Recently, in my monthly newsletter, I veered from my normal format, and shared an update on a journey I began 15 months ago, one that hasn’t gone quite as I’d planned.
For the backstory, check out this post from December 2017.
I’m referring to my plan of walking away from my 9-5 by August 2019, in part, by turning side hustles into full-time self employment. In the post, I referred to it as my “climb down the corporate ladder”.
With only a couple of months to go, you may be wondering how that’s going. Well, I can tell you with a high degree of certainty that I won’t meet my self imposed deadline.
In a way, just typing those words feels like I’m admitting to some sort of failure, like I’ve resigned myself to defeat. But the funny thing is, I consider the journey I’ve been on as nothing other than a resounding success. Here’s why:
Doing It For The Money
When I set out, my plan was to build a digital marketing company, and cater to local businesses. I met with a number of business owners that I had relationship with, and there was some interest expressed. What I quickly realized however, is that I wasn’t interested in the work itself. I was pursuing what I thought was the fastest way to make money quickly. I was motivated by the wrong things.
Thankfully, with some wise counsel from a couple of close friends, I figured this out before I got too involved.
Instead, I made a pivot, towards other things.
I Focused On What I Actually Enjoy Doing
Once I stopped chasing after what I thought would make money (digital marketing for local businesses), I was able to figure out what it was I actually enjoyed doing. Stuff that fits the lifestyle my wife and I want to build. So, I shifted my side hustle focus to freelance writing/editing.
With my freelance work, money is NOT the #1 priority (even though I share income reports in my newsletter every month). Instead, my focus is on improving my craft, providing the highest levels of service to my clients, and building valuable relationships.
Currently, my side hustle brings in between $600-$700/mth, but because I’ve spent so much time on relationships and learning, I’m confident that I could triple my income very quickly if I decided to.
I Improved My Cashflow
This should say, my WIFE and I improved OUR cash flow. As a result, in the past year, through a combination of expense reduction and increasing our income, we’ve grown the gap between our income and expenses by over $32,000 dollars. In 12 months!
Growing the gap is crucial to anyone’s financial independence journey. To illustrate, imagine making (these aren’t our actual numbers) $100k/year, while having expenses that also total $100k/year. In this situation, if you want to change careers, or make the leap to self employment, you don’t have many options, because you have to make the same income somewhere else in order to cover your expenses.
However, if you can reduce your expenses by $30K, to $70,000, and add $10K to your income through other means i.e. a side hustle, passive income, you’ve improved your cashflow by $40,000!
You could then replace your $100K job with something that pays as little as $60,000. Your level of financial independence has increased.
That’s a very simple illustration, but it demonstrates the freedom you gain by growing the gap between your income and expenses. For a more thorough read on the concept of growing the gap, check out this post by my friend Jillian.
I Climbed Down A Couple Of Steps
Six months ago, at work, I took a lateral transfer into a role with less pressure & responsibility, not to mention a location much closer to home. That’s been REALLY positive, as it’s allowed me to shift more focus to my freelance business, and this blog. I couldn’t have made this choice if we hadn’t grown the gap.
It’s amazing how much better you feel about your 9-5 when you create additional income streams on the side. There’s an enormous amount of freedom that comes from that.
Still, there are times when the 9-5 is all consuming. In the past 2 weeks, for example, I’ve worked four 12-hour days. Heck, as I’ve sat here writing this, I’ve had numerous phone calls, and at least 3 or 4 texts from the office.
Trying to tame my 9-5 can feel like battling a 2-headed monster.
A Tipping Point Is Coming
So how does all of this tie in to my journey to descend the corporate ladder?
For starters, I’ve decided that the big lifestyle shift I was trying to squeeze into 18 months can probably wait 5 or 6 years.
Our youngest is still only 12, so it’ll be at least that long before my wife and I will be wanting the increased freedom to travel, to be location independent. And neither of us want to rush these years. Life is too short, we’re enjoying the journey.
Until then, as much as I complain about it, my 9-5 still holds enormous value. So, I’ve decided to use it to my advantage as we work our way towards financial independence.
That said, I feel more and more like there’s a tipping point around the corner. There will come a time in the near future when I decide that I need to slay the 2-headed monster once and for all, and make the leap. It may not be August, but I’m a lot closer today than I was 15 months ago.