A Fixed Income Is a Sucker Bet (Blog)

[Savage]

Use this thread to discuss the following entry from Steve Pavlina's blog:

A Fixed Income Is a Sucker Bet

[Bud921]

Hey Steve,

I'm curious as to if you still have the " I'm making 100,000 dollars a month" affirmation in your office?

Loved the new words by the way

[Savage]

Originally Posted by Bud921

Hey Steve,

I'm curious as to if you still have the " I'm making 100,000 dollars a month" affirmation in your office?

Loved the new words by the way

I took those down a while ago. I got tired of visitors freaking out each time they saw it.

Last month was probably my best ever income-wise though, so were getting there. Fun to see it gradually manifest.

[Bud921]

I can relate.

The first thing I did when I moved into my dorm was put up some similar affirmations.

"I'm attracting all the right people into my life." "I provide value for thousands of people around the world." " I make an abundant income doing what I love."

Most of my floor-mates think that's weird I think it's weird they all wants jobs.

[seeker5]

Originally Posted by Steve Pavlina

I took those down a while ago. I got tired of visitors freaking out each time they saw it.

I though you wrote something about how if you were concerns about your visitor's reaction to your goals, you probably wouldn't achieve them.

Yet you still seem to be making progress toward that goal.

[Erin Pavlina]

I think he was more annoyed than concerned. There's a difference.

[Savage]

Originally Posted by seeker5

I though you wrote something about how if you were concerns about your visitor's reaction to your goals, you probably wouldn't achieve them.

Yet you still seem to be making progress toward that goal.

I wasn't concerned about their reactions in the way I was referring to in the article. When I wrote that article about the belief board, I knew some people would hesitate to do it for fear that people would criticize them just for setting goals. Like if you post a financial goal on your wall, will your roommate walk in and poke fun at you or act incredulous? And if that happens, will you stand by your goal, or will you stop setting goals because others have an issue with it? I think it's good to push through this kind of resistance. That was an important step for me when I first started posting my goals on the wall more than a decade ago.

For the most part, people don't tease me about my goals or act incredulous when they see them anymore. They're more likely to believe I can achieve them, and sometimes that creates the opposite response. They get fixated on an outcome that seems too far beyond them at the moment. That causes them to tense up and withdraw a bit. I don't want such people to tense up after walking into my office since it messes with the connection experience.

I wrote the beliefs article for people who need to work a lot on their power, people who must overcoming feelings of inadequacy. The area I'm working on personally right now is learning to create deeper connections with people and to meet them where they are, and my belief board was working against that.

What I could do to compensate is to restore the belief board and focus more on my connection/love goals. Then they'll become conversation pieces that can help create more connection, not less. The $100K/month goal is of secondary concern anyway.

[James81]

Great article. Something I really need to hear right now.

[jesstucker]

Awesome article.

[praxis22]

I found you via ycombinator/twitter.

Personally I'd have to disagree, largely because I feel that you take no account of why somebody would be happy with a "fixed" income. For the last three jobs I've been earning progressively less money, solely out of choice I might add, (I can't spend all the money I make even now.) But then I love my job. "truly, madly deeply" There was a time I'd have done it for food and a bed, indeed people joked that I was there so long, I may as well just put a camp bed into the server room, as that way I wouldn't have to walk to work and back. That was my first UNIX job, the one I got paid least for, and it's still the best single job I've ever had. Because of it, I stepped out into a wider world, left my country of origin, met great friends, and got married on a mountain top on the other side of the world, to a woman who continually surprises me, even now.

Because we're trying for kids at present I'm reading a lot of developmental psychology, stuff about parenting, etc. I came across this passage today, from a book my mother read as she was waiting for me:

"I like especially the work being done by Dr Donald W. MacKinnon, director of the Institute of Personality Assessment and Research in San Francisco. Five hundred and thirty really top notch leaders in many different fields were studied - the shining lights among artists, architects, mathematicians, engineers, research scientists and writers, among others; all people who represented original and creative thinking. They found that having a high I.Q. was not a consistent or reliable requirement, although all of the people were in the normal-to-bright category. In addition: 'It is certain that most of our most creative subjects hadn't been grade getters.' Most of them had a C or B average and many would not qualify for entrance to some of our graduate schools today. The most significant qualities to emerge from this study (and many others as well) were: curiosity, scepticism, independence, aesthetic sensitivity, introversion and nonconformity. Many of these people seemed to have 'a sense of destiny', which tended to make them refuse to conform in their thinking."

Which took place in a wider discourse of the insanity/sadness of parents being in a hurry for their five year old's to achieve, so they could be streamed early for success and graduate school entry.

Amusingly enough there's a program on the BBC later this week about parents in NYC fighting, (and paying stupid amounts of money) to get their kids into the right kindergartens.

I remember listening to an interview long ago with the sage like porn magnate Larry Flynt, where he was talking about his life, and why he was in a wheel chair, and as an answer to a question I cannot remember he said, "happiness is way to travel, not a destination" which chimed, and has stuck with me ever since.

Not everyone who's on a fixed income is a sucker, just as not everyone who makes $100K a month is smart. If money is all you love...

[Brickman]

It was an ok article....
Kind of smacks of 'Ten Reasons You Should Never Get A Job".
Which in it's self is kind of funny. I picture a world in which everybody follows Steve's advice. Now we move twenty five years into the future, roads in disarray, bridges and infrastructure falling apart. And everyone sitting around with extended bellies and flies all over them like the people I see on Sunday morning TV. And all because we followed Steve's advice, and nobody wanted to be a sucker and work for a living.
Only one problem were not all pizza delivery men.....
Let's see.....Firemen for the one of the highest paid departments in the U.S. Paid vacation, paid sick days, paid personal time, paid Holidays. Full pension for life, that means six figures for hanging with the Family doing whatever I want.
My wife is a School Teacher in the same County. Same paid vacation, sick days, personal and Family leave, all paid for. Again, full pension. Now for the kicker, we both have full major medical 100% catastrophic coverage for us and are children, for life. This also includes dental and eye....
Yea I feel like a sucker. I assume you pay out of pocket for these things now. I'm curious to know how you will pay for these things in the future, say ten to twenty years from now. BTW I also owned and operated my own Masonry contracting business for 23 years. which I just sold off and liquidated for a very large sum. I did this freely because of my fixed income job. A lot of firemen and Teachers, Cops are able to work their fixed income job and have a second business on the side. Most people can find good fixed income jobs that handle the cost of things like health insurance, to name one very important asset. And still allow you to pursue other goals. Fixed income provides a steady flow of money while you refine your goals, point is you can still have both. But success doesn't come without hard work, and I think it's irresponsible to tell people otherwise. I'm sure you didn't achieve your status without it.....

[Writertype]

I think there are plenty of people who would have a hard time implementing this advice.

What about a single mother with two young children who dropped out of high school? She would love a big house and nice things for her kids, but as it is she has a job that lets her provide the family with a livable apartment, food, and adequate clothing. She is dissatisfied in the sense that she wants more, but should she "roll 'dem bones" on the hope that she will get it? She has to weigh the benefits of quitting her somewhat guaranteed income to pursue that pot of gold, and in the process she could lose her apartment, her ability to buy adequate food and clothing, and ultimately her children if she just cannot create that money. Yes, she took a chance that could have eliminated her dissatisfaction, but she may find that she should have been happy for all the things she had instead: her children, food on the table, a roof over her head.

For many young, single, intelligent, motivated people this could be great advice. When you are young and ambitious, all you really have to lose are your youth and ambition. When you become older and have people who depend on you, though, it just seems too dangerous to give up a secure income in hopes of more. Maybe people in that situation should start looking to things other than the shinier car and the bigger house for satisfaction in life.

[AlwaysLearning]

I don't know whether my whole ego/self-image is ready right now for wealth and richness, to be honest. But I will at least affirm that I want to become ready.

[Bud921]

Fixed income provides a steady flow of money while you refine your goals, point is you can still have both. But success doesn't come without hard work, and I think it's irresponsible to tell people otherwise.

The entire theme of this blog advocates hard work. Not once does Steve say personal development is easy.

"Personal development is hard work. It takes time, consistency, and patience. If you're only here looking for shallow quick fixes and you aren't interested in real, lasting change, this isn't the right place for you." - Steve Pavlina

I picture a world in which everybody follows Steve's advice. Now we move twenty five years into the future, roads in disarray, bridges and infrastructure falling apart. And everyone sitting around with extended bellies and flies all over them like the people I see on Sunday morning TV. And all because we followed Steve's advice, and nobody wanted to be a sucker and work for a living.

Do you even read his blog =P? In all seriousness, Steve never advocates laziness. He instead challenges one to contribute genuine value to the world. There's nothing wrong with making a living by doing what you love.

And yes it's perfectly fine to have a JOB you love. As long as you're choosing to do so consciously.

IMHO The scenario you imagine is unrealistic in two regards. First, if everyone WERE to follow Steve's advice the world would be in a much better place. Instead of trashing our world we would take care of it instead. And there will always be people who ENJOY doing the odd jobs of the world.

[Jake Birkett]

@Always learning: Hmm, I would say that if you tell the universe you "want to be ready" that is basically saying you are not ready. So I would personally go with "I am ready" and visualise yourself being ready and it will come to pass.

I put up some positive affirmations at work about being highly productive and loving working on my current game and making the best games in the world etc. and got a funny look from at least one person, but I don't care because it works for me. You do have to break through a certain amount of social embarrassment if you do something like that though.

I was doing a talk last night at the Vancouver Film School to a load of Game Design students about my Indie game developer days and I mentioned some key things that Steve mentioned today. One was about hiring an accountant because they save you time and money so are totally worth it. I don't want to fill out boring forms, I'll delegate that to an expert so I can do what I do best. I've used an accountancy firm for 7 years with zero regrets.

Another thing I mentioned at the talk was "Speculate to Accumulate" in relation to spending money on a business venture. Normally people have no problem spending money on stuff that depreciates in value like a car or a huge TV, but when it comes to investing money in something, fear kicks in and they don't want to spend the money. In 2006 I decided to spend about $2300 on a game I was making and I reasoned that the worst case was I'd loose it all, a middle case was I'd loose some or break even, and a best case was I'd profit by anywhere from $0.01 to infinity. Turns out the game has made $23,000 so far, nearly a 10x ROI, and it only took me 5 weeks to make, so I'm pretty pleased with that. Also, I constantly receive royalties for that game so the figure goes up every day :-)

You may have noticed from my post above that I'm now employed instead of Indie (self-employed), and yes that was a hard transition but I did it for the experience of moving to another country and learning from the best in the industry, and to get paid loads. I still own my company and it still makes me passive income, which is nice. So, who knows what the future holds? (Well I guess I probably do as I have a 5 year plan - do you? But things can change.) Most likely at some point I'll run my own company again after building up more skills and contacts (some people would worry about posting stuff like that on-line, but it's the truth and don't believe in having two personalities i.e. public and private like people do on facebook, how lame. Besides whilst I'm still an employee, I'll be a damn good one because I want it to be win-win for me and them.)

Anyway, that's my thoughts. Hope they are useful to someone.

[KazeCraven]

Originally Posted by Brickman

...I picture a world in which everybody follows Steve's advice. Now we move twenty five years into the future, roads in disarray, bridges and infrastructure falling apart. And everyone sitting around with extended bellies and flies all over them like the people I see on Sunday morning TV. And all because we followed Steve's advice...

If it doesn't strike a cord, it's safe to say it's not for you. Some people just seem to subscribe to societal rules and forget to think.

Also, if no one cares to build roads, maybe it's safe to say that we would be better off without them? And if people really want all these fancy roads and stuff, road-makers will be paid big bucks. That's where the phrase "If I don't do it, somebody else will" comes from. And people being people, we'd be lucky if 20% of people take Steve's advice.

[Brickman]

Oh man.........

The entire theme of this blog advocates hard work. Not once does Steve say personal development is easy.

For starters, personal development isn't holding a job....

Steve's Blog is focused on facts that fixed income jobs are for suckers, fixed income......That there are other ways of earning and enjoying yourself while you do..... That's all well and good...

Do you even read his blog

Ah......yea....did you?

And yes it's perfectly fine to have a JOB you love. As long as you're choosing to do so consciously.

Nobody said it wasn't.....my point is that there are other considerations, such as benefits and health care. If you have a Family, children, and responsibilities, then said benefits should be your first consideration. Most good fixed income jobs offer this. Remember I also said I owned and operated a very successful masonry contracting business. And there would have been noway I could have afforded the level of health care my current job and my wife's job offer up. So in point I was defending the fixed income job.....
Fairyland is nice until your children need major medical.....

IMHO The scenario you imagine is unrealistic in two regards. First, if everyone WERE to follow Steve's advice the world would be in a much better place. Instead of trashing our world we would take care of it instead. And there will always be people who ENJOY doing the odd jobs of the world.

Well here is were the problem is then, because my little scenario wasn't meant to be taken seriously. But the fact remains, if everybody followed Steve's advice nothing would be maintained. Because nobody would hold a fixed income job........ You see the key here is everybody following Steve, everybody....... not some people still doing odd jobs, everybody........
And it would take more then a few people doing odd jobs to keep most things functioning.

[Carl Carlson IV]

Okay, that's it, I've had enough! I swear if you write one more article that sychronizes with a problem I am having I'm just going to do something crazy... like listen!!

[Brickman]

If it doesn't strike a cord, it's safe to say it's not for you.

Contrary to what you think, the meat and potatoes of what Steve said does strike a cord. In fact as a business owner, now moving into another business a lot of what he says is good advice. I simply disagree with advocating the elimination of the fixed income position, especially for those just entering the job market.

Some people just seem to subscribe to societal rules and forget to think.

So if I understand this to mean, that my wife and I providing benefits and security for us and our children is.........not thinking......ok.

Also, if no one cares to build roads, maybe it's safe to say that we would be better off without them? And if people really want all these fancy roads and stuff, road-makers will be paid big bucks. That's where the phrase "If I don't do it, somebody else will" comes from. And people being people, we'd be lucky if 20% of people take Steve's advice.

Well, how can I argue with that...........

[YourHumbleNarrator]

Originally Posted by Brickman

I picture a world in which everybody follows Steve's advice. Now we move twenty five years into the future, roads in disarray, bridges and infrastructure falling apart.

Then you can't see far into the future. I can't predict exactly what that world would look like, but I know that just because we have a system in place it doesn't mean that the world can't function if the system is fundamentally altered, it just won't continue as it is now.

This argument boils down to, "some people will have to live lives they hate to keep things running" and it's ultimately an excuse for why you're stationed where you are. If you're not living how you want and you've got an ernest desire to change, you've no one to look to but yourself.

And don't assume that if no one were employed (in the sense that people are now) that the roads would be in disarray and everyone would spend their time watching TV. Why do you think roads got built in the first place? The creative urge that drove those projects forward are still present in human beings. And if you think no one would want to handle the sewage or the garbage or what have you, you underestimate the range of human interests. Some are happy just being given a problem and an opportunity to solve it.

[mmartin2009]

What advice would you give to an unemployed recent college grad with school loans? Where do I go from here? I have no one relying on me and I'm not sure how to say screw you to cubicles yet.

[Bud921]

Brickman:

I apologize if my tone was somewhat arrogant. That was not my intention.

[pjhaggerty]

I like this article. Struck a strong chord.

I think it's worth pointing out that steve did not recommend immediately quitting your job. Until you have another way of creating and delivering value up and running, or to a point where your job is really stopping you, then you might consider staying in your job to pay the bills.

Also, there's nothing wrong with a fixed income and benefits if you feel you are actually gaining more from the fixed income than you could outside of it on your own. Of course, there might be some internal work to do to improve your self worth, but if you are really getting great benefits etc. and you enjoy your job, why not stay with it? If you are happy in your job stay there. Just don't stay with a job you hate because of the money. Find another way to earn money, or die trying ( a little intense, I know, but hey, nothing wrong with a little intensity ).

[siryessir08]

Wonderful article, Steve.

Really put me in the mood to do some major work on my website.

You're right...we decide what our income is.


Sure beats your egg article. Didn't care for that style of writing...not very uplifting.

[komorian]

I quit my day job about 3 months ago.

I have no longer fixed income and my passive income has not even reached that level (but it's close ). There are days however, like yesterday, when I earn twice as much as I earned in my day job. It feels great and even greater when I realize that this might be just a beginning if I play it well and keep providing value.

Working without perspective for doubling or tripling my income really looked like playing game without any progress to me. Boring. Now I realize I can go broke but increasing my income 5 or 10 times is no longer a crazy thought either. And it's worth it

But it's not only about money but also time for me. With my passive income I've essentially bought these 8 hours per day to do what I like. More time, more fun... maybe more money as well, some day

[spirit4711]

Originally Posted by Brickman

... I picture a world in which everybody follows Steve's advice. Now we move twenty five years into the future, roads in disarray, bridges and infrastructure falling apart. And everyone sitting around with extended bellies and flies all over them like the people I see on Sunday morning TV. And all because we followed Steve's advice, and nobody wanted to be a sucker and work for a living.

...

That's one picture. Another picture: people providing these services for a fee instead of in a 'fixed income' job.

It seems you assume Steve tells us to get rid of our jobs. He doesn't. He does point out some of the disadvantages, to have his readers think about it, and make conscious choices, whatever they are.

At least that's how I read him .

[KazeCraven]

Originally Posted by Brickman

So if I understand this to mean, that my wife and I providing benefits and security for us and our children is.........not thinking......ok.

Brickman, in case you didn't get what I was saying:

If you've looked at the possibilities of getting a job vs. not getting a job, the consequences of doing taxes or not doing taxes, etc. then guess what?

You've thought about it, and no one is talking about you!! In this case you are taking something personally because you think or feel it applies to you, but it really doesn't. Some people have thought about it and still have jobs. Certain personality types, if they had thought about it, would never have gotten a job.

If, on the other hand, you think, "Huh, well why didn't think of doing that? I'd much rather live with all the possibilities that not having a job offers over having a steady income that my wife and children can rely on!" Then you should thank Steve for showing you the golden egg.

I don't know what to say. You seem to get it, but still think I'm attacking your position. I'm well aware that not having a job sucks financially for the first few years until the person "gets it". Maybe I missed something, but it seems to me that Steve is appealing to those people who are thinking "God, I hate a) doing my taxes b) never having really good days c) never getting credit for all my good ideas, etc." Whereas he is not appealing to those who are thinking, "Wouldn't it suck to have to always be looking for new opportunities? I'm glad I have this steady pay job." (although he gives credit where credit is due, and points out that the steady pay job might not be as stable as you think)

[spirit4711]

Originally Posted by Brickman

...
I simply disagree with advocating the elimination of the fixed income position, especially for those just entering the job market.
...

Why?

So if I understand this to mean, that my wife and I providing benefits and security for us and our children is.........not thinking......ok.

That's one interpretation. And a valid one if you were not thinking .

[Savage]

Originally Posted by Brickman

Well here is were the problem is then, because my little scenario wasn't meant to be taken seriously. But the fact remains, if everybody followed Steve's advice nothing would be maintained. Because nobody would hold a fixed income job........ You see the key here is everybody following Steve, everybody....... not some people still doing odd jobs, everybody........
And it would take more then a few people doing odd jobs to keep most things functioning.

I'll take it as a compliment that you think my writing could threaten the volume of sucker jobs in the world and lead to mass infrastructure collapse.

I find the argument that bridges can only be built by employees to be rather silly.

Bombs that blow up bridges (and people) are also built by employees, so be sure to take credit for those too. No sucker jobs means it would be much harder to conduct war.

When the world is free of sucker jobs, I will personally maintain our bridges.

[Savage]

Originally Posted by komorian

I quit my day job about 3 months ago.

I have no longer fixed income and my passive income has not even reached that level (but it's close ). There are days however, like yesterday, when I earn twice as much as I earned in my day job. It feels great and even greater when I realize that this might be just a beginning if I play it well and keep providing value.

Working without perspective for doubling or tripling my income really looked like playing game without any progress to me. Boring. Now I realize I can go broke but increasing my income 5 or 10 times is no longer a crazy thought either. And it's worth it

But it's not only about money but also time for me. With my passive income I've essentially bought these 8 hours per day to do what I like. More time, more fun... maybe more money as well, some day

That is wonderful... Congrats!