Dear Financial Samurais,
Given that it’s Valentine’s weekend, I thought I’d share my top personal finance-related tip for maintaining a happy marriage: don’t do a gut home remodel!
If you take on a gut remodel, you will face immense frustration due to cost overruns, delays, and unexpected setbacks. That frustration will inevitably boil over into anger, and unfortunately, you may end up taking it out on your loved one.
I can’t tell you how many times I’ve heard from listing agents that a home is for sale because of a divorce partially ignited by a remodel. When a relationship turns sour, neither party cares about getting top dollar for the home; they just want to be done with it—and with each other.
I’ve done two gut remodels and a series of other home renovations over the past 22 years, and I can confidently say I will never do another one. Not only will you protect your marriage, but you’ll also protect your finances. Although real estate prices have risen over time, construction costs have increased even faster and contractors are becoming more savvy.
I don't care how organized and driven you are. The remodeling process will beat you to a pulp, especially today.
See: Buy A Fully Remodeled, Move-In Home Over A Fixer Please. At the moment, I think the market is misplacing turnkey properties. They should be trading at greater premiums than they are.
Getting Rewarded Based On What You Deserve
All most of us ever want is to be rewarded based on our effort and skill. To be given something we don’t deserve just because of who we are doesn’t feel right. Conversely, when we don’t get rewarded despite our efforts, the disappointment can be soul-crushing.
The idea of solely being rewarded based on merit sounds great in theory, but in practice, it’s impossible due to human biases. Take, for example, a parent’s love for their children. When it comes time for your son or daughter to get a job, will you truly remain neutral if you have hiring power? Probably not.
The reality is that connections matter. If you have money and influence, your friends and family will naturally get more opportunities than those outside your circle.
Some of you will be fine with this because you’ve convinced yourself that your achievements are purely merit-based. Others may feel a nagging sense of guilt and want to prove their true potential by venturing out on their own.
If you’re wondering whether you’re making the maximum impact, ask yourself: Will the organization you belong to continue to thrive if you leave? If the answer is yes and you’re eager to challenge yourself, then perhaps it’s time to create something of your own—whether during your off hours or by going all in.
See: Rewarding Based On Merit Alone: Great In Theory, Hard In Practice
Interestingly, the feedback from this article has been more muted than I expected. It makes me hopeful that more people are realizing that getting ahead isn’t just about hard work and talent—it’s also about relationships, timing, and luck.
Too Much To Do In A Big City
It’s NBA All-Star weekend here in San Francisco, and our family is heading to an event before attending the Chinese New Year’s Parade (Year of the Snake). After that, we’re driving up to Palisades, Lake Tahoe, to take advantage of the fresh snowfall, given that school is out next week.
Frankly, all this activity feels a little overwhelming, especially since we were just in Lake Tahoe a couple of weeks ago. It must be nice being a kid these days—with endless vacations and experiences! Still, we’re going to make the most of this time together while we can because we can.
This busyness got me thinking about a few key things:
- Having fun is fun, but even fun gets old after a while. There needs to be down time.
- Your idea of fun evolves as you age. Don’t assume that what excites you in your 20s will be the same in your 40s.
- Big cities create a constant sense of FOMO (fear of missing out). When there’s always something exciting happening, you feel like you should be doing it all. Meanwhile, your friends and acquaintances are out there enjoying everything, making you wonder if you should be, too.
Some people have this idea that those who pursue financial independence, retire early (FIRE) do nothing but work, save, and invest, sacrificing fun along the way. While it’s true that sacrifices are necessary to build wealth beyond the average person, I believe the process of wealth accumulation can be a source of joy itself.
When you’re working toward financial freedom, there’s a sense of purpose, discipline, and delayed gratification that ultimately makes the rewards even sweeter. And once you reach FIRE, you may find that your lifestyle doesn’t actually change that much—you’ll just have a little more freedom to do what you truly enjoy.
See: Partying Like A Young Degenerate Is Not Good For Your Finances.
To Your Financial Freedom,
Sam
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