Setback

As Luck Would Have It

Posted by FI Monkey
It's times like these when you think, "Man, I sure could use a shovel."
It’s times like these when you think, “Man, I sure could use a shovel.”

Isn’t life funny?

One moment, you’re stressing about things in a major way and the next moment, opportunity lands right on your face. Or desk. Opportunity lands somewhere. And if things have sorted themselves just so, it’s sort of like being stuck in a hole and having a shovel fall in with you — not the best situation, and it won’t be easy getting out, but at least you have a way out.

So yesterday, after getting my absolutely final offer from the company I’ll be taking a job from, I had resigned to the fact that I’d be making a lot less money over the next year — again, somewhere around 35% (but closer to 30% because of the way taxes work out).

In fact, this is why my posts have been sparse. I’ve been doing a lot of thinking. Thinking about how to reduce expenses, what that will do to my marriage, what that will do to my self-image. I know the amount of money I make shouldn’t be tied to my self worth and that’s quite often what I tell other people, but combined with a personal “crash” of sorts which has taken the FI Monkey “stock” down 35%, it’s much easier said than done. And that’s exactly what sort of hit me yesterday — my “portfolio” (income rate) is about to take a huge hit and because I am not diversified (having multiple income streams), I am feeling the full brunt of that impact.

And so I thought about that.

Now obviously I have promised myself (and my readers!) that I will start a side business (or side hustle, as they say these days) and I absolutely intend on doing just that. But as I said at the beginning of this post, opportunity landed. And that opportunity came in the form of a consulting agency that wants to farm part time work out to me at the rate I’ve been charging the company I work for.

And the more I think about it, the better it sounds:

  • I get paid the same rate I was being paid before
  • I can work at my own pace and on my own schedule
  • I can deny projects if I should so choose
  • I can even charge flat rates for projects
  • I don’t have to work directly with clients and act like a project manager
  • I don’t have to manage people
Now we're talking.
Since I was beating the stock analogy to death, here is a picture of a horse wearing roller-skates. You’re welcome.

The trade-off, of course, is that I have to charge accurately and competitively. These guys aren’t going to pay a slow horse to do a fast horse’s job. But I can swing that. The trick is staying within those guidelines while keeping my main income stream happy, but what makes me most happy about this possibility is just that — I will no longer have just one main income stream.

As of next week (I believe), I will have become diversified. Naturally, having just two income streams is not really diversified but it’s an excellent start. It just means that starting (or buying) a business will become yet a third income stream and lead to an even more balanced “portfolio.” I’ll have my stable income (bonds?) and my volatile income (stocks!) that will hopefully both grow at different rates.

The side benefit to this (not that I want to try to predict the future so early on) is that, should it somehow work out that I get close or even hit my financial independence number, I will be able to transition away from my main income stream and then slowly ramp down this side work over time in order to focus on my main business. Or who knows, maybe I’ll continue. I should probably figure out what my ideal “early retirement” looks like before waxing on about it, but you get the point.

What I have to be extremely careful about is making sure that my main job is not impacted by work from the others. But I also have to make sure I can get things done in a timely fashion with my second job. Luckily, I took the job that allows me to do all of this from the comfort of my home office. And I’m beginning to think I won’t have to keep beating myself up over the choice I made.

As luck would have it, things have a way of working out.

Rough Seas Ahead

Posted by FI Monkey

Let me just say, today has been interesting.

So has the past month, for that matter. See, I’m currently a contractor and it was recently made very clear to me that I either join up as an employee or start looking for work elsewhere.

Of course, it was put in much nicer terms. I don’t work with monsters, after all. They value me as a team member and want to keep me on board. Had that not been the case, I suspect I would have been cut out a lot sooner. Luckily, I’m somewhat of a workaholic and the kind of work I do is in high demand for the time being. The only problem, dear friends, is that going from contract to salary is … tough. Rarely do you get the chance to do a straight contract-rate to salary conversion. In my experience, there’s always a cut. Always a price to pay for being a permanent member of the team with raises and the like.

So how much of a cut? Well, in my case, it’s about 38%. You might be familiar with that amount as most of what I save every month.

Yeah.

So I’m dealing with that at present.

Plus, I have another offer on the table that would mean commuting about 50 miles each way, but it’s for $15,000 more. I’ve done the math a number of different ways and even with tax deductions, traveling that distance would quickly beat that $15k bump into submission. In other words — it would work out to be about the same because I would spend a lot more on automobile-related expenses. Plus, there’s that whole opportunity cost of being in traffic for 2-4 hours every day. Yeah, the more I talk about that offer, the less desirable it sounds.

There are more perks to keeping the job I have now, of course. For example, I get to work from home every single day, which means I get to see my family. Every day. On top of that, I’ve been meaning to start a business for a long time and just haven’t gotten going. Keeping this job would mean there would be a certain … urgency … to that pursuit that wasn’t there before. I’d like to work that in my favor. There are parts of my brain sorting out the details right now (time to get some excellent sleep), but I now have an obvious challenge placed before me: earn the difference with a side business or bust.

It’s strange what times like these will do to your confidence and extremely important to reflect in order to turn emergencies like these into opportunities.

I mean, I’m not out of a job. By the time this change goes into effect, I will have fully funded my Emergency Fund and started investing. Things aren’t that bad. I’m just really bummed that I won’t get that big monthly infusion into my various retirement-focused accounts. The story I want this blog to reflect is that of someone who learned the error of their consumer ways a bit later, but not too late. Someone who faced successes despite bumps, setbacks and rough seas. Someone who doesn’t lie and pretend things are always happy.

I honestly hope that’s what you all take away from this.

For now, I’ve got a lot of thinking to do. A lot of talking to do with my wife. We have to make sure our expenses will be covered. Maybe this is the catalyst we needed to down-size the home (and mortgage payments with it) in an effort to live more simply.

Of course, I’ll keep you posted on where this takes me.

Wish me luck!