Welcome Financial Uproar readers!
It’s that magical time of year again. No, I’m not talking about Christmas. You’re not even allowed to say that anymore. Thanks a lot, Obama. That’s what you get for putting a Muslim in charge.
I’m talking about that wonderful time of year where your favorite blogs don’t actually produce any content. As the writer of said words, I am a fan of doing as little as possible in the name of the season.
I am not a fan of Christmas carols. It’s just the same eight songs done in slightly different ways over and over again. Barf.
Anyhoo, that’s probably an acceptable amount of preamble. Here’s are the top ten Financial Uproar best posts of 2016. In order of how much they loved me back. Yes, my writing can do that. It’s that magical.
Two honorable mentions
OH STOP PRETENDING ITS AN HONOR YOU SUCK HONORABLE MENTIONS. MORE LIKE FIRST LOOOOOOOOOSERS AMIRITE?
Y’all Need to Relax About Zero Down Mortgages. — A number of mortgage brokers are still offering “no money down” mortgages, which directly violates rules put out by the mortgage insurers. GASP! OMG! THOSE CROOKS! I’M GOING TO MURDER THEIR CHILDREN WITH AXES.
I’m not really exaggerating. The reactions were that angry.
Anyhoo, I crunched the numbers. And it turns out the problem was more like a “problem.” Not a big deal.
The One Thing That Will Make You Better at Money, Investing, and Life — I referenced this post a lot over the past year, mostly because I think the lessons within it are very important. In short, if something seems to good to be true, it probably is.
The actual list
10. How to Get Paid $350,000 Per Year for Two Part-Time Jobs — I really enjoyed writing this post, but the stats say y’all didn’t really read it. You should. It outlines how wealthy folk can use their influence to effectively control small companies, giving themselves some sweet benefits at the expense of shareholders.
9. Get Great Returns Investing in Trailer Parks — YES NELLY’S GONNA BE A SLUMLORD.
Trailer parks are a good business. They can be hands-off investments. Municipalities hate them, which means you’re not about to see a giant wave of supply hit the market. And most importantly, they offer succulent returns. After just a few minutes of searching I found a park that offered a 15% return on investment. Yes. Please.
8. Instead of Retiring in Your 30s, Try This — Ah, the ol’ FIRE movement, which I now declare stands for Fuck It, Retire Early. I’m a big fan of the whole financial independence part. Not so much of the retire early part though. So I suggested an alternative. Rather than retiring for decades, try it for a year or two first.
7. The Canadian Guide to Whether You Should Incorporate — This post is required reading for any freelancers or other independent contractor type sorts. How much money can you save if you turn yourself into a corporation? Turns out it’s kinda complicated. Who woulda thunk it?
6. Scam Your Co-Workers and Make $100 Per Week — Fun fact: the day this post came out I was accused on Twitter of not writing interesting things. Because hey, what’s more generic than coming up with a lottery scam? If y’all need me I’ll be writing some truly interesting stuff like five ways to get out of debt. Did you know that spending less money is one way to get out of debt? I do now!
5. The Financial Planning Affordability Paradox — The post where I ask a simple question: the people who can’t afford financial planning need it the most. How can we get it to them when advisors insist on charging so much?
Oh baby it’s the top 4
4. Financial Literacy Education Doesn’t Work — “If only I learned this stuff in school! I’d be so much better off!” “Uh, you do learn this stuff in school. And studies have shown the people who do learn it don’t retain it.” “No, that can’t be right.”
That’s personal finance education in a nutshell. And yet nobody gets it.
3. Your Favorite Personal Finance Blogger is Likely Crazy — Speaking of behavior issues…
Have you ever noticed that all of us are crazy? Think about it. Checking account balances more than once a day and losing sleep over stock market gyrations is not acceptable behavior. But maybe you have to be a little bit crazy to really succeed at this stuff.
2. How to Become a TFSA Millionaire — It turns out that if you consistently max the thing out and get a decent return, becoming a millionaire is almost guaranteed. That’s good news for those of us who plan on blowing all our money on popcorn and Skittles. Can I crash on your couch when you’re retired?
And finally…drumroll please… IT’S THE BEST POST OF 2016! ZOMG! I LITERALLY CAN’T EVEN RIGHT NOW.
1. No, These Millennials Didn’t Get Rich By Avoiding Home Ownership — A couple or early retirees tried to argue that the whole reason they got rich was by not buying a house in Toronto during the greatest real estate boom in history. I did not agree with them.
And that’s it
It’s going to be pretty quiet around here for at least a couple of days. But there are lots of things to read in the ol’ archives. Some of it is even good!
Thanks for reading and happy whatever you celebrate to all of Financial Uproar’s readers. All others, as always, can go to hell.
The interwebz have made things a lot easier for those of us who really don’t like going outside.
Communities exist for just about everything, especially on Reddit. All sorts of FREAKS hang out there. Into having sex while dressed up like animals? That community exists, and no, I’m not linking to it. That’s gross.
There are also much more, uh, vanilla interests out there. Take investing, something I’m assuming all of us are interested in. There are hundreds of different websites for every kind of investing out there. Whether you’re into real estate investing or putting your money to work in blogs, there are websites where people can weigh in and discuss the basics.
Having internet friends is all fine and good, even if it is a little weird when you first meet them. I’ve met some of my best friends online. Hell, I met my wife online. But there are also reasons to get some offline friends too, especially local ones.
The easiest way to meet friends is to find a common interest. You bond over whatever it is you have in common, and then the relationship blossoms from there.
Say you’re like me and you want to meet real-life people who are into investing. What to you do? You can either go to all sorts of socials and mixers, hoping to somehow stumble upon somebody who has the same interests. Or you can streamline the process by just catering to folks who are already into investing.
I’d prefer to do the latter. Here’s how to start an investment club.
How to find investors
Most investment clubs are centered around real estate, and they’re usually started by real estate agents who are looking to pick up clients. It’s smart marketing, actually.
Stock market investment clubs exist too, which are usually started by an investment advisor looking for assets under management.
Beginning to see a trend here?
The first step is to find like-minded people. Most of the time this is easily done through the internet. A bunch of people with similar interests realize they’re close to each other, and make plans to meet in real life.
But what if you’re Nelson, and you live in a small town with only a potential pool of 100-200 people? That makes things a little tougher.
You’ll have to do the work of asking around. Start with business owners, real estate agents, mortgage brokers, and so on. Go to things like Chamber of Commerce meetings or various business meet-ups in your community.
Personally, I wouldn’t be interested in joining an investment club that was just a front to drum up business. So I’d make it clear that I was just a guy looking to discuss all different types of investing with other fellow nerds.
If you’re starting it, chances are you’ll be the de facto president. Rule with an iron fist. What’s the point of being president if you can’t? Hey, it’s working for Donald Trump! Hey-o!
The money question
Most investment clubs pool together their money and invest in stocks they all find interesting.
I personally wouldn’t want to be part of such a club. I’m a do-it-yourself guy. I want to invest my own money. I wouldn’t want any of my capital going in some dumb stock I think is overvalued.
But at the same time, people aren’t going to take it seriously if there isn’t some sort of financial commitment. I’d argue strongly that you at least need to charge a yearly membership fee. Even if you only make it enough to cover snacks and the cost of renting a room, that’s still enough for people to take it somewhat seriously.
And it’s always good to have a way to discuss stuff in between meetings. Facebook groups work good for that.
Running the meetings
Hey, it’s your club. Talk about whatever the hell you want.
If I was going to go to an investment club, I’d want to hear stuff about:
- Stocks (but not the usual suspects)
- Real estate (but from investors, not realtors)
- Various private businesses
- Good ol’ fashioned hard money lending
- Merger arbitrage
Things I definitely wouldn’t pay to hear about:
- Anything pyramid scheme-y
- Any managed product
As tempting as it would be to just hang around and talk stocks all night, there needs to be a meeting format. I’d suggest making at least one member pitch an idea each meeting, with the requirement of each member having to make at least one such presentation a year.
If you invite me to your investment club, please have the following snacks:
- Jalapeño and Cheddar Doritos
- Beef jerky
- Movie theater popcorn
- Costco/7-11 hot dogs
The following snacks will result in my skipping your meeting for all of eternity:
- Oatmeal raisin cookies
Conclude that ish, yo
I would LURVE to start an investment club, but I fear my small town just doesn’t have enough serious investors in it. Besides, I don’t really want to be president of anything. I’m more of a junior vice president kind of guy.
As long as you can find yourself a decent group of people, an investment club will be an interesting opportunity to talk with like-minded people in real life, and will present the opportunity to look at investments you wouldn’t normally consider.
My life was a lot different three years ago.
I was still a chip guy, impressing everyone with a very specific skill set of showing up when I said I would. Seriously, that’s all I did. The world of retail has incredibly low expectations.
And then, one day, I snapped. Okay not really, but I did quit my job without another lined up.
I legitimately thought I was going to retire for a while. Yeah. Really. I had just moved, and was flush with cash after selling my house. I could live a reasonable lifestyle for years without really depleting my savings, and I also had all sorts of other sources of passive income–everything from stock dividends to my private mortgage investments.
That lasted for about two weeks. My God, I don’t know how you early retirees do it. I was so bored. And I tried all the stuff I was supposed to, too. I read and hung out with friends and explored my new city and everything. I still only lasted two weeks before starting to look for a job.
After temporarily working at a grocery store for a few weeks and continuing to write at Seeking Alpha part-time, I was approached by Motley Fool to write on a full-time basis. The rest was history.
Now that I’m approaching my 3rd anniversary of writing about money for a living, I thought I’d take a look back at some of the more important lessons I’ve learned.
Over the years, I’ve had hundreds of people complain about errors I’ve had in my articles. Some of these errors were so minor it was comical. There’s a special place in hell for people who point those out. No, I don’t care about the typo in paragraph three.
Others did matter, including the time I got two companies mixed up and insinuated one was about to go bankrupt. It was actually the other that was struggling.
I don’t even need to take a second look at the data to know that bearish articles had a higher complaint rate. People do not like hearing their favorite stock is about to go down.
Most corrections came from regular investors. Every now and again, companies would get involved. I once had an email conversation with the CFO of a company y’all have heard of, and he was not happy. He was very insistent we meet and talk about my grave errors.
After declining this request, I decided to wait a few months and try it again. This time I wrote something much less bearish. Three things happened:
- The CFO reached out again, thanking me for “taking a more balanced effort.”
- The company shared the article and followed me on Twitter
- I was offered credentials to ask questions during quarterly conference calls
People don’t read investment research on the internet to hone their critical thinking skills. They read it to confirm their already-held beliefs.
Writing quality doesn’t matter
The more I write the more I realize something. I’m not a particularly good writer.
I’m perfectly competent. I use semicolons non-ironically. I’ve finally figured out that shorter sentences are better than longer ones. And I can spell all sorts of tough words on the first try.
But I’m not great, and I’m the first to admit it. This used to bring me pain. I wanted people to read my stuff and gawk in amazement. EAT YOUR HEART OUT, STEPHEN KING.
They don’t. And they never will.
But that’s okay. The nice part about being a non-fiction writer is people read me because they’re looking for something specific. As long as I present that information in an easy to digest and entertaining way, I’m good.
That’s what I focus on now.
I remember back in 2012, I read a tweet from some long-forgotten PF blogger who bragged about firing off four posts in two hours. I thought that was insane. Who writes that fast?
2016 Nelson can do that if the topics are easy enough.
Between this blog and my other writing clients, I estimate I’m writing between 15,000 and 20,000 words per week. I’m capable of doing about 25,000 words a week. Spread that out over a 40-hour work week, and we’re talking about 625 words an hour.
One of the nice things about the writing business is I’m rewarded for being efficient. I get paid more if I produce more. And the easiest way to produce more is to get faster.
It’s a volume business, at least for me.
Certain websites have different editorial standards. Some do not care at all, posting everything I’ve ever written as is. Others go nuts and will change 5% or 10% of what I write. I’ve even gotten an article or two back, asking to make wholesale changes.
From my perspective, a good editor makes me sound better. They’ll make my words flow smoother and clear up any punctuation mistakes. Typos too, but I find that most writers don’t care so much about typos. It’s editors who really care. Think of it like detailing a car. I’m providing the engine, seats, and so on. The editor is just shining it up before it goes out to the customer.
But what many editors need to realize is the difference between good copy and great copy isn’t worth the additional effort. I’m lucky; my editors get that, almost without exception. If I’m missing a comma or make an embarrassing to/too mistake, they just change it. Any writer appreciates that.
I’ve met editors who will spend 20 minutes composing an email to tell a writer about an error that would take 20 seconds to correct. These people have dedicated their lives to learning all the inner workings of the English language, and they take it as a personal insult when guys like me only know 98% of what they do. It might read fine, but that’s not good enough for them. They want perfection.
What I’ve learned is there are websites I will not write for because their editorial standards are just too high. That simple rule has saved me countless hours of frustration over the years. Those sites may offer higher rates, but by the time I’d go back and forth with corrections, I’d probably end up making about what I make now.
I pitch two or three websites a week, spending at least 15 minutes clicking around the site and coming up with an educated pitch. None of that copy and paste crap for me. I know that gets rejected 100% of the time.
Instead, I get rejected 95% of the time. Progress!
The internet is a tough place to make a living, especially in writing. There are a million people out there who are willing to write about personal finance who are better at crafting sentences than I am. I probably know more about the genre, but it’s hard to convey that in a 250 word pitch email.
So I’m constantly hustling, doing everything I can to get more work and further diversify my income away from one source. I think I’m getting better, but it’s still one rejection after another. That’s the way it is.
Most days here at the ol’ FU machine, we do the same old thing. I talk about finance stuff and you kids pull up your proverbial chairs and gather round, just waiting to be wowed by the wonderful pageantry that is Nelson.
Either that or you’re dicking around at work in an attempt to forget about your crippling existence for a little while. Got a little real there, didn’t it?
A blog is kind of like a hot dog factory. You never know about the background, likely for good reason. All you get to see is the delicious tube-shaped product when it’s finished and you’re about to stick a six inch dog in your mouth. Be gentle with it. Anyone who puts it all in at once is just showing off.
So let’s do something a little different today. Let’s take a closer look at how I make the magic happen. Allow me to take you for a personalized tour of the hot dog factory, Nelson’s desk.
Picture it up, yo
Oh God Nelson that’s disgusting. An energy drink?
Relax, it’s empty.
I don’t think you really understand my criticism.
So let’s start at the beginning. This high quality office you see actually costs me money.
The story goes something like this. I got back from South Korea and was deciding whether I’d take writing seriously or get a job and continue writing on the side. After applying for all of one job that semi-interested me, the choice was pretty clear. Typos and all, Nelly was going to double down and become a true professional writeer.
That typo is intentional. I’m not that big of a hack.
I quickly realized writing at home wasn’t going to do it for me. It was depressing not leaving the house for days at a time. I missed human interaction. My wife made me cook dinner. And most importantly, I really needed to put on pants and go to work. The psychological boost of leaving the house is a huge deal for me.
I started going to coffee shops and grocery stores to write, but that got old quickly. I’d run into people I knew or they’d just be too damn noisy. Coffee shop internet will do in a pinch, but it’s not really that good.
So I decided to rent an office. After viewing a half dozen different offices, I chose the one in the picture above for a few different reasons, including:
- It’s located in a mall, which gives me a physical location for private mortgage clients to pay me
- I liked the free option for opening up a retail store, although after more than a year here I still can’t think of anything I’d want to open
- The rent is a terrific deal for what I’m getting
- There are other people around who I can talk to
- Snacks and energy drinks are close by
My desk basically sits in the corner of a retail space that’s approximately 400 square feet in total area. I use maybe 100 square feet. There’s another ~200 square feet in the back, too.
Here’s the view from the other side.
As you can see, there’s plenty of room for me to stretch my legs. I’ve thought about opening a co-working space with my extra area, but my landlord isn’t really in favor of subletting and I am cripplingly lazy. I’m also not exactly sure how much demand there would be. Solopreneurs don’t really end up in my boring small town.
Anyhoo, onto the desk itself.
Let’s start with the two monitor setup. If you’re a writer, it’s an absolute godsend. You can research on one monitor while keeping the other open to your work. It makes everything go that much faster and smoother.
Ron Swanson currently guards one of the monitors, and Bender will soon be guarding the other. I left him at home. He’ll be standing right where the Subway cup is.
The MacBook pro exists for two reasons. I use it almost exclusively for email and tweeting, and every now and again I’ll drag if off with me when I do somewhere. I will need to replace the cord soon for the second time, which I don’t intend on doing. It will get replaced by a PC laptop sometime soon, probably in 2017.
My papers are always a bit of a mess. On the left is the least high-tech system ever for keeping track of stuff I want to write about. The large notebook has ideas for Motley Fool and other investing topics I want to cover, while the smaller one has all the ideas for this here blog.
I own the Texas Instruments BA II Plus Financial Calculator which is the only calculator any serious finance type needs. You can figure out things like depreciation, amortization, and compound interest on it, although I usually just use online calculators for a lot of those things. Still, it was only $30.
Off to the right is a printer and file cabinet, which actually get used. More than once. I went with the printer that could scan stuff because that’s nice to have every now and again.
You might have noticed the pair of shoes under the desk. They’re off most of the day. The only time I really put them on is when I go somewhere. The rest of the time I walk around in my socks.
And finally, let’s talk about the chair. I spent $170 on that chair (regular price, $249) and it was the best money I ever spent. If my ass could talk, it would probably just say things about my bidet and that chair over and over again.
As evidenced by the previous pictures, I don’t have much up on the wall. In fact, my wall only has two things on it, my business licence and my pictures.
The two bottom pictures are of my wife. I decided to take these pictures out because the last thing I need is to be yelled at. The other two pictures are of my cat, who only yells at me in cat language. Besides, cats don’t use the internet.
Let’s talk more about the picture of Warren Buffett, which I got at the Berkshire Hathaway annual meeting for a buck. Warren looks down on me, making sure I don’t make any dumb decisions with my capital. Charlie Munger is on the other side, and periodically I might turn it around so Charlie is looking down on me.
Best dollar ever.
And that’s really about it. It’s not the most glamorous desk, but hey, it sure beats one of those standing desks. Nobody likes those things.
If you’re actually graduating this year, you were probably treated to a big long ceremony which included a speech from some C-list celebrity that peaked in 2003. Wilmer Valderama, come on down.
Hey, not all of us can have Andy Samberg show up. Seriously, take 20 minutes of your day to watch that. It is so delightfully awkward. I’m legit surprised he didn’t get the ol’ vaudeville hook.
Those of you who have been around for a little while might remember that my annual speeches to grads are a bit of a tradition. It started off in 2013, when I pointed out that real life is much harder than college. I followed it up in 2014 by telling people that if they spent their life working hard and working smart, things would be much easier.
Because apparently I don’t know when to stop beating a dead horse, I followed things up with a 2015 edition that begged graduates to stop being so damn impatient. It’s great you want to change the world. But it’s not going to happen overnight.
And so that brings us to 2016, graduates. When I first started this series, you were only just entering university, a pimply-nosed nerd who thought that somehow getting out town and into college was going to get your ass laid. Naturally, this did not work, on account of you still being a pimply-nosed loser. At least internet porn exists.
The world of higher education seems to have changed completely in the last couple of years. Safe spaces have become a thing, especially for minority and LBGTQ students. Colleges, which have long been a bastion for liberal thought, have almost become dangerous for those who don’t share the same opinion as the prevailing wisdom.
My understanding of this issue is most students think the same way about safe spaces as reasonably informed people in the real world. They think that people should have the right to spend time in places they feel safe. They’re just not sure those freedoms should extend into places where being uncomfortable is a good thing for long-term growth, like in the classroom or the workplace.
See, graduate, here’s the deal. Maybe you don’t want to feel uncomfortable at work. But Bob from accounting doesn’t give two craps if you feel safe at work or not. As long as he’s not breaking the law or about to get himself fired, he’s going to give you hell if your results aren’t up to snuff. Bob cares far more about the health and welfare of himself and his kids than he cares about some new grad the company hired.
The big picture
This brings up a bigger issue. At the end of the day, colleges are echo chambers. Liberal students end up learning from liberal professors who are the underlings of liberal university staff. Because these people all look at the world in the same way, they think alike. They all agree that Donald Trump is the devil and Jon Stewart (RIP) is our GOD. There is no room for alternative thinking.
If you surround yourself with these people, you will never grow as a person. All you’ll do is continue to hear the same opinions as you always do, which further cements your beliefs. That is not a formula for growing as a person.
For whatever reason, we’ve decided that the opposite side of the argument isn’t even worth listening to. The internet has turned debate from a respectful thing into a contest of who can use the most swear words and condescending language. Whoever is the biggest asshole wins, apparently. Both sides of the political spectrum are guilty of this.
People who just scan the comment sections of Gawker, the New York Times, or Breitbart think this is ridiculous, of course. We all realize that in the scheme of things, it’s just not worth our energy to get that upset about which gender takes a whiz in which bathroom. We have more important stuff to worry about, like whether Bob from accounting is going to fire our asses.
The problem is that you, graduate, have never had bigger things to worry about. You don’t have the kinds of problems those of us in the real world have because you’ve never been in the real world.
Say this whole getting a job thing doesn’t work out. Most of you can (and will!) end up back in your parents’ basement after just one phone call. You’ve got a built-in support group that is conditioned to feeling sorry for you. Sure, most of us older folks have a similar group of sympathetic friends, but we’re conditioned to feel pride in being able to take care of ourselves. If you think it’s bad being a 22-year old who moves back in with their parents, try being a 32-year old who does. That person is mocked, and rightfully so.
We have a new generation of kids entering the working world who have never really dealt with adversity in a big way. Their parents protected them. College protected them. And they protected themselves by only exposing themselves to one side of a lot of different complex arguments. They’re about to enter a very different world.
This will be a shock for many people, especially ones who insisted upon safe spaces and trigger warnings at school. If these folks don’t figure out things quickly upon graduation, they’ll quickly devolve from promising young grads to bitter entry-level employees who somehow think it’s The Man’s fault that they’re not junior vice-president after a year of mediocre service. That’s not a formula that’ll get anyone ahead.
Luckily, there’s a solution to this, and it’s really easy. You just have to change your attitude. Instead of thinking of the world as a you-centric place, think about what you can do for the world.
If you don’t get ahead after a year and your job no longer challenges you, be thankful you have the mental energy to be creative outside of work. Start a side hustle to harness those creative juices.
If you can’t afford to buy a house because of Canada’s real estate bubble, focus on how good of a deal renting is.
If one of your co-workers suck, spend time appreciating all the awesome co-workers you have.
Focus on what you can do to make your life better, rather than insisting somebody else make changes to accommodate you.
Here’s the deal, graduate. The world is your oyster. It really is, even if I’ve spent 1,000 words telling you how it’s hard. There will come a point when you just shake your head and marvel about all the opportunities out there.
This won’t happen unless you have the right attitude. If all you focus on are negative things, you’ll see the world in a negative way. If you focus on viewing the world the same way as the average university student, you’ll miss out on all the valuable contributions made by people who don’t view things the same way as you do.
Embrace this new world and ditch the echo chamber of your old one if you want to succeed. Your schooling might be over, but your education is just beginning.