The only reality is the one you know, which is why it’s odd for someone to ever say you’re “out of touch with reality.” To do so would imply your reality is superior to another’s reality, which is arrogant. But many people have commented I’m out of touch with reality over the years because of the way I view money and opportunity. So I’ve decided to slowly do something about it.
The tone of Financial Samurai has changed from one of defiance, to one of acceptance. I no longer rail against the government or argue with folks why a ROTH IRA conversion is a mistake. If you want to only save 10% of your earnings and work until you hate your job, go right ahead. I just like to put things out there now and let the community decide what’s best for themselves. I’ll go about doing what’s right for me, and if you don’t want to take my advice, no problem.
Part of the reason why I do write about wealth inequality and socioeconomic equality is because I recognize I’m lucky and I don’t want to take my luck for granted. And so I write and write and write to share my thoughts on boosting wealth in hopes of sharing my luck around. But with the largest personal finance blogs in the world focusing on frugality instead of making more money because it’s so much easier, I need to adapt to grow, even though I know many of you don’t want to eat dog food in retirement.
A SECOND PART-TIME JOB
The recent stock market correction resulted in roughly a $25,000 loss to my rollover IRA. Although my rollover IRA is considered my punt portfolio where I chase unicorns and supposedly don’t care about its amount since it can’t be touched for 25 more years, losing $25,000 still brings my spirits down. After all, real pre-tax money was originally contributed via a 401(k). (Related: Should I Rollover My 401(k) Into An IRA)
Instead of whining about my stupidity while letting myself get depressed thinking about how I could use that money to go on a great vacation, I decided to heighten the pain by doing something about my situation. I’ve taken on another part-time job to make up for my losses!
You’re now reading the proud words of Tennis Coach Sam! I love tennis and I enjoy teaching folks a game that can be played well into their 70’s. My new part-time job is coaching a fellow player’s daughter for 1.5 hours a week. Her team won the varsity city championships last semester, and she’s looking to keep up her game during the off-season in order to come back stronger for her final year of high school.
With about 10 years of teaching experience and 25 years of playing experience, I decided to charge $50 an hour, a deal compared to $95 an hour at private clubs. We keep it real by playing on public courts near her house from about 4:15pm until dark for 1.5 hour sessions.
But here’s where the mental pain begins. At $50 an hour, I have to work 500 hours to make up for my recent IRA losses. At my current pace of only teaching 1.5 hours a week, it would take me 6.2 years to break even! I enjoy exercising and helping young folks get better. But just knowing that I have a long road ahead to recovery crystalizes the reality of my financial loss.
In order to expedite my recovery in three years, my new mission is to now teach three hours of tennis a week. If by some miracle my stock picks recover, maybe I won’t have to work as long. Or maybe I’ll continue to lose more money as the markets correct, but for now, I’m shooting for three hours of tennis coaching when I’m not consulting at a startup for three days a week. Who knows, maybe I’ll do a great job and get many referrals to boost my coaching time to six hours a week. The only way I’ll know is by trying.
THE SEGMENTATION OF REALITY
It would be easier to dismiss my investment failure because I can’t touch my IRA until age 59.5. “Think long term” as short-term losers like to say. But my goal is to face reality in order to never take my luck for granted. I also always want to do something about a bad situation and not let it defeat me. By putting $25,000 in the context of coaching for $50 an hour, I’m going to be more diligent in my investments and more appreciative of hourly wage workers.
My part-time consulting role at Personal Capital pays 60%-85% less than what I made in banking, but it’s fun and reminds me of all the times I hated taking the bus to work. I look around at all the long faces waiting for coffee who must work at jobs they dislike in order to pay their bills and receive health care for their families. I want to feel that similar type of melancholy too in order to appreciate more of what I could do with my free-time.
I think the main reason why people say you are “out of touch with reality” is because they don’t think you know what their harder lives are like. I’ve been a burger flipper at McDonald’s who opened up shop at 6am before. I also spent time doing heavy labor as a mover. But those jobs were so long ago, and it’s all about what kind of suffering have you done for me lately to relate to another person’s hardship.
My day now consists of waking up at 5:30am to work online for three hours until I take the bus to my part-time consulting role from 9:15am until about 5 pm. I then spend another hour online catching up with stuff I missed during the day at night. During my off days, I’ll teach tennis for at least 1.5 hours until the sun goes down and then work with my personal finance clients one-on-one for however long it takes to get the job done.
In essence, I’ve got four jobs: a writer, a startup consultant, a personal finance consultant, and a tennis teacher, all at vastly different levels of income.
WHAT IS YOUR REALITY?
If a child grows up in the projects with parents on welfare, are we to say he is out of touch with reality for presuming it’s normal for people to be on welfare for years? If a child grows up in a 4,500 square foot suburban home, attends private school all her life, and lands a plum job through connections, are we to say she is out of touch with reality despite all her friends going the same route?
If you can still call someone “out of touch with reality” who takes the bus to work, owns a 14 year old car, went to public school, works four jobs, started off at McDonald’s, has a mortgage, grew up in third world countries, and is still saving aggressively in order to one day take care of a family of four, then you are right. I am out of touch with your reality because my reality is all I know.
The only thing that might be different from me compared to most people is that I put myself out there in my writing on a consistent basis. My book is more open than yours. Hence, to level the playing field it’s important to get everybody to share their stories so we can better understand.
Updated for 2018 and beyond.