four months of the year and positioned more aggressively, but not enough unfortunately. It’s fun to keep predictions set all year so we can look back and see how we were feeling back then.

One of my biggest challenges all year was maintaining focus. It’s way too easy to sleep in every day, binge watch shows on Netflix, stuff my face with donuts, travel for weeks on end, and have days blur together with so much free time now that I no longer have a day job. As a result, I set one year, three year, and five year business revenue goals to minimize the amount of meandering. So far, so good. But to be quite frank I’m losing my desire to make more money. I just don’t care anymore, which is part of the reason why I left Wall St. I just want to feel useful.

You can’t deny how someone feels. They just do and you’ve got to accept it. Maybe the color blue looks different between two people. We’ll never know because we can only know ourselves.

I started this site as a way to deal with the agony of the financial meltdown in 2008-2009. I needed to find a way to let the pain escape in a healthy way. Drugs and booze were not an option although tempting they were.

This site has always been about introspection. To understand why we think the way we think. To understand our inconsistencies. Finally, to talk about issues that are on so many people’s minds but cannot be publicly discussed due to fear of persecution.

Since my very first post in 2009 I’ve been able to reconcile the stupidity of my multitude of financial mistakes. I’ve met many friends online who are also on uncertain paths to financial independence. We’ve shared victories and defeats.

But I thought there would be more people like me who fear being alone, going broke, or being a failure to our family. Lately, I feel like I’m the only loser around.

A PERFECT WORLD FULL OF PERFECT PEOPLE

It’s never easy to open up about mistakes and insecurities. Yet, that’s exactly what I’ve done in posts such as, “Real Estate Mistakes To Avoid,” “Dealing With The Fear Of Being Alone Forever,” and “How Amazing Is Your Fabulous Life?“. I thought I’d feel a little better about exposing some failures full on and I slightly do. But as I read and responded to the comments, I realized I was basically the only one who lost hundreds of thousands of dollars in real estate, who fears dying alone, and who has a case of FOMO.

Nobody commented in a particularly negative manner. Instead, it was more, “Thank goodness I didn’t buy a second property!” or “I’m so happy to come home to a loving wife,” or “FOMO? Really? That’s pretty ridiculous if you ask me.” Each comment reaffirmed that I was the only sucker to experience such things.

Keeping Things real

One of my goals for writing about my mistakes and worries is to let readers know there’s a real person behind the writing, not some financial wizard who never steps into a hole and twists his ankle.

Personal finance is such an unpredictable journey that if you travel long enough, bad things will happen. I thought if I could share my bends and turns, you’d not only feel better about yourself but also become more encouraged with never giving up. Maybe it’s not working or maybe it’s working a little too well.

Failure to properly convey a message online is frustrating. I enjoy crafting stories around a topic so that maybe readers can better imagine a scenario that will promote dynamic discussion. My goal is to always try and put myself in someone else’s shoes so we can better understand their situation.

To be told my ideals are “different,” with the insinuation they are inferior is disappointing. I need to constantly remind myself not everybody is as open minded or has seen the world or speaks another language.

I FEEL STUPID FOR CARING SO MUCH

Those who care the most are probably the weakest link. If I didn’t care so much about my company, I wouldn’t have stayed for 11 consecutive years. I would have hit one of many multiple bids from competing firms looking to hire me for more money instead.

I also felt it a duty to train up my junior hire so that he could be self-sufficient in running the business before I left. The decision cost me around $300,000-$500,000 in lost income over two years.

Lesson learned: Loyalty is overrated. Do what’s best for you.

In the blogging world, I’m probably the only blogger my size who actively comments on other sites because I remember the loneliness of first starting out and the joy of having someone leave a note. The positive comments are what kept me going in the very beginning.

Now I’m thinking it’s probably best to conserve my energy to prevent burnout as things are getting unwieldy. I still have a habit of responding to the vast majority of comments on Financial Samurai, but I should probably learn to be more indifferent.

Lesson learned: Write more boring, neutral posts which produce less commentary.

What a fool I am for spending hours writing posts on touchy topics that are specifically requested by readers who are too shy to ask friends or family for help. I do all the work and get all the flack while the inquirer gets to sit back and take in all the helpful information. No more.

If you’ve got a particular problem that’s not mainstream, I want you to sit down in front of a computer, spend at least three hours crafting a structurally sound 1,500 word article and send me a copy. I’ll give you some editorial pointers and will publish your post. But you’ve got to do most of the work so you know how it feels.

Lesson learned: Encourage readers to do the work if they want to hear answers to their concerns. This way, more readers will realize how difficult it is to write a post and receive criticism from people who don’t share their own story.

I write about relationships all the time because I want to be a better boyfriend, husband, son and father. By trying to write from different viewpoints I hope to better understand when conflict inevitably arises. I’m well aware about how hard it is to maintain a long-term harmonious relationship given the difficulties I see with close family and friends.

Everybody knows someone who seemed to have the perfect marriage but decided to split. I’m optimistic that relationships can be improved through hard work, no matter how much flack I get from my writing. Truly, the source of all stress is giving a giant crap.

Lesson learned: Putting yourself out there hurts. I’ve got to better weigh the rewards of understanding others with the pain of getting stomped on.

Finally, just a couple weeks ago a buddy of mine was turning the big 3-0. I promised him a week before his birthday that I’d take him out for drinks to celebrate. He enthusiastically said yes.

About three days before his birthday he started getting wishy washy about celebrating. I could sense he was going to flake so I made other plans. It turns out he made plans with some other friends and didn’t even mention it until the next day. Thanks a lot for agreeing to hang when you had no plans but pushing me aside once new plans were made.

Lesson learned: Be more selfish with my time. Focus on friendships where there is reciprocity and dump the rest.

TIME FOR A CHANGE AND A BREAK

In a 50 minute podcast interview I did the other week about the reasons for starting this site and the trends of online publishing, I told Spencer the host I wanted to do more of the things that made me happy (write). In addition, I shared I wanted to do less of the things that no longer made me proud (working in finance) when I was deciding on engineering my layoff.

I’ve decided to do the same thing with my writing by gradually taking away some personality and candor. Being open hurts. You just get constantly hammered by an unrelenting crowd who takes pleasure in mishap.

But I must say that often times I’m overfilled with joy by the internet world. The wonderful feedback from readers on my post, “My Fear Of Being A Father” makes everything worthwhile again. I also received several private e-mails from fathers who feel the same way and we were able to talk things out.

Finally, there are people out there who have admitted to suffering financial hardship like reader JayCeezy who wrote, “How To Lose A Million Dollars And Live To See Another Day.” If only I could figure out a way to consistently write more such posts to engender such terrific responses and find more readers to open up about their imperfect lives.

Neutralizing The Soul Of Writing

The biggest personal finance blogs in the world  – some of which have sold for millions of dollars – are expertly neutral in their writing. They don’t delve into taboo or more controversial topics out of fear of offending anybody. The big guys deftly hire multiple writers who report the news, write plenty of products reviews and talk about subjects that belies their experience. And guess what? Readers love it otherwise how could they grow so large? Building a content business is all about plain vanilla.

All the biggest sites also focus on frugality instead of ways to make more money through investments and alternative means. The reason is because writing about making money is much harder than writing about saving.

From a reader’s perspective, it’s also much easier to follow money saving instructions instead of doing research on real estate or stocks. It’s a match made in heaven which I’m being encouraged to pursue. One fellow blogger writes about a minimalist lifestyle living off less than $30,000 a year with a family while earning multiple six figures a year. The business model is brilliant.

Don’t Want To Change My Writing Style

It’s a little sad for me to change the style of my posts because it’s been so fun to read all the various responses. But I’m not stubborn. I’m a realist who is acting rationally. Vanilla is what is demanded of readers who feel slapped in the face by what I write.

I also don’t want to feel bad about my writing any more so I plan to slowly remove myself out of the equation. For all of you who’ve been privately asking me difficult questions, I’m sorry but the public has spoken. We cannot talk about things such as finding a rich husband. As one commenter said, I lose credibility when I write about anything other than personal finance because I should have no other interests or concerns in life.

Time For A Break

I’ve decided to take another 10 days off and won’t be back until the end of the month. I will think short and soft about the new direction I want to take with Financial Samurai. Maybe I’ll even cure some FOMO given there will be no wi-fi out at sea thank goodness. I will meditate on whether the vocal minority is striking and should be ignored or whether I need to drastically change directions to ensure the growth and survival of this site.

I’m looking forward to this potential new phase of Financial Samurai. Don’t worry, I’ve got at least 15 previously written posts and guest posts to go through before any significant changes take affect. Maybe by that time I’ll have regenerated my thick skin to take on the body blows once again. Or maybe new readers might change my mind. Here’s to feeling up and in again!

Regards,

Sam

Feeling Down And Out Updates

Update 2019: I lasted for another 6 years since writing this post, but am once again fading fast as I’m now a dad to a two year old lovely boy. He is the most wonderful person ever, but boy does he take a lot of time and energy to take care of. Because of my boy, I’ve decided to keep Financial Samurai going for another 20 years until 2039. Financial Samurai will be a career insurance policy for my son just in case he gets rejected everywhere and can’t find something he loves to do.

My goal of achieving $200,000 a year in passive income has been hit.

Update 2022: I wrote this post back in 2013, almost 10 years ago. And since then, so much has gone on. One thing I’m really proud of is publishing a Wall Street Journal bestseller called, Buy This, Not That. It took two years to write. But just a week after making the bestseller list, I felt this emptiness inside very similar to when I first wrote this post.

What I’ve learned over the years is that putting yourself out there and trying really hard can often hurt. But we do it anyway because we feel a great need to do something meaningful and help other people. I just want to remind everyone not to let your critics defeat you. Keep going no matter what! Eventually, good things will happen.

The best way to get ahead is sometimes not the most pleasant way. In fact, I believe the best way to get ahead is to tell yourself hard truths.

Is it better to tell someone what they want to hear or tell them what they should hear? I choose the latter, because sooner or later the fairy tale will end.

Between the ages of 10-16 I started reading a lot about Eastern philosophies, particularly the concept of karma. I used karma as an excuse for everything!

Examples of Using Karma As An Excuse

“If I’m meant to get into a good university, I will, so don’t worry about my studies mom and dad!”

“If I’m going to die young, I will, so let me buy the 600cc Honda CBR motorbike OK?”

“I cannot change whether I’m going to be rich or poor, so let me have some fun while I’m still alive.”

“I can’t do anything about this bully. Let fate handle him.”

“We’re either destined to be together, or not. I’m not going out of my way to woo her.”

Karma is a pretty neat way of rationalizing not having to study, be safe, work hard, fight back or go after what you want. My dad finally knocked some sense into me when I asked about the motorbike for the umpteenth time. He said, “Son, don’t be stupid. A colleague of mine just drove his motorbike into a wall and died. You want that to happen to you before your life even starts?”

“Oh, OK. Maybe I’ll stick with riding my bicycle to school then,” I remember saying. I actually did end up buying a mini-50cc replica racer motorbike without them knowing in high school. Its top speed was only about 45 mph so I figured if I did hit a wall I’d survive. Too bad it ended up getting stolen because it was sweet!

Listening To Stinging Criticism From My Father

My father also said something that really deflated my enthusiasm for tennis during high school. When I didn’t win some difficult match sophomore year he consoled me by saying, “Well, I guess you’re just not good enough.”

That was a zinger because I stayed after school every day during tennis season to practice for 2.5 hours. By the time I got home all I wanted to do was sleep, but I had another 3-4 hours of homework to complete. Even my hero at the time, Andre Agassi loses, so why can’t I? For about a month I didn’t do jack shit because I was depressed.

It was hard to hear “just not good enough” at the time. But the reality is I wasn’t good enough to take my game to a Division I school. It was better I spent that extra hour practicing for my SATs instead of on my backhand. I did end up getting a small scholarship to play for a Division III school. But I passed to go to a better institution.

The one thing about sports is that scores don’t lie. You are either a winner or a loser. The best way to get ahead in sports is to face reality and work on your weaknesses.

I’d like to think I’d come to my senses on my own about not being good enough after losing one too many difficult matches. But who knows. Maybe I would have stayed in a long state of denial that would have been detrimental to my life. At least I was able to get bumped up to a 5.0 USTA rating at age 39! 5.0 gets me competing against ex-college players.

At the end of the day, I think we need to know hard truths so we can focus on areas that will bring us happiness. Here are three truths I plan on reminding myself every so often to make sure I’m on track.

If you want to get ahead, why not just try harder? It sounds simple doesn’t it? Let’s see if trying harder is one key to success.

Anybody who knows me realizes I’ve got very little talent in practically everything I do. Complex math was confusing so I stopped at Trigonometry sophomore year in high school. Who needs math, I told myself as a teenager who knew he could never become an engineer. 

My tennis serve is mediocre because I’m not particularly strong or tall. 205 lbs was the max I could ever bench and it’s been all downhill from there. Even after owning an acoustic guitar for over 10 years, I still can’t fingerpick quick enough to play Just Breathe, one the most beautiful songs by Eddie Vedder.

Even writing an article is often hard despite writing consistently online since 2009. My post on the recommended net worth by age and work experience took over 10 hours to write for example. Who the hell dedicates 10 hours of their life to write an article when I could be sipping a Moscow Mule on a beach in Bora Bora after an adventurous dive? An untalented writer who has to constantly double check his math and make sure there aren’t too many grammatical errors, that’s who.

Surviving Being Average

Despite my deficiencies, I’ve managed to survive and lead a happy life. Serves are carefully placed while lullabies are simply sung. I even managed to get bumped up to a 5.0 USTA rating, which only 1-1.5% of USTA players get to.

I argue that genetics plays a big part in happiness because when I was a poor college student studying abroad on $300 a month I was ecstatic. When I was getting Django Unchained on Wall Street, I was excited to be in the thick of the action. Now that I’ve retired, the happiness meter has stayed elevated as it should.

But what about effort? How much does effort play a part in getting ahead vs. talent? Every time the wheels start slipping, I ask myself, Why not try harder? Let’s discuss.

Effort Is More Important Than Talent For Success

Imagine being 7’1″ feet tall and 300 pounds of muscle and not do anything useful with your superior physical attributes. Maybe you get drafted in the second round of the NBA based on shear potential despite only playing two years of organized basketball. But because you fail to practice your free throws, your post up moves, and your footwork you are a dud who is out of the league in five years. Or maybe you turn into Shaquille O’Neal and win four championships over a 19 year career.

Now imagine being so intellectually gifted that you score a perfect SAT score without even trying. But because you’re lazy and love to puff the ganja your grades suck and you end up going to Podunk U instead of Harvard. Just make sure if you go to Harvard you try harder too. Expectations are much greater for you!

Or maybe you turn into one of the thousands of first generation immigrant students who overcome language barriers and constant ridicule to dominate our nation’s best universities. It’s always been a mystery to me why those who are born in the United States, who don’t have to adjust to local culture, and who’ve been speaking English since they could first speak can be outpaced by those who have no such advantages.

I’m sure everyone knows someone with incredible talent who has never lived up to their potential. They should have tried harder, but they didn’t. In many ways, it’s a curse to have superior talent because everybody expects you to be somebody special. When the pressure starts to build, it’s easy to screw it all.

But no logical person would argue for less talent over more talent if given a choice. So let’s not feel sorry for those who are gifted.

Getting Ahead With Simple Math

Let’s assign numerical value 1-10 to describe getting ahead in life. Let’s also define Talent as anything that does not require effort e.g. luck, environment, being born into a rich and powerful family, etc.

1-4: Falling behind

5-7: Running in place

8-10: Getting ahead

Now let’s determine what is the percentage mix between Talent and Effort. I firmly believe that Effort plays a majority of the reason for progress, hence Effort = 51% or more and Talent = 49% or less. But ascribing such a huge value to Talent is a very pessimistic way of looking at things.

These are the people who attribute other people’s success to luck instead of hard work. On the realistic other side of the equation, I believe Effort makes up 80% of why people get ahead, and Talent therefore makes up only 20%.

Pessimistic Case: Effort 51%, Talent 49%.

Realistic Case: Effort 80%, Talent 20%.

Talent Also Requires No Effort

Hence, the numerical value of Talent is always the FULL value e.g. 20% Talent = 2, 49% Talent = 4.9. Let’s solve the equation using the Realistic Case scenario.

Realistic Scenario: Effort (80%) + Talent (20%) = Getting Ahead (7+).

If I’ve got 20% Talent and give full Effort, my Getting Ahead score will be 10 = 10(.8) + 10(.2). If I give half Effort, then my Getting Ahead score of 6 = 5(0.8) + 10 (.2).

Now lets look at the pessimistic case where folks can give 60% Effort and still get ahead due to so much talent.

Pessimistic Case: Effort (51%) + Talent (49%) = Getting Ahead (7+). 

In this equation, one only has to try HALF as hard (5) and will still get ahead = 5(51%) + 10 (49%) = 7.45. These are the 7 footers, the math whizzes, the music savants, and gorgeous people of the world.

One of the main arguments is defining what “Getting Ahead” means. We must also decide for ourselves  There’s a reason why the average height in the NBA has averaged around 6′ 7″ since 1985. If you’re 5’7″, so sorry. Find another sport. But at 5’7″ you can clearly be an outstanding guard in your after work league. The same goes for your career or anything you do. There needs to be an achievable set of goals based around your realistic potential.

Try Harder To Get Ahead If You Want

If we are to focus on becoming wealthy, then I argue that a path to wealth is pretty straight forward. Provide more value to someone than you cost and you’ll achieve enough riches to lead a content life. Get into work before everybody else and leave after everyone else and surely you will get ahead in your career. Consistently save and invest and surely you’ll amass a nice little fortune.

It’s the definition of rich which is the biggest variable. Some think owning five cars, five houses, and alligator shoes is the definition of rich. Meanwhile others are happy with just a backpack of necessities to their name and the ability to travel wherever they want, whenever they want.

We run into trouble where we try and mold our definition of “getting ahead” onto others. I’ve laid out my thoughts on the average net worth for the above average person, why spending much more than 10% of your income on a car is a waste, and why contributing to a ROTH is a mistake, but such views are my own. They’ve worked for me, but they won’t necessarily work for you. I’m not forcing anybody to read Financial Samurai, although it would be interesting if such a device existed. We’ve all got the power of choice.

Effort Makes A Difference

I’ve seen how much effort plays a role in achieving goals. Consistently writing thousands of words a week on this site for the past four years takes a lot of dedication, but it’s been fun and it’s paid off.

For example, spending several hours researching Chinese internet stocks one Saturday morning generated a decent chunk of change. Contemplating all my trading mistakes should help make better decisions going forward. Sometimes even practicing eight hours of tennis a week results in a perfect season.

Nobody is going to give us anything. We’ve got to go out and earn it. We should try harder to get ahead. It is very rare that someone is so talented that they don’t have to try hard at all. The only profession that might come close to this scenario is if you are so beautiful and so fit that you can easily grace the cover of any magazine. But even then, a model must learn how to walk, pose, and maintain for longevity.

Let’s make the most of what we’ve got. If effort really is more than 50% of the equation, then we should feel emboldened knowing that the power is in our hands. Summer is here. Do we work while others are at play? Or do we relax like everyone else? Whatever we do, let’s just make sure the end results are congruent with our efforts.

Readers, why not try harder to get ahead? What’s stopping you from trying harder to achieve what you want given hard work requires no skill? Is there such a thing as having a talent for hard work? What do you think the appropriate ratio is between effort and talent to get ahead if not 80/20?

Photo: Enjoying Art & Sunshine in SF, 2013.

Post is updated for 2021. Work ethic is huge folks. Do not underestimate its power! The secret to your success is 10 years of unwavering commitment at you craft!

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