Whenever things are going well for an extended period of time, I begin to worry. Where did all the bad luck go? Something must be wrong. I’m not sure why life has turned out OK when there are plenty of smarter, more deserving people out there who still struggle. Maybe the exhausted fumes of good karma from a past life?
The longer you live, the longer you realize nothing good lasts forever. Something bad is bound to happen – a break of an ankle, a bad investment, a friend who disappoints, a boss who lies, a disease that debilitates. Instead of waiting for disappointment, I like to seek out failure to knock some reality back into my life. Getting rejected is also a great way of keeping the ego under control.
WHY I SAVE SO MUCH
Ever since I got my first paycheck in 1999, I’ve saved over 50% of my after tax income. I didn’t care about living in a studio with another fella the first two years out of college because I needed to save. Over the years, people have asked why be so frugal? Work to live, especially while young, right?
They asked whether I thought extreme savings was learned, or part of one’s DNA. I always responded that extreme savings is due to circumstance. When you know you won’t be able to last in a brutal work environment for an extended period of time, you save. When you know tax cuts are temporary, you save to pay for the inevitable hike. When you believe it is your duty to not only take care of your immediate family, but also your parents, you save and save some more.
When life is good, you don’t save. There’s no need to prepare for the unknown. I believe the good life is the reason why the savings rate is so low (~4%) in America. We’ve got a stable government, fresh air, the internet, cheap electronics, an abundance of food and water, Social Security, stable inflation, and accessible education for all. Why bother saving more than you have to? Move to India, and the national savings rate zooms over 20% because life is much harder!
If I drill down even further as to why I continuously save so much after all these years – from flipping burgers at McDonald’s to early retirement in 2012 – the real reason is because I’ve perpetually FAILED at so many things.
KING OF FAILURE
When I graduated from William & Mary, I had no official job offer (failure #1). How embarrassing it was to have nobody believe in me after four years of studying and working at internships. I told the Economics department I got an offer at Goldman just so I could have their name next to my name in the graduation booklet, even though I was still in the middle of interviews. It wasn’t until a month after graduation did they finally welcome me in.
I thought the offer was a fluke because it came in e-mail form while I was visiting my girlfriend in Tokyo, so I decided to save like crazy just in case they made a mistake. After all, William & Mary wasn’t a target school, I didn’t have rich parents as private wealth clients, I got into trouble with authority, and I didn’t have any connections to keep me employed. They never did retract the offer, but I certainly wasn’t a prized analyst like others.
Because the dotcom bubble burst in 2000, I knew my job was at risk. I overheard a conversation my supervisor had with another Managing Director about how I probably was going to be let go in the next round of layoffs (failure #2). As a result, I frantically interviewed with a competing firm in San Francisco and left the firm before they could let me go!
At my new shop, I began saving even more than 50% of my paycheck partly because San Francisco is so much cheaper than Manhattan, but mainly because I felt like I had escaped a firing squad back East. Two years after I left, only about 25% of my analyst class remained. Further, surely my new firm would soon discover I wasn’t any good and retrench me during the next Last In First Out layoff round. After all, I was just a 24 year old kid who wasn’t bringing in any business, yet.
What I was experiencing in my early 20s was “The Impostor Syndrome.” I was making decent money, but felt I really didn’t know what I was talking about. Why the hell would/should older, more experienced clients listen to me about investing in international equities? One client called me “green as a gourd” when I traveled with him to India. Another client asked if my senior colleague could cover her instead. Confidence shaken. So, I saved and saved some more.
When I failed to make Managing Director in 2012 after four years as a Director and three years as a VP (failure #3), instead of navigating through the maze of corporate bureaucracy for one more year, I decided to create my own luck by leaving. My active income immediately took a 80% dive (failure #4), and once again, despite having negotiated a severance package, I found myself worried about my financial future.
During my time away from Corporate America, I decided to write a book about severance negotiations. Given there weren’t any books out there about the topic, and there still aren’t, I thought my book would be a runaway success! After all, who doesn’t want to walk away from a job with more financial security during a time of great uncertainty? Three years, and one huge 50-page revision later in mid-2015, I’m still only selling about 30-40 books a month (failure #5).
Between the first edition and the second edition of my book, I attempted to create a personal finance advertisement network in 2013. I brought on a partner, and we gave it a go for six months. Her goal was to bring in the advertisers. My goal was to bring on the bloggers. She ended up finding full-time employment, and I realized brokering transactions was a supreme PITA! The project was shut down a couple months later. (failure #6)
And now, partly because I have doubts about the sustainability of my online business, I decided to look for full-time work again. If my business was a runaway success, I wouldn’t entertain going back to Corporate America because working for yourself is pretty amazing despite the loneliness of being a solopreneur. But my growth rate has slowed to about 50% in 2015 from 120% in 2014. If I don’t do anything significant to improve the business, surely my business will slow even further in 2016 and beyond (failure #7).
So far you’ve read about seven large failures over the course of 15 years. There are many more failures during this time period I could share, rest assured. But over the past three months, I’ve experienced a tsunami of failures that no longer have me wondering how I could be so lucky.
Let’s enjoy them all!
NINE MORE RECENT FAILURES
Over the course of three months, the following happened:
* Didn’t get the job I spent 10 hours interviewing for at a fintech consumer lending company. They decided the scope of the work was too narrow for me, and they didn’t have the capacity or desire to pay more.
* Interviewed at a buddy’s firm for an hour, and the person didn’t even bother to e-mail back or follow up with any closure after I thanked him for meeting up. I have no plans to inquire further as I’d rather not mix friendship w/ business.
* I lost the remaining three years of stock options promised to me as an advisor to a company after our agreement was terminated this November. At least I get to vest 1.5 years worth of options that should be in the money.
* Didn’t get into a startup fellowship program after spending ~3.5 hours on the application. Yes, there were 6,500 applicants for 22 spots, but still, there was a chance!
* An advertising client decided to suddenly terminate our business arrangement. We also had a contract in place. Now I wonder about their business model going forward and whether they’ll be able to raise a next round of funding to survive.
* A business partner changed the way they are tracking conversions, so I’m now making 30% less with them, even though I’ve made no negative changes on my side.
* Got rejected from a local incubator program after spending five hours filling out the application and another couple hours going down to Redwood City and giving the pitch. This one particularly hurt because I thought I sold my value proposition well. But now that I see who got in, it’s clear that incubators no longer incubate ideas, but companies that have already been around for years and have received funding. For example, one company that got in already raised over $1.2 million and has a viable product for years already! I’ll write more about this in the future.
* My site went down for a whopping five hours on a recent Monday the most trafficked time of the week and day because some construction worker accidentally hit up a fiber cable that took down my entire datacenter. WTF. There was no backup. This outage easily cost me at least $1,000 in lost revenue and I’m waiting to hear if there is any remuneration.
* I just lost $16,750 in income from one partner I worked so hard on. I wrote two 2,200+ word posts focused on them, and published two newsletters to my 25,000+ e-mail subscribers about their product. When it was time to settle, they said the amount of leads I generated according to the dashboard they provided was wrong! If I can’t trust the numbers they gave me, then what can I trust since I have to rely on their back end data to remain whole. I followed all their guidelines and still got screwed.
The total revenue lost from all these failures is probably about $220,000 over the next 12 months! Granted, I would have had to put in hours of work at the day job and the incubator to earn that money. But still, it would have been nice to have been given a chance.
DEPEND ONLY ON YOURSELF
Do you know what $1 million dollars buys you? Only about $25,000 a year in freedom income since it’s good to not touch principal if you want guaranteed freedom. That is nothing if you have a family or live in an expensive city like San Francisco. Given we all know that $25,000 is barely enough to live a comfortable life, the only solution is to save until you have an amount that’s equivalent to provide you 100% freedom income e.g. $4M for $100,000 a year.
Rejection hurts. These past three months remind me why it’s easier to just not try. If I think about the rejections too much, it will make me mad because I know I can run circles around my competition if I just got the chance. But feeling the pain is exactly what I want so I never take anything for granted. Now I’m motivated more than ever to prove my detractors wrong!
Look, I know it’s not all bad. I’ve got my health and my family who are always so supportive. The Financial Samurai community is rocking. And I’ve grown a livable passive income stream that provides for flexibility. But all this doesn’t matter to other people, because they don’t know the details.
Having money is all about having the freedom to choose. A large cash cushion is what will help you get through the inevitable dip.
The next time you start feeling a little too good about yourself, seek out rejection from a person or an organization. Better yet, spend hours of your time trying to create something of your own only to realize nobody gives a damn. You’ll feel bad at first. But after a couple days, your motivation meter to save will explode through the roof! Put your hopes and dreams in you.
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Updated for 2017 and beyond.
Recent Failures:
1. Failed to secure a perfect 6 figure job that was local. I was overconfident that between my experience, education, and connections I would be a sho-in, but I didn’t even get an interview, I found out a month after applying that the position was filled internally.
2. Failed to negotiate a meaningful raise at my current position, but on the bright side I still have a decent job
3. Failed to hit my earnings goal for my blog…
But with failures, you also need to look at the successes:
1. I exceeded my savings rate goal for the year, bringing me in at over 33%.
2. I increased my total income by over 25%, mostly by working more
3. I increased total traffic to my blog by 500% (roughly 1,000 page views/mo to 5,000 page views/ mo)
All in all the good balances out the bad! Thanks for sharing, we all have failures and set backs, but for the most part we tend to advertise our wins much more than our losses.
Nice balanced way to look at your failures. Nice job!
I was laid off from my first job out of college. And I was probably better off not spending the next few years earning less than $30K at a record label. But that failure has stuck with me for every job I’ve held since. And I save because I know I’m never safe. I pick up side jobs for added financial security.
I can definitely empathize with your mindset, Sam. But I think you’re being overly hard on yourself. I hope the time in Honolulu gives you a chance to clear your mind and recharge.
I wrote this post right after I found out I got dinged by the incubator. When emotions are high, it’s best to write. Such a cathartic and healthy exercise.
Thanks for sharing your failure!
Interesting observations on the changing nature of incubators/accelerators. These broad terms cover a variety of practices, objectives, virtues and sins.
Venture Capital money in many areas of the country is looking for proof of market traction rather than just cultivating an idea. Angels and crowdfunding are options to VC money, but early key customers are often more important than early equity to startup success. This means bootstrapping and cultivating customers has to be considered rather than just running after investors.
A few hot spots like Silicon Valley still seem focused on scale (e.g., traffic or eyeballs) with a willingness to figure out monetization later.
Incubators with a real estate focus (fill my building, cover the incubator’s overhead) judge by a “startup’s” ability to pay rent. Ability to pay generally requires current cash or cash flow.
Accelerators applying the Eric Reis’ Lean Startup methodology like National Science Foundation’s Lean LaunchPad (Steve Blank, Bob Dorf et al.) look to cultivate market insight as the foundation for getting the business model correct, before worrying about writing a business plan. You can write a great business plan for a terrible business model if you’re not careful.
Competitive selection models do tend to consider evidence of prior success, whether awards, grants or investors.
If you’ve gone to the work to prepare a pitch, develop a business model canvas, or business plan, and you strike out on your first try, there are a multitude of venues to keep trying. It’s like a bank, just because the first one says, “No,” doesn’t mean the next one won’t say, “Yes.”
You do want to match your business to the history and interests of the incubator/accelerator program. Their connections and insight are as important as their money. An incubator that is an expert cultivator in med tech may not have as much insight into online marketing to consumers.
In fair disclosure, I am a certified Lean LaunchPad instructor and teach and coach startups for the NIACC John Pappajohn Entrepreneurial Center and the University of Iowa’s, Tippie School of Business, Iowa Venture School (an NSF I-Corps accelerator). One of my mantras for startup clients is that success is not about who you know, but who you get to know. (Stolen from LBJ’s secrets of political success.)
It’s hard to blame the incubators for accepting and “incubating” already proven businesses. The incubators don’t want to fail or look bad either.
The only area of bullshit I see is one company who got into the program I applied, and then they joined another incubator the next year, taking the spot of a company that has never gotten the same tutelage. To the company, it’s free money so why not. To the incubator, I think it’s a gutless move.
But again, fear of failure is a great driver to just accept as late an established early stage company as possible. Like adopting a 17 year old!
And on failure. . .
This isn’t universally true, but as a coach and investor, I want entrepreneurs who have experienced failure. It’s a myth that successful business leaders never fail. It’s the ability to deal with failure, learn and find an alternate route to success that defines character and improves the probability of success. I don’t want an entrepreneur to experience failure for the first time on my watch. I love the Lean LaunchPad process of customer/peer discovery before operational launch. The guru’s talk about moving from faith-based to fact-based market insight. I call it, “non-destructive business model testing” (c) because the alternative of guessing and getting it wrong is destructive of time, money, energy and relationships. Otherwise known as failure.
+1
If you haven’t failed, you aren’t trying hard enough.
When I interview people for anything – business, personal, etc. – I want to hear about people’s failures. It shows me their ambitions, and it shows me their strengths and weaknesses. When you can fail, and tell me why you failed and what you learned from it, you’re someone I want to invest time in learning more about, and likely someone I want to invest my money in.
Failure teaches us our most important lessons.
Good you look for failure. I might be your guy if I ever interview with you then! :)
Good stuff, Sam. I look around at folks coasting through life (ignorantly) wondering how they sleep at night. Most would consider me very successful, but I’m always working. Sure I take a break when I feel like it, take a nap when I want, but I’m always hustling. While most people were enjoying doing absolutely nothing the last 4 days of Thanksgiving weekend, I put in probably 30+ hours. I did it with a smile, too, knowing my wife and I are set if we keep hustling for 7 more years (I’m 48)… and I’ve been hustling since 16.
Keep hustling, Sam, and keep on encouraging others to hustle.
Will hustle on!
But I have a feeling folks coasting through life really are sleeping well at night. America is a walk in the park compared to so many other countries!
There’s an old quote, not certain who said it first, that the easiest way to not fail is to never try. So you’ve failed. At least you tried! Hold your head up! You’ve accomplished more than 90% of America!
But what about that other 9% to 99%? :)
I’ve always had a goal to try to get to the top 1% for things I care about eg income, tennis, blogging, etc. Might as well if I’m going to try!
Try. There is no try. It is do or do not. Try is the mantra of those that do not see the true value in their failures and do not fully learn from them. From failure you learn what not to do and possibly learn what to do better next time. Try is for those that quit and choose not to continue. If you want something bad enough you will get to it. Try is the ” it could have been me”s of the world that eventually give in or give up. This may come across as harsh but I am more of an all or nothing kinda guy. You give it your all and continue to do so until you get what you are truly and honestly looking for. Otherwise try is you not knowing what you truly want in the first place. Try is you just wanted the experience of the effort and not the actual end goal. I see this often. People think they know what they want but are not willing to commit to it and risk it all. By nature we avoid pain. Pain is inevitable. Make pain part of your reward. That may sound crazy but it is a badge of your success.
“I have not failed. I’ve just found 10000 ways that won’t work.” – Thomas A. Edison
I’m not sure everyone would agree with some of your “failures” Sam. I mean, growing a site only 50% a year after 120% growth in previous years is not really considered failure in the corporate world (growth has to slow eventually). It sounds more like type-A overachieving not quite reaching the outrageous goals you set for yourself.
But you’re right, any goal not achieved feels like failure regardless of how successful you are compared to others.
Accepting a 50% growth rate from a 120% growth rate the year before is a slippery slope. Because once you accept 50%, then you’ll accept 20% the next year, 0% the following year, negative, and then a complete loss one day. Complacency is what kills progress.
That said, it’s also important to ask how much progress one really needs. Further, it’s about what you compare progress towards. These are challenges I face at least every year when I review my year’s performance and plan for the future.
BTW, nobody has ever said I’m a type-A overachiever, so thanks! All have said type-B, hang loose guy on the courts (someone said this yesterday wondering why I always seem so relaxed and saying that I looked lazy on the court), and at work (clients always wondered why I wasn’t more stressed, especially hedge funds).
The one thing I love is a challenge. The more something or someone can kick the shit out of me, the better. I admire high performers. And I love to compete and get things done. Doesn’t everyone?
I think most businesses have taken a hit since last year. My sales drop probably 40% which is huge when I have over 20k in rents. Anyways, sometimes you gotta grind and make things happen. Is not accepting, because if you are working the same or harder and you still went down it may not be entirely about you it could be the market or it may be time to navigate into to other adventures. Who knows! 100+ year businesses go under, what makes you think they want that to happen or that they let go? its market change and as a person you can make a drastic change, when is a corporation it will go under.
People are making money on the internet today like people were making money in stores in the 1900s. All smaller channels that we see today people making money on the internet will start to make less and less in the upcoming years. Just like Brick and mortal today. My reasoning behind is lets say for example, you sell clothes online and you make good profits 100k a month! right now there are thousands making 100k a month selling clothes online right? lets say 2000 in the world ( it may be a small number but w/e) whats going to happen when 200k people start the same business? those 100k a month become 10k a month ( which is still a good number) but hey the market will continue to expand ( how about 2 million people selling clothes online?) thats whats happening to retail. In my city of 70-80k people there was 1 walmart 3 years ago, now we have 3 of them, can we have 4 or 5 yes! but, sales will continue to drop the more they open. And mom and pop stores are almost extinct noways. hmm Dollar stores in my city alone there were like 2 total 10 years ago, now they are like 15 between dollar tree, dollar general, general dollar etc.. Population growth?60K to maybe 70k-80k now…
So, yes! If you need more you do what you gotta do and get more! there is always more out there! Btw, my comment wasnt negative is just something thats happening! I now own 7 stores, I know in 3 years I need 12 stores to make the same money as today! so, don’t be scared the internet is still booming for the next 20 years! enjoy.
I love your attitude! Being aware of the market trends and doing something about it is exactly what everybody wants to continue going needs to do.
Adversity put us on the path to success :)
+1
Early adversity is a common thread in a lot of real-life Horatio Alger or business success stories. Adversity can be a gift. It puts things into perspective and provides motivation.
I’ve been failing upwards my entire life..due to feeling inadequate. It’s strangely been leading to some really great opportunities. I keep thinking I’m not “good enough” to do X Y and Z, and then those opportunities pop up. But it all started because I’ve always felt inadequate. I do think if you start off having to work for everything, you do have sort of a chip on your shoulder that makes you hustle harder. I have a friend who is a multi-millionaire who told me he never received much help when he was starting out, and was sort of an outcast (always got into trouble growing up), and just hustled and made it happen. So I think there is definitely truth in what you are saying.
Hi Kammi, I wonder, when do you think you’ll finally feel adequate?
I like the term failing forward.
1 million buys you 25K? how do you get that number?
The way i see it,
A 4% withdrawal rate is 40K which if you only take from 401K up to the 15% tax bracket and the rest from investments you get it without paying taxes.
Unless I’m missing something…
I should elaborate in the post. I use $25,000 a year because I use a 2.5% risk free rate of return. My philosophy is to never touch principal during financial emancipation/retirement.
If you start withdrawing principal, then you’re going back to zero. I’d like to leave the money to family and organizations I care about to build multi-generational wealth.
A few thoughts about people not saving enough (in addition to all the reasonable ones mentioned in the article):
– Capital is cheap and relatively easy to access in the US and developed countries. Why save up to afford the things you want when you can easily tap your future earnings with credit today?
– Savings is a bit of a catch 22 in the sense that I personally choose to save and invest for all the reasons commonly mentioned on this site. BUT… I would prefer (reductio ad absurdum) if everyone else in the entire world spent everything they made and more since consumer purchasing is what drives the value of my investments over the long run.
We’ve all had tons of failures, so try not to beat yourself up. I got rejected for a promotion I wanted and really deserved, have been rejected from well over a hundred job applications, failed at scholarship applications and music competitions, and the list goes on and on.
You’ve had a huge list of accomplishments, which is awesome. And while failure does suck, it’s good that you are able to use it as motivation and to continually find ways to improve and learn new things. That in itself is a huge success!
Too many folks try and avoid all types of failure and all that does is ensure that you never put yourself in a place to achieve anything significant because you are never around risk that will pay off. Play it safe and you always wonder “what if” and live a life of regrets. I hate failure too, but every time I get rejected I just chalk it up to that business has no interest in really being successful. Lots of opportunity these days and tomorrow is another day. Companies have never fulfilled me, but the opportunity to grow and build on ideas fulfills my goals.
Not experiencing the “what if” is right up there with the main reason I want to try. I knew if I didn’t try online entrepreneurship FT in 2012 I would always wonder what if! Now, I can rest better going back to work if I want.
Johnny Miller & Mike Weir
One way I deal with failure by saving is the following. If I have an unusual expense such as a plumbing failure that for example costs $1,000 I will think of a way to save that extra $1,000 in order to be at least back to even. So basically small failures lead me to save more.
Per this method, I’ve got to save about $200,000 over one year to make up for all the failure. Good goal to have! Thanks
I like to think of negative events as setbacks, rather than failure. Failure means it’s done for good, setback just means it’s temporary… because it is. Losing stock options, quitting before you get fired, selling only 30-40 books a month instead of hundreds — merely setbacks.
I can’t wait to see where you go next, Sam. You are 100% right about failures knocking you down, but then motivating you to try harder afterward. I didn’t realize it until you said it.
After college, I was out looking for a fun or meaningful job with a decent salary, and was disappointed by what I found. I always wanted to be a writer for Road & Track or Car & Driver, but even my mediocre path toward that career (copywriting for an internet-based home automation company) fizzled out when they laid me off. None of the other job options were good (outside sales jobs with no base salary), and I ended up managing an inbound call center by default. It was torture. I still hate to hear the phone ring.
I had wanted to be a lawyer previously, but got burned out in school, and gave up and decided to just get a “normal” job. I thought that being a college grad from a pretty good UC school would give me some good options, but it was really depressing to see that that wasn’t the case. Fortunately, it kicked me in the ass and made me decide to take the LSAT to see what would happen. I studied hard and ended up scoring in the 97% percentile, which not only got me into law school but landed me a 50% scholarship my first year.
If I had gotten a mediocre-to-good job, I probably would have passed on the law school opportunity, and my life would be much worse today. Being kicked down and having to pull yourself back up is a really great motivator.
Being a writer and test driver for R&T was one of my dream jobs as well. Man, that would’ve been amazing!
Tell you what, the first one of us to get hired at R&T has to promise to get the other one a job there, too. :)
Like Jim said, I like to think of things like this as setbacks instead of failures. Much better to think positively too :)
We save a great deal of money because we have no idea what the future holds for us. I’d rather be prepared so that I can worry less later!
I like your approach to aggressively saving because nothing’s ever guaranteed to last forever. I think however you do not mention the possibility to be flexible. Surely, there are lots of things one could do to lower their expenses way below $100’000 a year, in particular if they have their house paid.
Thanks for sharing your failures. I think you and I had this discussion a few days ago that one could learn a lot from the people who failed. Your a person who succeeded, but with failure along the way, that’s good enough ;)
In an era when social media encourages nothing but perfect filtered photos, amazing vacations, flawless homes, and all AWESOME all the time, it’s nice to read somebody’s honest list of failures and shortcomings.
I’ve certainly got plenty myself. I’m not at the level of career I’d hoped so far and while I think the quality of my blog is decent, it hasn’t seen the traffic levels I hoped to get to this year.
Maybe life really is perfect for everybody else? I am striving to one day replicate the perfect life through the lens of social media. :)
Interesting post Sam. I feel that I was very similar in your outlook. I saved because I was sure that at some point I’d find myself out of work and I wanted a financial cushion if it happened. Well, it did happen and every day I thank my paranoid self. People who push themselves generally are doing it by thinking themselves into a discontented state. It wouldn’t be hard to reframe and focus on the positives of your experiences. But I don’t think that’s your intent here.
There are definitely positives from all the failures. But I really want to focus on the failures and not sugarcoat them to remind me that nothing good lasts forever. I’ve had enough post about wins before. I thought it be nice to Show a different side of the story.
It is super important not to let fear of failure rule over your brain and everyday thinking. I try to create the overall wealth game-plan based on a little fear, but live day to day as carefree as possible! And when I really think about it, as long as I have food, a few great friends, and I’m growing personally I will be happy. Since I have already got these things, the worst-case scenarios seem a lot less scary. And if you aren’t happy living a modest lifestyle, you won’t be very much happier living a lavish one. Money just buys security for me, not happiness.
That said, I continuously save 75%+ of my income based on a little fear! Fear of running out of money and fear of having to work forever. In some ways, I think a healthy amount of fear can make you much more wealthy in the long run. I am a little afraid of getting laid off from my day job, so I work hard there and try to shine during those 40 hours. I am afraid because my day job will never bring the financial freedom I want quickly enough, so I hustle on the side with a blog or a small business. Constant fear of failure drove me to diversify my income streams as much as I could. It is probably some sort of survival instinct for this new digital age.
A 75% savings rate is fantastic! How long have you been saving at this rate and how much do you need to say to be able to take the risk and find a new job that you like?
I have only been saving 75% for around 1.5 years, after reading blogs like Financial Samurai and Mr. Money Mustache. I’m lucky I found your website while I am still young (25). Bless the exploding volcano of helpful information we call the internet.
I currently have a fantastic, entrepreneurial friend and business partner, so instead of looking for a new W-2 job, we are trying to create our own company or side business. If any one of our ventures was looking promising and started to demand more time, I would probably quit my day job and pursue that. Partly inspired by a few close friends who are successful entrepreneurs, and a few of your articles like Bankers, Techies, and Doctors never getting rich.
Perpetual Failure Equals Whatever Meaning YOU Assign.
“Nothing in life has any meaning, except the meaning we choose to give it”.
— Tony Robbins
I followed a similar path…
1) Age 20 – Lost girlfriends to drugs and other guys – learned to select better girlfriends.
2) Age 25 – Lost money on credit card interest – learned how to budget w/ no debt.
3) Age 30 – Lost money on stock tips – learned how to invest properly.
4) Age 35 – Lost money when associates stole from me — learned to work for myself.
5) Age 40 – Lost job when boss lied about me — learned to be financially independent.
6) Age 41 – Lost desire to work in corporate America — learned to be retired at 42.
Thank you for the lessons, – what a blessing!!
Choose your meaning carefully or society may choose something for you!
I agree with your belief. And I do believe that all the failures I’ve listed are indeed failures. There is no sugarcoating around them. I think it’s great to write down the ones failures to remind themselves how they are not good enough and how they can get better. Because as the saying goes, if you’re coasting, you’re going downhill !
Hmm two apply to me
5) Age 31 – Lost promotion when boss lied about me — learned to be financially independent.
6) Age 31 – Lost desire to work in unsafe work environment — saving to retire.
Because people here take everything granted….my Cousin bough 27k second hand lexus just because he like cars..WTH…he can barely afford it but who cares, he likes car so he should get lexus……this mentality is killing america
These tie into “lack of education,” but I think deserve their own focus. In the “Why don’t Americans save question” I think some of the largest factors include:
1. Perceptions of successful people as apart or different. It took meeting some very successful people and witnessing the lack of anything overwhelmingly different for me to change from “That’s not me,” to “Why not me?” Americans mythologize famous entrepreneurs and have lost the spirit of entrepreneurship that is embodied in the successful.
2. Perceived inability to save. The idea of saving $10 a month would be scoffed at by most. I think most people who have tried to learn to be frugal start small to establish good habits, and this leads to successful saving of larger and larger sums. The first thing most people do when they get some breathing room is expand their spending. And one trip on that hamster wheel and they are screwed.
3. Lack of ambition or drive. I don’t want to point a finger at a whole generation, but at 25 years old, I think most of my peers are pleased to have a decent job. Most wouldn’t consider bailing on one for a riskier but potentially more lucrative career.
4. Not lack of education, but downright misinformation is pumped into the cultural consciousness. I get a big chuckle from broke movie characters living in chic flats in the ehart of America’s most expensive cities, or the drone of go to college but college isn’t for everyone (which is more about holding up how important it is for anyone of worth to attend college then it is about validating tradesman work or independent business). Public school teachers land in the goldilocks zone of comfort vs. risk when it comes to employment. Most of those responsible for educating millennials have no idea what it takes in todays job market or financial world.
I don’t want to sound too doom and gloomy though. As much as millennials get looked down on when it comes to the employment and financial side of things, I think much of these woes can be attributed to the learning curve we didn’t expect to encounter, rather than laziness or unwillingness to work.
On the bright side, if much of these woes can be attributed to the learning curve, and all it takes is more and more awareness for people savings rates and savings amounts to go up!
Funny how failure is really in the eye of the beholder – I would struggle to classify many of these as failures at all. Some are achievements that might have fallen short of a very high benchmark you’ve set yourself, or simply things that have happened over which you have minimal control.
But we all set our own expectations and goals, and I guess if it feels like a failure to you, then it is. I do appreciate the point about seeking rejection though, to keep you motivated. When life is good, I really try and be grateful for it, and recognize that things can change at any moment – although it can be hard to stay motivated just by being grateful and it’s easy to grow ‘soft’. But I’m definitely not as much of a glutton for punishment as you Sam…
Everything is relative, I agree. But failure to me feels the same and is the same as failure to anybody else with goals that are not achieved. And so I say, hang a lantern on it. Shine your failures as Bright as possible so that you never forget how hard and takes to get to where you want to go. So that when you ultimately succeed, you will savor the success and appreciate the victory that much more.
Failure is what makes Success feel so good!
Failures are the stepping stones to success!
Failure is not Futile!
You can’t have the sweet with out the bitter. We need contrast in our lives to fully appreciate.
I think Failure is Fantastic!
If you want to win you just have to fail faster than the people you are competing with. You get to determine how many at bats you get…and you just might hit a home run instead of another strike out.
You got this Sam.
Have to love the self deprecation.
I hope we get a chance to meet in person one of these days.
Enjoy Hawaii.
Cheers,
Dom
Hi Dom! I wouldn’t go so far as to say that failure is fantastic, but I do believe failure is a healthy part of being a better person. Come on up to San Francisco one day and we’ll go grab a beer!
Need less than $500k to cover my yearly expenses.
Varsity and personal problems burnt me out and when I started at work, I had the worse case of “The Impostor Syndrome.” (very accurately christened by the way!). In hindsight, it’s a good thing, because I don’t have the arrogant attitude that some of my co-workers have.
I save because I know my job is at risk (since 2008 really), I live in a 3rd world country and I want to live a rocking awesome life full of travel and a comfortable home somewhere safe in my old age.
So in short I save because I want to live!
Sounds like a great reason to say to me! I think if you come to the United States, you’ll wonder why everybody isn’t a very well-off person because life is so easy here compared to other places 。But I also think you realize that because life is so easy here there is in this intense desire to save as much as in other countries.
Wow! That’s a lot of failures to cramp into one blog post and even though it was amusing to see list go on and on, I wondered why you’re even thinking of getting a day job when you run one of the most famous financial blogs in the world. Maybe you’re trying to aim higher and higher, and there’s nothing wrong with that, but for all the failures you have listed, this is one major successful venture that could set them off! I do fully support the idea of saving because you simply don’t know what the future holds for you, so save, save, save all you can.
Is FS one of the most famous blogs in the world? I’m not so sure, but that would be kinda cool if it was!
I really feel like I should be doing a little bit more with my life on the professional front. It’s like my time for working hard over yet, as a result, might as well do some extra work while I still have the energy. I know my energy will eventually fade, so I want to pack in this much stuff as possible before that day happens.
It has to be one of the most visited financial blogs because your site is in the top 5 results on many common financial Google searches.
SEO is neat b/c I know the fundamentals of SEO, but I don’t use any hacks/tricks to try to rank well for particular search terms. The most important way to rank well is to just think logically about search and write something worth reading.
I agree with your attitude and I think it’s fair to describe those things as failures. I also tend to set myself up for small failures in the sense that I set lofty goals that I can’t always meet. The danger in this approach is that it can leave you vulnerable to psychological wounds from never feeling good enough, but the older I get, the easier it is to look back and feel satisfied with what I’ve accomplished rather than focus on the “failures”. And yes, having a large savings rate certainly eases the anxiety that comes from more significant financial failures. Peace of mind is very valuable!
Great post. One of your best! I think dwelling on failures/setbacks can take you down a slippery slope. (I’ve done it myself.) We’re all quarterbacks in life that are one play from throwing an interception. In some respects you gotta have short term memory and look to the next play. Don’t be too hard on yourself. You have a lot to be proud of. We’ve all made mistakes and missed opportunities.
I try not to dwell. I try to just be frank and remember so I don’t take anything for granted. Now, I can look back to this post whenever things feel too good to be true.
Been following your blog for a while and really enjoying the content. I noticed that you’ve been looking at roles within fintech. Shoot me an email if you’d like to chat; not a recruiter but we’re hiring as we grow, and I’m happy to refer
Thanks Ken. I’ll shoot you an email. Unless there’s a perfect fit, I think I’ve exhausted my interest in working in fintech at the moment.
The only failure in my opinion that is of any real significance is the failure of one’s financial independence. I don’t personally understand the desire to overcome comparatively frivolous “failures” when compared to one’s ability to abstain from active employment.
The fear of losing it all only keeps one from never really retiring at all. Not that “retirement” is everything.
The truth is, the worse case scenario is never really that bad. I’d rather not worry about insignificant failures when I know I’m already in great shape. Should shit ever hit the fan, I know I’m a resourceful individual that will make it work and maybe even come back stronger. The need for reaffirmation that I “still got it” just isn’t enough for me to care about such relatively small failures. That’s just me though. I can see both sides.
The only thing that would keep me up at night with regards to failing is the desire to have more in life. I already have way more than I could ever want, so there is no motivation to acquire more money at all. I’m more interested in intellectual pursuits that will probably inevitably lead to more money. But if I fail – I’m not necessarily more motivated to try harder simply for the money.
I am very impressed that you have no motivation to acquire more money at all. If your desire is just on intellectual pursuits, then all you’ve got to do is really read, hear, an watch a lot from people who provide intellectually stimulation information!
When do you think your complete motivation for money stopped?
The motivation stopped as soon as I had enough and a comfortable lifestyle and realized that acquiring more things or being in a different place wasn’t worth working any longer unless it’s something I’m passionate about.
I do definitely consume a lot (reading, movies, etc.), but plan on creating my own things in the future – I’m just now settling into this lifestyle. Being free from having to work for money gives you the ability to think about what you really want to do and not have any fear of ever not making money from it.
Sam, have you read this – https://www.amazon.co.uk/Adapt-Success-Always-Starts-Failure/dp/0349121516
It’s an interesting read if you haven’t! :)
But on the post, your successes kill your failures. And success and failure goes hand in hand right?
Failure is like weight training for your resolve!
Mr Z
Nope! What is the skinny?
I do like the Yin Yang nature of success and failure. Too bad I hate to weight train! :)
I’m only part way through at the moment. But it’s about adapting from failures rather than aiming for success per say.
Also a big comparison between evolution and business success or failure. Which is cool. But scary, as it suggests that more of success is random than we think (especially when we consider large businesses)
Pretty interesting. But I do like to pretend I have some semblance of control!
Sam, while I agree that failure makes us into better and tougher people, I think there’s also an issue of perception at play here. Not having a job out of college could seem a mark of failure, but you also passed the yardstick of getting the degree (that not all people do; side note: Go Tribe!). Additionally, you left corporate work to try your hand at something else, and were financially able to do so. That it didn’t play out the way you expected it to is no more a failure than the decision to undertake it: it’s just a fact of the experience. I have no doubt that you’ll move on to a new success, and it will likely happen soon given your history.
I was in the depths myself last year when I got passed over for a new post at my job, especially because I’m looking for the next big ‘thing’ in my career. But it does mean I just keep looking, and I’ve done enough in my current position to realize that I’ve got it pretty good.
Go Tribe! It is interesting to note that ~35% of Americans have college degrees.
Let’s see where the adventure takes us next. Good luck w/ the next big career move!
In my line of work failure is part of the game. As an academic I am constantly submitting my work for peer review. I get rejected more times than I get accepted even with a publication record that is pretty good for my field. For me it acts as motivation. Best advice I ever got was: 1) Get the results and stick it in a drawer for a couple of days. 2) Then pull out the results. Read them. Spend 2 days being angry; 3) Spend 2 days being sad; 4) Then sit down, shut up, and do the work. Works for me.
I like the tips! I can’t be angry and sad for 4 days. I can stew on things for one day, and then I’ll let the stew go. Writing helps!
First off, bad luck and failure, you can both stay all the way over there. I’ll be over there.
*Sigh* If only.
My failures. I don’t have time to list them all because that would take days of continuous, uninterrupted writing. But for this year alone?
1) Attempted to transition from banking into a law enforcement career. Did not work out. Did not work out HARD.
2) Tried to go to a different, higher paying credit union after that didn’t work out. Ended up crawling back to the bank I was so excited to leave and promising that I was now there for the long haul. If it weren’t for the concept of unemployment, that would have been the worst case scenario.
3) Failed to negotiate a higher salary after I was promoted.
4) Have performed horrendously since my promotion kicked in. Didn’t meet my sales quotas last quarter and have no leads or anything in the pipeline for investment products (I’m the only person in my branch that is qualified to sell them, so much of the branch’s profitability falls directly on me). I’m completely failing to motivate the branch staff in sending me qualified referrals as well. Pretty much, every function and responsibility entailed by my new position is one that I’m not even close to performing well at.
5) Wanted to earn $5,000 in dividends for 2015. Off by about $1,000.
6) Wanted angryretailbanker.com to be earning at least $100/month from Google Adsense revenue by the end of the year. Not. Even. Close.
7) My overall plan to retire at 35? After some back-of-the-napkin calculations, it seems like if I try, work, save, and invest REALLY hard, I might retire by 45. Barely. I don’t want to work for another 15 years. I don’t even want to go to work today.
And like I said, that’s just for 2015. That’s not even the full 2015 list either! That’s just what I’m willing to put on here.
But you know what? While I can’t say I have no regrets, I don’t have nearly as many as that list seems to imply.
At least I’ll never wonder “What if?” when it came to a career change.
At least I HAVE a website. I showed it to a friend of mine recently who I hadn’t seen in over a year (he’s away at school). I always had a reputation for not knowing computers well, so when he said “This website is pretty interesting. Who made it?”, I was very proud to tell him it was me.
I got my job back. My manager pulled strings to get me back and then gave me an in-branch promotion. So I can’t be too bad at my job. Plus, my recent Year End Performance Assessment shows that he disagrees with me on my own view of how things are going there for me, as it was a glowing review. Plus, I made my first fixed annuity sale last month! No referrals, nothing. It was 100% me.
And despite not making my dividend goal this year, it’s partially because I set the bar arbitrarily high for myself. I made $1800 in my first full year and this is my second. It was a number I was aiming for because it seemed like a large but reasonable step forward, and it was hopefully one that could be replicated each year. If I tripled my dividend income each year, I’d be happily retired by 35. Of course, that’s pretty unrealistic (entailing a six figure dividend income in five years. Where is that money coming from!?), but I was aiming to get a good early start so that compounding, dividend growth, and dividend reinvestment would pick up the slack for my lack of consistent fresh capital.
And to retire between 45 and 50 (possibly)? How many people in this country will be retiring at 62? 67? I wonder how many people in my generation will be able to retire at all?
Failure is one of those things that we have to accept if we are going to do anything, well, at all. Bad luck I can’t stand when it’s pointless nonsense with no potential to move me forward, but anything good in life comes with the risk of failure and setbacks. I’d just like to get past those parts already. I want my successes to outweigh my failures.
Sam, it seems like you’ve reached that point already. You’ve achieved financial freedom and are able to do what you love whenever you want. And good for you; you’ve worked hard and earned it. You’ve had–and still have–many failures, but your successes have outweighed them immensely. Be proud.
Pyrrha: “Wait, Jaune, stop. Do you feel that?”
Jaune: “Soul-crushing regret?”
–RWBY Volume 1
Sincerely,
ARB–Angry Retail Banker
Thanks for sharing! That’s a really healthy dividend income stream based on your day job income, so nice work! Also, it is great you do have a site. What do you think is keeping it from growing as fast as you want? Are you posting 3X a week consistently?
It took me well over a year to get $100/month in Adsense fyi. But after 2.5 years or so, things started really taking off. Hang in there!
I wish I was posting that often. Between 50-60 hours a week at two jobs (not including commute, getting ready, compliance modules that I have to do at home, etc.), I’ve been falling asleep at seemingly random points during the day. I wanted to do some work and get some writing done when I got home from the bank yesterday, and I ended up eating dinner and falling asleep instead.
I’ve got to learn how to focus more. It feels like I’m moving from task to task without a definitive conclusion to anything. I’m looking to turn some of my 2015 failures into 2016 successes.
I liked how open you were with this article. Everybody has failures, and as I can see in the comments, it’s all about how you look at them.
Regarding your concerns about your website, have you thought about making different products? I bought your layoff eBook, and have read pretty much every one of your posts. I think that if you were to create another product, many people would consider buying it.
My favourite posts are those that contain the numbers and age brackets, such as net worth, your 1/10th rule for car buying, income, savings amounts, and so on. Perhaps you could put together an eBook that puts these kinds of articles all together, and do some kind of general analysis on each age bracket? E.g. “this is what I recommend your income/savings/etc… to be like at age 25/30/35/40, here’s what to do if it isn’t there yet”.
I’m struggling to improve the income on my own website so I know the feeling.
Just a thought :) Either way, keep up the good work, and enjoy the break.
Thanks for buying my book and reading my articles Ben.
I think I’ll try to create a new product once a year so that after five years I should have a stable of new products. Thanks for the encouragement!