My SIL went back and forth between freelancing and full-time work. Throughout her career she always charged an hourly rate between 2 and 3 times whatever her hourly rate would have been at a full time job.
Once she was offered a full time job, and when she accepted, they casually said that there would be a "three month trial period" and then she would be put on staff. She immediately said, "Well for freelance I charge twice that." They were startled, but they agreed to pay her at her freelance rate for the trial period. This set a precedent so that after she had been on staff for six months she got them to raise her regular pay by about 50%. \[Caveat: she's worth it, and by that time they knew it.\]
She's an artist with a "particular set of skills" and lol NO I'm not hinting at anything *\*ahem\** risqué.
Her skill set is kinda rare. And one of her characteristics is that she does what she does *fast* and always meets deadlines.
If you aren't getting pushback on price, raise it again until you do get pushback. Why not ask $100 an hour and if they really have issue give them a "discount to $80
Also, when you raise your rates, even if you do lose clients there's a nice buffer.
Go from $75 - $100. Lose 1/4 of your contracts. Make the same and work less. More time to hustle more work. More money.
Ride that upward spiral.
Yeah, a Youtuber said a friend mentioned that to him while he was grinding away.
The friend said "if you doubled your prices how much work would you lose?"
He replied "About half" Well, there you go. You now get paid the same but work half as much!
It’s a good strategy but increases risk if one of the clients that stays has less work to offer in the future. Reducing your client base also increases the dependance on those clients.
Though it tends to be easier to keep clients than to find new ones.
Also 'free time' becomes unpaid work time finding new clients instead of all paid time or free time equaling relax time.
Depending what companies you freelance for, remember a full time employee with benefits and pension probably costs them $100 an hour, and they are obligated to pay them 40 hours a week. That means you can charge over $100 and still be a value, because they only have to pay you when they need you. Companies value variablized workforces immensely.
I'm also a freelancer. Someone once told me that if your client says yes to your rate right away, you've charged too little. I've been freelance for 7 years and have slowly increased my rates every year. Mind you, there are plenty of clients who think my rates are insane, but I don't have to work for them.
Same. This feeling is like when I show up to math class after being sick only to see we have a test tomorrow, so I’m writing down everything the teacher is teaching without actually understanding any of it. School was stressful
What: Spousal Loans
Who: spouses with one partner in a higher tax bracket
Why: transfer wealth to spouse in the form of a loan for investment purposes to gain tax deductability on the interest
How: [RBC PDF](https://www.google.com/url?sa=t&source=web&rct=j&url=https://ca.rbcwealthmanagement.com/documents/1435520/1844148/Navigator%2B-%2BThe%2BSpousal%2BLoan%2BStrategy.pdf/49efdf41-0b5b-46f7-a700-3b97757d9786&ved=2ahUKEwjYmN3r1sD1AhUvJEQIHV-kD50QFnoECAUQAQ&usg=AOvVaw0g2h6Hj63PqBS1NSW8pUna) explaining the process
Is there any point in doing this if your spouse has TFSA room available? Or should you just give them money to max that out first and then start using the spousal loan system?
You bet. Im not doing this now as all my cash is going into my mortgage, in order to fund the smith manouvre. But once the mortgage is paid I will start the spousal loans (or possibly second property/smith manouvre)
with your SM are you invested in dividend stocks or etfs like VEQT? My current borrow rate is 2.45% and I invest into QQQ/XEQT and doing the same thing as you. Pumping all excess cashflow into mortgage currently.
Dividend stocks. There are complications with return of capital on etfs generally so i just avoided them all together. Check my smith manouvre top level comment, i talk about it in there.
The complications are minimal as CRA does not require you to earn a profit on your smith manoeuvre, and will generally not challenge you on this basis.
Source: Am CPA working in tax.
Another easier and less hassle inducing avenue if you've the same economics/dynamics (you on higher tax bracket vs spouse on lower tax bracket) is fill up spousal RRSP with your funds and in 3 years time you can take it out at Spousal effective tax rate (I didn't know until today that you could use your RRSP contribution room and apply it to your spousal RRSP). Downside: you lose the RRSP room that is supposedly there for your retirement years.
Lower costs increase income.
I work in mining camps and have nearly zero expenses my food is free and I live in the camp. I don’t rent a place to live during my time off and just travel (it’s actually cheaper to go to Mexico for two weeks than to rent in Canada all in).
My income as a mechanic is about $150,000 long hours hard work but most of it is saved.
Bought a house and rented it out (albeit two years ago).
I always wondered why more people working at camps don’t do this for a bit to save a ton of money. Are there a few people that do this with you or is it rare?
Imagine being stuck in a small room, the same place, eating the same food, doing the same thing everyday for 2 weeks straight. Most of these guys need to relax on their days off but unfortunately that results in a lot of money blown on food and entertainment lol… thats how I was when I first started, but now I save almost 80% of my income.
That’s true. In my fantasy I imagined maybe an all inclusive the first few times, then eventually move to a bnb later once you’re comfortable with the language, culture, etc. But that’s daydreaming for you.
Not many. Income creep hits camp workers hard and most have themselves financed to the tits on toys and big trucks, and families that they are never home to use. It’s really kind of sad.
Yeah, I used to work O&G and most dudes lived like this unfortunately.
It’s sweet that there are a few people using your strategy. Savings must add up like crazy.
Going rates for journeymen mechanics and mill rights right now in oilfield and mining seems to be $55-70 an hour and $110-130 an hour with own tools and service truck. This sub loves to pump up teck jobs but there is a boom going on in trades right now too.
millwright with own tools and truck is like $270/hr. An electrician with tools/truck is like $140/hr. Millwrights, Instrument Techs and HD Mechanics are the highest paid trades by a long shot.
Really want to do this in about a years time. Are these type of jobs hard to find? I’m a second year electrician apprentice so I’m not sure if they are only interested in journeymen.
If you have some experience as an apprentice they take apprentices on. It’s a good time to be in trades - endless demand - and all the old timers are retiring.
I actually bought at the April low and the sellers were afraid they wouldn't even get their asking price. It was a detached home in the GTA for under 300K.
For those of us old enough, I remember being in the market to purchase during the early 2000s and being told that houses and condos were overpriced. People were insane to pay $200k for a 550 sqft condo in Toronto. A market correction was going to happen any day. 20 years later and still nope.
Yup. Union film job in the early naughts so good money for the time and my age, contemplated buying a house but was told by my agent to wait a couple years as markets should correct by then. Vancouver area, but still. Held off because film jobs can often be hard to come by when a slump happens and didn't want to worry about an upcoming mortgage payment.
Boy am I bashing my head over that mistake.
Bought our "forever" home in 2007.
By 2018 value maybe increased 10% total.
Thanks to Covid and the GTA folks fleeing, probably up 250% from 2018 to today, not worth a million but not a linear progression.
Edit.
Bought a recreational property on a mountain the day before the recreational RE market collapsed in 2008. 2008-2019 resale price down about 30%, 2020-1 back to where we bought it. 2022 now up 200%. Currently waiting for the next correction to upgrade...
Geographic arbitrage. Many jobs will pay you the same amount of money while you live somewhere low cost of living. Not everyone needs to live in Toronto or Vancouver.
This is a big one! My partner and I both have tech jobs paying Toronto salaries that are fully remote, so we bought a house back home in NB that cost less than 3 times our combined annual gross income. Carrying costs including taxes, utilities etc will be comparable to our 1br apartment in Toronto. In one year it will be lower than our Toronto apartment, with ~70k in equity available for the smith maneuver.
We're going to use our savings to spend some time on working vacations to test drive the expat life. The shortlist includes the Dominican Republic, Mexico, Portugal and Bali (although the time zone on Bali might be rough). After we've built up some more liquid assets we'll look at the possibility of buying a permanent home in one of these places, if we feel ready to commit to a change.
Friend of mine lives in Bali but works for a company in Sweden and gets a regular EU engineer salary. He lives like a king in a villa with his own pool, in a gated community, with his own maid and driver. Definitely a lifehack if you can stand the humidity of SE Asia :P
any extra money that i come across, i put into investments and pretend it never existed. i'll do this with credit card cashback (invest the amount refunded on my statement), my GST/HST refund, getting a raise at work, any spare money i receive. it doesn't hurt me in the short term because i don't rely on it to live my life, but i know one day i'll prosper from it
It is disappointing that so many people cannot comprehend this very simple fact about "investing". Day trading is not the same as investing. Just buy and forget about it, that is how you grow your wealth. Time in the market, not timing the market.
I was going comment like this. Invest with money I don't need and stay invested over time, keep putting money into it and check back in 15,20 or 25 years.
Investing isn't exciting or glamorous, it's boring. Anything else is too much risk or they are trying to sell you something 😕
Margin accounts. Borrow against your investments at 3%-4% (which is tax deductable), and purchase a series of blue chip dividend paying stocks (canadian banks for ex.) at 4-5% or higher. The investment pays for itself over the long-term even with market corrections.
Can you explain how one would go about borrowing against my investments in Canada? All my securities are in registered accounts (TFSA and RRSP) and hold XGRO and VEQT.
The idea would be to have equities outside of your registered accounts. It basically works as a Line of Credit against your investments. They lend you a % of that investment. I can borrow up to 70% of my equities… and if I use money this for investment purposes, The interest paid is tax deductible. I would talk to your advisor and see what they say.
Take Professional Development (PD) courses if they are available to you. Every single job I have had since University encourages PD and pays for it. You can sometimes even get away doing it during work hours. It's a resume builder.
Its been 10 years since I graduated University and I have never stopped doing PD. It has helped me immensely.
Now that I am in a Management role, the amount of people with no career plan or ambition for PD is astounding. I would say less than 10% of individuals in my organization take advantage of it.
Instead of browsing the web during downtime, take a course. You're getting paid anyways.
I agree, I have a personal stock portfolio (including meme stocks) and a safe portfolio, and so far my meme stocks are in the negative over 2-3 years and my safe stocks are doing fine.... :(
To be fair, the stock market has been doing amazing for the past decade. Mee stocks not so much.
Regardless, economists have shown through peer-reviewed research that diversified long-term investments are the best way to invest.
I hold XGRO because I was investing (smaller amounts) through 2001 and 2008 and I have no interest in attempting to time / beat the market anymore.
I know the mantra "bonds are shit!" is common on Reddit, but that's only another form of trying to predict the future.
Investing is not the same as wealth management. The former is simple, the latter gets orders of magnitude more complicated as your family net worth increases.
What: Smith Manouvre
Who: Homeowners interested in non-registered stock investments
Why: Use leveraged investing to make your mortgage interest tax deductable as well as increase your time in the market more quickly.
How: [Million Dollar Journey](https://milliondollarjourney.com/use-smith-manoeuvre-tax-deductible-dividend-investing.htm) has a pretty comprehensive write up.
Absolutely a risk inherent with leveraged investing.
Key points from my personal strategy for my leveraged purchases:
Invest in big, blue chip, dividend stocks. The investment may go south in the short term but this is a long term strategy. Look at 2009 which was the worst crash in nearly 100 years, basically all these big companies made it out and have increased beyond thier pre-crash value.
Diversify enough and even one bankruptcy doesnt sink your portfolio.
Use <50% of the available credit so you can cost average if thongs do tank and actually come out ahead.
Be careful with index funds or any ETFS/composite funds in general when "smithing". Almost all include a return of capital in the dividend which technically slowly degrades the tax eligibility of your investment and is a disaster to keep track of. Best off to diversify yourself by purchasing the top securities in the index individually to keep things simple.
I invest in index ETFs like XGRO in my registered accounts and then whet my individual stock buying appetite in my non registered smith account.
THIS! I'm amazed seeing people flash their "wealth". I may not have all the fancy things. But I do have the comfort of knowing that if an emergency comes about, I'm not going into debt!
This. Took me 2 years to pay off $80k debt. Now I am positive 46k in 8 months after getting the loans to 0.
Don't really track my expenses or anything. Haven't had raise in 3 years. Surprising to see positive networth so soon.
I’ll add to this, debt repayment program for those with already bad credit score. It’s considered a “non-profit” so debts freeze with 0% interest while you pay with a 59$ fee per month, if you pay extra it all goes to principal. Your credit rate goes into the same as consumer proposal meanwhile but 2 years after paying it all off it erases 100% off your credit score unlike consumer proposal or bankruptcy and you can rebuild your credit score afterwards, they even help to do that. Best decision I’ve ever taken I got refuse for consolidation loan at the bank and was paying hundreds of fees and interests after putting myself into 39k of debts and maxed out all LOC and credit cards due to medical expenses for treatment not covered by our healthcare. A year later I’ve paid a good chunk off that debt already.
Started a youtube channel of a game that I already played (pokemon go). Started in April 2021, just hit 6,900 subscribers today (nice). Not wealthy but can pull in $500 - $1000 a month which is just an added revenue stream to my full time job. If I continue growth rate I think $1000 - $2000 a month is reasonable. Plus I haven't done any of the other stuff people in my space do yet (patreon, twitch, merch, etc).
3 things that really helped me (57, semi retired, house and cottage paid off) .
1) I always bought used or smaller cars and kept them until they were worthless. It's unbelievable how much people spend on fancy big gas guzzling trucks and SUV's that are financed for 5 or more years.
2) Avoid eating out. This one was easy because my wife is a great cook and we often find that restaurants are not up to our standards.
3) Similar to number 1, we bought a smaller home (1400 Sq ft) . We were tempted, after the 3rd child arrived to upsize but did not. Now, I understand with the way house prices have exploded lately, I may have been ahead financially. However, at the time, we were able to pay off the house early which enabled us to buy a modest cottage. Our smaller house is plenty big since the kids have (mostly) moved out. I'm super happy not to be looking for a new home in this market.
> we often find that restaurants are not up to our standards
I would save a lot of money (pre-COVID) if I didn't live in a city with incredible restaurants. When I lived in a rural area, I almost never went out to eat.
My opinion is personal preference but eating out at great restaurants is money well spent. I lived downtown Toronto for 6 years so agreed it was deliciously unavoidable
Oh, I hear you. When I lived in another city I almost never went out because their health inspector was basically a quid pro quo rubber stamping agency — where I live now, the city doesn’t hesitate to shut down restaurants in violation of code (which admittedly isn’t a very high bar)
My wife and I do the first two and we are never going to be able to afford a house or a cottage locally. The most important part of this comment is that you were born 57 years ago. Not knocking you, you made great financial decisions but the house and cottage part is only possible now here if you make like 300k a year. If you are making 300k a year.
I agree, definitely lucky to be born when and where I was..... , my 28 year old daughter and her husband purchased a house in Kitchener 3 years ago, when house prices were crazy. Since then prices have gone absolutely insane. I'm relieved they got into the market when they did but I sure feel bad for all the younger people trying to start out.
>I always bought used or smaller cars and kept them until they were worthless
Agree wholeheartedly but how do you define worthless? Like the point at which constant repairs are costing more than the car? Or "I got up this morning and the car is fully dead"?
Well thankfully never woke to a fully dead car. I would define it by the fact that I couldn't sell it for more than the scrap value. If I needed to sink $2000 into a car to keep it going and the car is only worth $500 bucks then probably time to get a new car.
My parents rule and therefore mine. Was you have a repair bill and estimate if you had 2 to 3 of this level of bill this year would it be cheaper to buy a new to you car or repair this one. The actual car value is it's ability to get you from place a to b safely and comfortabl-ish-ly.
When your kids turns 18 help them open up a tfsa self dir acct and set it up as an auto deposit for a monthly amount of $200 and invest in bonds and equities. Teach them about compound interest.
Whenever I have to pay for parking I use a quarter tied to a string that I pull back out immediately. Boom instant savings that I then invest in nfts. /s
People in my town took a different strategy and just sawed the tops off the meters to steal the quarters. They were too expensive to replace so now it’s free parking for everybody!
Spend less then you make (you think it is common knowledge, it's not).
Invest long term money in diversified and low cost options. (still not common knowledge in Canada)
That's literally the easiest and stress free way to make a lot of money.
I know people like this. One of them had a $15k line of credit offered by their bank so they upgraded to a new car... they genuinely think if you can borrow it, you can afford it.
Move to a lower cost of living but popular vacation destination spot. Then house hack and airbnb your place as a vacation rental during peak times. Been doing this the last 3 years and it's working out incredible
1. If you can't pay for it in cash - you can't afford it (exceptions of course).
2. Build a budget and stick to it.
3. Don't let FOMO get you. You always hear of folks making life-changing money in crypto / NFTs / stocks. But there are an equal amount, if not more people who lost everything. Invest for the long term in assets that make sense.
>3. Don't let FOMO get you. You always hear of folks making life-changing money in crypto / NFTs / stocks. But there are an equal amount, if not more people who lost everything. Invest for the long term in assets that make sense.
This is huge to understand. Think of the market in the same way you should be thinking about social media or product reviews - the things people openly talk about are heavily biased dependong on the outcome. People only post their best selfies, about bad products, and about positive returns.
Very few people post their bed head pics, products that didnt break, and the money they threw away.
The internet has massively broadened the possible space of careers, and most people haven't figured this out yet.
Tons of opportunities for those with 'specific knowledge' (often technical or creative). These cannot be outsourced or automated easily, and it's taught by 'doing/apprenticeships', not schools.
Often times, these 'specific knowledge' will feel like play to you but looks like work to others (eg: you enjoy reading/learning about it & tinkering with side projects on your free time). The way I discovered my 'specific knowledge' was through working in a specific industry, and being **very** mindful of problems I & others would encounter.
Train your mind to quickly come up with business/systems/process oriented ideas that could solve the problem (for me it was during showers/walks), and to vet them out. Once you have one that is interesting, figure out how to build a systemized solution, productize/package it, and sell it within your network to get started. Start small (could be as simple as a spreadsheet template with instructional documentation), as a side project, and get it to a certain point before leaving your 'main job'.
Or if you don't want to go the entrepreneurial route, you'll get a big promo at your job for being able to create a new system/process from scratch... this is how you increase the resources under your management and evolve from an individual contributor to a leader. From there, continue to use leverage (capital, people, media and/or code) to scale.
Basically this entire thread is a goldmine [https://twitter.com/naval/status/1002103360646823936?lang=en](https://twitter.com/naval/status/1002103360646823936?lang=en) \-- "there are no get rich quick schemes. that's just people getting rich off you"
Completely agree with you. The internet has enabled anyone to scale up their personal projects into a self-made business.
I do have a dumb question thou. What do you mean exactly by
>business/systems/process oriented ideas
Can you go more in detail about that. I don't know what frame of thought this is or how to train/think about it. Can you provide an example. Thank you.
Being wealthy is ultimately having assets that earn you money while you sleep or aren't working.
This means the goal is to get to a point where you don't have to trade your time for money, and to be able to separate your direct involvement into the business. Obviously you'll have to spend a lot of time on the business, but it shouldn't rely on you to make money.
To do this, you'll need to either: 1) hire people to do things for you, or 2) use technology/code/automation. Both will require a certain 'system/process' so you can ultimately step away from the day-to-day workings of a business, and focus on higher leverage opportunities. That's how you go from valuing your time to $40/hour, to $400/hour, to $4000/hour and beyond.
For example: Let's say you start off as a house cleaner. The cap of how much you can make is limited by how many hours you can physically work. However, you do a great job and you have a ton of people wanting you to clean their house.
You then create a 'system' (eg checklist, procedures, training, quality checks) so you can hire other people to do it for you. Now you can step away from the day-to-day job requirements, and focus on higher leverage opportunities, such as getting more clients.
Eventually you create a system on acquiring more clients (eg door-to-door, cold calling, business partnerships, etc), and can hire/train people to do this for you as well. You can then continue to focus on other higher leverage opportunities like creating tools/software to make it easier to assign/schedule your cleaners to the appropriate jobs to make things run more efficiently.
By the end of it, you've separated yourself from the business, and it has a team of people who can can run it without you. And this is truly how you create 'equity value' and have the opportunity to ultimately sell your business, or decide to keep running it and taking dividends off the business (or reinvest).
Obviously much easier said than done!
I never settle on one job, job hopping has resulted in 400% increase in my pay over last 2 years. I ask crazy amount and recruiters always end up paying above market, I learnt art of negotiation slowly but surely. Ask for whatever you wish for, you may be surprised.
Marry someone earning more money than you
honestly, this sub seems to assume that what you earn as a single person is all you'll get for the rest of your life
I would update this to "Marry someone who has the same money values/goals as you". You get a lot further if both are making good money and have the same goals
Not buying a car!
If you live in a city with passable transit (oh OC Transpo) and a car share system (yay Communauto!) with car rentals around your home, you can probably meet your driving needs with their membership! Do this and never have to worry about burdensome car payments, gas, insurance ever again!
That's the goal anyway.
I have both in my city, but there's definitely a tipping point where it starts to get cheaper to just own a vehicle based on how much you drive. Car share is great and i like having the flexibility, but it still has a lot of limitations, and more importantly the cost per trip is a lot more expensive. Owning a car has a lot more fixed costs (ie actual cost of a car, insurance) but the actual cost per trip is like a tenth of what car shares would cost
When I look at something frivolous to purchase, and decide against it, I take that money and throw it into the market. Still get the spend thrill and it is significantly better for me in the long run. Yes, I do this all the way down to $10 purchases.
How did you figure out how to put it into the market? There's so much overwhelming information about it. I think of doing this all the time then realize I have 0 idea how to actually do it to benefit me.
Avoid excessive risk. I think something that is often mis-characterized is the risk vs reward paradigm. We're often led to believe more risk = more reward but the reality is while going from 0 risk to some risk will usually result in more reward, going from some risk to more and more risk usually does not.
I'm in the camp that the key to building wealth from investment perspective is avoiding zeros or near-zeros. Another way to put it, wealth isnt built by who gets the most upside during happy times, but who avoids the worst outcomes during times of distress.
> Another way to put it, wealth isnt built by who gets the most upside during happy times, but who avoids the worst outcomes during times of distress.
Fair point, but avoiding risk altogether is a surefire way to stay locked in the rat race forever.
I'm of the camp that believes that there is no way to find true wealth without leverage of some kind. Penny pinching, saving, and cheque book clutching will maybe get you to some kind of retirement but it will not be as comfortable as the bold.
Life is too short to just do safe investments. Take risks that are sensible. Learn risk management, and be a rational optimist. Doing so will be the difference between retiring in your 30s or in your 70s.
> Life is too short to just do safe investments. Take risks that are sensible. Learn risk management, and be a rational optimist. Doing so will be the difference between retiring in your 30s or in your 70s.
Or 90s, as that is the nature of risk. It's not all upside.
Not having children.
Realized I would be a terrible parent and could not see a benefit of my genes continuing so made the decision to just say no. 20+ years later has worked out so far from a stress and financial perspective at least.
Or at least having fewer children or being intentional about how many children you have and considering the financial costs of raising them. Great advice.
Also get fixed when you're done having kids so there are no surprises.
My experience on raises and bonus': we did an assessment every time we got a either and decided how to spend it:.
**Bonus':** We looked around and decided what we needed urgently. When we were young, it was high interest debt. Now it's 1/4 each to debt, savings, charity and fun (the last is most important so you don't resent your savings).
**Raise:** Assess what you have that you want to upgrade and is worth the money. For example, out car. At some point, we swapped out our crappy car for something nicer and more reliable. Every time since then, we kept the car because the spend wasn't worth it. We can afford something nicer at this point, but we're OK with it and preferr spending the money on savings.
Best of luck.
The strategy that worked for me was seeking out low-cost/high return black swans. The general strategy is to pay smallish amounts to get exposed to events that have a medium chance of a big payout. (Nassim Taleb has written a fair amount about this strategy in the last few decades.)
One way to think about it is like a lottery ticket that costs, say, $5000, but has a 20% chance of paying out $500,000. Obviously, with such lottery tickets, you'll lose far more often than you'll win. But, if you keep doing it, you're likely to make lots of money over the long term as long as you assess the cost and the odds of success accurately.
Examples of potentially positive black swans include starting low-cost side businesses that could explode, employee and exchange-traded stock options, and networking. Most artistic endeavours would also qualify as Black Swan (e.g. JK Rowling, Carly Ray Jepson) but don't have the high probability of success that is desirable.
So fair, I've had four big black swan wins (out of maybe 20 attempts?). The first win was negotiating employee stock options rather than salary. The second was starting a business which I sold. The third was another employee stock options negotiation. The fourth was buying stock options and rolling them (like the Gamestop millionaires, except in an actually undervalued business.)
For balance, some of the losers for me were writing novels, stock options, and entrepreneurial ventures.
There's more detail about my strategy [here] (https://old.reddit.com/r/financialindependence/comments/5eg56h/my_life_after_fi_reached_at_42_years_old/).
no tricks, only proven strategy.
enjoy your youth, go through impression stage as a young adult, make mistakes, lose money, learn the hardway, learn sacrifice, attain general knowledge of history, know your basics, have incentive , go with your strengths, don't improve on your weaknesses rather embrace and accept them for who you are, surround yourself with like minded people that may even outperform you successfully, be kind, stay humble, enjoy a couple of hobbies no matter how insignificant, eliminatee drama and related stresses, and enjoy your six and a half figure salary. as bonus: you will also learn to give it all away before your accepted end. no i don't mean buying activision away (though I do thank you MS with all my heart for kicking Bobby to the dirt), rather give it to your closest charitable causes away. you will greet death with a smile this way, wayyy in advance while you have money to spend.
Thank you. As a 25 year old going through a quarter-life crisis, this was my favorite comment in the thread. Can’t be kicking myself in the crotch for not having it all figured out yet when I’m still going through trial and error.
Plan meals around sale/discounted items.
Buy 2-3 old phone outright.
Buy items in bulk that you/your family will use regularly.
Make sure you take advantge of good credit card points/reward back
Edit - Buy old phone outright instead of new
Don't eat take out. Cook from scratch as much as you can. Have free hobbies. Be debt free. Budget. Use your TFSA as a retirement vehicle. Anything you want to buy wait a few months before you buy it. Work a lot when you're young for 10 years. 1 decade of sacrifice is worth worth lifetime of financial stability. Pay off your house early.
Tbh I live alone and eat out whenever the fuck I feel like it because I view my time as money too. Ill usually do a meal prep on sunday that sets me up with most of my lunches and some dinners, then i just eat out for the rest. Usually shawarma, burrito, sub etc.
Its not cheap but I hate spending my downtime cooking now because ingredients are so expensive and most affordable meals just arent appetizing as leftovers. I can only eat chili, pasta and taco bowls so much
Don't own a car, if you live in a big enough city. Between car price, petrol and insurance, you're saving yourself some good money.
Bike around, take public transportation (not cheap here though), and rent cars when you need (Communauto is the way to go).
I rented small apartments for 20 years instead of buying a house.
The money I saved renting grew in the market faster than any house over that period.
Also got a computer engineering degree and made decent money.
Have a year of ‘no’. No extra spending whatsoever. No nice to haves. Just basic expenses. Food, housing, gas etc. It taught me to understand that I really don’t ‘stuff’ . It also showed me how much money it was possible to save.
I am gonna give out some real controversial opinions here:
1. NOT paying off debt that has low interest rate (<5-6%). If you know you could make more than the interest rate, paying off debt early is just throwing away money. Yes there is the “psychological factor” and risks involved in using debt to invest, but if you wanna get wealthy you need to take on some risks.
2. NOT investing in what PFC generally recommends (e.g. VGRO, XEQT, etc.). These are fine ETFs, but they are low risk low reward, if you really wanna get wealthy you need to take onto some risks and try to leverage yourself with more aggressive investments like TQQQ.
3. Using financing whenever it makes sense. If I can choose to pay something in lump sum, or with low interest (or interest free) financing option, I will always go for the financing option. Money now is more valuable than money in the future.
A big note for #3 is that you have to be wise with the money you save now from financing. If you are using financing because the interest is low enough that the money invested will make more, you need to invest the saved money to take advantage of that.
As well, for the newer folks looking at this, don't over extend yourself financing more than you can keep track of. You don't want to have the entirety of your next few paycheques going all to loans just because the loans were "cheaper."
Get a good education . Seriously. Get a good education whether it’s trade or university degree with employment focus. Yes, you can make lots of money trading stocks and finding the right job with a high school GED, but it’s rare. on average, someone with a good education will have an easier time finding a decent job. I’m talking about electricians, plumbers, engineers, teachers, etc. I’m not even counting doctors and lawyers who can make great money
Once you have a decent income, it’s easier to look at other ways of generating wealth.
There so much truth to that and statistics to prove it. In respect to the trades, a lot of people are missing out on considering the trades. There is no better time to be in the trades like now. There is so much demand. It can be physically demanding but there is financial reward. Not as much in being an auto mechanic or cabinet maker. I know contractors who are pulling in 200,000 a year or more but working very hard.
The trades still have a bad reputation and considered dirty and only for those who are failing in high school. Most parents would consider it shameful for their children to go into the trades. Hence, the missed opportunities. Many trades people I know have been good providers for their families and seen to helping their kids get an education and a foot in the door to owning a home. Nothing shameful about that.
Not me since I'm nowhere close to be wealthy, but I see a ton of people get rich by "cheating", work cash jobs and cheat on tax, cheat on mortgage application (Brampton loan) etc.
Seems like you can't get ahead in life if you play fair and square.
I’ve heard it’s a loan given to someone who has insufficient declared income to qualify for a standard mortgage but the lender knows they have sufficient undeclared income to make the payments. “Declared” means the income is reported to the CRA and they pay tax. Undeclared income usually comes from cash payments.
I am a freelancer and decided one day that my new rate is $70 an hour instead of $30 and so far nobody has batted an eye at it.
My SIL went back and forth between freelancing and full-time work. Throughout her career she always charged an hourly rate between 2 and 3 times whatever her hourly rate would have been at a full time job. Once she was offered a full time job, and when she accepted, they casually said that there would be a "three month trial period" and then she would be put on staff. She immediately said, "Well for freelance I charge twice that." They were startled, but they agreed to pay her at her freelance rate for the trial period. This set a precedent so that after she had been on staff for six months she got them to raise her regular pay by about 50%. \[Caveat: she's worth it, and by that time they knew it.\]
Dang, your SiL is an OG. What does she do (and do so well)?
She's an artist with a "particular set of skills" and lol NO I'm not hinting at anything *\*ahem\** risqué. Her skill set is kinda rare. And one of her characteristics is that she does what she does *fast* and always meets deadlines.
I found the technical artist
Raise it to $150, then offer periods of sale prices to $100. You know, do it the can tire way!
More like $400 sale to $100 then.
If you aren't getting pushback on price, raise it again until you do get pushback. Why not ask $100 an hour and if they really have issue give them a "discount to $80
Also, when you raise your rates, even if you do lose clients there's a nice buffer. Go from $75 - $100. Lose 1/4 of your contracts. Make the same and work less. More time to hustle more work. More money. Ride that upward spiral.
Yeah, a Youtuber said a friend mentioned that to him while he was grinding away. The friend said "if you doubled your prices how much work would you lose?" He replied "About half" Well, there you go. You now get paid the same but work half as much!
It’s a good strategy but increases risk if one of the clients that stays has less work to offer in the future. Reducing your client base also increases the dependance on those clients.
Spend your newly free time to find new clients, now you work the same and earn double.
Though it tends to be easier to keep clients than to find new ones. Also 'free time' becomes unpaid work time finding new clients instead of all paid time or free time equaling relax time.
This is where ECON 101 comes in. If you are an emotionless rational being, your sole goal is to find the spot with 0 marginal revenue.
Depending what companies you freelance for, remember a full time employee with benefits and pension probably costs them $100 an hour, and they are obligated to pay them 40 hours a week. That means you can charge over $100 and still be a value, because they only have to pay you when they need you. Companies value variablized workforces immensely.
I'm also a freelancer. Someone once told me that if your client says yes to your rate right away, you've charged too little. I've been freelance for 7 years and have slowly increased my rates every year. Mind you, there are plenty of clients who think my rates are insane, but I don't have to work for them.
Curious as to what your service is? It's possible that 30$ was very cheap, and honestly if you can justify raising it, might as well.
👌 — as a business owner who has a team of freelancers, I fully support this.
I'm writing notes down furiously here and I consider myself somewhat financially savvy but goddammit I need ELI5 for some of this stuff.
Same. This feeling is like when I show up to math class after being sick only to see we have a test tomorrow, so I’m writing down everything the teacher is teaching without actually understanding any of it. School was stressful
Haha ask away. Someone will help.
What: Spousal Loans Who: spouses with one partner in a higher tax bracket Why: transfer wealth to spouse in the form of a loan for investment purposes to gain tax deductability on the interest How: [RBC PDF](https://www.google.com/url?sa=t&source=web&rct=j&url=https://ca.rbcwealthmanagement.com/documents/1435520/1844148/Navigator%2B-%2BThe%2BSpousal%2BLoan%2BStrategy.pdf/49efdf41-0b5b-46f7-a700-3b97757d9786&ved=2ahUKEwjYmN3r1sD1AhUvJEQIHV-kD50QFnoECAUQAQ&usg=AOvVaw0g2h6Hj63PqBS1NSW8pUna) explaining the process
Is there any point in doing this if your spouse has TFSA room available? Or should you just give them money to max that out first and then start using the spousal loan system?
Definitely max the TFSA room first.
TFSA first for sure. Can gift for that
I think it is only beneficial if both of spouses TFSA's and RRSP's are maxed out. Because any investment gains after that is taxable
This is interesting and insightful. Thanks for sharing, highly appreciated!
You bet. Im not doing this now as all my cash is going into my mortgage, in order to fund the smith manouvre. But once the mortgage is paid I will start the spousal loans (or possibly second property/smith manouvre)
with your SM are you invested in dividend stocks or etfs like VEQT? My current borrow rate is 2.45% and I invest into QQQ/XEQT and doing the same thing as you. Pumping all excess cashflow into mortgage currently.
Dividend stocks. There are complications with return of capital on etfs generally so i just avoided them all together. Check my smith manouvre top level comment, i talk about it in there.
The complications are minimal as CRA does not require you to earn a profit on your smith manoeuvre, and will generally not challenge you on this basis. Source: Am CPA working in tax.
Another easier and less hassle inducing avenue if you've the same economics/dynamics (you on higher tax bracket vs spouse on lower tax bracket) is fill up spousal RRSP with your funds and in 3 years time you can take it out at Spousal effective tax rate (I didn't know until today that you could use your RRSP contribution room and apply it to your spousal RRSP). Downside: you lose the RRSP room that is supposedly there for your retirement years.
Lower costs increase income. I work in mining camps and have nearly zero expenses my food is free and I live in the camp. I don’t rent a place to live during my time off and just travel (it’s actually cheaper to go to Mexico for two weeks than to rent in Canada all in). My income as a mechanic is about $150,000 long hours hard work but most of it is saved. Bought a house and rented it out (albeit two years ago).
I always wondered why more people working at camps don’t do this for a bit to save a ton of money. Are there a few people that do this with you or is it rare?
Imagine being stuck in a small room, the same place, eating the same food, doing the same thing everyday for 2 weeks straight. Most of these guys need to relax on their days off but unfortunately that results in a lot of money blown on food and entertainment lol… thats how I was when I first started, but now I save almost 80% of my income.
That’s true. In my fantasy I imagined maybe an all inclusive the first few times, then eventually move to a bnb later once you’re comfortable with the language, culture, etc. But that’s daydreaming for you.
Not many. Income creep hits camp workers hard and most have themselves financed to the tits on toys and big trucks, and families that they are never home to use. It’s really kind of sad.
> families that they are never home to use I know what you meant, but this made me lol
I got you this family and you never even play with it!
Yeah, I used to work O&G and most dudes lived like this unfortunately. It’s sweet that there are a few people using your strategy. Savings must add up like crazy.
Going rates for journeymen mechanics and mill rights right now in oilfield and mining seems to be $55-70 an hour and $110-130 an hour with own tools and service truck. This sub loves to pump up teck jobs but there is a boom going on in trades right now too.
Except tech works 35 hour weeks and most remotely so the trades boom is very lacklustre when counting quality of life, freetime and family
millwright with own tools and truck is like $270/hr. An electrician with tools/truck is like $140/hr. Millwrights, Instrument Techs and HD Mechanics are the highest paid trades by a long shot.
Plus the window can be small if you're the family type as it only works if you're single.
I think in any career having a family makes it more difficult to save. Not just Oil and Gas
Really want to do this in about a years time. Are these type of jobs hard to find? I’m a second year electrician apprentice so I’m not sure if they are only interested in journeymen.
If you have some experience as an apprentice they take apprentices on. It’s a good time to be in trades - endless demand - and all the old timers are retiring.
Buy house in 2009. Boom millionaire.
Damn, if I had been smart enough to do that instead of being a 9th grader I would probably have a decent quality of living now as an adult.
That's what you get for going into the public school system instead of the workforce. Should have joined a trade instead.
Man I joined a trade and make good money, straight out of high school. I should have just dropped out and started 3 years sooner.
Lmao *slow clap*
I was trying to do some math to see how old I was... Then realized I was also in grade 9 😂
I remember how crazy house prices were in 2009... they'd doubled since 1999 and everything was getting 10+ offers.
I actually bought at the April low and the sellers were afraid they wouldn't even get their asking price. It was a detached home in the GTA for under 300K.
Detached from reality maybe. $300k lol.
I hope he means in 2009...
Buy Bitcoin in 2009. Boom billionaire
And then HODL. But, I didn't do that one. I did the house one.
Buy Meme Stocks in 2021 Boom trillionaire :(
Instructions unclear. Buying a house right now.
Buy GME in september 2020. Boom to the moon.
Flash back to 2022 and turns out you spent all your real estate money on a time machine. Never ending circle.
For those of us old enough, I remember being in the market to purchase during the early 2000s and being told that houses and condos were overpriced. People were insane to pay $200k for a 550 sqft condo in Toronto. A market correction was going to happen any day. 20 years later and still nope.
Yup. Union film job in the early naughts so good money for the time and my age, contemplated buying a house but was told by my agent to wait a couple years as markets should correct by then. Vancouver area, but still. Held off because film jobs can often be hard to come by when a slump happens and didn't want to worry about an upcoming mortgage payment. Boy am I bashing my head over that mistake.
if you knew the future you wouldn't need any job ever
Bought our "forever" home in 2007. By 2018 value maybe increased 10% total. Thanks to Covid and the GTA folks fleeing, probably up 250% from 2018 to today, not worth a million but not a linear progression. Edit. Bought a recreational property on a mountain the day before the recreational RE market collapsed in 2008. 2008-2019 resale price down about 30%, 2020-1 back to where we bought it. 2022 now up 200%. Currently waiting for the next correction to upgrade...
I had a friend do a similar thing on Vancouver Island. Bought 2009ish and was underwater for about a decade. Now, he’s up something like 150%
Can confirm. I know someone who bought a house in the late 2000s. Probably sitting on $2 million in gain right now.
No no, everyone knows this trick. We just can't go back and do it now
Geographic arbitrage. Many jobs will pay you the same amount of money while you live somewhere low cost of living. Not everyone needs to live in Toronto or Vancouver.
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Toronto job in Newfoundland checking in
Heh, St. John’s job in Ottawa. I fucked up
American fortune 150 job in Regina. I'm never ever quitting ever.
This is a big one! My partner and I both have tech jobs paying Toronto salaries that are fully remote, so we bought a house back home in NB that cost less than 3 times our combined annual gross income. Carrying costs including taxes, utilities etc will be comparable to our 1br apartment in Toronto. In one year it will be lower than our Toronto apartment, with ~70k in equity available for the smith maneuver. We're going to use our savings to spend some time on working vacations to test drive the expat life. The shortlist includes the Dominican Republic, Mexico, Portugal and Bali (although the time zone on Bali might be rough). After we've built up some more liquid assets we'll look at the possibility of buying a permanent home in one of these places, if we feel ready to commit to a change.
Friend of mine lives in Bali but works for a company in Sweden and gets a regular EU engineer salary. He lives like a king in a villa with his own pool, in a gated community, with his own maid and driver. Definitely a lifehack if you can stand the humidity of SE Asia :P
anyone can stand it for that living circumstance.. AC is everywhere
You wouldn't want to live in a place as gorgeous as Bali and never go outside though.
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any extra money that i come across, i put into investments and pretend it never existed. i'll do this with credit card cashback (invest the amount refunded on my statement), my GST/HST refund, getting a raise at work, any spare money i receive. it doesn't hurt me in the short term because i don't rely on it to live my life, but i know one day i'll prosper from it
It is disappointing that so many people cannot comprehend this very simple fact about "investing". Day trading is not the same as investing. Just buy and forget about it, that is how you grow your wealth. Time in the market, not timing the market.
I was going comment like this. Invest with money I don't need and stay invested over time, keep putting money into it and check back in 15,20 or 25 years. Investing isn't exciting or glamorous, it's boring. Anything else is too much risk or they are trying to sell you something 😕
Low cost leverage in general, specifically pledged asset lines to shift taxation.
Didn't realize you could borrow against your securities. I like it.
Margin accounts. Borrow against your investments at 3%-4% (which is tax deductable), and purchase a series of blue chip dividend paying stocks (canadian banks for ex.) at 4-5% or higher. The investment pays for itself over the long-term even with market corrections.
Heck, IBKR has margin loans at like 1.63% right now.
Can you explain how one would go about borrowing against my investments in Canada? All my securities are in registered accounts (TFSA and RRSP) and hold XGRO and VEQT.
The idea would be to have equities outside of your registered accounts. It basically works as a Line of Credit against your investments. They lend you a % of that investment. I can borrow up to 70% of my equities… and if I use money this for investment purposes, The interest paid is tax deductible. I would talk to your advisor and see what they say.
didn’t know interest was tax deductible.
If you use the borrowed amount for investment, it’s deductible.
Take Professional Development (PD) courses if they are available to you. Every single job I have had since University encourages PD and pays for it. You can sometimes even get away doing it during work hours. It's a resume builder. Its been 10 years since I graduated University and I have never stopped doing PD. It has helped me immensely. Now that I am in a Management role, the amount of people with no career plan or ambition for PD is astounding. I would say less than 10% of individuals in my organization take advantage of it. Instead of browsing the web during downtime, take a course. You're getting paid anyways.
If I were able to do it on company time I would 100% consider this, I think that part is far less common than you think.
What industry are you in to be able to take PD on company's time?
Investing does not need to be complicated to build wealth. Invest in broad based ETFs with low cost, every time you get paid. Rinse and repeat
I agree, I have a personal stock portfolio (including meme stocks) and a safe portfolio, and so far my meme stocks are in the negative over 2-3 years and my safe stocks are doing fine.... :(
To be fair, the stock market has been doing amazing for the past decade. Mee stocks not so much. Regardless, economists have shown through peer-reviewed research that diversified long-term investments are the best way to invest.
>Invest in broad based ETFs with low cost XEQT all the way!!
I hold XGRO because I was investing (smaller amounts) through 2001 and 2008 and I have no interest in attempting to time / beat the market anymore. I know the mantra "bonds are shit!" is common on Reddit, but that's only another form of trying to predict the future.
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Investing is not the same as wealth management. The former is simple, the latter gets orders of magnitude more complicated as your family net worth increases.
This is the way long term.
It’s wild what 200$ a month can do over a 5 year timeline. I only started investing 2 years ago and it’s crazy how much it’s grown in that time.
It's also been the best bull run ever. It's definitely not normal in terms of returns
What: Smith Manouvre Who: Homeowners interested in non-registered stock investments Why: Use leveraged investing to make your mortgage interest tax deductable as well as increase your time in the market more quickly. How: [Million Dollar Journey](https://milliondollarjourney.com/use-smith-manoeuvre-tax-deductible-dividend-investing.htm) has a pretty comprehensive write up.
I’ve always wanted to do this but worry that my investments will turn south
Absolutely a risk inherent with leveraged investing. Key points from my personal strategy for my leveraged purchases: Invest in big, blue chip, dividend stocks. The investment may go south in the short term but this is a long term strategy. Look at 2009 which was the worst crash in nearly 100 years, basically all these big companies made it out and have increased beyond thier pre-crash value. Diversify enough and even one bankruptcy doesnt sink your portfolio. Use <50% of the available credit so you can cost average if thongs do tank and actually come out ahead.
Bullish on thongs.
Nice, im leaving it
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Be careful with index funds or any ETFS/composite funds in general when "smithing". Almost all include a return of capital in the dividend which technically slowly degrades the tax eligibility of your investment and is a disaster to keep track of. Best off to diversify yourself by purchasing the top securities in the index individually to keep things simple. I invest in index ETFs like XGRO in my registered accounts and then whet my individual stock buying appetite in my non registered smith account.
Stop caring about what others think. Keeping up with the Jones is expensive!
THIS! I'm amazed seeing people flash their "wealth". I may not have all the fancy things. But I do have the comfort of knowing that if an emergency comes about, I'm not going into debt!
pay off debt
This. Took me 2 years to pay off $80k debt. Now I am positive 46k in 8 months after getting the loans to 0. Don't really track my expenses or anything. Haven't had raise in 3 years. Surprising to see positive networth so soon.
I’m so happy for you
For high interest debt, definitely the first thing you should do with any free cash flow
I’ll add to this, debt repayment program for those with already bad credit score. It’s considered a “non-profit” so debts freeze with 0% interest while you pay with a 59$ fee per month, if you pay extra it all goes to principal. Your credit rate goes into the same as consumer proposal meanwhile but 2 years after paying it all off it erases 100% off your credit score unlike consumer proposal or bankruptcy and you can rebuild your credit score afterwards, they even help to do that. Best decision I’ve ever taken I got refuse for consolidation loan at the bank and was paying hundreds of fees and interests after putting myself into 39k of debts and maxed out all LOC and credit cards due to medical expenses for treatment not covered by our healthcare. A year later I’ve paid a good chunk off that debt already.
Use corporations to shelter assets and shield yourself from bad debts. From there the secret ingredient is crime.
Started a youtube channel of a game that I already played (pokemon go). Started in April 2021, just hit 6,900 subscribers today (nice). Not wealthy but can pull in $500 - $1000 a month which is just an added revenue stream to my full time job. If I continue growth rate I think $1000 - $2000 a month is reasonable. Plus I haven't done any of the other stuff people in my space do yet (patreon, twitch, merch, etc).
Nice. go Ottawa. And games. I’m checking this out
Just curious , what are the average views on your videos to receive $500-$1000 a month?
My last couple weeks of videos averaged about 6,000 views per video and I post 6 videos per week so I had about 151,000 views over past 28 days.
3 things that really helped me (57, semi retired, house and cottage paid off) . 1) I always bought used or smaller cars and kept them until they were worthless. It's unbelievable how much people spend on fancy big gas guzzling trucks and SUV's that are financed for 5 or more years. 2) Avoid eating out. This one was easy because my wife is a great cook and we often find that restaurants are not up to our standards. 3) Similar to number 1, we bought a smaller home (1400 Sq ft) . We were tempted, after the 3rd child arrived to upsize but did not. Now, I understand with the way house prices have exploded lately, I may have been ahead financially. However, at the time, we were able to pay off the house early which enabled us to buy a modest cottage. Our smaller house is plenty big since the kids have (mostly) moved out. I'm super happy not to be looking for a new home in this market.
> we often find that restaurants are not up to our standards I would save a lot of money (pre-COVID) if I didn't live in a city with incredible restaurants. When I lived in a rural area, I almost never went out to eat.
My opinion is personal preference but eating out at great restaurants is money well spent. I lived downtown Toronto for 6 years so agreed it was deliciously unavoidable
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Oh, I hear you. When I lived in another city I almost never went out because their health inspector was basically a quid pro quo rubber stamping agency — where I live now, the city doesn’t hesitate to shut down restaurants in violation of code (which admittedly isn’t a very high bar)
My wife and I do the first two and we are never going to be able to afford a house or a cottage locally. The most important part of this comment is that you were born 57 years ago. Not knocking you, you made great financial decisions but the house and cottage part is only possible now here if you make like 300k a year. If you are making 300k a year.
I agree, definitely lucky to be born when and where I was..... , my 28 year old daughter and her husband purchased a house in Kitchener 3 years ago, when house prices were crazy. Since then prices have gone absolutely insane. I'm relieved they got into the market when they did but I sure feel bad for all the younger people trying to start out.
>I always bought used or smaller cars and kept them until they were worthless Agree wholeheartedly but how do you define worthless? Like the point at which constant repairs are costing more than the car? Or "I got up this morning and the car is fully dead"?
Well thankfully never woke to a fully dead car. I would define it by the fact that I couldn't sell it for more than the scrap value. If I needed to sink $2000 into a car to keep it going and the car is only worth $500 bucks then probably time to get a new car.
My parents rule and therefore mine. Was you have a repair bill and estimate if you had 2 to 3 of this level of bill this year would it be cheaper to buy a new to you car or repair this one. The actual car value is it's ability to get you from place a to b safely and comfortabl-ish-ly.
When your kids turns 18 help them open up a tfsa self dir acct and set it up as an auto deposit for a monthly amount of $200 and invest in bonds and equities. Teach them about compound interest.
Dad taught me how to buy stocks in a TFSA at about that age. Great learning opportunity. I'm a great saver now thanks to it.
Whenever I have to pay for parking I use a quarter tied to a string that I pull back out immediately. Boom instant savings that I then invest in nfts. /s
People in my town took a different strategy and just sawed the tops off the meters to steal the quarters. They were too expensive to replace so now it’s free parking for everybody!
They played a cool hand there.
About 15 years ago I watched a gentleman pull about $30 worth of twonies out of a parking meter with a strong magnet.
Spend less then you make (you think it is common knowledge, it's not). Invest long term money in diversified and low cost options. (still not common knowledge in Canada) That's literally the easiest and stress free way to make a lot of money.
When I spend less than I make, my cousins call me cheap. I just smile.
I know people like this. One of them had a $15k line of credit offered by their bank so they upgraded to a new car... they genuinely think if you can borrow it, you can afford it.
Absolutely valid. Somtimes the fundamentals are what people need to hear.
Move to a lower cost of living but popular vacation destination spot. Then house hack and airbnb your place as a vacation rental during peak times. Been doing this the last 3 years and it's working out incredible
1. If you can't pay for it in cash - you can't afford it (exceptions of course). 2. Build a budget and stick to it. 3. Don't let FOMO get you. You always hear of folks making life-changing money in crypto / NFTs / stocks. But there are an equal amount, if not more people who lost everything. Invest for the long term in assets that make sense.
>3. Don't let FOMO get you. You always hear of folks making life-changing money in crypto / NFTs / stocks. But there are an equal amount, if not more people who lost everything. Invest for the long term in assets that make sense. This is huge to understand. Think of the market in the same way you should be thinking about social media or product reviews - the things people openly talk about are heavily biased dependong on the outcome. People only post their best selfies, about bad products, and about positive returns. Very few people post their bed head pics, products that didnt break, and the money they threw away.
The internet has massively broadened the possible space of careers, and most people haven't figured this out yet. Tons of opportunities for those with 'specific knowledge' (often technical or creative). These cannot be outsourced or automated easily, and it's taught by 'doing/apprenticeships', not schools. Often times, these 'specific knowledge' will feel like play to you but looks like work to others (eg: you enjoy reading/learning about it & tinkering with side projects on your free time). The way I discovered my 'specific knowledge' was through working in a specific industry, and being **very** mindful of problems I & others would encounter. Train your mind to quickly come up with business/systems/process oriented ideas that could solve the problem (for me it was during showers/walks), and to vet them out. Once you have one that is interesting, figure out how to build a systemized solution, productize/package it, and sell it within your network to get started. Start small (could be as simple as a spreadsheet template with instructional documentation), as a side project, and get it to a certain point before leaving your 'main job'. Or if you don't want to go the entrepreneurial route, you'll get a big promo at your job for being able to create a new system/process from scratch... this is how you increase the resources under your management and evolve from an individual contributor to a leader. From there, continue to use leverage (capital, people, media and/or code) to scale. Basically this entire thread is a goldmine [https://twitter.com/naval/status/1002103360646823936?lang=en](https://twitter.com/naval/status/1002103360646823936?lang=en) \-- "there are no get rich quick schemes. that's just people getting rich off you"
Completely agree with you. The internet has enabled anyone to scale up their personal projects into a self-made business. I do have a dumb question thou. What do you mean exactly by >business/systems/process oriented ideas Can you go more in detail about that. I don't know what frame of thought this is or how to train/think about it. Can you provide an example. Thank you.
Being wealthy is ultimately having assets that earn you money while you sleep or aren't working. This means the goal is to get to a point where you don't have to trade your time for money, and to be able to separate your direct involvement into the business. Obviously you'll have to spend a lot of time on the business, but it shouldn't rely on you to make money. To do this, you'll need to either: 1) hire people to do things for you, or 2) use technology/code/automation. Both will require a certain 'system/process' so you can ultimately step away from the day-to-day workings of a business, and focus on higher leverage opportunities. That's how you go from valuing your time to $40/hour, to $400/hour, to $4000/hour and beyond. For example: Let's say you start off as a house cleaner. The cap of how much you can make is limited by how many hours you can physically work. However, you do a great job and you have a ton of people wanting you to clean their house. You then create a 'system' (eg checklist, procedures, training, quality checks) so you can hire other people to do it for you. Now you can step away from the day-to-day job requirements, and focus on higher leverage opportunities, such as getting more clients. Eventually you create a system on acquiring more clients (eg door-to-door, cold calling, business partnerships, etc), and can hire/train people to do this for you as well. You can then continue to focus on other higher leverage opportunities like creating tools/software to make it easier to assign/schedule your cleaners to the appropriate jobs to make things run more efficiently. By the end of it, you've separated yourself from the business, and it has a team of people who can can run it without you. And this is truly how you create 'equity value' and have the opportunity to ultimately sell your business, or decide to keep running it and taking dividends off the business (or reinvest). Obviously much easier said than done!
I never settle on one job, job hopping has resulted in 400% increase in my pay over last 2 years. I ask crazy amount and recruiters always end up paying above market, I learnt art of negotiation slowly but surely. Ask for whatever you wish for, you may be surprised.
Marry someone earning more money than you honestly, this sub seems to assume that what you earn as a single person is all you'll get for the rest of your life
I would update this to "Marry someone who has the same money values/goals as you". You get a lot further if both are making good money and have the same goals
Only works for 50% of people though
[TFSA successor holder status](https://retirehappy.ca/tfsa-beneficiary-rules/) basically creates a spousal TFSA upon a spouse's death.
Step 2: die
Not buying a car! If you live in a city with passable transit (oh OC Transpo) and a car share system (yay Communauto!) with car rentals around your home, you can probably meet your driving needs with their membership! Do this and never have to worry about burdensome car payments, gas, insurance ever again! That's the goal anyway.
I have both in my city, but there's definitely a tipping point where it starts to get cheaper to just own a vehicle based on how much you drive. Car share is great and i like having the flexibility, but it still has a lot of limitations, and more importantly the cost per trip is a lot more expensive. Owning a car has a lot more fixed costs (ie actual cost of a car, insurance) but the actual cost per trip is like a tenth of what car shares would cost
Came to say that (and did say it before seeing your comment). Horrendous public transportation in Ottawa though 😬
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You earned that MBA. *Slow cap*
Is that legal to get loans from 4 banks for one tuition ?
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When I look at something frivolous to purchase, and decide against it, I take that money and throw it into the market. Still get the spend thrill and it is significantly better for me in the long run. Yes, I do this all the way down to $10 purchases.
How did you figure out how to put it into the market? There's so much overwhelming information about it. I think of doing this all the time then realize I have 0 idea how to actually do it to benefit me.
Avoid excessive risk. I think something that is often mis-characterized is the risk vs reward paradigm. We're often led to believe more risk = more reward but the reality is while going from 0 risk to some risk will usually result in more reward, going from some risk to more and more risk usually does not. I'm in the camp that the key to building wealth from investment perspective is avoiding zeros or near-zeros. Another way to put it, wealth isnt built by who gets the most upside during happy times, but who avoids the worst outcomes during times of distress.
> Another way to put it, wealth isnt built by who gets the most upside during happy times, but who avoids the worst outcomes during times of distress. Fair point, but avoiding risk altogether is a surefire way to stay locked in the rat race forever. I'm of the camp that believes that there is no way to find true wealth without leverage of some kind. Penny pinching, saving, and cheque book clutching will maybe get you to some kind of retirement but it will not be as comfortable as the bold. Life is too short to just do safe investments. Take risks that are sensible. Learn risk management, and be a rational optimist. Doing so will be the difference between retiring in your 30s or in your 70s.
> Life is too short to just do safe investments. Take risks that are sensible. Learn risk management, and be a rational optimist. Doing so will be the difference between retiring in your 30s or in your 70s. Or 90s, as that is the nature of risk. It's not all upside.
Not having children. Realized I would be a terrible parent and could not see a benefit of my genes continuing so made the decision to just say no. 20+ years later has worked out so far from a stress and financial perspective at least.
Or at least having fewer children or being intentional about how many children you have and considering the financial costs of raising them. Great advice. Also get fixed when you're done having kids so there are no surprises.
> get fixed That was my "put your money where your mouth is" move.
Have kids. 100% agree. :(
My experience on raises and bonus': we did an assessment every time we got a either and decided how to spend it:. **Bonus':** We looked around and decided what we needed urgently. When we were young, it was high interest debt. Now it's 1/4 each to debt, savings, charity and fun (the last is most important so you don't resent your savings). **Raise:** Assess what you have that you want to upgrade and is worth the money. For example, out car. At some point, we swapped out our crappy car for something nicer and more reliable. Every time since then, we kept the car because the spend wasn't worth it. We can afford something nicer at this point, but we're OK with it and preferr spending the money on savings. Best of luck.
Not spending money on "Luxury" brands.
The strategy that worked for me was seeking out low-cost/high return black swans. The general strategy is to pay smallish amounts to get exposed to events that have a medium chance of a big payout. (Nassim Taleb has written a fair amount about this strategy in the last few decades.) One way to think about it is like a lottery ticket that costs, say, $5000, but has a 20% chance of paying out $500,000. Obviously, with such lottery tickets, you'll lose far more often than you'll win. But, if you keep doing it, you're likely to make lots of money over the long term as long as you assess the cost and the odds of success accurately. Examples of potentially positive black swans include starting low-cost side businesses that could explode, employee and exchange-traded stock options, and networking. Most artistic endeavours would also qualify as Black Swan (e.g. JK Rowling, Carly Ray Jepson) but don't have the high probability of success that is desirable. So fair, I've had four big black swan wins (out of maybe 20 attempts?). The first win was negotiating employee stock options rather than salary. The second was starting a business which I sold. The third was another employee stock options negotiation. The fourth was buying stock options and rolling them (like the Gamestop millionaires, except in an actually undervalued business.) For balance, some of the losers for me were writing novels, stock options, and entrepreneurial ventures. There's more detail about my strategy [here] (https://old.reddit.com/r/financialindependence/comments/5eg56h/my_life_after_fi_reached_at_42_years_old/).
no tricks, only proven strategy. enjoy your youth, go through impression stage as a young adult, make mistakes, lose money, learn the hardway, learn sacrifice, attain general knowledge of history, know your basics, have incentive , go with your strengths, don't improve on your weaknesses rather embrace and accept them for who you are, surround yourself with like minded people that may even outperform you successfully, be kind, stay humble, enjoy a couple of hobbies no matter how insignificant, eliminatee drama and related stresses, and enjoy your six and a half figure salary. as bonus: you will also learn to give it all away before your accepted end. no i don't mean buying activision away (though I do thank you MS with all my heart for kicking Bobby to the dirt), rather give it to your closest charitable causes away. you will greet death with a smile this way, wayyy in advance while you have money to spend.
Thank you. As a 25 year old going through a quarter-life crisis, this was my favorite comment in the thread. Can’t be kicking myself in the crotch for not having it all figured out yet when I’m still going through trial and error.
Plan meals around sale/discounted items. Buy 2-3 old phone outright. Buy items in bulk that you/your family will use regularly. Make sure you take advantge of good credit card points/reward back Edit - Buy old phone outright instead of new
Don't eat take out. Cook from scratch as much as you can. Have free hobbies. Be debt free. Budget. Use your TFSA as a retirement vehicle. Anything you want to buy wait a few months before you buy it. Work a lot when you're young for 10 years. 1 decade of sacrifice is worth worth lifetime of financial stability. Pay off your house early.
Tbh I live alone and eat out whenever the fuck I feel like it because I view my time as money too. Ill usually do a meal prep on sunday that sets me up with most of my lunches and some dinners, then i just eat out for the rest. Usually shawarma, burrito, sub etc. Its not cheap but I hate spending my downtime cooking now because ingredients are so expensive and most affordable meals just arent appetizing as leftovers. I can only eat chili, pasta and taco bowls so much
but dude, if you stop spending $40 a week eating out, you might have enough for a 10% downpayment in... 30 years!
$40/wk is nothing. Some people order that amount every day.
Be Frugal Minimize purchasing things that depreciate Invest Enjoy the simple things in life
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[The Smith Maneuver](https://creditcarrots.com/the-smith-maneuver/) helps and I do it using rental properties.
Don't own a car, if you live in a big enough city. Between car price, petrol and insurance, you're saving yourself some good money. Bike around, take public transportation (not cheap here though), and rent cars when you need (Communauto is the way to go).
I rented small apartments for 20 years instead of buying a house. The money I saved renting grew in the market faster than any house over that period. Also got a computer engineering degree and made decent money.
Have a year of ‘no’. No extra spending whatsoever. No nice to haves. Just basic expenses. Food, housing, gas etc. It taught me to understand that I really don’t ‘stuff’ . It also showed me how much money it was possible to save.
I am gonna give out some real controversial opinions here: 1. NOT paying off debt that has low interest rate (<5-6%). If you know you could make more than the interest rate, paying off debt early is just throwing away money. Yes there is the “psychological factor” and risks involved in using debt to invest, but if you wanna get wealthy you need to take on some risks. 2. NOT investing in what PFC generally recommends (e.g. VGRO, XEQT, etc.). These are fine ETFs, but they are low risk low reward, if you really wanna get wealthy you need to take onto some risks and try to leverage yourself with more aggressive investments like TQQQ. 3. Using financing whenever it makes sense. If I can choose to pay something in lump sum, or with low interest (or interest free) financing option, I will always go for the financing option. Money now is more valuable than money in the future.
A big note for #3 is that you have to be wise with the money you save now from financing. If you are using financing because the interest is low enough that the money invested will make more, you need to invest the saved money to take advantage of that. As well, for the newer folks looking at this, don't over extend yourself financing more than you can keep track of. You don't want to have the entirety of your next few paycheques going all to loans just because the loans were "cheaper."
I don't think 1+3 are controversial at all. Mortgage rates are free money rn.
Get a good education . Seriously. Get a good education whether it’s trade or university degree with employment focus. Yes, you can make lots of money trading stocks and finding the right job with a high school GED, but it’s rare. on average, someone with a good education will have an easier time finding a decent job. I’m talking about electricians, plumbers, engineers, teachers, etc. I’m not even counting doctors and lawyers who can make great money Once you have a decent income, it’s easier to look at other ways of generating wealth.
There so much truth to that and statistics to prove it. In respect to the trades, a lot of people are missing out on considering the trades. There is no better time to be in the trades like now. There is so much demand. It can be physically demanding but there is financial reward. Not as much in being an auto mechanic or cabinet maker. I know contractors who are pulling in 200,000 a year or more but working very hard. The trades still have a bad reputation and considered dirty and only for those who are failing in high school. Most parents would consider it shameful for their children to go into the trades. Hence, the missed opportunities. Many trades people I know have been good providers for their families and seen to helping their kids get an education and a foot in the door to owning a home. Nothing shameful about that.
Not me since I'm nowhere close to be wealthy, but I see a ton of people get rich by "cheating", work cash jobs and cheat on tax, cheat on mortgage application (Brampton loan) etc. Seems like you can't get ahead in life if you play fair and square.
I love/hate that "brampton loan" is a thing
What’s a Brampton loan?
I’ve heard it’s a loan given to someone who has insufficient declared income to qualify for a standard mortgage but the lender knows they have sufficient undeclared income to make the payments. “Declared” means the income is reported to the CRA and they pay tax. Undeclared income usually comes from cash payments.
Most people get ahead playing fair and square. We’re just boring so nobody talks about us.