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Friday, October 22, 2021

Hitting Your "Number." Top Three (Free) Tips for Anyone in Life's Dumpster Fire Still Striving to Hit Their Number.

Five years in one sentence:  A catastrophic flood, three hurricanes, two moves, a condo sale, a home purchase, a dream job assignment come true out of the blue, an engagement, a once in a lifetime freeze in the tropics, a parents' death, my first grandbaby, and a pandemic.  No wonder I didn't post any blog updates.   

But I've graduated from work-life again!  And I hit my number with a big safety margin this time.  

So what were the top three things I did, free of charge, that helped me survive those swings?  

#1)  LBYM. Living Below Your Means gives you a McGyver tool kit of skills to survive financially, no matter what.  

If you don't know where to start just look at how much you spent over the last three months. Was there more income than outgo?  If so, that's great!   Because that "spread" is how much you truly earned in the quarter.  

Let me repeat it -- if you spent $1,000 less last quarter, then that's the increase in your Net Worth.  Your Assets.  Your Capital.  Everything else went to somebody else's paycheck.  If you want to quibble about your house note, okay, a tiny bit of it went to equity.  Let's be real.  What, about $200 a month maybe?   

Your next, most glorious step toward freedom, is to increase your net worth as much as possible in the next quarter by reducing your expenses.  

Every quarter I check my net worth through Personal Capital's software.   It's free.  You can use a spreadsheet or even just a pencil and a notebook, which is what I did for many years.  If I haven't added to your net worth, then you are just a wage slave and need to do some major adjustments.  

#2)  Don't Buy a New Car.  Ever.

Out of all the big expenses in today's consumer economy, housing and transport usually come up as 1 and 2 unless you are older and healthcare gets on the list.  (Oh, let me rant about that on another post!) 

It takes time and effort and energy and yes, money, to downsize your home and its expenses.  It is much easier to keep your automobile expenses low. 

Buy a car that is at least one-year-old or more.  

Real Life Money example:  I own a 2011 Honda Insight with 140K miles, paid $12,000 cash for it in 2014.  

This website https://repairpal.com/cars/honda/insight/2011 estimates average maintenance costs of $341 for a 10 year old car! 

I've only paid about $250 a year for maintenance, other than tires and a AAA battery replacement that was all my fault.  That $250 per year was cash ($1,800) I paid in 2021 to a local mechanic to get it ready for another 7 years of use.  Preventative maintenance.  

No car note, just insurance and about $50 a month on gas, maximum.  Even with day trips.  

But but but!!!!  What about warranties and safety?!!!  

1.  The warranties from the manufacturers are still available on preowned and pre-cerftified slightly used cars, so don't throw that one at me.  :-}  
2.  If you are going on a long car trip and don't want to risk it with your older car?  Rent a Car!  Heck, you can even Air BnB a car now.  https://studentloanhero.com/featured/turo-review/

But but but!!!! What will the neighbors think? 

Buy a used Ford 150 and they will think you might be a millionaire next door. 


#3)  Get Your Side Hustle On - Carefully and Mindfully

Not all side hustles are worth it, I hear you!  If I get one more email about Ibotta grocery store coupons or online interviews that never pan out, AAAHHHHHH!!!  Tried them all and just ended up wasting my time. 

Solopreneurship and sole proprietorships are a step up.  And not only do you make extra cash, you also have tax write-offs like office space in the home, that help with housing costs.   
- No employees, ever.  
- You aren't trying to scale a business
- You can try and fail fast
- Hanging out with your favorite people can make it profitable.

As long as you make a legitimate effort to sell your skills to the marketplace, it's a legit business, as per the IRS.  

This is one of the better, easy to consume blog posts I've found about solopreneurship.  https://www.incfile.com/blog/post/difference-between-solopreneurship-and-sole-proprietorship

My Real Life example:  I operated as Stansbury Creative Consultants providing AdWords consulting and marketing support as a side hustle for many years.  It brought in between $2 - $10K per year and allowed me to write off 50% of my new computer supplies and a percentage of my housing costs.  

More importantly, it has allowed me to do fun projects with people who "get sh*t done" without worrying about corporate objectives.  And I can continue to use my new side hustle brand to work on whatever appeals to me throughout retirement.  

What say you?  Have you survived a life of one dumpster fire after another and have wisdoms to share? 


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