Always be grinding! Happy New Year Everyone!
Hopefully all of you survived and are ready to rock it in 2017! I spent a lot of time over the holidays thinking about why I failed at so many things, and the consistent answer I came up with was that I wasn't grinding hard enough.
Why did I gain 5 lbs instead of lose 5 lbs? Answer: Because I didn't grind hard enough at the gym and give a crap about the way I looked. I worked out maybe twice a month on average and didn't watch the quality of food I ingested.
Why did I lose all my tennis league matches? Answer: Because I didn't grind hard enough on the court. I wasn't practicing my serve and volleys as much as I should. Instead, I was just playing fun matches that did nothing to improve my skills.
Why was my online traffic only marginally up in 2016? Answer: Because I didn't grind my mind hard enough. Instead of writing more posts, introducing new mediums of communication, addressing new topics, and publishing a new ebook, I left things status quo. I told myself in my 2016 review post I was most proud of not quitting. Come on. That's weak! Writing is like a full body massage compared to digging for coal or constructing a house in the middle of a Texas summer.
It's so easy to get soft in America, especially as you get older. As a result, my theme for 2017 is: Always Be Grinding. ABG baby!
Related: Perpetual Failure Is The Reason Why I Continue To Save So Much
Things Feel Different Now
I haven't been this excited since I first got a job out of college when the sky was the limit. For the past 10 years or so, I've been questioning what's the point of working so hard if the government is just going to take more from us than what we're able to keep. To finally get some potential tax relief is thrilling!
Everybody should strive to have a higher savings rate than their effective tax rate. Can you imagine saving just 10% of your gross income while paying a 20% effective tax rate? What a joke. Politicians are laughing all the way to the bank for being able to keep the masses enslaved so they can remain in power.
The upside to a corrupt and inefficient government with trillions in unaccounted for tax dollars (see the Dept. of Defense) is that it pushed me towards a life of leisure. I would never have engineered my layoff in 2012 had the correlation between effort and reward stayed intact. I never would have started a lifestyle business either. Since my departure, it's been fantastic paying less in taxes and not having to work for anybody. My stress level has gone way down as well.
But now that the correlation between effort and reward is tightening up, it's time to grind until the window shuts again! Without further ado, here are my goals for 2017. They are divided into three categories: Business, Personal and Personal Financial.
Business Goals
1) Focus on growth by broadening the audience. I've received plenty of feedback that I need to write more for the mass market. Even though my advice holds true whether you have $1,000,000 to invest or $1,000 to invest, readers have told me they can't get their heads around larger numbers. As a result, some readers will tune out and that's bad for growth.
It's not my fault the median home price in San Francisco is ~$1.1M. I just write about my first-hand experiences to keep things authentic. Personal finance is too important to be left up to pontification. But I acutely realize the way to mega millions is to relate to as many people as possible. Further, I don't want to write about things I'm not interested in or am not going through.
Therefore, going forward, I've decided to add my best friend, Sydney from Untemplater, on as a regular contributor. She'll focus on broader personal finance topics, family finances, women's finances and be my podcast partner in our little Dojo Talk podcasts. I'm confident there is a great need for expansion in these categories on Financial Samurai.
Sydney is great because she's living the dream as a business owner and freelancer ever since she engineered her layoff with a severance package back in January 2015. I was her coach. Here's her severance negotiation story, which I'm so proud of! Sydney also grew up in a low income household and will draw from her experiences to bring a new flavor to FS.
2) Publish a new ebook by July 18, 2017. Despite the rise in interest rates, it still takes a gargantuan amount of money to generate $1,000 a month in passive income – we're talking $300,000 in capital at a 4% gross yield. I was so focused on building a large municipal bond portfolio after the sell-off in November and December that I forgot I could easily write a new ebook and earn $1,000 a month with no downside!
Therefore, I've decided to publish a unique book on real estate investing. It's going to be one of the most entertaining and thorough books about real estate on the market. It'll be an actionable book that anyone from beginning investors to experienced investors can use to help create wealth, build passive income and avoid extremely bad mistakes. I promise to write in my usual no BS style.
3) Focus on three business partnerships. I've got about 10 business partnerships with Financial Samurai right now. It's very easy to get spread too thin as the main writer and business development guy. Instead, I need to identify three things I'm most passionate about and tilt my writing towards these three topics to build a deeper portfolio of articles. Then I need to identify the three best products that match these topics to create incredible business synergies.
I'm currently most excited about entrepreneurship, real estate crowdsourcing and family finances.
After eight years, I've got so much to share about being an entrepreneur and earning side income. The upside is unlimited when you work for yourself. So many people believe they can't do anything because they don't have an idea or don't believe in their abilities. The truth is that nobody has everything figured out in the beginning. They just start, learn and pivot as they go.
Real estate crowdsourcing is the perfect solution for real estate enthusiasts like me who don't want to buy another physical property for a while. Dealing with tenants and maintenance issues as I get older is very counterproductive to living a good retirement life. However, real estate has been instrumental in achieving financial freedom (~50% of my passive non-online income) and I want to continue investing wisely in various projects around America for hopefully higher returns.
Finally, talking about important family financial issues will be topic du jour for 2017 now that I'm hitting middle age. I've already tested the waters with posts such as, Is Private Grade School Worth It? and Scraping By On $200,000 A Year to a warm reception. Now I plan to go deeper. Sydney is really going to be of great help in this endeavor.
4) Send two to four e-mails a month. I've been paying $150 a month to send out only one newsletter a month for the past couple of years. What an underutilization of resources. What's held me back from sending more e-mails is believing I have to write meaty e-mails to add value. Instead, I plan to write shorter, punchier e-mails to connect with all my newsletter subscribers. There's like 30,000 or so of you. All I've got to do is get into a routine, come up with a consistent topic, and not worry too much about trying to impress.
Personal Financial Goals
1) Create a million bucks of wealth. Last year my goal was to growth my net worth by $500,000 because I had a neutral-to-bearish outlook. Given I'm now bullish on my business, it's only logical to shoot higher. In a strong business environment, valuations for businesses start expanding like magic. If I can grow earnings and expand valuation multiples, then growing wealth becomes much easier.
The equity you own in your business is one of the biggest reasons why everybody should start their own business. Not only can you make money every month from your business, you might also have the option to sell your business based on a multiple of revenue or earnings one day. As an employee, you can only sell your talents to the highest bidder. As a result, you'll always be stuck having to trade your time for money.
I already spoke to the CFO and CMO of one publicly traded company and one private company about a potential acquisition. As a result, I've got an idea of the valuation of my company. Now all I need to do is grow my brand, traffic numbers, search rankings, and revenue and I'll be set!
Value Creation Scenario
Potential acquirer: We'll offer you $6,000,000 for Financial Samurai based on a 8X operating profit plus a $500,000 earn out if you stay for two years.
Me: Given my operating profit is growing by 25% a year for the next two years at least, and the S&P 500 is trading at a 18X operating profit multiple, let's split the difference. I'll sell for $9,750,000, based on a 13X operating profit multiple, and will stay on for two years at $200,000 a year to make sure everything transitions smoothly.
Potential acquirer: You've got yourself a deal.
See how easy it is to create some wealth? All you've got to do is create something of value. I don't plan to ever sell my company, but for the right price, I will and then I'll start a new company. That's the American dream.
Related: The First Million Might Be The Easiest
2) Invest at least $20,000 a month without fail. The $20,000 a month doesn't have to be in the stock market. It can be in bonds, real estate crowdsourcing, private equity, private debt, or paying down a mortgage. I actually did a deep dive analysis of my investing habits for 2016, which I'll share with you guys in an upcoming post. It's pretty eye-opening how much we think we invest versus how much we actually invest. By investing $20,000 a month minimum, I should be able to grow my net worth by at least $240,000 this year.
3) Start earning $20,000 a month in passive/semi-passive income by year end. My passive income is currently averaging about $17,600 a month over the past six months. To increase my passive income by $2,400 a month, I've got to publish my real estate book by year end, market it well and update my severance negotiation book for 2017. My products will be my main passive income growth driver once again.
The other growth driver will hopefully be the redeployment of roughly $400,000 into higher returning investments compared to the ~4% return that money was getting in a CD and a LIBOR+ private investment. Instead of earning $16,000 a year from the $400,000 investment, I could feasibly earn $32,000 a year, or $2,667 a month total ($1,333 extra) via an 8% returning investment. Hence, my focus on higher income producing investments for this year. Thank you bond sell-off!
4) Spend like I'll be dead within 10 years. I've been frugal my whole life. It's one of the main reasons why I was able to hit the eject button at 34. But, I'll be 40 in 2017 so it's time to live it up for the second half of my life. You don't have to be as stealth in middle age because people are more accepting of those who've spent 20+ years working. If they aren't, then they're just being jealous idiots who weren't willing to work hard for a long enough time themselves.
I will buy my mid-life crisis car that costs $60,000 – $80,000. I will pay an extra $100 for Economy Plus seats to Hawaii each way (still can't afford first class comfortably). I will buy the latest version TV instead of buying the previous version to save $300. I will pony up $400 more for 1 TB of hard drive space for my new laptop. I will pay $6.25/hour for parking after driving around the block once. I will turn the heat on full blast when it gets to below 60 degrees. I will always pay up for convenience gosh darn it!
Every time I buy something, I feel guilty for not using that money to invest because I've been an investing addict since sophomore year in college. I also grew up middle class working summer jobs at McDonald's and moving furniture. My upbringing is probably the reason why I felt so comfortable giving over 500 Uber rides so far as a financially independent adult. I'm not too proud to do whatever it takes to support my family.
Therefore, to counteract my spending guilt, I plan to always invest the $20,000+ a month first before splurging on anything.
5) Don't chase the stock market. Although I'm bullish on my business, I'm lukewarm on the stock market and the economy. The higher rates go, the more consumers get squeezed. The period between 2009 – 2016 was a great time to focus on growth stocks. For 2017, now that equity valuations are stretch and the bond market has finally sold off some, I think it's a great time to focus on income.
Instead of having a majority of my public investments in stocks in 2016 (~70%), I'm rebalancing to 40% stocks and 60% bonds (80% municipal bonds). Besides stretched valuations and more attractive income yields, I think there will be roadblocks on Capital Hill to pass what everything Trump has promised.
With 40% exposure to stocks, I'll still be able to participate reasonably well in any further exuberance. Further, I'm already highly leveraged to the tech industry through my SF real estate holdings and corporate consulting business.
I just feel way too lucky with my investments now after a +10% unexpected return in 2016. To now be able to get a ~4.5% gross yield on the fixed income portion to cover two mortgages that cost 2.5% and 2.375% is nuts!
Related: The Proper Asset Allocation Of Stocks And Bonds By Age
Personal Goals
“When you're coasting, you're going downhill.” – Unknown
1) Scare myself out of my comfort zone. I haven't been personally challenged in a long time. With a portfolio of over 1,300 posts on Financial Samurai, I know with decent confidence that if I write 152 new posts a year, I should be able to grow traffic and revenue by ~10% a year if I do nothing else. But writing 2-4X a week is an easy goal to achieve.
Once I turn 40 this summer, I think it'll be fun to challenge myself with more live events. I'll first start with my Dojo Talk podcasts with Sydney to improve my speaking skills. Then I'll move onto bigger audiences if I have the opportunity. I'll be the moderator for a panel of crowdsource company CEOs in San Francisco with an audience of ~100 – 200 people sometime in February. That should be fun. I'll post the details here once I know more.
The other thing I'm considering is being a more public figure starting in 2H2017. By July 1, I'll have collected the final severance payment from five years ago. Further, I'll have hit my five-year goal of seeing whether my writing can stand on its own without my promotion. Now that it has, to be able to combine a public persona with my writing could be a very powerful combination.
2) Really make a difference in 12 people's lives. At the end of the day, the best feeling in the world is when a reader sends a private e-mail or writes a comment that says how much a particular article or the site in general has helped them achieve their dreams. Being online for almost eight years has enabled me to read people's stories on how they've changed over time.
Without positive reader feedback, it's harder to keep going at my pace long term because I also occasionally get haterade from random folks who are upset with their lives. Instead of choosing to see what's possible, they adopt a welfare mentality and lash out.
If enough haterade piles up, it makes me want to just take a break and relax since I'm not getting paid by readers to write anything. With most of my traffic coming from organic search, and most of my online income passive as a result, there's no need to write much of anything anymore.
Here's a comment a newish reader left that gave me a power up.
3) Start a family. It's about time we start a family. My wife and I feel we've done everything we've wanted to do as adults. We've both engineered our layoffs. We don't have the itch to travel too much anymore after visiting over 60 countries. We have no desire to climb anybody else's corporate ladder, but our own. After two years, our house is finally remodeled to the way we want. We have a digital business that allows us to be present for our child. Finally, we've developed a steady stream of passive income that should support a family of up to four comfortably in expensive San Francisco or Honolulu.
With so much responsibility in raising a child, it's only natural to plan as thoroughly as possible before becoming parents. I commend those of you who had the courage to have children earlier on and make things work. I've seen so many things go wrong with a relationship after having children, it's made me nervous.
If we do successfully start a family, my number one goal will shift towards not dying before 69. I'd like to live until my child officially becomes an adult. Now where are my veggies and vitamins?
Related: Personal Goals For 2021. I plan to earn as much as possible and then re-retire by 2022!
Hi Sam,
As someone who closely follows the website selling industry, I can tell you that your valuation of FS is way off. You’d be lucky to get a 4x multiple. Just look at what other websites doing similar numbers revenue-wise are going for. You might well be able to get 3x. 2x, no problem. 8x is unheard of in the industry, and this includes much bigger sites than yours.
Furthermore, most website investors wouldn’t touch FS because it’s too closely connected to you. It’s pretty much your personal blog. Without you, what is the future of FS? Hire a bunch of PF bloggers to replace you? Sure, but it wouldn’t be the same, and over time the blog’s traffic and revenue would diminish. People are mainly here for you. I certainly wouldn’t visit if you left, and I imagine the majority of your readers feel the same way. They come here to read your thoughts and for updates on your story, not anyone else’s.
Thanks for dashing my dreams Chuck! :)
I actually got an offer above a 6X multiple that I turned down. I use these multiples as EXAMPLES of how to create wealth, and the power of owning your own business. When you own your own web business, you not only can make tremendous cash flow since fixed costs are low and operating margins are high, you can also sell the equity in your business as well.
I can share with you some examples of how workout arrangements work if you wish to explain why XYZ companies have offered to buy FS and other similar sites.
Have you started a business or sold your own website before? If so, I’d love to know about your experience and check out your website to. And if not, why don’t you start your own website already?
Sam
Congrats on setting some solid, achievable goals! I think you’ll truly enjoy making a difference in the 12 peoples’ lives — it’s a huge part of why I started my website. Good luck starting a family as well, because nothing beats being a Dad!!!
Since you asked, my goals for the year is to take my fledgling website up to 1,000 subscribers by year’s end. On a personal note, I hope to break a 6-minute mile and at the same time get in better shape.
Thanks again for the great content, motivation, and advice — best wishes to you in 2017!
Greg
Hi Financial Samurai! Would you consider doing a brief write-up of Realtyshares (briefly how it works + your experience with it)? I’m asking because as I browse the site, it asks for registration, etc. in order to get more information. I’d love to read a little more about it before I jump in there and sign on the cyber-dotted line!
Thanks!
Dan Villarreal
Taipei, Taiwan
(US citizen expat)
Sure. Here’s my RealtyShares review and a post where I crowdsourced knowledge of a particular commercial real estate investment I ended up buying in Conshy, Pennsylvania.
Even if you sign the cyber-dotted line, there’s no cost to just look and get educated on the various deals around the country. I’d spend time looking at each deal and cycling through the information tabs. The more you learn, the more comfortable you will get. It does give me comfort that only 5% of all proposed deals land on RealtyShares’ platform. Then it’s up to the individual to analyze even further.
Good luck starting a family! It might be a little tough if your wife is your age. Don’t get discouraged if it takes a while. There are lots of things doctors can do to help if it comes to that.
Thanks! I know it’s not easy to succeed as one gets older. They say it takes 7 months on average to conceive, and even then, there are plenty of things that can go wrong after. I have a awesome guest post on IVF and Chinese Medicine for those interested in going that route who are older.
One of the keys I’ve realized is to NEVER ask a woman or man why they don’t have children, or when do they plan to have children etc. Plenty of people are trying, and not succeeding. We should be sensitive to this situation.
Great goals, definitely inspiring as usual. When you think about how much money is generally required to generate high levels of passive income, it’s eye opening to realize how people can start businesses with little capital (blogs, for example) and make a high rate of return. Put the time in up front, reap some rewards later
I have to disagree with the “plan as thoroughly as possible before becoming parents” mentality. This mentality is not only impractical, but also unhealthy in my opinion. I can understand wanting to only provide the best to one’s offspring, but within reason though.
As a parent myself, the nature of child rearing appears chaotic and unpredictable. One can try his/her best to act with a pre-determined principles, best intentions and well-thought-out plan; but one must be flexible and OK with constantly changing plans as the days unfold.
I had (still can choose to do so) the luxury of staying home with my child to give him my undivided attention. I was even working from home part-time at night so that I would not lose connection to the outside world completely — but I had to look for a job with more commitment after a while. I loved every minute spent with my son — but I needed more stimulation and so did my son.
In my opinion, the mental stimulation and personal grown of my current job provides me, and the social and learning benefits my son receives from his daycare outweighs the inconvenience and the inflexibility of a work schedule by a sizable margin.
Well, enough said, I am sure you will find out what parenting is all about very soon… :)
Good perspective, thanks. When I talk about planning, I’m more focused on financial planning so that money won’t be an issue, or less of an issue once a child is born. The less we can worry about money, the happier we will be.
Plan for the best, but expect chaos.
I completely agree about the financial planning part of thinking. Given how much you earn and save, I feel you’d have been financially ready years ago already, lol.
Having kids help us hone our time, temperament, finance, and resource management skills to a large extent. I think once I get good at the family operation, I will be ready to go FI/ER, utilize the skills for business operation and start my own gig. :)
Hi Sam,
I came across your website (recommended by WallStreetPlayboys, another fantastic site) and I have to say it’s absolutely mind boggling how a resource like this is freely available to anyone with an Internet connection. I have a question: as a 19 year old, what would be the best way of setting myself up for a great 10 year period (financially)? I’ve toyed with the idea investing in an index fund. I’m also in the process of setting up a business (and app)
Thanks!
Hi Sam,
I absolutely love the blog and have been a avid reader for 6 months. I’m curious to know which real estate crowdfunding conferences you plan to participate in or have looked at attending? I’m in the real estate development industry professionally and a landlord myself and would like to understand the topic better. Just hoping to pick up on any research you’ve already done!
-Evan the Landlord
Howdy Evan, thanks for writing and reading. I don’t plan to go to any real estate crowdsourcing investment conferences, but I am hosting a real estate crowdsourcing and business crowdsourcing panel in San Francisco in February if you are interested in attending. Companies like circle up will be there. It’s pretty cool being in San Francisco and being in the heart of all this fin Tech innovation.
Got it. Wish I was closer to San Fran to make that happen. Best of luck in 2017, and don’t stop writing!
“When you’re green, your growing. When you’re ripe, you rot.”
–Ray Kroc
Keep growing, keep hustling!
I’m with you on the whole “become a public figure and get better at public speaking” goal. Unlike normal people, for some reason public speaking energizes rather than scares me! That’s why I’m super excited about the talks I’ll be doing this year (one which is coming in 2 weeks!)
Starting a family is also something that’s also been stirring at the back of my mind now that I love what I do (unlike when I hated my job and couldn’t imagine being forced to do it for the next few decades because of kids). My biggest worry is that they will suck up all my time and cause friction between my hubby and I. I think the key is taking time for yourself, time out as a couple, and not letting your kid(s) take over your whole life. My biggest worry is that I’ll lose myself and then freak out once they leave the nest. I’ve seen it happen to other people, I won’t let it happen to me.
Happy new year and have fun accomplishing all your goals!
My spouse and I are DINKs. We spend about 4.3% of our annual gross income on our house. We recently bought a pied-a-terre, which costs about 12% of our gross (or 6% if you back out the mortgage principal and tax deductions). Lifestyle-wise, we enjoy it, but is this crazy from a financial perspective? I know most people spend more on their primary residence than we do on two combined, but that doesn’t make it right. Our goal is financial freedom but we also want to live a good life and not wait to be 80 to enjoy life. Thoughts?
These are some awesome goals, I’m especially interested in that e-book you plan to write (as I am currently trying my hardest to real about real estate).
Also, I think I’m going to copy your goal of “leaving the stock market alone”. I’m going to be honest, I was really tempted to join in the high market lately after seeing everything go up 10%.
So excited to hear you’re finally thinking about starting a family! I think it will actually help you become even more productive – you suddenly have to work hard to find the time, so when you do, you make it count!
Interesting theory Robert! I’m thinking a child will make me want to give everything up and just spend time with him/her because what’s more important than your own children?
Will be asking you for advice! Hope your new one is doing well!
Hi Sam!
I too didn’t realize you were married until relatively recently. I’ve been reading for a little while (12 months?), and also wondered about your desire for kids.
Children are absolutely fantastic, but man are they expensive (especially in high cost areas). When my children were both in daycare together, I was out over $50k a year just in childcare (that doesn’t get into activities, insurance, diapers, food, plane tickets, etc). We just returned from a week of skiing at Whistler, and ski school was $200 a day (Canadian) plus tips (I tipped $20 each day) for my 6 y/o.
My daughter was born a few months after my 30th birthday, and my son was born right after I turned 34 (I’m about to turn 37). We’re considering a 3rd, but know it will put a dent in our lifestyle, finances, and short term happiness.
What made you wait until 40? Is your wife younger? Since I’m asking personal questions, and you pointed out equal footing is only fair (above), I’ll throw out 36, married, NW (excluding residence and kids’ college funds) approx $500k, HH income (dual income) approx $300k. The dual career thing is both empowering (adds income security, sense of purpose for both spouses, and HH income) and extremely limiting (I have had to turn down promotions that would require relocations, and neither my wife nor I can work the hours we used to before kids).
Great to hear! Are kids really that expensive though? I see families who don’t look very wealthy with 3-5 kids all the time. Can’t be too bad.
Regarding all your personal questions, the simply answer is to all is destiny. I enjoy letting destiny figure things out and preparing in the meantime.
I looked at your goals.
Maybe your new partner should do the mass broad general appeal posts, and you stay doing your numerically adapt posts. You could have a simple (using salary? sure its lacking but do u have a better idea) or complex survey (though how to incentive ur readers to do it all?) to examine the actual breakup % of ur current blog readership. Yes, Manny said she doesn’t understand half of ur posts. Me, I read ur posts as something ez to read, I could easily add 10-15 pts per posts, but ur not my industry.
Sure a breakup solely on salary maybe erroneous as a %. I dont know the details of, who ur readers are. Cause u got doctors, engineers who don’t know basics in ur financial blog world. So maybe the % would be based on amount of knowledge the readers has. And should you come to the conclusion that the 95% of ur readers are basic, stay at home moms, recent college grads, service industry, sales industry, government workers and 5% are number guys as myself. Well f me, write for them and forget about the remaining 5% cause the numbers and adrevenue doesn’t make sense anymore for you.
Yep, we definitely plan to divide and conquer and write based on what we know. A partner should help me with avoiding burnout as well.
The Financial Samurai readership is highly motivated and highly educated. Here’s the summary:
* Age: 76% of you are between the ages of 26 – 45. 11% are under age 26. 13% are over 45.
* Annual Income: 33% of you make between $100,000 – $200,000 a year. 18% of you make over $200,000 a year, while 17% of you make between $75,000 – $100,000 a year. 3.3% of you make over $500,000 a year, the level which I consider to be the definition of rich. Impressive that 45% of readers make over $100,000 here.
* Value Of Primary Residence: 39% of you said your apartment or house is worth between $250,000 – $500,000. 28% said your apartment or house is worth between $500,000 – $1,000,000. And 9% of you said your apartment or house is worth more than $1,000,000. Most homeowners have refinanced at least one over the past 10 years to take advantage of record low interest rates. Check out LendingTree for some of the lowest rates where banks compete for your business by letting you know their best rates.
* Retirement Savings: About 19% of you have saved over $1 million dollars for retirement, excluding the value of your primary residence. Another 18% of you have saved between $500,000 – $1 million dollars. While 38% of you have saved between $100,000 – $500,000. Roughly 35% of you consider using a low cost digital wealth advisor like Wealthfront to manage a portion of your after-tax retirement investments.
* Social Class: 67% believe you are considered in the Mass Affluent Class followed by 20% who believe you are Middle Class.
* Education: 62% of you went to public university while 29% of you went to private school with grants or scholarships worth at least $4,000 a year. Roughly half of public university attendees got grants or scholarships worth at least $2,000 a year.
* Debt Levels: 52% of you have $0 consumer debt outstanding. While 22% of you have less than $10,000 in consumer debt outstanding. 36% of you have total debt outstanding (mortgages, credit cards, student loans, etc) of between $150,000 – $500,000. 15.5% of you have no debt of any kind.
* Net Worth: 35% of you have a net worth of between $300,000 – $1 million. 23% of you have a net worth over $1 million. 80% meticulously track their net worth with free tools like Personal Capital at least once every six months. Leveraging the internet to grow your net worth is a no-brainer.
* 401k/IRA Savings: 21% of you have between $100,000 – $200,000 in your 401k or IRA. 25% of you have between $201,000 – $500,000. 17.5% have over $500,000.
* Ideal Income For Happiness: 14% say you need to make $101,000 – $150,000 a year to feel “very happy.” 22% say $151,000 – $250,000. While 52% of you need to make over $250,000 a year to feel very happy.
* Savings Discipline: 15% of you save between 11% – 20% of your after tax income each month. 18% save between 21% – 30%. 28% save between 31% – 50%. While 23% of you save over 50% of your after tax savings.
* Career Risk: 53% of you say you’d prefer the stability of a full-time job over the flexibility of being a contractor.
* Retirement Safety: Roughly 40% of you have a significant pension that will cover a large part of your living expenses in retirement. While 13% of you also have a pension, but nothing worth writing home about.
WELL ABOVE AVERAGE
The Financial Samurai community is doing very well compared to the average American who has a $52,000 household income, a median retirement account of under $100,000, and a pitiful savings rate of under 5%.
What stands out most about the community is how aggressively we save. Roughly 70% of us save over 21% of our after-tax income every month. The other surprising stat is that 52% of us think we need $250,000 or more to feel very happy. It looks like I’ve got a lot of work to do to convince y’all that trying to earn much more than $250,000 will likely not lead to any more happiness.
If you are below some of the financial survey results, I suggest sticking around because we tend to evolve into the people we associate with most. And if you’re ahead of these financial results, then please continue to share your strategies for building wealth with the community!
For those who haven’t filled out the survey questions before, below is a list of the 40 most popular survey questions. From start to finish, it should take no more than five minutes to answer them all. As soon as you answer one of the questions, the result appears. Over time, I’ll continue to add new polls to this post.
– See more at: https://www.financialsamurai.com/who-is-the-typical-financial-samurai-reader/#sthash.JdemHCGq.dpuf
Hi Sam,
You will not be disappointed spending extra money to heat your house. I grew up in a cold house. We were never allowed to touch the thermostat. Same went for my wife’s upbringing. I waited far to long in life to turn that damn heater up. When I finally did it was amazing!
It’s 8 degrees outside right now and my house is a cozy 73 degrees.
I’m completely serious about this comment. Best money I spend every month!
Thanks, Bill
It’s crazy how we’re UNWILLING to turn up the thermostat just to save some money yeah? Perhaps the reason why I love California and Hawaii so much is because I was too frugal to turn up the thermostat! As a result, I ended up buying some expensive property that have done well over the past 14 years. Irony!
I’m blasting my heater all the time now for an extra $100-$150 a month. WELL WORTH IT! Now I wish I bought the fancier furnace with the two stroke setting for better air flow. There’s a $20,000 Trane furnace that constantly cleans the air too. Maybe one day!
Wow massively ambitious goals! Very best of luck in hitting them – love how specific you were on a lot of them, in my experience this will help a lot.
Looking forward to seeing how you get on with them. If you hit half you’ll have had a great year :)
I can’t imagine you don’t get enough positive shares to motivate you to carry on, but I’ll add to the good reviews because I find your posts increasingly valuable as every year passes since stumbling on them in November 2014. You have provided a great range of topics with a writing style that I have always found enjoyable to read through. If you had a membership, I’d pay for access to a private community to get access to more focused discussions, occasional feedback and educational materials as a way to further support the great advice I have picked up from you along the way.
Thanks Krista! I need all the positive motivation I can get because I find myself naturally drawn to just couch around. It’s the path of least resistance to do nothing.
A writer needs to be read. So thanks for reading and sharing my work!
Curious- do you keep those goals in annual format or break them down to monthly or weekly Sam? This year is do or die for me-freelance my way out of debt, start working toward income of maximum happiness.
Each goal has different time frames e.g. book goal is by July 15, 2015.
I like to just write a new years goal and revisit at the end of the year. But I may just do a mid-year update to ensure I’m not falling off the wagon.
Do or die is great! B/c you will generally live.
Sam Sam Sam, we have to talk about your newfound spending habits.
Actually, you’ve got a good reason to want to ease up on the extreme frugality, but I don’t think spending money simply to spend it is a good idea. What’s YOUR idea of “living it up”? Is a fancy expensive car something that will make you happy, or is it something you are doing because you’re getting older and you are “supposed” to have?
Remember that part of the reason you achieved your wealth is your frugal nature; your preference to invest your money rather than wasting it. Don’t get so caught up on spending that you start putting you’re current state of financial freedom at risk. There are plenty of people out there with huge salaries that are still somehow broke. Don’t slowly start becoming one of them!
All your other goals are on point. Good luck in achieving them. But your goal to spend MORE is one that, well, I’m not so sure I want to see you succeed at.
Sincerely,
ARB–Angry Retail Banker
I believe all these things will make me happier than the cost:
Mid-life crisis car
Economy plus seats to Hawaii
Latest version TV instead of buying the previous version to save
Paying for parking for convenience
Blasting the heat
But I like to take baby steps though. For example, going from 14 year old Moose to brand new Honda Fit for $20,000 was a baby step. And it felt great!
So I’ll be spending more money slowly so it doesn’t feel too painful, and so I don’t risk my financial freedom status.
S
Hi Sam,
Great goals here. I’m happy to learn that Sydney from Untemplater will be a regular here I really like her blog and writing style. My favorite of your goals is to make a difference in 12 peoples lives. You have so much to offer and I’m sure you’ll work wonders here. Best of luck to you in 2017
I’m one of your newer 2016 lurkers/readers. I enjoy your writing and edgier approach to wealth accumulation and life.
I had a good 2016 (sold a live in flip house, maxed retirement accounts and paid off all debt) but feel lost in 2017 unless I explore ways to generate income outside my job. For now I will be chugging away at maxing retirement contributions and trying to find a reasonable deal on a new home in a market awash with overpriced listings.
Look fwd to your 2017 updates.
Welcome new lurking reader! I think I’m going to write a little more edgey going forward. I miss the good ‘ol days of being more irreverent.
The main group of people who are feeling the most pumped in 2017 are business owners. Check it out!
Let me know if you need an editor for the new book, Sam!
Good call. Will do. More newsletters and more focus on writing the book. Agh, lots to do.
Hi Sam,
Great goals for 2017, especially on splurging and buying a fancy car (if you generally like cars, it’s worth it)! Let us know how you like that. In terms of passive income streams, which types do you recommend for people who already have a full time day job?
I’m gonna create a cliff hanger for fun. Already formulating some posts. Time to get back to my car fanatic days!
Best type of passive income for those w/ FT jobs?
See: Ranking The Best Passive Income Streams (Updated for 2017 and beyond)
Best of luck achieving your goals in 2017 Sam! Looking forward to seeing how you can grow this site. It’s been one of my favorites for years now. I’m always impressed with your content.
Another inspiring post Sam! Thanks for laying out everything you hope and expect to happen in 2017. I look forward to following along. I have a feeling you’ll end up in Hawaii someday soon, even if you have those two kids.
I’m determined to be in Hawaii in five years time :) I will make it happen because it’s just a choice I need to make. After spending 2 years remodeling here and there, it would be a shame to then just sell the house or rent it out. Gotta enjoy the fruits of our labor!
Best of luck to you in 2017!