2021-08-04_The_Power_of_Conventionality
00:00:00.000 | Welcome to Radical Personal Finance.
00:00:02.080 | Although today I should simply say welcome to conventional personal finance.
00:00:07.720 | My name is Joshua Sheets.
00:00:08.720 | I'm your host.
00:00:09.720 | This is a show dedicated to helping you live a rich and meaningful life while steadily
00:00:15.180 | working towards the good life, enjoying it both now and achieving your goals for financial
00:00:20.360 | freedom over the course of several decades.
00:00:23.320 | Now, of course, that's a different introduction than I usually start the show with.
00:00:29.000 | But today I think it is an appropriate one because I want to talk today about the power
00:00:34.760 | of conventional thinking and also conventional financial planning.
00:00:40.920 | Let me begin with a bit of philosophical introspection that I have been engaged in quite a bit over
00:00:48.240 | the last few days and I try to make this a continual bit of introspection, especially
00:00:53.560 | over the last few years.
00:00:56.280 | Thinking broadly, I think that one of the dangerous trends of youthful revolutionaries
00:01:05.400 | and in that camp, I would count myself at certain times, and also of many leading voices
00:01:14.840 | in many industries is we tend to ignore the wisdom of the past.
00:01:23.560 | Without question, I myself have been guilty of this at many times in my life.
00:01:29.320 | I come across an idea that excites me.
00:01:32.040 | I come across something where I think, "Oh, this is phenomenal and we should just change
00:01:36.600 | everything."
00:01:38.760 | And then perhaps you go down the path a little ways and you discover that actually there
00:01:45.240 | is a good deal of wisdom in what most people were doing.
00:01:53.520 | Over the years, I've shared with you various podcasts and one of those I talked about why
00:01:58.720 | I have decided that I am not interested in being a revolutionary.
00:02:04.360 | Rather, I'm interested in being a reformer.
00:02:09.000 | Now speaking broadly, I have come to the opinion that most revolutions are mistakes.
00:02:18.240 | Revolution is exceedingly dangerous.
00:02:20.760 | Revolution takes down one system and replaces it with something entirely new and that something
00:02:27.000 | that's entirely new is often untested and sometimes it works, but sometimes it doesn't.
00:02:33.160 | It can perhaps lead to a bold story that indicates success, but oftentimes it leads to a collapse.
00:02:43.680 | And I don't think it's safe.
00:02:44.960 | I don't think the outcomes of virtually any revolution are worth the way that they're
00:02:51.240 | achieved.
00:02:52.240 | Rather, I think that reformation is the proper and productive path.
00:02:56.840 | Change is necessary in many parts of society and many parts of a life, but reformation
00:03:04.680 | will in many cases lead to better results.
00:03:08.480 | I want to be cautious not to make too many blanket statements.
00:03:13.040 | There may indeed be times in your own life where a complete and total transformation,
00:03:17.800 | a complete and total revolution does lead to better results, at least on a personal
00:03:24.080 | level.
00:03:25.400 | But whenever you look broadly, I think that often reformation is better.
00:03:30.120 | Now I've articulated that concept before.
00:03:33.280 | Today though, I want to apply it to the concept of simply understanding why certain systems
00:03:38.480 | exist.
00:03:40.440 | Let me share a business example and then an ecological example from first my own life
00:03:47.520 | and also from just observing how systems change over time.
00:03:55.280 | When I was in college, there was a book published.
00:03:58.860 | It was never a popular book.
00:04:00.480 | It was just a book I found browsing through the bookstore and the title grabbed me.
00:04:04.280 | I bought it, read it, and was impressed by it.
00:04:06.200 | The book was called "Why Work Sucks and How to Fix It."
00:04:11.000 | At this point, I don't even remember the author's name.
00:04:13.680 | It was two ladies who wrote this book articulating many people's frustrations with work.
00:04:26.040 | They advocated in that book for what they termed a results-only work environment.
00:04:33.160 | The idea was we should discard any kind of corporate slavery.
00:04:38.440 | We should discard stated schedules, fixed office locations, and we should hold people
00:04:44.000 | accountable exclusively for the results that they achieve in their job.
00:04:50.920 | At the time, their success story that they were pointing to was the corporate headquarters
00:04:57.560 | of Best Buy.
00:05:00.640 | That book impressed me deeply, and the authors articulated certain things that I wanted to
00:05:05.960 | be true for myself.
00:05:07.120 | At the time, I was working in a salaried job where I was expected to be there from about
00:05:12.440 | 8.30 to 5 o'clock, something like that.
00:05:15.320 | I was expected to show up in the office to do my work on regular times, to stay a little
00:05:19.480 | bit late and get the work done when I needed to be there.
00:05:22.520 | With my personality, that didn't feel great.
00:05:26.960 | I remember distinctly something that those authors wrote in that book about how the modern
00:05:32.400 | corporate environment causes people to have to lie to their bosses to justify being 20
00:05:39.720 | minutes late to work.
00:05:41.020 | You come in and instead of arriving at 8.30, you arrive at 8.50.
00:05:44.160 | "Oh, sorry.
00:05:45.160 | The traffic was really bad."
00:05:46.160 | In reality, you were sitting at home with your family eating blueberry pancakes, and
00:05:50.360 | you just wanted to stay and eat blueberry pancakes.
00:05:52.280 | Their point was you're an adult.
00:05:54.260 | You should be allowed to do your tasks on your own time.
00:05:59.160 | Now, I succeeded in my own career of moving into an environment, especially an entrepreneurial
00:06:05.520 | environment that included complete and total time freedom and location freedom where I
00:06:11.360 | didn't ever have bosses.
00:06:13.080 | From the time I left that job, now going on 15 years, I have not been accountable to a
00:06:21.160 | boss for where and when I work.
00:06:25.840 | That was important to me, and I wanted that sense of personal freedom.
00:06:29.800 | Hear me clearly.
00:06:30.800 | I like that personal freedom.
00:06:33.280 | It means a lot to me.
00:06:35.560 | It's something that I would be quite loathe to give up.
00:06:40.480 | But having achieved that, I find it fascinating how much my life looks like the life of a
00:06:48.320 | conventional employee, a conventional salaryman.
00:06:54.160 | I tend to work from about 9 a.m. to about 5 p.m.
00:06:58.720 | I usually work Monday through Friday.
00:07:01.400 | I find that working in an office is where I work best.
00:07:07.120 | So although I could go and sit at a cafe in some beautiful seaside resort, I choose not
00:07:12.240 | to do that.
00:07:13.240 | I don't like it at the moment.
00:07:14.320 | I have rented a co-working space for the last few weeks I've been working here in Malta,
00:07:22.600 | renting a co-working space, sitting and working at a desk just like I did so many years ago.
00:07:28.560 | I don't go to the beach.
00:07:29.560 | I don't go to the beautiful cafe.
00:07:31.000 | I don't go to anywhere except a desk in an office.
00:07:34.200 | I sit down at the desk.
00:07:35.640 | I get up in the morning.
00:07:36.800 | My family and I, we have breakfast together.
00:07:38.520 | I kiss my wife.
00:07:39.520 | I walk to work.
00:07:40.520 | I sit down at my office.
00:07:41.520 | I work until about 5 o'clock or 5.30.
00:07:43.880 | Then I pack up my stuff and I go home.
00:07:48.480 | Now I'm not saying that there aren't days that it's really nice not to have to do that.
00:07:56.600 | What I'm saying is when I was 20 years old, I didn't appreciate the power of the conventional
00:08:07.000 | lifestyle.
00:08:08.000 | I didn't appreciate that people had developed this salaried lifestyle because it was a pretty
00:08:13.800 | good way of doing things.
00:08:15.520 | Rather, I wanted to toss the whole thing out on its head.
00:08:18.560 | I wanted to be a radical revolutionary and say, "I'm not going to live that way.
00:08:22.200 | I'm going to live the four-hour work week."
00:08:23.760 | Interestingly, although I haven't followed it closely, I believe that the experiment
00:08:34.000 | at Best Buy of their results-only work environment, the thing that the book was written about
00:08:40.560 | was a fairly short-lived experiment.
00:08:43.020 | They did it for a few years.
00:08:44.240 | They weren't getting good results from it and they scrapped that idea.
00:08:50.720 | They imposed more structure and order on the functioning of their company.
00:08:57.160 | Fast forward to today in 2021, the entire world has changed.
00:09:02.000 | Remote working is the norm.
00:09:04.040 | But there are a lot of remote workers who want to go back into the office.
00:09:10.040 | As offices have opened and will open, there are a lot of workers who are glad to go into
00:09:15.640 | their desks, sit down at 830 in the morning, work at their computer, and leave at 5 o'clock.
00:09:22.880 | There was, perhaps, a list of small changes that needed to happen that have now happened.
00:09:34.180 | But the changes over the last 15 years have looked more like a reformation of sorts rather
00:09:42.600 | than a whole-scale revolution.
00:09:47.320 | I today appreciate more than I ever did why a company should have a physical headquarters,
00:09:53.300 | why many, if not most, employees in the company should be gathered together in a physical
00:09:57.600 | space.
00:09:59.020 | I appreciate why we people work better when they're physically together as part of a team,
00:10:04.540 | everyone working at the same schedule on the same tasks in the shared space.
00:10:10.620 | There's a power in that.
00:10:12.820 | And as I think about my own businesses, I'm loathe to actually try to build an entirely
00:10:23.400 | remote distributed workforce.
00:10:25.080 | There are companies that are still doing it, but I'm not convinced that it's categorically
00:10:29.860 | a superior model.
00:10:30.960 | I think it can work for certain functions within a company, but it's not the best way
00:10:34.940 | that all companies should be run.
00:10:37.100 | It's not.
00:10:39.220 | So before we dismantle the old system, we should try to understand it a little bit.
00:10:47.580 | That leads me to the ecological example that I want to use.
00:10:53.580 | Over the years, I have come to appreciate ancient cultures far more than I ever did.
00:11:03.140 | By ancient cultures, I mean traditional cultures within the recent past, and I mean genuinely
00:11:09.840 | ancient cultures.
00:11:13.200 | Our forebears were in many cases men and women of tremendous wisdom.
00:11:19.580 | And the systems, the ancient systems of life in a local place often had a tremendous wisdom
00:11:27.600 | associated with it.
00:11:29.400 | Even if they couldn't articulate why they do certain things in a certain way, the fact
00:11:34.380 | that they did those things that way, there was a reason behind it, even if the person
00:11:39.820 | involved couldn't articulate it.
00:11:42.940 | And one thing that I get very concerned about in our day is in many parts of our societies,
00:11:49.560 | there is something of a revolutionary spirit.
00:11:52.860 | People who are operating under the assumption and idea that virtually everything from the
00:11:58.940 | past was marred, was broken, was wrong, was wrongheaded.
00:12:03.820 | And now we are the enlightened generation, and as the enlightened generation, we should
00:12:08.340 | wholeheartedly revolt against the oppression and strictures and bonds of the past and replace
00:12:14.620 | those things in the past with a completely better, improved system.
00:12:20.980 | Count me out.
00:12:23.640 | It's not that I reject the need for reformation, but before we reform, we need to understand
00:12:31.540 | what works about the past and why.
00:12:37.460 | I said I wanted to use an ecological example.
00:12:41.280 | Before I give a farming example, let me talk about something like cities.
00:12:48.540 | I'm fascinated by intelligent engineering and design.
00:12:55.900 | It's a real interest of mine.
00:12:58.080 | I have followed for years, there is a Twitter account, and there are many others, but there's
00:13:03.080 | a uniquely interesting Twitter account.
00:13:04.640 | If you're not following it, I encourage you to consider it.
00:13:07.000 | It's called Wrath of Non.
00:13:09.080 | I don't know where that particular screen handle, what it even alludes to, but it's
00:13:14.440 | called Wrath, W-R-A-T-H of Non, G-N-O-N.
00:13:20.700 | But the anonymous person behind this Twitter account does a very good job of systematically
00:13:26.800 | profiling the beauty and intelligence of how towns and cities have been constructed for
00:13:35.240 | millennia and of quite rightly pilloring how we do these things in the modern era.
00:13:42.080 | And I have been interested over the last couple of weeks, as I said, I've been here in Malta
00:13:46.880 | and I have been touring some of the ancient cities here.
00:13:51.720 | And there are some classic cities.
00:13:54.320 | What's interesting to me about Malta, Malta is a very hot place, especially here.
00:13:57.360 | I'm here in the summertime.
00:13:58.360 | It's very hot, it's very dry, and it's an exceedingly unpleasant place during the daytime,
00:14:04.240 | at least for someone like me, who is not quite as bronzed of a god as I would like to be,
00:14:10.840 | and for whom the sun is oftentimes quite unpleasant.
00:14:15.760 | So you can walk around in most parts of Malta, and while it is without question a very pretty
00:14:23.680 | place, it's right on the Mediterranean, the island has curves galore, buildings everywhere,
00:14:30.720 | it's got a lovely European culture, it appeals to tourists, it's a very beautiful place.
00:14:36.480 | But when you are looking around and walking around, it's a very unpleasant place because
00:14:43.520 | of the heat.
00:14:45.120 | And you feel like you're in these different zones.
00:14:47.360 | You have the commercial zone and then you have the residential zone.
00:14:52.160 | So that is, of course, that you travel to one of the ancient cities, and there are a
00:14:55.800 | number of them, but two popular ones are the city of Limdina, formerly the capital of Malta,
00:15:04.520 | and the city of Valletta.
00:15:06.480 | And both of these cities are ancient walled cities.
00:15:12.040 | They are absolutely amazing to be in.
00:15:15.800 | They're walled all around, but what you find is that they are very pleasant places to be.
00:15:22.200 | It's not that they haven't been updated.
00:15:25.080 | They have been, right?
00:15:26.080 | There are now shops with pretty glass windows and whatnot.
00:15:28.160 | They look a little bit different than they would have looked 600 years ago, but they
00:15:33.680 | are pleasant places to be in.
00:15:35.120 | And what strikes me is the value of something as mundane as very narrow streets.
00:15:44.320 | Now having been interested in architecture a little bit and trying to understand this,
00:15:49.560 | this is something where I have changed my mind drastically on because now I understand
00:15:55.400 | the wisdom that is behind narrow streets.
00:15:57.960 | In 2013, I was living in downtown West Palm Beach, Florida, and at the time, right next
00:16:04.400 | to my house, there was a very nice big road.
00:16:07.920 | By nice big, I mean classic American four-lane road, easy flow of traffic, easy cars, and
00:16:14.680 | it was in the downtown area.
00:16:15.920 | It worked really well.
00:16:17.520 | And then one day I come along and there are construction vehicles, and there's a guy out
00:16:22.400 | there with a chipping hammer attached to the front of a tractor of some kind, and he's
00:16:30.480 | out there chipping and sawing the concrete up in the middle of the road.
00:16:35.920 | And the city workers came in, they tore up a perfectly good road, and they put in medians,
00:16:42.200 | and they dropped it from four lanes down to two.
00:16:46.360 | And they put in these medians full of bushes and trees and whatnot, and they finished their
00:16:49.960 | work and they left.
00:16:50.960 | And at the time, I was quite self-righteous about it, and in my indignation, I said, "This
00:16:57.680 | is typical.
00:16:58.800 | These government people, they just want to spend money unnecessarily, and they come in
00:17:02.720 | here and they take a perfectly good road, and they go and spend money wrecking a perfectly
00:17:08.800 | good road."
00:17:09.800 | And I felt quite self-righteous about it.
00:17:11.960 | I felt quite confident in my opinion.
00:17:14.840 | I was wrong, and the engineers who did that were right.
00:17:19.840 | Because today, because of the restraint on traffic flow, the fact that now not as many
00:17:26.280 | cars can get through, the cars that do get through have to drive more slowly, it's made
00:17:31.480 | it a much more pleasant place.
00:17:33.280 | And I found that the city planners and engineers now know this, that if you want to create
00:17:38.720 | community, you need to slow down traffic and make it unpleasant for cars to go through.
00:17:45.240 | And so one of the best things that you can do to create a center of economic activity
00:17:50.320 | is get the cars out, slow the streets down, lower things, make it small, make it tight,
00:17:57.120 | restrict the flow of traffic so that there can be life, because nobody wants to do business
00:18:02.680 | next to a busy road.
00:18:04.020 | Nobody wants to walk next to a busy road, et cetera.
00:18:08.000 | And so now, if you look at modern urban planners and urban design, there will be a greater
00:18:13.440 | appreciation of this.
00:18:15.320 | Well, to appreciate this, all you need to do is go and look at some of the places that
00:18:19.240 | we love to be, right?
00:18:20.360 | Go and look at an ancient European city, an ancient Asian city, something preferably more
00:18:25.640 | than 500 years old, and you'll find that it looks very different than our modern developments.
00:18:31.840 | Now today, we are in a time, which I'm quite happy about, where people think much more
00:18:37.360 | about sustainable design.
00:18:40.920 | But what's ironic is a lot of modern sustainable design is quite the opposite, right?
00:18:49.520 | There's the greenwashing of many new products and many new ideas.
00:18:53.080 | And if you really want to get sustainable design, you should look to the past and understand
00:19:01.120 | what worked then, because chances are what worked in the past would probably actually
00:19:05.960 | work really well today.
00:19:09.120 | And you walk through a city like Limdina here in Malta, and I wrote to Wrath of Non on Twitter.
00:19:16.640 | I said, "I've been in Limdina.
00:19:18.880 | You're right.
00:19:19.880 | I would love to live in this city.
00:19:21.120 | The city is hundreds of years old."
00:19:23.840 | It's not been updated.
00:19:24.840 | There's some...
00:19:26.720 | The walls are the original stone.
00:19:28.480 | They're not been painted.
00:19:29.480 | They've not been covered.
00:19:31.200 | Most of the streets are...
00:19:32.360 | The original streets are a similar style.
00:19:34.680 | They didn't take out the ancient cobblestones and put in beautiful tile anywhere.
00:19:40.200 | It's just the ancient technology.
00:19:42.760 | And I...
00:19:43.760 | Yes, they've added electricity, which certainly I would want.
00:19:47.880 | I'm sure there's a little bit of climate control, but you walk down those streets and it's
00:19:51.080 | a pleasant place to be.
00:19:52.800 | Why?
00:19:53.800 | Well, because the streets are narrow, then they're shaded.
00:19:57.440 | This is the point.
00:19:58.440 | I should have made it more clear earlier.
00:20:00.960 | You have these narrow streets.
00:20:03.280 | And yes, they were designed in a time before cars.
00:20:07.240 | But because the streets are narrow, the streets are pleasant places to be.
00:20:12.280 | And I could imagine all of the economic activity that would have occurred in those ancient
00:20:18.760 | days right in those streets, because they're narrow, they're shaded, they're cool, they're
00:20:22.920 | comfortable.
00:20:27.040 | Modern Malta is not that.
00:20:29.800 | The modern streets, even though again, it's because of this ancient development, a lot
00:20:33.160 | of the streets are very small, you're forever trying to find a spot of shade.
00:20:36.760 | It's just unpleasant.
00:20:38.360 | And so you hit about four o'clock, five o'clock in the evening, and now you think, "I can
00:20:42.320 | go out."
00:20:43.320 | Well, we can improve things.
00:20:49.040 | We really can.
00:20:50.040 | But before we go about improving, we would be wise to sit and learn.
00:20:54.920 | Number of years ago, I was deeply interested in permaculture design, which is a form of
00:21:01.080 | thinking and design that's applied to usually food production, although it can be viewed
00:21:06.680 | comprehensively.
00:21:07.680 | And I took several classes and consumed dozens or hundreds of hours of instruction by a designer,
00:21:15.440 | an Australian permaculture designer named Jeff Lawton, amazing guy.
00:21:18.800 | Had stumbled across him on the internet.
00:21:20.600 | He had done this phenomenal, phenomenal video, very old, but still out there called "Greening
00:21:27.080 | the Desert," where he went into the Jordan Valley, a place that was completely and utterly
00:21:31.600 | destroyed, and he put in a green oasis and just simply used good design to turn the desert
00:21:39.600 | into a green oasis.
00:21:41.800 | It was amazing.
00:21:43.260 | And when I saw that, it filled me with a sense of optimism because I thought, "If that guy,
00:21:50.280 | operating on virtually no budget, can come in years ago, install this kind of beautiful
00:21:56.400 | design, there's no place in the world that we can't green.
00:22:00.600 | There's no desert that we can't beat back, and there's no ecological problem that we
00:22:03.880 | can't solve."
00:22:05.560 | I genuinely believe that.
00:22:06.760 | I have no fear whatsoever of thinking that there's any ecological problem that we can't
00:22:12.000 | solve because I've seen intelligent designers work miracles, genuine miracles.
00:22:17.560 | Well, Lawton stressed in his teaching the importance of understanding ancient designs.
00:22:26.080 | Before you go in and you just start cutting everything down, understand why does this
00:22:30.440 | exist?
00:22:32.520 | What is it about this place?
00:22:34.640 | Before you come in and you just raise an entire forest, cutting every tree, every vine, etc.,
00:22:40.000 | down and plant fields because there's a lot of rain here, understand the fact that it's
00:22:44.000 | the forest itself that creates the rain.
00:22:46.540 | And so what happens in a lot of places is you have this modern mindset that comes in
00:22:50.480 | and says, "We're going to get rid of the forest, and we're going to replace it with fields
00:22:54.320 | because this is a great place to grow more crops, and with our large, massive amounts
00:22:58.320 | of agriculture equipment, we can build a huge farm here that would be very productive."
00:23:03.720 | So you come in and you cut down the forest and you put in the farm, but then you turn
00:23:08.160 | around and a few years later, you're living in a dust bowl.
00:23:11.040 | Why?
00:23:12.040 | Well, because the forest created the rain, and you didn't understand the fact that it
00:23:15.160 | was the forest itself that was creating the rain.
00:23:18.000 | And so that's not to say that you shouldn't have cut down the forest.
00:23:21.200 | There's a place and a time to cut down the forests, but you need to first understand
00:23:24.860 | how the forest works and then put in the appropriate measures to keep some of the forest.
00:23:30.400 | Maybe you do strip farming, right?
00:23:31.880 | You put your farms in other places.
00:23:33.160 | You think about what's there, understand how the system works to the best of your degree
00:23:37.480 | why it works, and don't come in and be a revolutionary.
00:23:40.680 | Otherwise you might wind up with tremendous problems.
00:23:45.400 | Now I feel the same way now going the opposite direction.
00:23:51.960 | And as I'm getting older, again, I try, I know I'm not good, but I try to do my best
00:23:57.440 | to be a self-aware person, right?
00:24:00.200 | To think carefully about what I believe and why, and then to constantly test those things.
00:24:04.360 | And I do my best to respect you as a listener and articulate the things that I believe in
00:24:10.360 | such a way that you can understand not only what the opinion is, but why it is so.
00:24:15.500 | And then you can decide if that line of thinking is something that serves you.
00:24:18.760 | This was what always annoyed me years ago before I started creating Radical Personal
00:24:22.640 | Finance.
00:24:23.640 | Somebody would say dogmatically, "This is the reason behind this certain..."
00:24:28.000 | Sorry, they would say, "You do this, right?
00:24:30.640 | Always do this with your money."
00:24:32.840 | Instead of articulating, "I think you should do this and here's why," so that I can understand,
00:24:37.960 | "Okay, that reasoning, that thinking applies or doesn't apply to my situation."
00:24:45.960 | So even now, I look and I realize that same thoughtful respect of the past is important.
00:24:57.640 | So I beat on a moment ago, industrial-level agriculture, right?
00:25:02.600 | I do not believe that industrial agriculture should be eliminated.
00:25:10.160 | That would be the revolutionary spirit.
00:25:12.020 | That would be catastrophic, right?
00:25:13.480 | If we came in and I were emperor of the world and I said, "That's it.
00:25:16.960 | I can see that these giant monocrop farms, these giant estates, these are bad.
00:25:22.320 | And so as emperor of the world, I'm passing an edict that says they're now banned."
00:25:26.000 | People, we would starve, right?
00:25:29.000 | We would absolutely starve.
00:25:31.400 | I don't want to whole-scale eliminate industrial agriculture.
00:25:37.760 | The change should occur at the margin and there should be steady change.
00:25:41.000 | So you can look and say, "Why does industrial agriculture work?"
00:25:46.000 | Don't just dismiss it until you understand it and then say, "How can we make it better?"
00:25:50.180 | And human beings applying their engineering thinking to these problems will improve things
00:25:54.340 | systematically over time.
00:25:59.040 | The revolutionary spirit that sweeps something aside is something that may be interesting,
00:26:04.520 | it may be entertaining, and there may be some of us who actually do enjoy that, right?
00:26:08.480 | Being the revolutionaries.
00:26:09.480 | In fact, often perhaps those people are necessary.
00:26:13.480 | They're activists, they're agitators, they're people who come in and do something so radically
00:26:18.960 | different that they can bring attention and carve out a different path.
00:26:25.600 | I personally, by personality, am often attracted to those people.
00:26:29.480 | There's a reason my podcast is called Radical Personal Finance.
00:26:33.120 | But now that I've laid the foundation, I want to talk about the power of conventional personal
00:26:37.080 | finance because if I'm going to be honest and consistent with everything that I have
00:26:41.600 | said, then I should apply the same basic principle to my own thinking and say, "Before I come
00:26:47.480 | in as the radical personal finance guru, the revolutionary who's going to say, 'Build
00:26:52.920 | a plan for financial freedom in 10 years or less,' or 'Start your own business and become
00:26:56.800 | a multi-billionaire,' or 'Live like a wacko in an RV,' or something like that, I should
00:27:02.360 | understand why the systems that be work and what works well about them because only then
00:27:11.040 | can I properly identify the changes that could perhaps improve things and then articulate
00:27:18.800 | to somebody what changes they might want to consider."
00:27:24.440 | So let me begin with financial freedom.
00:27:31.080 | Long-time listeners know that one radical revolutionary idea that I have mostly rejected
00:27:39.520 | has been the joy of not working, to steal the title of Ernie Zelinsky's book, which
00:27:46.520 | I've read and actually like.
00:27:50.080 | I believe that the revolutionary spirit around financial freedom, financial independence,
00:27:59.840 | free retirement, etc., is in many cases an overreaction to a modern work environment
00:28:08.400 | that can indeed place heavy burdens on its participants.
00:28:15.840 | Now this is not one where I've never been a loudmouth advocate to say, "Don't work,"
00:28:21.080 | but I wanted to articulate this one because it is something I see around.
00:28:24.060 | There are a lot of people who genuinely believe that if they could just get rid of work, they're
00:28:29.760 | lives would be better, and I don't think that is true.
00:28:36.240 | Now I have a personal theological conviction that man is meant, meaning designed, to work,
00:28:47.320 | and that work is not a curse.
00:28:49.720 | Work is a blessing.
00:28:51.720 | I do think the use of that word "work" can be a very wide and expansive application.
00:28:59.120 | I don't think that work is work only if you receive financial compensation for it.
00:29:06.560 | I don't think that work has to be done in an office.
00:29:09.720 | I don't think that work has to be knowledge work or physical work.
00:29:13.200 | And so I'm not an advocate that somebody has to stay in a corporate job in order for them
00:29:23.200 | to experience all of the joys of working.
00:29:28.160 | That's not the case.
00:29:29.440 | There are many people who have become financially independent.
00:29:32.580 | They don't need to work for money, and they decide that, "I'm going to invest my labors
00:29:36.800 | into something else.
00:29:39.160 | I'm going to invest my labors into my community.
00:29:41.680 | I'm going to invest my labors into my grandchildren.
00:29:44.760 | I'm going to invest my labors into my garden."
00:29:47.560 | The world is open.
00:29:49.400 | What I do think is important to articulate is that work is not a curse.
00:29:53.120 | And in fact, even some of the most stereotypical work, in my opinion, is actually quite valuable.
00:30:01.920 | As I reflected on this, I realized I miss, I genuinely miss the normal corporate work
00:30:13.840 | environment.
00:30:16.200 | I genuinely miss going to work and seeing my friends every day.
00:30:19.920 | My sister used to say why she goes to work.
00:30:21.920 | She said, "I go to work to see my friends every day."
00:30:24.160 | And at the time I would laugh at her, but you know what?
00:30:26.680 | She's right.
00:30:27.680 | I genuinely miss it.
00:30:28.920 | I feel isolated doing the independent entrepreneur thing, far more so than I ever thought that
00:30:35.440 | I would be.
00:30:37.640 | And while I'm not changing exclusively for that reason, and while I am seeking to make
00:30:43.400 | sure that I don't remain isolated, it's funny how when I think about the corporate environment,
00:30:49.400 | I think about going and taking a job, working in an office, one of the things that I realize
00:30:54.920 | I would appreciate is having that structured social environment.
00:31:00.800 | It's a tremendous benefit, a tremendous, just simple system.
00:31:05.260 | And the fact that everyone is all together, the fact that everyone is together at the
00:31:08.560 | same time, the fact that everyone's in one place, and that there's a diversity of people
00:31:12.840 | at all different levels coming together to work on the same thing, this is fun.
00:31:19.200 | This is something that is useful.
00:31:22.320 | Again, my revolutionary spirit, when I was younger, I thought, "Well, the dream is just
00:31:27.640 | going to be me and a laptop, because if I could go with my laptop and I can make money
00:31:31.720 | around the world, then I can go wherever I want and I can be in the most fun place."
00:31:37.320 | And I'm glad that I did it, but I miss the corporate work environment.
00:31:43.840 | So if you're part of a company where you're expected to come to work at a certain time,
00:31:48.220 | you're expected to be there, I want to encourage you not to...
00:31:52.760 | There's a word.
00:31:54.040 | In Spanish, the word is "menospreciar."
00:31:56.800 | I don't know how to translate that word.
00:31:59.400 | Basically it means to diminish, to not appreciate, to cast off without consideration, to despise.
00:32:10.440 | I guess that would be the best translation, to despise it.
00:32:12.960 | Don't despise that.
00:32:14.360 | There's a good chance that if you're working a job, diligently salting away your money,
00:32:19.420 | planning for the day of your financial freedom, there's a good chance that on the day that
00:32:22.920 | you declare your independence, you submit your resignation and you leave that job, you're
00:32:26.320 | going to feel a sense of euphoria.
00:32:28.520 | There's a very good chance that a week later, when you're sitting on your balcony, drinking
00:32:31.920 | your morning coffee, lazing about, reading books and swiping through your Instagram feed,
00:32:36.840 | without the need to go to the office, you're going to be even happier with your decision.
00:32:41.380 | And there's a very good chance that one or two years later, after you declared your independence
00:32:46.280 | from the corporate system, you're going to look back fondly and wish that you could be
00:32:51.440 | on the same schedule as everyone else, sitting in traffic, going back to your corporate job.
00:32:59.120 | So while you're in it, recognize that the conventional lifestyle of going to work is
00:33:07.320 | not a bad thing.
00:33:09.320 | I remember years ago, I had a meeting with my managing director at Northwestern Mutual,
00:33:18.160 | where I used to work when I was a financial advisor.
00:33:21.960 | And my managing director was a neat guy.
00:33:24.320 | When I came along, he was at the end of his career.
00:33:27.640 | And at the time, I think it's still the case, but at the time, that company had mandatory
00:33:32.820 | retirement for all management personnel at the age of 65.
00:33:36.920 | And so he knew that he was going to be retired at that time.
00:33:40.960 | And he was a very successful managing director within that system.
00:33:46.960 | He had built an insurance office, he had insurance agents working for him, investment office,
00:33:52.840 | et cetera.
00:33:53.840 | And that business is, as far as I'm concerned, just a wonderful business, because it integrates
00:33:59.800 | so many good things.
00:34:01.320 | It gives you control over your time, freedom, gives you massive financial compensation,
00:34:05.600 | especially in the latter end of your career.
00:34:07.640 | And he was and had been at the peak of his career.
00:34:10.200 | He had a lot of money.
00:34:12.360 | He earned a lot of money without a whole lot of difficulty.
00:34:16.320 | He had all the toys, right?
00:34:17.680 | He had the nice cars, a nice motorcycle, had an airplane, had a boat, you know, a nice
00:34:21.720 | boat, all the stuff, beautiful house on the water.
00:34:24.160 | He had all the stuff.
00:34:26.240 | And he was facing up at his mandatory retirement at 65.
00:34:29.640 | And so he retired at 65, but he took a consulting job, continuing to work just as an independent
00:34:34.960 | consultant within the same system.
00:34:38.400 | And I remember talking to him, we were close, and he made a comment to me about how glad
00:34:44.160 | he was to still have that job, meaning the consulting job.
00:34:50.480 | And he said, "I derive a lot of satisfaction and a significant degree of my self-worth
00:34:57.120 | from my identity as a businessman."
00:34:59.040 | Articulated just like that.
00:35:03.160 | I'll never forget that because the older I get, the more I've seen that.
00:35:07.960 | Especially, I think this affects men more than women, but there have been so many times
00:35:13.680 | where I've coached with a retiree, right?
00:35:18.320 | Somebody who's 64 years old.
00:35:19.760 | And that person, you know, that man is at the peak of his career, is at the zenith of
00:35:24.120 | his achievement.
00:35:25.560 | He's respected, he's admired, he's well-paid, he is appreciated, his perspective is appreciated.
00:35:32.520 | And then often he'll retire.
00:35:35.400 | Pull out of that system.
00:35:37.560 | "Hey, what do you do?"
00:35:40.040 | "I'm retired."
00:35:41.720 | Loses contact with friends, loses contact with people in that business social circle,
00:35:47.040 | loses a sense of contribution to the community around, the company at hand.
00:35:52.000 | It's not a thing to be taken lightly.
00:35:55.120 | How much more if you do that at 30?
00:36:02.360 | What's the next thing that perhaps the power of conventional thinking?
00:36:07.040 | Here I would say the conventional power of a job.
00:36:13.600 | I don't see myself as the kind of person who is well-suited for a job.
00:36:19.560 | I don't.
00:36:21.280 | I like being an entrepreneur.
00:36:22.600 | I like the freedom, I like the flexibility, etc.
00:36:25.840 | But there's not a week that goes by that I don't think very carefully and ask myself,
00:36:30.120 | "Am I wrong?
00:36:32.120 | Couldn't I just go and be better off having a job?"
00:36:37.360 | A job is a wonderful thing.
00:36:40.360 | A job is one of the most rewarding things that you can do because it simplifies your
00:36:50.080 | life.
00:36:52.560 | When you are a boss or an entrepreneur, you come in so frequently, you sit down, look
00:36:57.160 | at a blank piece of paper and you have to figure out what plan, what design, what to
00:37:01.560 | build on that piece of paper.
00:37:04.480 | I find that frequently overwhelming.
00:37:07.040 | I don't know.
00:37:08.040 | And even though I'm very good at goal setting, I'm very good at saying this is what I want,
00:37:12.480 | even though I'm a world-class planner and can often see pathways through complex situations,
00:37:18.360 | I look at a blank sheet of paper every morning and sometimes I just can't figure out what
00:37:22.040 | to do.
00:37:23.320 | And I long and I wish, I just wish somebody would tell me what to do.
00:37:28.440 | Because then if somebody would tell me what to do and then I simply do it, I can have
00:37:32.160 | the confidence knowing I've done what I needed to do today.
00:37:36.480 | When I was a boy, my dad said, "Joshua, when you go to work, find out who your boss is,
00:37:41.600 | figure out what your boss wants and figure it and make him happy and then you're done."
00:37:45.120 | And I've always applied that, right?
00:37:46.560 | And as an employee, it's a wonderfully simple thing to do.
00:37:50.120 | You go into work, find out what your boss wants and you do it.
00:37:55.280 | And when you do what your boss wants, your boss is happy, you walk out of work feeling
00:37:58.640 | like I did a good job, I'm done.
00:38:01.120 | And you can leave the office with a clear heart, clear head.
00:38:06.520 | The lifestyle of an entrepreneur is not that way.
00:38:09.120 | As an entrepreneur, you come to the office, you sit down, you try to figure out what to
00:38:13.600 | do, you do it, you wonder, is this good enough?
00:38:16.800 | But who do I ask?
00:38:18.600 | There's no one that I can ask.
00:38:19.600 | I'm the one that's responsible.
00:38:20.600 | I'm responsible for everything, the vision, everything.
00:38:26.720 | So I'm here to tell you that having a job where you're an employee is actually a really
00:38:31.720 | wonderful thing.
00:38:33.280 | In addition, it's a wonderful thing in your personal finances.
00:38:38.720 | I don't withdraw from my opinion that if you want to become wealthy, one of the best ways
00:38:46.360 | to become wealthy is to build a business that makes a lot of money and/or build a career
00:38:51.160 | that makes a lot of money.
00:38:52.160 | And in fact, most of your first investments should be into your income.
00:38:57.040 | I believe that's true.
00:38:58.040 | And as far as I can tell, it's almost undeniable.
00:39:01.880 | However, there are so many things that are better in a conventional path, a conventional
00:39:09.880 | path of simply having a salary, having a paycheck.
00:39:17.320 | Let me articulate some of those so perhaps you'll appreciate what you have.
00:39:20.880 | The first thing is you have the ability to plan.
00:39:26.080 | For me personally, since the time that I was 21 years old, I have never been able to do
00:39:31.520 | a budget in the traditional sense.
00:39:36.600 | Took me years to be okay with that because when I was a teenager, I'd read books about
00:39:40.840 | doing a budget.
00:39:41.840 | You do zero dollar budgeting.
00:39:43.600 | You sit down, you figure out how much money you have coming in, figure out where it's
00:39:46.320 | going, and then you write down what your thing should be.
00:39:48.880 | And I remember when I was in college, I had an income and it was wonderful.
00:39:51.040 | I would sit down, I had my income, I knew how much it was going to be, I was a salaried
00:39:55.160 | employee, I would do my budget, I'd pay my bills.
00:39:58.640 | I remember it was very simple.
00:40:01.280 | I'd pay my rent, I had a certain amount for gas, but it was really predictable in terms
00:40:06.000 | of how much I was driving.
00:40:07.160 | And I think I had my food bill, as I remember it was $200.
00:40:10.360 | And so I would just put $200 of cash in my wallet and I knew that for food and fun, I'm
00:40:14.320 | going to spend $200 over the course of this month.
00:40:18.080 | And it was so freeing to go out to eat, knowing that if there's money in my wallet, I can
00:40:23.200 | spend it.
00:40:24.720 | And if there's not, I can't.
00:40:26.120 | It was so freeing to know that if there's money here, I can do it because there'll be
00:40:30.920 | more money next month.
00:40:33.220 | And I could spend money guilt-free because I had planned where the money was going to
00:40:37.480 | go.
00:40:38.480 | Well, then I became an entrepreneur.
00:40:41.000 | And there would be some months where I would make $0 and there would be some months where
00:40:45.520 | I'd make tens of thousands of dollars.
00:40:49.000 | That's a crazy thing to deal with on a daily basis because it makes it very difficult to
00:40:55.080 | know where to draw the lines.
00:40:58.000 | And you have this tension between frugality and enjoyment.
00:41:02.460 | You want to be frugal because you know that frugality is a useful tool along the journey
00:41:07.140 | to wealth.
00:41:08.220 | But on the other hand, you want to enjoy your money and you want to spend on peak experiences
00:41:12.840 | and on peak things.
00:41:14.700 | And a lot of times, the times that you want to spend the money don't line up.
00:41:18.500 | Maybe you have a $30,000 month and you're thinking, "Great.
00:41:21.500 | Awesome.
00:41:22.500 | I've got a $30,000 month.
00:41:23.500 | This was great."
00:41:24.680 | And so you go out to eat.
00:41:26.460 | Okay, fine.
00:41:27.880 | Maybe you go out to eat, nice restaurant, spend money, feel really good about it.
00:41:32.220 | But then what about the next month?
00:41:33.820 | You had a $30,000 month the previous month.
00:41:35.900 | The next month, you have a $0 month.
00:41:37.980 | Do you still do it?
00:41:40.260 | Well you're thinking, "Okay, well I made $15,000 between the two months."
00:41:44.100 | But then what about the fourth month?
00:41:45.600 | You know that in the fifth month, you could make a hundred grand.
00:41:48.460 | But in the fourth month, now your wage is averaged out.
00:41:52.140 | If you had a $30,000 month that took you for four months, now you're down to like seven
00:41:56.220 | grand a month.
00:41:57.220 | Now you don't feel so flush.
00:41:59.540 | I've lived this since I was 21 years old.
00:42:02.780 | Now I like it.
00:42:05.060 | I like it because it inspires me with a confidence to know that whatever it is that I want, I
00:42:09.740 | can make a plan to do it.
00:42:11.320 | If I went back and took a job, it would annoy me because I would not know how.
00:42:15.700 | It's like, "Okay, I want to buy a new toy.
00:42:17.740 | I want to buy a fancy thing.
00:42:19.180 | I want to buy, I don't know, a Ford Raptor pickup truck, something fancier.
00:42:22.940 | I want to buy a Tesla or I want to buy a boat."
00:42:25.580 | Well, in my world, I can look at a boat.
00:42:28.500 | By the way, I found this.
00:42:30.140 | Beneteau makes this center console cabin cruiser boat.
00:42:37.020 | My entire life, I have lived in South Florida and I've never understood since I don't enjoy
00:42:41.260 | fishing.
00:42:42.260 | I have never understood why everyone buys center console boats.
00:42:46.620 | They're uncomfortable unless you're fishing.
00:42:48.140 | They're designed for fishing.
00:42:49.140 | They're great for fishing.
00:42:50.140 | But the thing is people buy this fishing boat and they use it 90% of the time for partying
00:42:53.980 | and they use it 10% of the time for fishing.
00:42:56.980 | I don't like center console boats.
00:42:58.980 | I finally came across this last week across the Beneteau line of basically small cabin
00:43:05.460 | cruiser.
00:43:06.460 | You can get a 34-foot boat.
00:43:07.460 | It's got two small cabins on it.
00:43:09.900 | If you're into boats, you're looking for a lifestyle boat to put behind your Fort Lauderdale
00:43:13.740 | house, check out the Beneteau.
00:43:15.220 | I forget the brand name on it.
00:43:16.900 | But anyway, I can come across that and I can look at that and I can say, "This boat is
00:43:21.020 | awesome."
00:43:22.020 | Right?
00:43:23.020 | "300 grand?
00:43:24.020 | All right, no big deal.
00:43:25.020 | Okay, how am I going to make 300 grand?"
00:43:26.020 | I think it was 300 grand, something like that.
00:43:28.940 | To me, I love that sense.
00:43:31.300 | I love that sense of excitement to know that there is literally nothing that I could say
00:43:35.980 | to myself that I want and don't have that I can't figure out how to get because my income
00:43:44.320 | potential is unlimited and it allows me to live in this very pleasant, dreamy world of
00:43:50.060 | opportunity to go around the world and to be completely and totally unencumbered by
00:43:56.420 | constraints on my financial thinking because I know that no matter what the thing is that
00:44:02.260 | I want, I can figure out a way to do it.
00:44:06.660 | It's awesome.
00:44:09.100 | It's also brutal, right?
00:44:11.840 | Because there's those other times when things aren't going well and you really love to know
00:44:16.180 | when you're going to be able to achieve the goal.
00:44:18.700 | And a normal person can say, "I want to pay off my $300,000 house," and you can sit down
00:44:23.900 | and you can calculate, "All right, if I'll pay an extra $2,000 a month, I'll have my
00:44:27.700 | $300,000 house paid off in four years."
00:44:30.500 | And you can scrimp and you can save and you can be frugal and you can feel really good
00:44:34.540 | about that because you know you're making progress towards a goal.
00:44:38.980 | You can say no to yourself.
00:44:39.980 | Like one of the things that I used to do, I used to, if I said no, I'd go out to eat
00:44:44.740 | and I wanted to buy a $9 glass of wine but I just felt like, "Eh, that's a little excessive.
00:44:48.460 | I don't need to buy a $9 glass of wine."
00:44:51.140 | And so I would pull out my phone and I would transfer $9 from my checking account to my
00:44:55.140 | savings account.
00:44:56.140 | And I'd be like, "Okay, I didn't buy the glass of wine so there's $9 more available in my
00:44:59.820 | financial freedom fund."
00:45:02.940 | That's a nice thing to know that you're going to achieve it.
00:45:06.700 | And then you hit it.
00:45:08.460 | And you have the joy of knowing, "I hit that goal."
00:45:11.620 | And the ability to plan a fairly direct path from here to there through budgeting because
00:45:17.160 | you have a regular salary is a wonderful thing.
00:45:20.740 | The ability to leave your work and go home and feel good knowing that, "Hey, the work
00:45:25.340 | was there," is a wonderful thing.
00:45:27.400 | Even if your job is difficult, even if you don't like it, I'm going to encourage you
00:45:31.380 | if you don't care for your job to change to a different job.
00:45:34.500 | I just want to tell you that the conventional thinking behind having a job is not wrong.
00:45:41.100 | There's a lot of wisdom behind it.
00:45:43.220 | What about the good life?
00:45:46.140 | There are a lot of people whose parents have been very wealthy.
00:45:50.100 | I remember years ago I read Tom Stanley's book and he talked about how there were so
00:45:54.180 | many – I forget which one it was.
00:45:56.300 | May have been the Millionaire Mind.
00:45:58.820 | May have been – I don't remember which one.
00:46:00.900 | But he talked in that book about how there's so many very wealthy entrepreneurs that encourage
00:46:07.120 | their children to become professionals serving the wealthy.
00:46:11.380 | It's very common that you'll have – Dad builds this mega awesome business.
00:46:16.120 | He's got dozens or hundreds of millions of dollars in the bank.
00:46:19.620 | But he encourages his son, "Son, why don't you go to dental school and become a dentist?
00:46:24.420 | Son, why don't you become a lawyer, a state lawyer serving the wealthy people?"
00:46:30.660 | I didn't understand.
00:46:31.660 | I was like, "Why do they do that?
00:46:33.620 | Why wouldn't you, if you had been very successful in business, why wouldn't you look at your
00:46:37.900 | son and say, 'Son, why don't you become an entrepreneur and make yourself a couple
00:46:40.980 | hundred million dollars?'
00:46:43.120 | After all, the entrepreneur is the one who's done it.
00:46:45.780 | You know it's possible because you've done it.
00:46:48.260 | Why would you tell your son, 'Go get a job,' basically a highly paid job?"
00:46:51.980 | Well, today I understand it.
00:46:54.500 | The entrepreneur knows how if just a few things had changed, the success wouldn't have been
00:47:01.860 | there.
00:47:02.860 | If she hadn't met the right person at the right time, she would not have made it.
00:47:09.260 | If the bank had not given three extra months of grace period, everything would have collapsed.
00:47:17.540 | The entrepreneur looks at someone who makes $400,000, $500,000, $800,000 a year and says,
00:47:23.820 | "You can live a great life on $300,000, $400,000, $800,000 a year.
00:47:29.980 | You can do really well.
00:47:30.980 | You can be really wealthy.
00:47:31.980 | You can have all the toys.
00:47:33.660 | You can have it at a young age.
00:47:35.820 | It's almost a guaranteed path.
00:47:39.980 | And the work is great."
00:47:40.980 | You know, the entrepreneur knows that the idea that somehow you're going to work four
00:47:45.460 | hours a week and make millions is nonsense.
00:47:47.820 | The entrepreneur knows the weeks of family vacation that you miss because you're putting
00:47:53.340 | things in.
00:47:54.340 | The entrepreneur knows the early mornings, the late nights, the flying, getting on a
00:47:57.500 | flight to go and have breakfast with a guy that you don't really want to go and see but
00:48:01.800 | you got to do it.
00:48:03.220 | The entrepreneur knows that.
00:48:04.900 | The entrepreneur looks at it and says, "Hey, listen.
00:48:07.220 | You're telling me office hours are from 9 a.m. to 4 p.m. four days a week and there's
00:48:13.140 | a $300,000 paycheck sitting there at the end of the year from a business that's fairly
00:48:18.220 | stable?
00:48:19.220 | Two-thirds of the revenues come in from government payments?
00:48:23.780 | All of a sudden, that sounds like a pretty good deal."
00:48:28.100 | So don't let my radical thinking cause you to menos preciar, to despise what you got.
00:48:37.060 | It's pretty good.
00:48:39.220 | And I could go on forever.
00:48:41.460 | I want to give you a few more examples.
00:48:45.020 | Living a stationary lifestyle.
00:48:47.980 | Right now, my family and I are living out of suitcases.
00:48:52.100 | As I have described previously, we have a total of seven bags.
00:48:59.100 | We have six under seat personal item rolly bags and one backpack and that's it.
00:49:06.700 | Everything else is sitting in the storage unit.
00:49:10.860 | We're traveling the world.
00:49:13.020 | We've been in one, two, three, four, five countries on this particular trip and on the
00:49:20.860 | road for several months.
00:49:22.940 | I love it.
00:49:23.940 | I really, really enjoy it.
00:49:26.460 | I really love some of the experiences.
00:49:29.660 | I really enjoy it.
00:49:33.020 | It's tough.
00:49:35.220 | It's tough.
00:49:36.220 | Right?
00:49:37.220 | COVID has made it especially difficult.
00:49:40.220 | You're always looking and saying, "Where do I want to go?
00:49:44.140 | Where am I going to go next?"
00:49:46.140 | In the same way that I learned that years ago I wanted to be able to live in any country
00:49:49.980 | of the world and then I've realized that's too big.
00:49:52.860 | Right?
00:49:53.860 | A human being is not capable, is not equipped to say, "I'm going to live in any country
00:49:58.100 | of the world."
00:49:59.100 | It's mind blowing to have that ability and then you look at the world and it's a classic
00:50:05.180 | problem of too many choices.
00:50:08.660 | It's like, "I can't do this.
00:50:11.580 | I just want – give me three choices.
00:50:14.100 | Let me choose among the three best options."
00:50:16.460 | So, the travel is great but travel makes you appreciate home.
00:50:23.940 | As a kid we would go camping and without fail my mom, every camping trip and my dad would
00:50:29.820 | always say, "The reason we go camping is so that you appreciate home."
00:50:33.380 | I think they're right.
00:50:36.020 | The reason I travel is so that I appreciate home.
00:50:41.100 | For years whenever I've gotten on an airplane and gone somewhere I've always come back home
00:50:44.900 | and had a totally new appreciation.
00:50:48.140 | Every country it's something different.
00:50:49.660 | When I was in Costa Rica in college I came back home and I had been cured of my car lust
00:50:54.660 | and I knew that, "Hey, just having a car is awesome."
00:50:57.580 | I was in Haiti.
00:50:59.580 | I came home from Haiti and I just was overwhelmed with a sense of gratitude about how easy it
00:51:05.820 | was to get a job and how amazing it is to simply have a job.
00:51:11.340 | What a vastly better life to have a job versus being unemployed.
00:51:17.980 | Go home from – I'm here in Malta.
00:51:19.660 | Malta is a wonderful place.
00:51:21.140 | If I were to go back to the United States I would look around and I'd be like all the
00:51:26.900 | simple – the little things.
00:51:28.460 | We have air conditioning in our bedrooms and our hotel room but not in the main room.
00:51:33.460 | Everything here is done with a mini split system.
00:51:34.940 | I like mini splits but sometimes you just want your house to be a consistent temperature
00:51:39.420 | or you want your water faucets to be mixed or you want to be able to buy a meal for less
00:51:45.140 | than 12 euros.
00:51:46.140 | That's what, 15 bucks or so.
00:51:49.140 | All these little things.
00:51:50.140 | It just goes on and on and on.
00:51:52.260 | When we were in the United States a few weeks ago after spending time in Mexico and Costa
00:51:55.820 | Rica and after two years of living abroad I was just flooded with this sense of everything
00:52:02.740 | is easy here.
00:52:06.380 | I tell my wife, it's like everything is easy here.
00:52:13.540 | I think very frequently about moving back to the United States and whenever I do it
00:52:20.340 | I'm mixed with this – I have these sensations.
00:52:24.020 | Number one is everything would be so easy.
00:52:27.740 | If I just moved back to the United States everything would be so easy.
00:52:32.340 | But then maybe I'm taking the coward's way out, right?
00:52:34.100 | I'm taking the easy way out.
00:52:35.300 | Is that really me?
00:52:39.180 | So travel, right?
00:52:43.180 | Someone's living the dream but the dream is full of a lot of stress.
00:52:48.020 | Not trying to dissuade you from it.
00:52:49.500 | I wouldn't do that.
00:52:50.540 | I'm not one who listens to most people when they try to dissuade me from things.
00:52:53.500 | I'm one who likes to go and learn from experience.
00:52:55.780 | But what I do want to do is I want to articulate some things so that if you're in a phase of
00:52:58.940 | your life where you don't particularly want to get on an airplane just recognize be here
00:53:02.780 | now and enjoy this particular phase of life.
00:53:07.300 | The conventional lifestyle – having a house, having a yard, having a swing set, having
00:53:13.460 | a driveway, having bikes in the garage, having a minivan – this is a really great lifestyle.
00:53:20.540 | It's really great.
00:53:23.420 | And if you don't understand why more people don't want to live in their car or why more
00:53:28.860 | people don't want to move to a tropical island somewhere, just recognize it's because – it's
00:53:34.580 | not because people are stupid.
00:53:35.820 | It's because that traditional conventional lifestyle is really good.
00:53:43.500 | The reason that most people live fairly conventional lifestyles where they go to work and they
00:53:48.500 | buy a house and they work a job and they do that for decades at a time is because it's
00:53:53.860 | a really good way to live.
00:53:56.180 | Let's not be those who are so convinced of our perspicacious radicality that we just
00:54:04.300 | wave our hands and say, "We should dump all of this."
00:54:08.500 | Suburbia exists for a reason.
00:54:10.660 | Suburbia exists because there have been many, many people who have looked around and said,
00:54:15.300 | "That's the kind of lifestyle that I want to live."
00:54:20.460 | Don't despise the wisdom of other people.
00:54:28.460 | Don't think that you're the only one who's got to figure it out.
00:54:33.340 | Having a house, living in the suburbs, commuting to a job – these are good things.
00:54:40.580 | These are a good lifestyle.
00:54:44.740 | Go on down the list.
00:54:45.740 | Let's talk about things like investments.
00:54:49.540 | I am one who is interested in finding the highest returning investments.
00:54:55.460 | I understand the mathematical power of good investments.
00:54:59.140 | But if you came to me and you said, "Joshua, I've got a job that's a good fit for me.
00:55:02.980 | I feel satisfied with my work.
00:55:04.860 | I make $100,000 a year.
00:55:06.980 | It's enough for us to have the luxuries that we enjoy.
00:55:09.980 | It's enough for us to be out of – we're not in the poor house.
00:55:16.180 | We don't struggle with financial insecurity.
00:55:22.620 | What should I invest in?"
00:55:23.620 | My answer is probably going to be, "Yeah, probably your 401(k) with some mutual funds."
00:55:29.060 | I'll talk to you about some other options.
00:55:33.140 | But the lifestyle where you got a job, you make six figures, you put aside 15%, 20% of
00:55:40.940 | your income into a 401(k), you do that over the course of a few decades, build up a few
00:55:46.820 | million bucks in reserves, this is a really great lifestyle.
00:55:51.820 | There is no easier investment plan than simply buying mutual funds.
00:56:00.180 | It works.
00:56:02.740 | It works.
00:56:06.220 | Will it work as well 10 years from now as it has in the last 10 years?
00:56:09.820 | You and I don't have a clue.
00:56:12.420 | Reality is it works.
00:56:14.060 | It's good.
00:56:15.660 | And it's low stress.
00:56:20.180 | I would ask you if you were in that situation, I would say, "Well, you could go into it pretty
00:56:26.180 | heavy, right?
00:56:27.180 | You could go and say, 'I'm going to buy 10 rental houses,' or 'I'm going to start a side
00:56:31.980 | hustle.'
00:56:32.980 | But do you really want to spend Saturday morning going and taking care of your properties?
00:56:38.900 | Do you really want to take time off from work on Friday morning to go meet with a banker
00:56:42.180 | and see if you can qualify for another mortgage just so you can have a few more million bucks
00:56:46.340 | down the road?
00:56:47.500 | Or would you rather just go ahead and buy a ski boat and Saturday morning load up, go
00:56:51.140 | down to the lake and spend the day out on the water?
00:56:56.060 | Do you want to be sitting in your office on Sunday afternoon reading stock reports or
00:57:04.060 | messing around learning how to figure out what the candles on a trading chart mean on
00:57:09.340 | Sunday afternoon?
00:57:10.780 | Or would you enjoy simply sitting in your den, cold drink in hand, watching a football
00:57:17.020 | game?
00:57:18.020 | It's a really good lifestyle."
00:57:25.780 | I could go on with these examples for a long time.
00:57:29.780 | I simply want to say that there have been many times where I have engaged in that youthful,
00:57:37.620 | revolutionary spirit of just waving my hands and casting off the good things that other
00:57:44.460 | people have.
00:57:48.140 | Reality is if you live in a country, a wealthy country like the United States, Canada, etc.,
00:57:54.900 | living well is not that hard and the conventional formula for success is not entirely broken.
00:58:03.540 | Going to college will help you to have an easier entree into the job market.
00:58:09.860 | If there is a disruption, a recession, the data from all the past recessions and disruptions
00:58:15.760 | has been that people with a college degree had a significantly lower unemployment rate
00:58:21.580 | than those without a college degree.
00:58:24.780 | Going to college is not a bad decision.
00:58:26.980 | Getting a job is not a bad move.
00:58:29.700 | Getting a job can work.
00:58:31.660 | Investing your money in mutual funds, buying a house, buying a car, putting mortgages and
00:58:38.060 | car payments on them and then just steadily paying them off.
00:58:40.660 | None of these are bad things.
00:58:45.700 | There are a lot of us who, whether it's a personality, whether it's a feature or a defect,
00:58:54.220 | I don't know.
00:58:55.220 | There are a lot of us who are just going to be happy to chart a different path.
00:59:02.100 | While I can appreciate so many things about a conventional lifestyle, right, the conventional
00:59:09.540 | financial planning path, I'm trying to articulate those things so that you know I genuinely
00:59:14.660 | do think they're good things.
00:59:16.700 | I'm unlikely to go back to it.
00:59:21.380 | But if you are enjoying that, don't feel like it's wrong.
00:59:30.420 | I don't talk a lot about some of those conventional pathways just because I'm not that interested
00:59:35.380 | in them.
00:59:36.740 | But if you are enjoying them, you're not wrong.
00:59:40.980 | Don't think that someone else is wrong.
00:59:45.780 | I don't have buyer's remorse for the decisions that I have made.
00:59:51.780 | All of us make, at every stage of our life, the decisions that we believe are best.
00:59:57.060 | I want to talk about that for just a moment outside of even the context of financial planning.
01:00:02.300 | This is one thing that bothers me and I'm trying as I get older and recognize I'm seeking
01:00:08.100 | very diligently to do my best to be less critical of other people and to be more cautious with
01:00:14.100 | my judgments of others.
01:00:15.820 | I think it's important that we acknowledge both intellectually and then in reality that
01:00:23.140 | other people are doing the best that they know how.
01:00:27.700 | Our parents, they did what seemed best to them.
01:00:32.220 | Our friends, they're doing their best.
01:00:35.220 | Politicians, they're doing their best.
01:00:38.380 | You can disagree with somebody without seeking to...you can disagree and honestly disagree
01:00:47.380 | with somebody without impugning their character.
01:00:51.660 | Believe the best about other people.
01:00:54.500 | Consider others to be innocent until proven guilty beyond a reasonable doubt.
01:00:59.420 | So when your dad gave you the advice to go to college, get a good job, and you've come
01:01:07.460 | to the point where you wish you had gone a different path, don't blame your dad for that.
01:01:12.660 | Recognize he did the best.
01:01:14.540 | He did and said what seemed best to him.
01:01:20.300 | When your financial advisor said, "Put money in your Roth IRA," and you wish instead of
01:01:25.900 | doing that, like I do, you wish that you had taken it and started a business with it, don't
01:01:32.140 | blame your financial advisor.
01:01:34.900 | Financial advisor gave you the best advice, right?
01:01:40.100 | Said the best that he knew how at the time.
01:01:47.900 | When our city planners looked around at these narrow two-lane roads or one-lane roads and
01:01:53.660 | said, "You know what?
01:01:54.660 | Our life would be better if we had some bigger roads to fit our cars better," and they put
01:01:58.900 | in four-lane roads, they did what seemed best to them.
01:02:02.820 | And then we've learned that, you know what, four-lane roads are really great in some applications,
01:02:08.820 | but in other applications they're not so great.
01:02:12.860 | So let's be those who don't pursue radicality as some kind of pre-commitment.
01:02:24.900 | You can indeed get great results if you are committed to a different path.
01:02:32.460 | You can get faster results.
01:02:36.140 | You can become financially independent quicker.
01:02:38.780 | Be inspired by the radical approaches, but recognize that those radical approaches come
01:02:48.820 | with a cost often.
01:02:52.620 | So don't be scared to embrace the things that seem conventional.
01:02:58.540 | I don't intend to live as a nomad for the next, you know, 10 years of my life.
01:03:06.860 | It's not an ideal way to live with children.
01:03:10.580 | It's not.
01:03:11.580 | I'm not sure.
01:03:12.580 | It's not great for them.
01:03:13.580 | It's fine for a time.
01:03:14.700 | I'm enjoying it.
01:03:16.520 | But what I'm doing is I'm embracing where I am.
01:03:22.820 | I'm enjoying what I'm doing.
01:03:26.580 | I'm taking lots of pictures, lots of video.
01:03:29.260 | I'm embracing the disruptions.
01:03:32.980 | Maybe I can't work today because I'm going to go on an excursion, or I don't get as much
01:03:37.880 | done tonight because I'm going to the beach.
01:03:40.740 | I'm going to embrace where I'm at right now.
01:03:44.900 | But then I think my guess would be in six months or a year I'll be living in a house
01:03:50.500 | again and what I want to do is I want to embrace where I'm at at that time.
01:03:55.660 | I don't want to be longing and just saying, "I wish I was on an airplane living out of
01:04:00.220 | a suitcase again."
01:04:02.380 | I want to look back fondly and appreciate the living in a suitcase while appreciating
01:04:08.000 | how much easier life is in a house.
01:04:11.460 | And then there'll come a point in time in which I'll move out of the house and I'll
01:04:15.380 | move back into an RV and then I'm going to appreciate the RV.
01:04:20.800 | So similarly with a career, I'm going to appreciate when things are going well.
01:04:25.460 | I wish I had taken more time to appreciate previous jobs.
01:04:31.340 | Who knows?
01:04:32.340 | I don't intend to take a job in the future, but maybe at some point I'll take a job.
01:04:35.740 | When I've got that job, I'm going to appreciate everything that comes with it.
01:04:39.800 | When I'm working in a business, I'm going to appreciate everything that comes with it.
01:04:43.340 | When I'm by myself working from a house, I'm going to appreciate that.
01:04:46.640 | When I'm in an office with a bunch of people on a structured schedule, I'm going to appreciate
01:04:50.220 | that.
01:04:52.500 | My life is but a vapor and it's gone.
01:04:58.140 | Life is a vapor.
01:05:01.460 | Gone.
01:05:05.180 | Let's not be those who spend so much time wishing we were somewhere else that we don't
01:05:12.620 | appreciate where we are today.
01:05:17.380 | There is power and intelligence and thoughtfulness in the things that are conventional.
01:05:30.140 | The ancient ways of living were not stupid.
01:05:34.220 | The design that's gone into the modern way that we live is not stupid.
01:05:39.460 | Don't be a revolutionary who just wants to reject everything because it's that way.
01:05:46.740 | Appreciate the things of the past and then systematically reform and adjust the things
01:05:52.180 | that are in your own life.
01:05:53.700 | I'm not saying don't take radical action.
01:05:57.020 | I don't intend to walk away from being willing to take radical action.
01:06:01.680 | But if you're one who listens to Joshua talk about all the things that you could do, don't
01:06:07.500 | feel any guilt or judgment because you honestly look at those things and say, "It's not for
01:06:13.780 | me.
01:06:14.780 | I don't want to quit my job in five years.
01:06:17.620 | So although I could save 80% of my income and quit my job in five years, I don't want
01:06:20.820 | to do that.
01:06:21.940 | I want to save 20% of my income and quit my job in 25 years."
01:06:26.220 | Totally fine.
01:06:27.740 | If you're one who says, "I recognize that I could potentially make millions if I started
01:06:31.820 | a business.
01:06:32.820 | I don't want to start a business.
01:06:34.540 | I just want to put money in my 401k and I want to live a good life now."
01:06:38.180 | That's totally fine.
01:06:42.420 | I'm going to continue to bring you as much clear-headed radical thinking and as many
01:06:48.380 | radical ideas as I'm capable of.
01:06:51.100 | I'm going to continue to test as many things as I possibly can to be the human guinea pig
01:06:56.780 | who does wacky weird things to try them out and see how they work.
01:07:01.100 | I'm going to continue to tell you honestly that the things that sound awesome often have
01:07:08.380 | a lot of awesomeness associated with them, but there is also a lot of difficulty that's
01:07:16.820 | usually associated with them.
01:07:19.540 | I want to do my best to articulate the awesomeness and the difficulties so that you can have
01:07:24.740 | a more balanced perspective.
01:07:28.220 | I'm not changing the name of Radical Personal Finance to Conventional Personal Finance,
01:07:33.620 | but I'm going to try to continue to highlight the wisdom of conventionality for you and
01:07:44.340 | for me.
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