Double Journey

So yesterday was my first day on the job.  It was a long day.  I got up 2 hours before I started because my commute was 1.5 hours.  Got to love L.A.    Despite the fact I can live rent free with my Mom for the time being, I think it will be worth it to just go find a place.  Will probably go look this weekend since next weekend I’m back to Seattle to go finish my move.

Not a lot out of the ordinary for the first day of work.  Just your usual orientation stuff and introductions.  Went to lots of meetings where I didn’t know what anyone was talking about.  Some people feel very uncomfortable in these types of situations.  I don’t.  I find you can learn much faster if you just get in the middle of it and figure out how the team operates.  I have been told I actually have to make some key decisions this week.  It’s a little early even for someone who can learn quickly like me, but hey, I’m up to the challenge.

Sorry this is not more of a substantive blog post.  It’s going to be a little light this week as I get my feet wet.  I will still have a blog post every day and actually have some pretty good stuff planned going forward.  I’m working some long hours this week, which goes against some of the things I believe in when it comes to work.  More on that later.
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Every once in a while, I’ll talk about something I learned along the way that has helped me build a pretty sizable nest egg at a relatively young age. So to start things off, I will give you my best tip. The secret to building wealth is to start building wealth.

I know what you are saying. What? Well the secret to building wealth is recursive. For all you non computer geeks, this basically means that the definition of something is contained within its own definition. As soon as your head stops spinning let me explain through my own personal story.

I wasn’t always on the path I am today. I started out of college with a good job that paid well. However, living in New York City, I had a lot of expenses. The two bedroom apartment I was renting was $3400 a month. My share of it was basically eating up half my paycheck. Somehow though, I managed to save some money and even put a little away in my 401K, almost $5000. After a year, I left my job and had to pay for my own move back to California, and that ate a big chunk of my savings. However, I still managed to keep enough for an emergency fund.

Over the course of the next few years, I was careful with my money, always remembering that sometimes, unexpected things like leaving your job and moving across the country can pop up and you need to be prepared. I still managed to max out my 401K every year and slowly but surely it was growing to quite a bit of money. As I became more successful in my career, I continued to see promotions and pay raises, but each time I kept my lifestyle pretty much the same. In fact, I began living more frugally. I’ll explain why.

The effect of getting more income and spending less money was VERY POSITIVE on my bank account. The higher I saw it go up, the more I wanted to see it go higher. The more money I got, the more interest I could earn from my savings account. As I started investing my money, I realized that the more money I had, the faster the whole pile would grow. This became almost addictive. I would find ways to save more and more money so I could funnel it toward these accounts. The power of compound interest is really displayed when you have a big bank account, and it just starts to snowball on itself. It almost becomes a game as you try to find more ways to save money or earn income to see the wealth grow.

So this is the best tip I can give. Just start trying to build wealth by any means you can. As you do it, you will find you really like it, and you will find other ways to increase your wealth. You will start getting into a feedback loop and you will soon realize that building wealth just becomes a habit. I now earn well over 2.5 times what I used to when I lived in NYC but I probably spend less money. All because I have become addicted to building wealth.
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So I decided to get rid of some furniture. I have a couch that I’ve had for a few years that is in good shape but I just don’t want it anymore and don’t feel like taking it across country again. So I posted an ad for it on Craigslist and figured I would ask $20 for it just to see if I could get it. Truth be told, I would have been happy if someone would have just come and transported it away. I figured if nobody responded, I would just repost the ad and give it away for free. No more than an hour after I posted the ad, I had three people contact me. I ended up selling it for $40, and probably could have gotten more if I tried.

I also ended up selling an entertainment center and my extra TVs. Got $20 for that. Was glad to get rid of the TVs because it can actually be kind of expensive to dispose of if you have to call the disposal company to pick it up.

Now, I was actually going to just get rid of this stuff, to give it away. To me, it was worth it just to not have to take it with me. But, because of this little project, I decided to see how successful I could be actually selling the stuff I didn’t want. Because I think it is a little unfair to just add the $60 to my total, since you had to have the stuff in the first place, I’m going to credit myself half the money. $30 will go to my total.

How about you? Have you had good luck selling stuff on Craigslist or other sites? How easy or hard do you find it to be?
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So Ningpo makes a good point, I never really discuss what I think “good” is vs. “great” So what is my definition of “good”?

First off, when doing this comparison, I’m going to talk strictly from a financial sense. There is not good or great without great friends, family, and if you are lucky enough, someone to share your life with. So that being said, this is what I consider to be a “good” life. A good life is a life where you are very comfortable, have all the things you need, and with a little bit of work, will continue this way indefinitely. This implies

• Having no debt outside of your primary residence (bonus if you have none of this).
• Having a job you like.
• Having a job or income source that allows you to live an upper-middle class life and afford a few luxuries.
• Having enough savings such that you could choose not to work for one or more years and still be OK.
• Having a savings plan that,if continued, will allow you to comfortably retire at your current consumption level by the age of 60.

So what makes something great?  Having all the above, but not having to work at it anymore but taken to a whole new level.  You can quit your 9-5 job, and just enjoy doing whatever it is that you want to do, even if that is to work.  You can afford pretty much whatever reasonable luxury that you want i.e. you could afford the BMW but maybe not the Ferrari.  You are probably “good” if you are in the top 15% of the population in terms of income and wealth, you are probably great if you fall into the top 1%.

So what is your definition, from a financial perspective, of good vs great?
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One of the thing I find myself struggling with is how to appropriately budget time for this project. With a goal as nebulous as “make money by any and all means necessary” you can sink a lot of time into trying to make something work and at the same time feeling like you didn’t accomplish all that much. Despite the fact that I’m not working, and already have my next job lined up, I find that I feel very busy all the time because I’m thinking about this site. How can I get traffic up? Does my design look right? What should I write about next? Etc.

Lucky for me I am a program manager. We are used to dealing with ambiguity and hectic project schedules. But still I find, when you are doing something for yourself, people like myself will tend to overextend themselves. I am not going to try and budget my time better over the next few weeks. This is going to become absolutely critical as I start my new job and I don’t have all the time in the world to devote to this journey. So starting today, I’m only going to devote one or two hours during the week to this, two or three hours on the weekend. It will be focused work rather than the kind of helter-skelter approach I have taken so far. My primary focuses will be:

1. Drive traffic up - This includes features added to the website to do this as well as visiting other people’s blogs
2. Pick stocks -Since I won’t be trading as frequently, I don’t need to spend as much time poring over my stocks. Also, I have gotten most of what I need to learn to analyze charts down, just need to apply it now.
3. Writing - I’m going to concentrate most of my writing on the weekends, and then space out my post during the week.
4. Coming up with other money making ideas - Last but certainly not least. Will set aside at least one of my sessions per week to try and come up with something I haven’t tried yet.
5. Working on my website - It is for the most part set up now and the way I want it to be. Will work no more than once a week making improvements or tweaking the site from here on.

That’s my project plan, hopefully I can stick with it now. Do you have any ideas on how I should budget my time or things I should be focused on? How about you, have you found you are spending too much time on your website?
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Jenny gave me a book a few years ago called Good to Great by Jim Collins.  When she gave it to me she said, “I saw this on the shelf, and I just thought of you.”  It was one of the nicest compliments I ever got.

While the book is mainly how good companies become great companies, it has made me think about how I can personally make the jump from good to great.   I recognize, and am thankful, that I have a good life.  I’ve gotten to the point where I am in a great relationship, have awesome friends, a new job that excites me, lots of savings, and no debt.  It’s hard not to be happy in this situation, and I am. 

However, even though I’m happy, I’m rarely if ever content.   I have started reading a lot of similar blogs about personal finance and jobs.  While I really enjoy them as I think I can add a lot to them because of  my own personal experience, they are all focused on getting to where I am today.  How do I make it to the next step?  How do I go from good to great?  Where is the information on how to do this?

When Tyler talked about finding your niche on the blogosphere, it got me thinking where would I find my niche.  Certainly not in the “make money online” space or the personal finance space.  Those are pretty crowded areas.  What isn’t crowded is the space I’m looking for,  people who have found success but want to take the next step.  I know I’m not alone in this.  Rick is trying to get there with me (and while I have a good head start, I think he will beat me to the finish line) as are most of my friends.  Hopefully, as we go on this journey together, we can figure out just what it takes to go from good to great.
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OK, so one of the keys to having a great corporate pedigree is to have attended and Ivy League School (And by Ivy League I do mean any of the top-tier national schools). For most people, it is too late to change this. There is always the option of going to get a graduate degree at a top-tier university, but for most people in the working world, that just isn’t going to happen. This is for all the young people who are wondering just how I did it and what advice I may have. Remember my post about compound interest? The point of that post was to emphasize how doing a little bit now, can pay big rewards in the future. This is my view on how important it is to do well at an early age to get into the right school.

I want to be very clear about this point before I move forward. You do not need an Ivy League degree to get a good job or to be successful. Getting an Ivy League degree does not guarantee success. What it does do is present a signal to potential employers is that somehow, someway, you made it through a very selective process. This is an important consideration in many managers hiring process. My alma-mater accepts around 10% of all applicants. And this is 10% of an already very selective group. It reminds me of that Seinfeld episode where George is able to meet beautiful women because he has a picture of a model who is supposedly his dead fiancee. The women accept him because he has already been selected by another beautiful woman.

Every time I go into a job interview, at some point someone says to me, “Obviously you are smart, you went to Princeton…” This is an important point. By default I am assumed smart. I got accepted to Princeton more than a dozen years ago, and yet it still works and is paying dividends for me. It won’t get me the job by itself, but it at least allows me to get my foot in the door. It’s up to me to shove my way through.

So what do I know about getting into an Ivy League School? Well I got into several, I still do interviews for Princeton, and I actually had a college friend on the admissions board for a while. So what’s the secret? Here it is, there isn’t any. I can assure you that there is no magic formula for getting into the best schools. Each and every application is read, and read by multiple people. What catches the eye of one, may not catch the eye of another. That being said, here are the basics in order of what I believe is important.

Get good grades in the hardest classes. I want to emphasize hardest, because A’s in classes that aren’t challenging just don’t carry as much weight. You don’t have to get straight A’s (I didn’t. Got a handful of B’s) and you don’t have to be #1 in your class (I was #8) but it doesn’t hurt. Your record has to demonstrate that you consistently challenged yourself and that you excelled in those challenges. Ivy League schools are looking for people who know how to tackle problems, get things solved, and aren’t afraid of what might come their way.

Do stuff outside of class. Obvious but important. However, don’t join every club for the sake of joining a club. Top schools prefer it much more if you can show you were committed and exceeded in a few areas than you spending an hour a week in twenty different clubs. This of course flies in the face of what I did, as I wasn’t particularly talented in any one thing. Everyone at Princeton, besides being smart, tended to have one really good talent whether it be playing an instrument or being good at sports. Be well-rounded. I can’t emphasize this enough.

Standardized test are important, but they aren’t that important. This is coming from a guy who got 1560 on his SAT’s and all 5’s on the AP exams that my school saw. If you do well, great. It will just confirm the other facts. If you do poorly, you aren’t sunk yet, the rest of your application is much more important. I knew people who got 1600 and didn’t get in. I knew some people who were in the 1100’s and got in. There were probably people even lower than that. So do your best, and as long as you are OK, then don’t worry about it.

Be interesting. Don’t do what everyone else does. This will come out in your application. These people read dozens of applications a day. Believe me, they all start to sound the same. If you have some unique talent or some special life experience, make sure it comes out in your application. However don’t write about how winning the big game made your realize blah blah blah. They’ve heard it all before. At the same time, don’t be too cute either. Chances are, among the thousands of applications over a dozen years, someone has tried the same tactic. Just be honest, and yourself.

Some things that aren’t that important include your recommendations and your interview. Everyone gets a good recommendation. At worse, it can only be a small negative. The same goes for interviews. Don’t stress over them. Most high-schoolers have never been in an interview, and they are very nervous going in. Believe me, it isn’t weighted all that much. I didn’t even interview with Princeton.  If you want advice on how to do well in your Ivy League interview, follow the preceding link.

That’s all it takes, and a little bit of luck. Did I miss anything? If you have questions or want to know more about my experiences, feel free to leave a comment, and I’ll try to respond.
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One of the things I thought I would touch on before I actually start my mad dash for the double would be to continue on the topic of how I was able to get into the position I am in now. I started this conversation in an earlier post, but when I thought about it, realized there was much more to it than just save, save, save. Over the next several days, I will dive a little bit into my personal life and let you all in on how I’ve been able to get where I am today, creating a site where I just might blow $20,000.

I didn’t do all of this by accident. If there is one thing my life has been, it’s been deliberate. I’ve been relatively successful in my life, and I think it’s very important that you understand just who you are getting in the car with before we all take this journey. More importantly, I think I can share some advice and insight on the one thing I have been really good at doing thus far, managing my career and saving for retirement.

My ability to start this little project of mine is a direct result of my ability to manage my career and finances. These are two things I think are vitally important to people of all ages but especially so to people like me who are in the earlier parts of their career. I might go off in some strange directions that don’t make sense at first, but believe me, it will all come together in the end.
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After doing some serious thinking (didn’t I say I always think a lot after talking to my friend) I’ve decided to make a slight course adjustment. Like any journey, you find things on the way, and new obstacles are presented to you which will make you rethink your strategy. A little more than two weeks in, I’ve had both happen to me.

The first, and probably most significant thing, is that I’ve decided to take a new job in Los Angeles. While I’m very excited about the opportunity, it greatly affects my ability to execute on my strategy for multiple reasons. I had actually planned on taking some more time off from the working world. Partially to just take a break, partially to get this project up and running. I had been interviewing with a couple of companies without any real intention to take the job. I was doing it to keep my interviewing skills sharp. Ideally, I wouldn’t have even considered jobs until after the first of the year. But when the right job comes along, you have to take it, and it was too good of an opportunity to pass up.

Of course, that means I have a lot less time to come up with my strategy and to execute it. Active trading is out the window as there is no way I’ll be able to monitor stocks closely enough to get in and out of positions when I should while simultaneously starting a new job. That doesn’t mean I’m not going to put my money to work in the market, I just can’t take the same approach I would have.

There is more data to suggest this is the right course of action. Despite the appearance of inactivity with the money, I’ve actually been monitoring the market and testing a few of my strategies without putting my capital at risk. Most of my strategy would have been positive (which would be good considering how down the market has been in the last month) but it would not get me close to what I need to do. It was a short time frame, so that doesn’t mean too much, but at the same time I know I can’t do this with a full-time job on top of it.

Despite this, THE DOUBLE JOURNEY IS STILL ON. I’m not one to put out a goal and then stop before I accomplish it. I will still attempt to end up with $40,000 on Dec. 18th 2008. I’m just going to have to find a different way to do it. I’ll get it partially through the market, but it is going to be a much smaller focus than it would have been otherwise. This site will have a slight change in tone. I still want to keep it up, and I still plan on blogging regularly about my progress, but in between my ideas I will focus on some other topics that hopefully you will all find more interesting. I love finance, I love talking stocks, but in the end, it can be a dry read.

The secret to a great blog, and great writing in general, is to write about what you know. If you write about something you are passionate about, and you write it well, people will come read. I’m passionate about a few things. My relationships, money, technology, basketball, and of course my job. I think I’ll leave my girlfriends and friends out of it, since I’m not so sure I could tell people how I’ve been able to get so lucky in this department. Technology has been done in a lot of different places and I don’t think I could do better than Engadget or Gizmodo. We have already been over the money idea. Tyler already has a basketball blog and will tell you it’s hard to keep up. Besides, I might throw something at my screen if the Lakers keep losing and I’m writing about it. Since I just bought this computer, and I love the huge monitor I got with it, I want to avoid that situation.

That leaves me blogging about my job and my career. I actually end up talking to a lot of my friends about their job and I love to provide job advice. I’ve been relatively successful in this part of my life and feel I have a lot to offer in this area. Since I’m recently unemployed, and felt I had a pretty successful job search, I will start off with that and see where it goes. I think its a subject with a lot of interesting areas to explore from finding the right job, getting the offer, and dealing with headaches once you arrive. Since I and so many of my friends struggle with these issues on a daily basis, I think it would be at the very least, entertaining and informative.
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Today I had lunch at what anyone with a website would consider Mecca. More appropriately, it would have to be called Mecca Northwest, since I didn’t actually make it down to Mountain View. I didn’t go there to learn any secrets, or to find a job, but rather to have lunch with a friend. This was the “friend” who convinced me that it was a good idea to come up to Seattle. The last few weeks, with the biting cold we have been experiencing, I’ve been evaluating the wisdom of this decision. More about that later.

Google seems like a pretty good place to work. Food everywhere, no doubt I would gain weight if I worked there. They even had a massage chair, which almost convinced me to hand over my resume. Too bad they don’t have a place for a Microsoft Program Manager (than again who does? It’s a job that seems to only exist at Microsoft).

I always enjoy talking to this friend. Whenever we talk, I walk away having learned something or having something to think about. Today, we discussed this site a little bit, but mostly in the context of trying to do something outside of work. It’s obviously something I think about a lot, thus the reason for this site. I realize that it would certainly be possible to get rich doing what I do for my day job, but I’m not sure it would happen as fast as I would like or be as fun as building up something on my own. He of course commented that he would never do what I was doing (I didn’t think I would either) it was certainly good that I was doing something.

Of course, I don’t want to do this strictly through trading, but it is where I’m starting for now. If I can somehow make money in some other capacity, whether it being developing a widget or selling lemonade on the side of the road, I’m certainly open to do it. I’m just not sure how successful I will be selling lemonade on the side of the road in Seattle when it is 30 degrees outside.
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