“While we wait for life, life passes.” —Seneca
While we are constantly seeking more money and more freedom, it’s important to determine how much you want or need to avoid falling into the trap of trading away all of your most important, finite resource — your time. In this episode, Travis shares how passive investing can help you stop exchanging your time for money.
1. Put a System into Place
“If you don’t put a system into place, then you inevitably end up chasing things that bring you short-term money, short-term dopamine hits, but in the long run, they lead to unhappiness at an older age,” Travis says. Happiness comes from spending time, effort, and energy on things that you love and enjoy, which passive income can allow you to do.
For Travis, that meant earning enough income as a W-2 employee in a job he didn’t enjoy in order to save up enough money to passively invest. By creating a system and a plan to generate passive income, he was able to achieve his goal of quitting his W-2 job and spending more time on things he enjoyed.
“Creative people say yes until they have enough work that they can say no.” —Austin Kleon
2. Become a Stoic
An investor, in Travis’s opinion, is a stoic, or someone who postpones present pleasure for a greater return in the future. While he was saving up to passively invest, he gave up modern luxuries by sleeping on an air mattress, strictly budgeting his meal expenses, driving older cars, and buying his clothes at secondhand stores. In the end, this mindset helped him to reach his financial goals.
3. Outsource Tasks You Don’t Enjoy
By building a passive income stream, you can outsource the parts of life that bring you unhappiness and spend more time focusing on what matters to you. If you can’t stand cleaning your house, for example, you can follow a plan that allows you to create enough passive income to pay someone to clean it for you. The system you create should ultimately allow you to live your fullest and best life.
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Travis Watts: Welcome back, Best Ever listeners. I'm your host, Travis Watts. This is an episode of The Actively Passive Investing Show. Today's episode is some food for thought, a little bit of philosophy here, something that's been on my mind that I haven't been able to articulate as clearly as I would like, so that's what this episode is all about. So how to stop exchanging time for money. It's the American way - more money, more success, more freedom. But where does it end? Are we trying to be the richest people in the graveyard?
Here's the lesson for today summed up. If you don't know what you want or how much you need, then you're going to tend to default to "I just want as much as possible." And the problem with that way of thinking is that a lot of people end up trading all of their time away, which is finite, it's the one thing we don't get back, in exchange for money. Mostly for doing things that you're not passionate about, or that you don't genuinely enjoy. And most people do this for the majority of their lives. And why? To end up keeping up with the Joneses, or buying things you don't really need or want in the long run, that don't bring sustainable fulfillment or happiness. That's what we're talking about here today, the ability to say no to money. That's a crazy concept that nobody talks about. So here it goes.
If you don't put a system into place, then you inevitably end up chasing things that bring you short-term money, short-term dopamine hits, but in the long run, they lead to unhappy unfulfillment at an older age. Because happiness truly comes from spending time, effort, and energy on the things that you love and enjoy, and spending less time, effort, and energy on things that you don't enjoy and don't have a passion for. In fact, that's really my encompassing quote that I say all the time when I do webinars and presentations, is passive income allows you to spend more time doing the things that you love, and less of the things that you don't enjoy.
So there's a great quote by Austin Kleon. I love this. He says, "Creative people have to say yes until they can start saying no." And this was me years ago, as a W-2 active employee, working the ladder up in a career I didn't want to be in, that I wasn't fulfilled in, that I didn't enjoy. But you know what, you guys? Here's the silver lining. It was the necessary evil to get me to my goals. So I'm not saying quit your jobs, don't have an active income, any of that kind of stuff. This income allowed me to start investing, but the point was, I created a system and a plan to have my investments create passive income, which then led me to my goal of leaving that job and being able to spend more time, effort, and energy on the things that I enjoyed more than doing that particular career, being away from home all the time.
And as I always say, "Simple, but not easy." There was a lot of sacrifice that I made for many, many years of giving up luxuries in our modern-day society. I slept on an air mattress for over a year. I only would allocate myself $6 per day on food expenses. I drove cars that were 10-20 years old, never buying anything new. I shopped at secondhand stores for my clothes, and I didn't take out any debt for college by choice.
Break: [00:04:51] - [00:06:37]
Travis Watts: It's a tragedy in 2022 when a student is graduating with $200,000 in debt because they went to college for that; not bashing college or saying that it's a bad idea, but here's the facts. You walk right out of the gate, before you've even started working a professional job, with the equivalent of a mortgage payment. And the sad part is you still have to find a place to live, whether you're going to rent or buy a home. So you effectively have two mortgage payments over your head, right out of the gate, before you've even started earning money. That is such a setback for so many younger people. So I hate that, but the fact is, everything is a choice in life. And I digress...
Let me bring this concept home for you. So an investor, in my opinion, is a stoic; and a stoic is someone who postpones the present pleasure for a greater return in the future. So again, I agree with Austin Kleon's quote; I was a yes man, and I would say that's mostly a good idea in your early years. Say yes to opportunities, say yes to jobs, say yes to earning money and trying different things and experimenting, but have a plan. Put a system into place so that one day you can truly hone in on what it is you're passionate about. The biggest tragedy to me is to see somebody put in 30, 40, 50 years in the workforce just to retire and have a few years left and then have a lot of regrets there on the tail end.
This system and this process and this investing, we'll call it at large, is what allows you to live your fullest and best life. That's my firm belief.
The Roman stoic philosopher Seneca once said, "As we wait for life, life passes." That saying's nearly 2,000 years old. It's important, it stays relevant here today. It's important to design your optimal lifestyle. And again, building passive income streams can allow you to start outsourcing the things that bring you unhappiness. Let's say, for example, let's just paint this picture here... Let's say you don't enjoy cleaning your house. That's just a pain point for you. You procrastinate on it. It's just something that you really don't like. So here's the way I look at that as an investor. I'm going to go out and work, I'm going to save, and then I'm going to invest $20,000 into something that produces positive cash flow or passive income. We'll say it produces 8% a year for simple math. That gives you $133 per month if it pays out monthly.
So then you turn around and you take $133 every single month and you outsource your pain points. You hire a house cleaner once or twice per month to come to your home and to clean it, because that is bringing you unhappiness. And in turn, you start having a bit more fulfillment and happiness in your own life.
So food for thought... As I said, another short episode. Just wanted to share that with you guys.
Thank you so much as always for tuning in to The Actively Passive Investing Show. I'm your host, Travis Watts. If we haven't connected on social media, let's do it. LinkedIn, Facebook, Instagram, @passiveinvestortips, Travis Watts. Reach out anytime, I'm happy to be a resource for you or anybody you know who could benefit from passive investing or investing in multifamily apartments. Always here to be of help. Have a Best Ever week, everyone. We'll see you on the next episode.
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