I'm just a local business and finance nerd looking to help people get educated about small business, marketing, and personal finance! I write about anything and everything that I can tie into those themes. I'm also Central Florida's only Kilted Realtor, so I write about Real Estate too! Check out my About Me page to see the origins of Cash Flow Celt.
Conquering Your Financial Empire
I was browsing Facebook the other day, and got into a personal finance discussion on a friend’s thread. The post itself was about how people in poverty are some of the most resourceful people ever; likely true, considering our impoverished aren’t dying by the daily dozen, rather they’re stretching scarce resources. However, the point the person on the thread was attempting to make was that people aren’t even given a chance at rising out of poverty. That sentiment absolutely baffled me!
Listen, I get some people are going to be poor and some rich. We call it economic stratification and it’s actually an integral part to a functioning merchant society. However, living in poverty – actual poverty as defined by the federal government – I believe is a personal choice for most people; and in this person’s case it was absolutely a choice since she was a young, child-less female with a college education. To judge her purely by her grasp of the English language and ability to formulate her thoughts, I would describe her as an intelligent woman. Then of course came the reasoning as to why she was in poverty: wages are too low, rent is too high, and it’s simply unfair that she can’t get by on 40 hours a week. That’s when it hit me. She’s ONLY working 40 hours a week.
Let me start off by saying that I agree wages have not kept up with productivity and I also agree with a minimum wage increase. I believe the inflationary argument is overly dramatic and likely a farce. You can check out some excellent papers on the short, intermediate and long-term effects of incremental increases to minimum wage at the St. Louis Federal Reserve website and the International Monetary Fund. By and large, small adjustments do not send economies into death spirals.
Now the, back to the argument. 40 hours is part-time. You heard me! Part-time! You have 24 hours a day for seven days a week. That’s 168 hours a week. Subtract 56 hours for sleeping and 40 for working and you’re still looking at a sweet 72 hours left to do with what you will. Even if you include one hour for getting ready and one hour for commute each work day, you still have 57 hours left. There is simply no reason to use all those hours for either menial errands or relaxation. You can work a side gig, start a business, improve your skills, network, the opportunities are endless. We all know wages are stagnant, so you can either sit back and bemoan the fact or you can go out and work on building other income streams! Personally, I work an average of 42 hours per week at my day (or night in my case) job, I spend another 6-11 hours on this blog writing posts, self-promoting, and following other finance blogs for click backs, and I’m currently in talks to join in a start-up business venture. If I do end up joining the business, I estimate my total hours to work a week at around 65. I also have the occasional budgeting and cash flow consultation jobs I get from this blog which add another 3 hours per client. They’re sporadic, so I just hustle a little bit more on those weeks. I also give myself at least half of one day to do absolutely nothing and decompress. It’s all about work ethic and discipline. Side note, before I had this blog and started the talks with the business venture, I was usually working overtime at my job to the tune of about 12 hours extra a week.
In this particular discussion with this Facebook stranger, I mentioned that people who have no criminal backgrounds should go to a community college after work and get a trade skill: medical coding, bookkeeping, mechanic, police/fire/medical, legal assistant. All of these jobs make enough to get you out of poverty and can be done in two years or less. Not to mention, if you are in poverty you can get a $2,000 Pell grant to cover your tuition which, at a community college, should cover nearly all of the bill. But nay, this person said that someone in poverty shouldn’t have to spend what little time they have after their job to go to school and learn a skill. Not to sound crass, but if you’re making $20,000 a year, you probably don’t have cable or season tickets to the Lakers. Much of your free time is spent on free activities like family or socializing. Why not spend that time bettering yourself with marketable skills?
Another thing to note is that the Bureau of Labor Statistics in their last quarterly report noted that the average hours worked was 34.4 – salaried employees tend to work more, while hourly people tend to work less. As a young professional we should be skyrocketing that average. Those who are older and have more wear and tear on their bodies should be the only ones taking it easy. You can’t work an average amount of hours and expect to get extraordinary results. It just doesn’t happen – especially not in this political or economic climate.
A common theme I see in budgets for young people complaining of not enough money is poor spending habits like spending too much on necessary items and splurging too often on unnecessary items. As a young person it can mean buying a home before they’re financially ready or not getting roommates when possible. Although, the biggest killer I see is buying a car outside of your finances and having those huge payments.
It’s an issue of mindset. You may work hard at your job, but you’re probably not working hard enough to get ahead if you think it all ends when you go home. For me, I prefer to live like a peasant for the first few years of my professional career so I can live like a king for the rest of my life. That’s why I focus so much on my budget and it’s why my work is just beginning when I go home. If I can afford a home on a public service salary and two dependents, you can too! You’re just going to have to work harder and be more productive than you ever have before.
Some people though are content where they are and are content to live an average life. If you’re one of those people, that’s great. You’re nodding your head right now and thinking “I’d rather live a stress-free life than work more”. To each his own. But if you’re thinking this article is rubbish and distasteful and that no one should have to work more than 40 hours a week, then I would remind you that you can’t expect extraordinary results for an ordinary amount of work. The average day job does not make you wealthy. People who make millions are those who achieved a great deal of education or have unique skills. The other ones are entrepreneurs. If you know your number for retirement, then you need to go out and grab it. It’s up to you to succeed – ordinary work gets ordinary results. Don’t fall for the 40 hours a week lie.
Readers, do you hustle in your down time and attempt to make multiple income streams or are you content living a simpler, albeit less wealthy, life? What are your reasons for choosing your certain lifestyle? For my older readers, do you wish you had hustled more in your youth or are you happy with what you’ve achieved in your life? Let me know in the comments below!
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