r0dman.com

Anyone who has read a few posts from this site – r0dman.com would realise that I have a few issues with the way that people live their lives. Not so much individuals, but large demographics.

It’s not so much that I don’t approve – it doesn’t actually affect me, it’s that I see so many people failing to perform and I would honestly like to see them achieve.

We’re on this planet for a maximum of what, 100 years? It sounds like a long time but as a 25 years old I already realise that I am a 1/4 of the way through a best case scenario.

I think about my parents, newspaper articles, stories of grandparents, movies, and so on and what people have and haven’t achieved in their lives. Everyone effectively lives the same life;

1. Go to school
2. Go to work
3. Buy a house
4. Have children
5. Wait for the children to leave the house
6. Retire
7. Wait to die

Granted that’s a fairly subjective way of looking at it all, but if you break it down, it is what most people do with their life and what many more will do.

People are concerned with the small things along the way. For instance during the younger working years they might be able to buy a nice motorbike. Their friends at the time will tell them that they have “made it”. Years on they will have seen their children through school, and being so “successful” they will have funded their children’s tertiary education. The children move out, they retire at 65 and then go on a three week cruise with their wife. They have won the game of life.

…Or have they? Chances are this same person has spent the last 45 years working a job that they hate. They always wanted more time with the kids but couldn’t afford to work fewer hours because of the mortgage. Their kids are on track to live the same life as them because of how they were brought up, and unfortunately the cruise was a challenge more than anything else because they had to spend so much time in close quarters with their wife who they have lost touch with after years of stress and neglect due to their work.

As children we have these dreams of being all sorts of things. I remember wanting to own a black Porsche 911, being a BMX champion, live in a rainforest, and so on. Things that most adults would put in the “unobtainable” category. Are they really that ridiculous though?

Granted nowadays I lust over a Porsche but know full well that the money spent on one would help me attain many other things ($200,000 would bring in enough income every year for me to justify taking a day off of work every week).

These supposedly unobtainable goals are the ones that keep us excited and ideally, happy. I strongly believe that if I’m not happy, my wife won’t be happy. This means that while I always take her into account, from time to time I need to be honest to her about what I want from life. The alternative is “forgetting it” and ultimately living a life of regret.

Our society breeds mediocrity and no one can break you out of this mold aside from yourself. If you are very lucky a close friend or loved one may push you, but ultimately it’s up to you to make the choice to break free.

Start to define what you want from life, then start living your life in the direction of achieving your goals.

It’s not to say that you need to always be meeting goals and turning your life into some sort of statistical report, it’s just important to make sure that you are where you want to be or on track to where you want to be. Goals could be as simple as “be happy” or be ridiculously complex too. My goals are relatively simple, although will require some effort from myself and my partner.

I want to remain free, happy and healthy. I DON’T want the same lifestyle until the day I die. I don’t want the same job, same bills, same day to day frustrations and hassles. I want the both of us to be able to change when we need it. When our lifestyle becomes one that doesn’t facilitate a good relationship, we’ll change. Ultimately everyone has the ability to do this, it’s just that many people tie themselves down and then it all becomes too hard.

Think about what you would like and start to work towards it. Try not to think too much about possessions, they will come with the lifestyle that you want to attain.

If life isn’t how you pictured it would be, make some dreams.

I’m currently on a 3 (or so) month backpacking trip with my wife, which will be mostly through Europe, before trying to find work in Canada for the rest of the year. It’s a completely new feeling to me, being the first time I’ve been out of the country and honestly, out of my comfort zone.

We both have a backpack with “the essentials” – clothes and toiletries basically.

When we were first packing, it didn’t seem to be enough – it was as though we were leaving all of this “stuff” behind. We felt as though we would never survive without it, but within a day or so that feeling completely left us. All of a sudden I realise the freedom that a light backpack gives you.

At home, when you are tied to many things – friends, work, possessions - it’s very easy to say no to things, because of all of these other external factors, but it is such a feeling of freedom when you remove them from your life. We can make last minute decisions on changes to make; we can literally get up and move in about 2 minutes if we want to.

I’ve only realised the power of freedom over the last few years. With so many possible commitments in life, it’s so easy to become intertwined in things that most people consider “life”. Contracts are a huge one – phones, internet, etc. Car loans, home loans, etc. They lock you in, and as a result, your decisions for the next “x” number of years.

I have no ongoing commitments at the moment – I’m tied to my wife and that is about it. It’s such a breath of fresh air, and I’m loving it. Who knows, maybe my opinions will change, but to be honest I doubt it. Life is great right now!

I’ve never been big on donating money to charities, but I’ve never really given it much thought. It was more the annoyance of having someone knock on my door and then make demands about how I donate money to their charity.

For example, one night around 9pm a man knocked on my door and asked if I wanted to donate to a charity that preserves rain forests and so on. I’m a bit of a greenie, so I was ready to give him some money but he refused the cash. “We are looking for a donation that we take monthly – as a regular thing”. I explained to him that I was travelling next year and had no idea what my financial situation would be like, but I would be happy to donate as a once-off thing. He refused again and gave me same story about the “monthly commitment”. It was pretty obvious that he was getting a cut of the monthly commitment, and as a result wasn’t interested in my genuine donation. He left empty handed and I walked back inside frustrated with the world.

Ever since a friend asked me to donate to a charity quite some time ago, I’ve given it some thought, and to be honest I ask myself “what is the point”.

For instance, charities supporting cancer research are just misguided, and wasting money on research for a wonder drug, when clearly the solution is a good diet and a healthy lifestyle. Doctors receive essentially no training on nutrition, despite it being the most important thing in our lives, and good nutrition being the most plausible way to “beat” cancer.

I plan to pick some well thought out charities that I believe strongly in, and donate to them only. I think it’s a better way of going about making donations.

Steve Keen is professional economist. Steve predicted the Global Financial Crisis in December 2005, and predicted falls in house prices of up to 40%. Some believe he is a “doomsayer” while to many of us he is merely a realist.

Steve has recently written his latest edition of “Debtwatch”. Debtwatch No 41, December 2009: 4 Years of Calling the GFC looks at where Steve started his journey and began to realise the global and Australian economic situation.

“…debt had been growing faster than GDP–4.2% per annum faster in Australia’s case for over 40 years, and 2.7% faster for longer in the USA’s. An unsustainable trend in debt had been going on for almost half a century.

Staring at those graphs, I realised that these debt bubbles had to burst (and probably very soon), that a global financial crisis would erupt when they did, that someone had to raise the alarm, and that given my knowledge, that someone was me.

Less than 2 years later, the Global Financial Crisis erupted, and economists who didn’t see it coming, and who for decades had argued that government spending could only cause inflation, suddenly called for–and got–the biggest government stimulus packages in world history to prevent an economic Armageddon.”

Australia's Private Debt to GDP Ratio, 1945-2006

He covers topics such as debt servicing, deflation and depressions, bad theories, and his opinions on where we are headed.

“With such ignorance about the dynamics of debt, academic economists and Central Banks around the world are hoping that the crisis is behind them, even though the cause of it–excessive levels of private debt–has not been addressed. They are recommending winding back the government stimulus packages in the belief that the economy can now return to normal after the disturbance of the GFC.

In fact “normal” for the last half century has been an unsustainable growth in debt, which has finally reached an apogee from which it will fall. As it falls–by an unwillingness to lend by bankers and to borrow by businesses and households, by deliberate debt reductions, by default and bankruptcy–aggregate demand will be reduced well below aggregate supply. The economy will therefore falter–and only regular government stimuli will revive it.”

Steve’s predictions for the future?

“…I do not share the belief that the GFC is behind us: while the level of private debt remains as gargantuan as it is today, the global economy remains financially fragile, and a return to “growth as usual” is highly unlikely, since that growth will no longer be propelled by rising levels of private debt.”

If you have the time, this really is a worthwhile read. Steve Keen’s blog is at www.debtdeflation.com.

I’ve been reading “The 4-Hour Work Week: Escape 9-5, Live Anywhere, and Join the New Rich” by Tim Ferriss lately. It’s the first time that I have read a book that always says “you’re not going to believe this” or “you’re going to think I’m crazy for saying this”, and never actually thinking it. It’s as though my views and goals in life fall in line with everything that he is preaching. Ok so maybe not all of it – I do still have my own opinions and don’t agree with some here and there, but essentially I have the same goals:

• Don’t get tied to a physical location
• Work as little as you can
• Actually do what you want to do in life

This is all good and well, but you really need to financially support the lifestyle that you want. If you have read any of my other posts on this site, it’s probably obvious by now that I’m not a very materialistic person. I’m no Amish, but I’m not very driven to have a lot of “stuff” either.

By not having the need to own a lot of posessions, I personally have a huge advantage – I can get away with earning less in order to have the lifestyle that I want. Of course if you do have a lot of needs by way of posessions, it’s all possible, you just need to raise more income.

How do I plan on doing this? There are plenty of ways, but essentially I am working on projects that require little to no work from myself after the initial setup. I’m not quite at the “outsource everything” stage, so I’m doing a lot of work myself (since I actually enjoy it), but maybe one day.

For instance, I run a website called “Eco Update“. The idea of the site is to aggregate content – basically it pulls the relevant content from other sites and then displays it on mine. The aim is to collect content on a few related topics, making it a “hub” of eco friendly/green living news and information. From the income generating point of view, the site also features Google Adsense advertising, and generates a minor income stream for me which requires little to no effort after the initial setup.

It goes to show that while you can make smart investments to generate passive income, there are also other little projects that can do the same for next to no cost. Some people like me create websites and use affiliate programs and advertising banners to generate income while others will start a dropshipping business. There are plenty of options and you are only limited by your imagination.

Think about it, then do some planning, and make it happen. Start small if need be and aim for the stars.