OT: Self-made millionaire: This is the greatest paradox of wealth—and most peopl
Papi_Chulo
Miami, FL (or the nearest big-booty club)
Yet when it comes to how we use our time and money ― especially for high earners and wealthy individuals ― we tend to be more resistant to change.
Here’s a little scenario to illustrate my point: I have a friend who earns more than $750,000 a year. He loves his job, but if you asked him how he’s doing, his biggest complaint would be: “I’m so busy.”
So imagine my surprise when I visited him one day and pointed to the bags sitting on his kitchen counter.
“Oh, I just got back from the grocery store,” he said.
After a quick pause, I asked, “Have you ever considered having someone else do your grocery shopping?”
He looked at me like I was crazy. Pay to have someone do his grocery shopping? What kind of elitist would do that?
Here was an adult earning $750,000 a year, but behaving as if he still earns $50,000.
The hidden paradox of money vs. time
The concept of buying back your time is one of the most powerful productivity concepts I’ve learned as a business owner.
Buying back your time is all about convenience: By spending on things like Lyft rides, pre-cooked meals or a housekeeper, you’re actually saving money because you get back the hours that you’d normally spend doing things that don’t make you happy.
Most high earners fail to recognize the effectiveness of buying back time. Maybe it’s because growing up, their parents didn’t have more money than time, which changes the calculus of how they make decisions. As a result, those high earners never end up changing their approach to work and their personal lives.
This is a huge paradox of earning more money: Many people claim they value time over money, but if you look at their calendars, you’ll find that the opposite is true.
Buying back your time isn’t an act of arrogance
I used to scoff at people who flew first-class and think, Why would anyone spend an insane amount of money something so pointless? We’re all getting to the same destination.
But more often than not, those people were not stupid. They were high earners who understood value in a different way than I used to.
If you earn $40,000 a year, for example, spending $5,000 on a first-class flight is crazy. But if you’re a CEO who earns $450,000 a year, it makes perfect sense.
In business, misaligned beliefs on time and money can cost you dearly ― while getting aligned can become a force multiplier.
Sometimes, people who buy back their time are seen as showing off. But guess what? Many of us already do it:
Eating at a restaurant instead of cooking at home
Getting the car oil changed instead of doing it yourself
Taking an Uber instead of walking or taking public transportation
Paying retail price instead of looking for a good deal
I’d bet that some of you do these things every week and don’t consider it as “buying back your time.” But you actually are because you’re spending on convenience so you can focus on getting results and move on to more important things.
I’m really into fitness, for example, and Theoretically, I could read a ton of material on bodybuilding, structure my diet and fitness routine ― and stick to it.
But I know I’ll never be as efficient as my trainer, who lives and breathes fitness. By paying him, I can trade money for time and get the best results. (Again, I could be doing it all on my own, but I don’t have to; I’d rather spend that time on my business and with my family.)
Give it a shot―it might change your life
I still find it difficult to know when it’s “right” to spend money or time on something ― and I’m not alone.
Think about all the wealthy and successful people, like my friend who earns $750,000 per year, who are uncomfortable with the idea of delegating tasks to others. But if you’re working hard, you should be able to buy back your time.
The key is to ask yourself: What do I get out of it?
What do you get if you got three hours of your time back every week? Do you get to fly your parents out and put them up in an amazing suite? (If you’re Indian like me, the answer is no: They’ll be staying with you.) Do you get to do things you really enjoy, like cooking your own meal or composing music?
If you’re making more money than ever, aim to save at least one hour per week. Think about all the responsibilities that you hate (e.g., doing the laundry, grocery shopping, managing your finances) where there are great solutions available to outsource or systematize the work.
Then, as you get more advanced, you can tackle trickier topics like scheduling, email management and entire project management.
Ramit Sethi, author of the New York Times best-seller “I Will Teach You To Be Rich,” has become a financial guru to millions of readers in their 20s, 30s and 40s. He became a self-made millionaire at a young age thanks to his website (which he started as a Stanford undergraduate in 2004), book and personal finance courses.
This is an adapted version of a post that originally appeared on Quora.
https://www.cnbc.com/2019/08/08/self-mad…
Got something to say?
Start your own discussion
17 comments
Spend time with wife and kids (she works 7 days on and then gets 7 days off). She does my schedule so that we can play. It took me two life times to figure it all out, but TIME is the one commodity that you cannot get back once spent. Make the best of it.
I always say this: The ultimate goal is happiness.
Money is simply the means to get it. If you spend all your time chasing money, but unhappy, you're doing it wrong.
Also, remember that everyone else's goal is happiness, too. If you can only feel happy relative to other people — because you have more money, because you're better than them at something, whatever — that's problematic, because the only way you can feel happy is by robbing others of their happiness. You have to find your own version of happy separate from everyone else's.
I don't get hung up on trying to get rich. If money meant more than happiness, I wouldn't club. I do get hung up on people that don't value others' happiness, or only value their own. Those folks bother me.
And I also agree that when you outsource something, the value may go down. Prepped meals may not be as tasty as if you learn to cook and get good at it. Pet/childcare may not happen the way you want, etc
One may have to do some hard research when deciding to outsource stuff. For example, if I were to use a service and get produced delivered to my house, I’d rather subscribe to a local CSA (community service agriculture box.
Also, I’d like to chime in there is also an argument made for minimalism whenever it’s possible in your life. The less “moving parts” one has...the less likely one has to make hard choices on what to allocate their “time savings dollars on”
For example, one can get a smaller house. Or drive a less nice car. Or develop a simpler taste in foods (which would probably be good on the waistline) or a range of other things. Or don’t procreate. Or not own a pet but instead occasionally foster animals and volunteer at a shelter.
...which that last one is a hell to the no for me on that one. And one can and should enjoy a high maintenance endeavor or two on anything in general. But it should be a conscious choice to have it, instead of going through the motions because society told you so.
OTOH...for the average 40hr a week wage earner in a job/career with defined pay bands and limited income growth potential....outsourcing would be a tougher call given its almost always cheaper to DIY.
After a quick pause, I asked, “Have you ever considered having a stripper do that for you?”
I'm a subscriber to the idea of buying back my time. But beware of, as in all things, going to far with an otherwise good idea.
My experience has taught me that as my personal wealth grew I could indeed afford to improve my living conditions, my travel style and other conveniences that return valuable time to my schedule. However, the danger in this approach is in forgetting to stay within your (increasing) means. I've seen some colleagues and friends who never learned the difference between what they NEED and what they WANT.
You NEED a home. You probably don't NEED a 25-room beachside mansion.
You NEED good, affordable transportation. You don't NEED a Lambo.
You NEED clothes. You don't need 100% French designer labels.
You NEED food. You dont NEED to eat at the French Laundry every night.
I've seen far too many well-off people live into what they WANT rather than what they NEED, usually to their own ultimate destruction. This is, sadly, especially true of the 18-28 year old strippers (and Sugar Babies) I see who are always broke. Their problem is not on the revenue side. Its all about managing expenses within their means.
____
+1.
It's nearly impossible to explain to some 21-yr-old girl that her absolutely magnetic sexual appeal doesn't last all that long and that she'll regret buying that BMW.
Not a bad article. I've been getting "Quora" articles sent to my email for several years and they attract some interesting authors.
The old cliche that "if you want something done right, then do it yourself" hold true in a lot of cases. Seems like half the projects done by contractors around the house are done poorly and I like to do simple things like painting or staining. Still doing my own oil changes and worry that the guy paid $11/hr and Jiffy Lube will forget to put the drain plug back on.
Both my older brother (by 3 years) and I grew up in challenging financial circumstances - we were both born in Cuba and our dad was a political-prisoner meaning we were 2nd-class citizens in a country where you barely got by as a "1st-class" citizen - we lived in a one bedroom apartment w/ no refrigerator; no working shower (we used the sink and a can to bathe ourselves); no TV; washed clothes by hand; and of course no A/C; etc (we didn't even have a gas nor electric stove but an old stove that worked w/ some kinda liquid one had to get).
I see money as security - my nature is to use $$$ for my needs and beyond that is to save it for a rainy-day or for some particular want - ever since I was a little-kid I would save w/e $$$ I got, but my brother OTOH having grown up in the same circumstances as me saw $$$ as a way to get as many of his wants as possible (i.e. if he got any $$$ he would spend-it/splurge it away right away) - my brother is naturally smarter than I am and things have normally come easier to him; for me I've always been a harder-worker - my brother has always earned more than me and earns over 6-figures yet I've had to help him out at times financially b/c of some jams he's gotten himself in (not a lot of times but a couple of times).
Given my challenging upbringing and my saver-nature, I've always lived below my means - for the most-part have never bought particularly nice cars which I o/w could afford nor stayed in nicer-hotels which I could o/w afford b/c I didn't see a "need" for it.
Now that I'm turning 50 at the end of the year it's more on my-mind about treating myself to some of the nicer things which are not necessarily "needs" but probably o/w enjoyable - in the past I didn't really think about it much in terms of not upgrading my lifestyle - I guess I was conditioned by my upbringing since my parents never splurged on anything either which in their case it was understandable having come as immigrants to the US and they were around 50 when they got here and for various reasons never really achieved financial success although the basics were always covered.
So in a subconscious way I've kinda always been "stuck" in a mindset of financial-worry given my upbringing and nature and for the most-part been one of those people that would not spend $$$ if it wasn't really a "need" but a the same time I've probably missed-out on treating myself a bit even though I could afford it w/o necessarily going into the red per se.
And then when talking with mongers, there are still other dimensions to consider.
:) :) :)
SJG