Am I Time-Poor?

So on the weekend I get a call from an old work colleague who I haven't heard from or seen in almost 10 months. We get talking, asking about work, and stuff and he mentions that he's contracting these days as his business is doing well and devotes time to do that. During our conversation he says something along the lines that he's on track to quit his 'day-job' in five years and be independantly earning a good living from his MLM business. Im like cool, good onya. So he asks me where my current job will lead me to? I told him I've got some specific goals and I have a fair idea I know what I want to do etc etc. (He also works in the I.T. industry). He goes on to say "so your probably very time poor in your current job and always will be when working in a job". Now at this point I told him, "No, infact Ive got more time than ever to do stuff. Plus with my curent role, I work 4 days off and then 4 days off, so it works out really well".

So what does time poor mean exactly. Basically its saying that your lifestyle, work, responsibilities etc, do not allow you to adequately devote time to other things that may be of your interest or leisure. Eg: Your timepoor if your so busy you cant find time to read a book, or do a painting, or you find it hard to go-out and participate in social events.

The mention of being time-poor actually ticked me off a little. Why? Well, I think its a common misconception that people who are working in a 'job', are time poor because they're stuck in a "routine" that barely gives them time to achieve their goals, dreams and aspirations. I know a few people who are running business and they're probably more time-poor than anyone in a job. Heck, I reckon even people like uni-students are time poor. I dont think being time-poor is restricted to just those working in a job.

Now I should let you in on a small matter of note and that is, this guy works in a MLM (multi-level marketing) business (hint: Starts with A and has five letters). These guys commonly use the term 'timepoor' to make you feel bad and then they try to sell how you can achieve your dreams of being financially secure and be time rich if you join their business. Mind you many people are doing are very well from this type of work and are very happy. Some people (like me for instance) join to try it out and realise its not entirely suitable for the type of person that I am.

Okay, so the question I ask myself is am I time-poor?? My answer is yes and no. Yes AND no? I believe your time-poor regardless if your stuck in a routine or not. If I am not managing my time and not writing goals to set out what I want to do with my time, well then yes I'm time poor. Simple. But, if I am writing down goals, actively working on these goals and crossing off my to-do list, then surely if I am relatively efficient at doing this, I can find time to schedule other things that I normally wouldnt be able to do. There are a lot of factors including but not restricted to the following such as,

• prioritising your time and tasks,
  
• being realistic about what you want to do and how much time and effort it may require,
• try to be flexible. You dont want to become so monotonous in your life that there is no spontaniety left.
  

Thus my yes and no answer. I am trying to better myself in becoming more efficient with my time, but I believe I'm no-where near as efficient as I would like to be. I'd say it'll take me another 12 months minimum to become even better at managing and organising my time. Take this blog entry for example, Ive done everything that I had wanted to do and now im writing about this particular topic because I wanted to. Im just starting my weekend (yes its Monday, I know. Ive got Tuesday and Wednesday off).

In conclusion if someone says your timepoor, think about it before you answer. Are you really?? It will take discipline and some hard work to become good at managing your time, once you start doing this and become good at, there is no reason for you to say your time poor. Live a life of no-regrets and hopefully you'll never hear yourself say "I wish I had the time to this" OR "I wish I had done that when I had the time" etc.


The real reason for this guys call, to basically get me to renew my "business" subscription. I told him straight up, I got the renewal letter and Im not interested. Its just not my thing. He was dissapointed to hear this.

Success = Compound Returns!!

Financial success that is....

Majority of people know what compound interest is and how it works etc. We all did it in maths class back in high school racking our brains trying to calculate how long much interest we'd earn if we put in X amount of principle, with Y% p.a. interest, at T time frame...yada yada...

Dont worry about the mathematics of the thing, I'm not here to share boring stuff. Instead I want to share something I recently came across in another blog a few weeks back and I can't help think, "damn, why didnt I start sooner!"

okay have a quick look at this.... Power Of Compounding - flash animation

The beaty of this animation is that it shows the difference in time frames. It puts into context the saying, 'the earlier you start saving for the future, the better.'

Alright, so lets take a look at some graphical pictures to see what would happen to my savings. Now to remind you I'm putting away $1000/month into a managed fund (my initial deposit was $2500), and I only started this last year in October.

Okay take figure below. If I only did this for 5 years I would end up with $77201.47



Alright so Ive decided to stop putting this money away and now im just "sitting on it" so to speak, so by the time I turn 55, I'll have approximately $566000. (assuming average rate of return is 8% p.a)



Another comparison. If I didnt stop at year 5 but kept going, by the time I turn 55 I'll have close to a whopping $1.5million. Again rate of return is same at 8%.



Lets see some figures with different return averages

Below if we left the $77201 after year 5 but got 10% returns, Id end up with $933219 when I turn 55.


If return on investment was 12% p.a, Id be sitting on $1.5 million.


What if I managed to get 23% average returns p.a. like Mr W. Buffet has. Id be sitting on $23million !!!



Now although at present Im a passive investor, I do plan on becoming an enterprising investor. For more on this topic I hope to do a book review on "The Intelligent Investor" - by Benjamin Graham. Im currently 1/3 of the way through and so far its compelling reading.

An interesting thing to note. Rule of 72. Heard of it??
Basically its a quick approximate calculation that allows you to determine how long it will take you to double your money depening on the annual rate of return. For example, if rate of return is 5%. Take 72, divide by 5 = 14.4 This will give you approximate number of years to double your money. Another example, If annual rate of return is 10%, 72 divided by 10 gives 7.2 years. Pretty nifty eh!

So in conclusion, if you can, start to put your money away early. Speak to financial advisors and get knowledgable on the concept of investing long-term. Majority of us will not be millionaires in our 20's and 30's, very few of us even come into decent inheritance money. By the way if you do get some inheritance money, INVEST IT! Or if you win lotto (fat chance) invest that too!! In my opinion if you want to be successful when it comes to wealth. Think long-term and start saving and watch compound returns do its thing.

The above pictures are screen shots taken from a savings calculator, found at http://personalfinance.news.com.au/banking/calculate/flash/savings.asp

The Mindset Determines Success

If someone were to ask you, ‘What truly determines success?’. How would you answer that? Is it hard work? Education? Running a profitable business? At peace with oneself?

All of the above and more qualities add to the chances of being successful in life. But to make the most of the above qualities, we must all have a positive mindset. Easier said than done eh! Our emotions fundamentally lead to the actions we take in life. If we try to be positive, and feel enlightened, this helps infinitely in performing daily tasks, setting goals, being more organised etc.

I am genuinely trying to be a more positive person. I have been doing the following for the last 12 months and I have found it greatly assists me in keeping a balanced mind;

1. Start a diary. Doesn’t have to be kept upto date everyday, every-hour etc, but keep a small notepad on which you can jot down your comments/thoughts when you feel like it. What this actually achieves is that it allows you to put your thoughts into context. There has been many a time, when I’ve been stressed due to exam preparations or just simply depressed wondering where my life is heading. Writing down these feelings greatly helps to clear the mind and allows the mind to unblock all those thoughts that are stuck in your brain-pipes. Ever had a business/cool gadget idea? Write it down! You will be amazed at how much it helps to clarify ones feelings and thoughts.

NB: I recommend not keeping a proper diary which has dates listed and limited room for you write under those dates. What I did, and am doing at present is I bought a small notepad (half A4 size) with about 300 pages, (I drew a calender with dates for reference) and I write down my thoughts, ideas, goals and miscellaneous stuff when I feel like it.

2. In your notepad/diary also jot down things you want to do. This can be anything from washing the car, to doing your tax return etc. Now mind you I don’t do this all the time, but I do try to jot down some goals that need attention. Once you start doing this, it will become somewhat of a habit. One thing I will recommend highly is to look at your notepad/diary at least once daily. Even if you have nothing to write, open it up, flick through to the latest page and see if there is anything you forgot about or need doing. Simple.
3. Create a motivation whiteboard. I've got one. What do you do to create one? I bought a whiteboard (90cm x 60cm) from Officeworks for $28. I've currently got it setup as two columns. On the RHS column at the top, I have written down long-term and short-term career goals. Long-term: what position I want to be in say 5 years and what $$$ I want to be earning. Short-term, what certifications/exams/study I need to do in the next 6 – 12 months. Underneath this, still on the RHS column, I have broken down my financials into rough numbers. This basically includes monthly after-tax income, and estimated monthly fixed expenditures, eg: mobile bill, fuel bill, managed fund saving etc. I will go into how I organise my finances in detail in another future post.

Now on the LHS column, this is where I do most of my free thinking. I write down short-term dates for things I would like done, for example when I want to sit for my certification exams (this takes up about 10% of the LHS column). The rest of the space I leave dedicated for me to communicate with myself, motivating myself to write down things that I am proud of, my best achievements in the last 24 months, things I want to achieve and other off-topic stuff. Basically it acts like a sounding board. I have found in most instances discussing personal growth goals and ideals with friends and colleagues gets shot down pretty quick. Mainly because it seems to be human nature that we don’t like to see other people succeed. Thus these people are unlikely to boast the same level of enthusiasm as yourself on plans you have about your future etc. The only people that might support you are those who already have similar goals. They do exist but are rare.

Actively taking part in the above three has helped me immensely. It’s a significant part of the reason why I believe and say to myself that I am successful and will continue to be successful in the future.

I have found the greatest hurdle in having a positive mind-set has come from within. The above helps me cross this hurdle in a major way. Once my positive mental mind-set becomes more permanent, I sincerely believe it will allow me to study more efficiently, organise my time better, allow me to live a more balanced lifestyle, and best of all will give me confidence through success.

Some great sites to visit

As Ive mentioned already, Ive been browsing many blogs on web in the past few weeks and I thought I'd list a few I have found to be great sources of information for personal development and personal finance.

1. Get Rich Slowly
   
2. I Will Teach You To Be Rich
3. Steve Pavlina - Personal Development

Ive already listed these as links on the side and I hope to add more useful site links as I find them.

Its all relative...

I made a bold claim in my first introduction post that Im already successful. Well it actually depends on how you seek to define success. In other words what I meant to say is that relative to my own past experiences, I am successful. Relatively speaking.

How so you ask?
At present most of my conscious thinking revolves around, developing my professional career, finance, and becoming a better person. To break down my career achievements, I graduated out of university back in July 2004. I got my first proper job out of uni in April working as a helpdesk monkey. Now this role I thought was very be-littling of me as I was somewhat over-qualified via my education (I spent five and half years studying Telecommunications Engineering). Apart from the role itself which was overly repitive and lame, I was only getting paid AUD $35k. Other graduates of my same age and education were scoring roles that paid minimum $45k (boy was I envious). But hey, I had to accept that the job market wasnt crash hot and I was somewhat fortunate that I managed to score this job.

Nine months on I changed jobs again to work for another company in a similar style help-desk role. I know your thinking WTF! Why did he do that! Well this role involved working in an ITIL environment, and although it was repetitive and boring work, the environment was more professional. Plus this was a contract role paying $25/hr plus 20% extra for shift loading. Yes the role was 24/7, I took it because I figured it would be good experience to have, and who knows, my next job might involve working in another 24/7 type role. I lasted 6 months before changing jobs again to my current role.

I now work for an American multinational as a Surveillance Engineer in their Network Operations. Finally a career role!!! Albeit its a graduate position, I consider myself extremely fortunate to have got this. Its paying $40k base with shift loading on top. Yes its another 24/7 job, who would have thunkit. An important note here, at my age money isnt tremendously important to me, as you can note I took a pay cut to work in this role. I am interested in building a long term successful career in networking. Long-term I want to be a specialist in network design. In the short to medium term, this role will definitely help me achieve my long term career ambitions and as I gain more experience, good money will surely follow. I can guarantee that!

So in-retrospect, after graduating out of university as an engineer, I had to slog it out in helpdesk for 15 months before finally landing a job I could happily tell people about. This to me is success. I succeeded in getting out of helpdesk in relatively short period of time and I know I will make great career progress in the coming years.

Now looking at the personal finance side of things. While in my first job out of uni, although I was getting crap pay, I was somewhat alert that I had to do something about securing my financial future. So what did I do? I went and spoke to a financial advisor. Basically what I wanted to know at that time was should I invest my money into a managed fund or should I be looking to go into property. Now this was October 2005, the advisor said straight up that at this point time your best bet is to invest in a managed fund, as the property market is currently sinking after the property bubble-burst due to the high unrealistic market prices driven by investor speculation.

So what Im doing financially is im putting away $1000/month into a managed fund, which is geared towards growth with roughly 50% Australian shares, 40% International shares and rest comprising of property/cash trusts. As im relatively young I plan to stick with this for about 5+ years minimum. I might look to invest in property once it starts to pick up again. As this is setup on auto-pilot, it gives me confidence and comfort knowing that I am already doing something about my long term future. Again success. (I will outline my personal finances in more detail in future posts)

Now becoming a success in terms of being a better person, this is something a little new to me. Ive realised a lot in the past 12 months I need to improve myself from within to become a better human being. Unfortunately this concept can be vague and is difficult to define at times. But in the past few weeks, Ive discovered there is an infinite amount of information available on the internet, particularly in the form of blogs and forums, I decided I would take action and start my own (I find writing down thoughts and feelings helps put things into perspective in many cases). The underlying aim is to reflect on what I write.


So here's hoping Ive explained my theory of relativity when it comes to defining success.