What's the number?

[Buster Highmen]

For those of you who have done well financially - what would you say was the key for you? Smart investments? Great business idea? Luck (no judgement there on my end - the saying goes that you have to be good to be lucky and lucky to be good). Combination of factors? Trying to figure out how to achieve what some of you have done financially.

0) avoid a mortgage. might be unpossible now, but that was key. fuck the toney neighborhoods, get something that works. rent, save, build incrementally, paydown.
1) pulled everything out of the market in 2000 and 2006. so luck. but it just smelled funny when the p/e ratios get astronomical. be very wary of wall street.
2) do cutting edge tech, find a way to make a difference.
3) real estate. luck again in finding undervalued property. it's still out there.

[Benny Profane]

I’ve always wondered about that. Any interest in sharing/extrapolating on that?

Gotta say that I have no clue about what the number would be but at 35 with a 6 month old and hopefully at least a couple more to come, I don’t know how any of you have been able to retire, period. Both wife and I have what would be considered “good” professions but neither of us have even a sniff at retiring before 65. One thing I’ve realized is that working for someone will likely lead to difficulty retiring at 65, let alone early, unless you’re in a field that pays FU type wages (of which I’d say 99% of us are not a part of).

For those of you who have done well financially - what would you say was the key for you? Smart investments? Great business idea? Luck (no judgement there on my end - the saying goes that you have to be good to be lucky and lucky to be good). Combination of factors? Trying to figure out how to achieve what some of you have done financially.

No kids.

[Mustonen]

No kids.

This.

Anybody who doesn’t have kids or started with a stake from the family is playing a different game.

[liv2ski]

On the kids thing, I did not want them as a young man, BUT my wife insisted on at least two if she was going to marry me. Now, I would not trade them for anything, so ya, they cost a lot but if you raise good people, they are worth the time and energy for sure.

[Benny Profane]

This.

Anybody who doesn’t have kids or started with a stake from the family is playing a different game.

And having a long marriage to a spouse who had a good job with benefits. DINKs.

[ötzi]

I dont have FU money but I found a way for the owner to make a bunch of extra money and asked for a % of it in the pitch.

Man I figured something out at 27 and was rolling with a similar scenario but it was a gentlemens' agreement and it turned out they weren't gentlemen after a while. Funny how greedy people get. I was making them a ton of money and the part they hated was the money they paid me. Get it all in writing.

The part they didn't figure on was me being able to pull the rug out from under them, which I did, but all it did was fuck them, it didn't come back to me. But I can live with that.

[frorider]

On the kids thing, I did not want them as a young man, BUT my wife insisted on at least two if she was going to marry me. Now, I would not trade them for anything, so ya, they cost a lot but if you raise good people, they are worth the time and energy for sure.

Absolutely, and that goes without saying. Kids are generally awesome. But the posted question was asking a financial question. The extra $2 million or so makes retiring @ 50-60 much easier for a childless couple.

[riser4]

On the kids thing, I did not want them as a young man, BUT my wife insisted on at least two if she was going to marry me. Now, I would not trade them for anything, so ya, they cost a lot but if you raise good people, they are worth the time and energy for sure.

You just haven't gotten a high enough offer yet for the kids.

[ötzi]

How much for the daughters?

[riser4]

I want to buy your women.

[riser4]

Man I figured something out at 27 and was rolling with a similar scenario but it was a gentlemens' agreement and it turned out they weren't gentlemen after a while. Funny how greedy people get. I was making them a ton of money and the part they hated was the money they paid me. Get it all in writing.

The part they didn't figure on was me being able to pull the rug out from under them, which I did, but all it did was fuck them, it didn't come back to me. But I can live with that.

Ya burned it all down. Nice.

[VTeton]

Man I figured something out at 27 and was rolling with a similar scenario but it was a gentlemens' agreement and it turned out they weren't gentlemen after a while. Funny how greedy people get. I was making them a ton of money and the part they hated was the money they paid me. Get it all in writing.

The part they didn't figure on was me being able to pull the rug out from under them, which I did, but all it did was fuck them, it didn't come back to me. But I can live with that.

Ice speaks the truth here. Get it all in writing and assume they are going to shitcan you in the near future one way or another regardless of performance.

[Marshall Tucker]

On the kids. Seriously. I cannot imagine life without them. fine, wave your extra bills.

[The AD]

On the kids. Seriously. I cannot imagine life without them.

That's because you have kids. If you didn't then it would be very easy to imagine...

[LeeLau]

I’ve always wondered about that. Any interest in sharing/extrapolating on that?

Luck. Timing. Execution. Discipline

No kids.

Lots of hard work above and beyond the 40 hour work week at financial education

Fanatical devotion to (reasonable amounts of saving).

Avoiding too much lifestyle creep.

To personalize it. Parents moved us from Malaysia to Canada when I was high school. Not much money. Studied hard. Saved pizza dish pit money. Wrote APs. Got some aid to go to UBC. Got a job buying tables at Grouse then waited tables. Graduated from school with no student loans and skied for free. ( Savings, hard work)

Taught myself computers. Worked for year a bit at a library in Calgary. Fixed consumer PCs and small software simple gigs in town saving enough to go to law school also without loans. Actually saved $ as anything to do with computers paid good money. (Savings, hard work)

Worked with a solo practitioner who mentored me through law. Didn't know any better so had no real idea how outrageous the nascent dotcom market was. Thought it was perfectly normal to bill at big firm rates yet have small firm expenses plus asking for ( and getting ) dollar and stock bonuses for doing work. Boss was quite new school and because I was so hungry and aggressive at getting paid + generating deals and work I was cut in for extra bonuses and stock. ( Savings, hard word, lots of luck - show me an inflection point at any time in the last 50 years a dumb rookie could get paid so much)

Was saving over 30% of gross so put down money on a place in North Vancouver before the boom. (Luck. 1 year after we bought the place went up 25% and never looked back)

Kept saving. The stock we had from the clients monetized as clients went public. As soon as stock unlocked I diversified portfolio and sold buying 2 properties both at BC ski areas . (Luck, these places all hit my 2x sell price target in 4.5 years when Whistler won the Olympics bid)

Kept saving. RE was paying for itself. I studied the CFA level 1 and midway level 2 on my own time. Took Canadian securities course. Learned about the markets. Learned how to short, how to hedge with options. Began working more with the finance side of the deals not just on the technology commercialization but also the finance structure side. Began analyzing the deals. Began originating the deals. Began taking a slice of the deals. Still worked full time law. (Savings. Hard work.

Luck - no way now that hedgefunds would let "rookies" in even if they were experienced lawyers. There was so little talent to run numbers they would let me even if I was raw. I also worked my ass off to learn from others more formally trained)

By now I'd worked more than 80hrs/week for 8 years. I'd read that most lasted about that long before blowing up/burning out and going to management. I didn't want to go to management. The long/short finance deals we did ( this just means we made money whether stock went up or down) and my RE had gone . I did a big derivatives deal where we got ambushed and lost a lot. I had a big loss carry forward and was stressed about juggling so many balls. Self-detected tendencies of gambling in that I was hunting deals and trying to make $ for the sake of %: all the signs of danger I saw in so many of my investment banking biglaw colleagues. Sold all the RE. Went neutral in cash. Thus the bag of FU (Savings - i had lots plus never got the spending bug so lifestyle was very frugal compared to peers. Luck - this was mid 2008.juat before Bear Stearns, Lehman, mortgage collapse.)

Because I was so fried I didn't look at markets much during financial collapse other than academic interest and wow. Took a summer and half winter off to bike and ski. Summer 2009 rolls around and I start deploying cash. (Savings - I didn't blow my wad. Luck - I bought a lot of dividend yielding names at bargain prices. Grandpa style stocks I hold to this day. Stuff like Microsoft at 30)

So I'm 38. What to do? I look at my biggest expenses. Skis and bike addiction. Like to travel. Write some articles about things I like and believe in. Product companies and travel/tourism operators like them. They start sending me free stuff and things to do to write about. Still do this. (Hard work.Luck. No such thing as influencers then. I understood SEO before many did. Not much competition among people who want to do a thorough honest job as it takes time to do that right and I had time and lots of that)

Maintained professional contacts. First profession as tech lawyer and second profession as long/short analyst &originator lends itself well to own hours, to being eccentric/different drum thinker and to indifferent work hours. For last decade have worked enough to not touch FU money but just enough to keep in practise. Not having big cash flow negative hits like kids or medical issues (largely US centric problem helps). (Luck, execution, timing in sense that have passively participated in massive decade long bull market).

Through all of this one thing I've done is to keep mindset to find angles. Something bugs you? Take advantage of it. Can't do anything about it? Move on.

If something extracts money out of someone like me who's so cheap then join the crowd and participate. Eg buy AMZN (too easy to impulse shop), buy BMO (usurious banking fees), buy WB (long lineups, overpriced food. Join the people who extract money.

US military industrial complex runs the country? Buy LMT

Financial companies will always win? Buy JPM.

From late 2019 on I got a bit more interested in actively managing the FU money and did more so post March. Also a lot of my (existing) tech clients have had lots of work so I felt obligated to help.

If you don't have FU money yet this year is the year to get it ASSUMING you had the luck/savings/hard work combo to have some initial stake to risk. I feel it's as much a real world and financial world inflection point as the dotcom blowup, mortgage blowup times. If you.have FU money this is the time to either make darn sure you keep it or the time to reach multiple FU money levels.

[LeeLau]

Live below your means, save, invest.

.... Of course this is the oversimplified version, I worked my ass off 24/7 for a long time to make it all happen, went 3 or 4 years without skiing, mountain biking, or anything else fun while building my business. Was the sacrifice worth it.......I don't know anymore but I see the light at the end of the tunnel and I can't fucking wait to get there.

That last paragraph is the hard one to convey. When it's your name on the mortgage. Your tenant decided to renege on the lease. You have to spend 15k on staining or 2k on appliances etc etc. You live and breathe it and it never leaves your mind.

It was all so stressful and if I did it all again, I'd do it differently

[Mazderati]

If you don't have FU money yet this year is the year to get it ASSUMING you had the luck/savings/hard work combo to have some initial stake to risk. I feel it's as much a real world and financial world inflection point as the dotcom blowup, mortgage blowup times. If you.have FU money this is the time to either make darn sure you keep it or the time to reach multiple FU money levels.

Meaning moon or Mariana but less of something in between?

It was all so stressful and if I did it all again, I'd do it differently

How so?

[zion zig zag]

LeeLau, much admiration for being able to stick with that. It makes me reflect on my own decisions and what I was and wasn't willing to give up to follow that path.

[XXX-er]

I would say most of what worked ain't gona work now, there are no lifetime jobs with DB pensions and if there were I coudnt get the gig with zero education but along those lines there are all kinds of jobs that don't exist or have gone by the wayside, i think a proffesional designation means a lot

looking back there were guys who were playing the same game that you think would have have made it that didnt for whatever reason be it luck, choices, wrong place just couldn't stand the game anymore ... I duno

the constants would be stay working, spend way less than you made, understand what is in your best interest and i think a lot of people don't

both women I married spent my money and were not big on working hard fortunatley ... I divorced well

[MiddleOfNight]

LeeLau, much admiration for being able to stick with that. It makes me reflect on my own decisions and what I was and wasn't willing to give up to follow that path.

Yea +1 to that.

I'm saving and working hard, but want to enjoy myself along the way. Never going to have FU money, just hope to get out a little early.

Props to those who can commit and make it happen.

[plugboots]

That's because you have kids. If you didn't then it would be very easy to imagine...

Yeah, I think I’m w/ AD on this one. I know plenty of folks w/o kids who are not at all alone, (and vice versa).

[LeeLau]

Meaning moon or Mariana but less of something in between?




How so?

If you have money you can lose and the financial education to learn how to deploy it this is the time. For example, industries will change. Long any workfromhome names, long industry changing paradigms. Short old boomer industries.

As to RE. I had about $1m equity in 2 properties self-managed by me and my wife.

I could have deployed that same equity in 10 smaller properties and hired a manager and came out ahead numbers wise (proportionately rent is higher), reduced expenses if I'd bought in urban centre (less wear and tear), easier to sell (bigger pool of buyers). Also Vancouver market went up more %!ge wise than Whistler marker

[The AD]

Yeah, I think I’m w/ AD on this one. I know plenty of folks w/o kids who are not at all alone, (and vice versa).

People with kids can't imagine life without them and vice versa, but I don't think not having kids is necessarily a recipe for loneliness.

[XXX-er]

I duno how many people i have tried to tell that THE one sure-fire way to get ahead is to run a basement suite

you already own it, the place is right there so you can keep an eye on it

they always say they don't want to be inconvienienced/ put out

which means they are not that seriuos about the FU money

but they don't mind complaining about not having any money

[Kevo]

Thanks for the write-up LeeLau. Awesome story.

How much of your portfolio are you actively managing? For things that you aren't actively managing, are you indexing? If so, are you indexing total stock market or are you indexing only certain industries?

I've currently got a lot on the sidelines. Certain friends in finance are sitting out because of PE ratios. Kinda wondering what to do and where to deploy. So much new tech is at insane PE ratios right now.