Compare/Contrast Financial/Lifestyle Literature

[7Wannabe5]

I recently took a heavy hit to my most passive income source (sales of my previously accumulated rare book inventory), due to the fact that Amazon jacked up its storage and servicing fees for my category of inventory (one-of-a-kind, slow-moving.) For me, this is roughly the equivalent of getting a notice from the property management firm that handles your largely passive real estate rental investments informing you that their rates are going way up, AND there is no other property management firm you can use, so now you are likely going to have to be on call for water heater issues and mow the damn lawns again yourself until you hack together a new plan.

So, since I was sent into "back to the drawing board" mode, I have been re-reading some of the titles in my stack of lifestyle and self-employment literature, and it occurred to me that it might be useful to start a thread with the purpose of compiling, comparing , and contrasting the basic premises of all these different books or plans. The list could include:

1) ERE FI investment version
2) ERE intermittent employment version
3) 4 Hour Work Week
4) Rich Dad, Poor Dad
5) MMM
6) Art of Non-Conformity/$100 Start-Up
7) 2 Day Work Week
8) Get Rich Quick on Some Pyramid/Margin High Risk Scheme
9) Conventional Wisdom (what most people think they should be doing)
10) Observed Normative Function (what most people actually do)
11) Possum Living
12) Permaculture Millionaire
13) Survivalist/Doomer
14) Simple Living- Low Tech
15) Sugar Baby/Kato Kaelin Social Capitalism
16) No Money Scavenge/Barter Lifestyle
17) No Money Meditate/Beg Lifestyle
18) Simple Living-Minimalism
19) Simple Living-Communal
20) Millionaire Next-Door
21) YMOYL
22) Tightwad Gazette

First two premises to (roughly) compile might be Suggested as Ideal/Possible Yearly Spending/Savings. Please correct me if you think I am off on any of these. Some I do not follow or have not read. Also, please offer a specific book or author for some that I only generally described, and please add to list.

1) $5500/$185,000
2) $5500/emergency-slush fund + fund to cover length of intermittent unemployment
3) $$?/mostly passive cash flow to cover ?spend$
4) $$$?/mostly passive cash flow to cover ?spend$
5) $24,000/$800,000
6) $50,000/$1000 venture + emergency-slush fund
7) Minimum hourly wage X 16 X 52/emergency-slush fund
8) $$$!?/$0
9) $60,000/$2,000,000
10) $40,000/$40,000
11) $5500/enough to pay cash for house with garden space at foreclosure sale in decent-enough neighborhood
12) $5500/shelter and free lease/own property
13) $$?/liquid funds for flight possibility and bunker supplies for fight possibility
14) $?/shelter and variety home production tools/facilities
15) cell phone bill /pedicures/etc. ($3600)/bus or uber fare to next couch surf ($3-$30)
16) $0/$0
17) $0/$0
18) $$?/total cost 100 BIFL items plus travel/experience expense fund
19) $?/$?
20) $24,000/$3,600,000
21) $?/($?/Long Term Treasury Rate )
22) $?/paid for house, enough passive and/or pension income to cover $? beyond small income from home-based self-employment.

It's pretty clear to me, in retrospect, that ever since I started reading in this realm of literature (1988?), I have always chosen to take and integrate whatever appeals to me from any plan and toss aside the rest. For instance, I'm still don't seem to be choosing to (1) go back to work full-time for 5 years or (11) keep/kill rabbits for meat or (15) live on a yacht with a grouchy old man or (22) force my adult children to eat lima beans from my garden.

[BRUTE]

brute believes the mix/match approach to strategies is common. for example, brute also likes various ideas from different blogs - ERE as a framework/yardstick of what is possible, GCC for the travel/tax tips, and so on. as long as the picks work well together.

in general, brute would suggest not relying purely on social capital. maybe it's not worse than relying 100% on any other type of capital, but beauty fates, and 7Wannabe5, too, will get old. sugar daddies aren't exactly known for loyalty.

brute's impression through the forum is that 7Wannabe is pretty handy around the house, enjoys various gardening activities, and social capital is one of the strengths. Possum Sugar Baby Gardening Handywoman maybe. $5,500 / (backbone-basics-fund of ~$50,000 + emergency cash of $10,000 + social capital + steady "income" stream of home-grown food + intermittent income streams from writing ebooks, selling canned jam, fixing others' plumbing..)

edit: brute somehow completely missed that this was supposed to be about compiling a list of books. oops.

[enigmaT120]

I've bought books from this site before. I like it because it's world wide; the volumes I wanted were only in Australia:

https://www.abebooks.com/

I don't know what they charge though, maybe more than Amazon.

[7Wannabe5]

@enigmaT120: I've been dealing books on the internet for about 15 years, so I've experienced almost the entire S-curve of this industry/endeavor. In the olden days, I could make money selling just about any book to somebody on the planet through a variety of outlets, such as ABE, Alibris, Ebay, Half etc. This is not the case anymore by a long shot. OTOH, I am almost certainly one of the 10 best scouts in my range, so I could still support myself in frugal genteel poverty through book-dealing alone, if that is what I wanted to do. Kind of like being the last remaining blacksmith in the county.
However, it is my preference to have my book business just be one of the 5 legs on my rickety-rockety jill-of-all-trades generalist-generalist 3-7 legged stool.

The particular problem I am having at the moment is in part due to the influence of the advice offered in "The 4 Hour Work Week" regarding the efficiency of outsourcing distribution (Tim Ferriss .) I used to have over 10,000 volumes stored in banker boxes stacked 4 high and 4 deep on pallets covering the bottom floor of a rented barn, and every other day I would have to drive to the barn, lift a bunch of boxes, then pack all the books that sold for shipping, then go wait in line at the post office OR pay one of my kids (teenagers at the time) to do it. So, it was like my business consisted of one job that paid well over $20/hr (scouting books) and one job that paid $8/hr (picking/packing.) So, when Amazon made warehousing/distribution available to dealers, I shipped all my inventory to them, for the price of a hit equivalent to maybe paying $10/hr (pick/pack.) At that time, Amazon had a policy that held one-of-a-kind items exempt from long-term storage fees in order to promote depth of selection. This is the policy they have recently changed. So, I either have to eat some very high storage fees that will significantly dent my profits, limit myself to scouting for inventory that will likely flip in less than 6 months (not how rare books market works), or take on the tasks of storage/shipping myself again. I am mostly just grouchy with myself because I should/would have seen this coming if I hadn't been a bit asleep at the wheel because busy with other projects, play-dates and idle chit-chat.

in general, brute would suggest not relying purely on social capital. maybe it's not worse than relying 100% on any other type of capital, but beauty fates, and 7Wannabe5, too, will get old. sugar daddies aren't exactly known for loyalty.

No worries. In my experience, being financially dependent on a man you love is better than being financially dependent on a job you hate, but being your own flavor of independent is best. Also, please recall that I am already 52 years old, so it is somewhat amusing to tag myself as "sugar-baby" because I let the affluent-because-old men I date pick up restaurant tabs and buy me gifts. OTOH, it is true that my current BF previously kept a 24 year old Sri Lankan girl in Dubai, and occasionally threatens to trade me in for either another one of those or next-generation sex robot, but I just reply "Go for it!" I recently read that the 50s/60s are the "cocktail hour" of life, and I am finding that to be pretty apt. Kind of like you might lapse back into a day or two of considering the possibility of a "serious" relationship, and then you think "Why?"

Possum Sugar Baby Gardening Handywoman maybe. $5,500 / (backbone-basics-fund of ~$50,000 + emergency cash of $10,000 + social capital + steady "income" stream of home-grown food + intermittent income streams from writing ebooks, selling canned jam, fixing others' plumbing..)

Not a bad mix/suggestion. Ideally, I would have 5 full legs on my stool, each of which would hold my weight on its own if necessary. I currently make enough money substitute teaching 2 days week to support myself. I would like to maintain this as one of my legs, because it also provides me with opportunity to serve my community and improve the world of the future, social interaction with peers, total flexibility, variety of challenges, fun with finger-paint, gummy-bear dancing and Dr.Seuss, and great deal of autonomy and appreciation (because I am over-qualified.) However, if I did it more than 2 days week, I would not enjoy it nearly as much.

The last year or two, I have been directing most of the profit from my book business to my perma-culture project, and I have been letting the book business run mostly passive, so I am going to have to really ramp it up a bit for a while and deal with my storage/shipping issue in order to restore it as steady leg. My permaculture project would already almost be carrying my weight as a leg IF I wasn't too chicken to live in my camper by myself. I want the cash crop from this project to be something that isn't edible, such as floral and basket craft supplies. Because I am a serious dilettante, my 5th leg needs to be left open/random/short-term. So, it is my plan that my 4th leg will be something more nerdy towards investment (IOW, 1/5 of my plan is the same as the whole plan of some other people on this forum, but I haven't really gotten started with this part yet) , and that is why I am taking a course on building robots. I am also due to collect enough social security to support myself in 10 years, so that could be a 6th leg. And it also is true that the yacht-guy offered to let me sail down the coast with him when he retired and my current BF would probably not make me pay for anything if I moved in with him and cooked him salmon cakes on a regular basis, so that is a 7th leg.

Anyways, returning to the general topic of this thread, the thing I've been thinking about is that the average productivity of the American worker is $68/hr or roughly $130,000 at 40hrs./week. Therefore, I think the premise of "The $100 Start-Up" which is that it is not that difficult for a motivated, intelligent individual to make $50,000/yr self-employed with little initial capital investment, if willing to throw 40 or more hours/week at the endeavor is likely true. So, it should follow that it is also a pretty robust assumption that a motivated, intelligent individual could likely make $10,000/yr. self-employed with little initial capital investment, if willing to throw solid 10 hrs. week at endeavor. Therefore, I would suggest that developing an enjoyable $10,000/10 hour/week gig along with an emergency fund adequate to cover time-to-develop-next-such-gig-if-first-gig-fails, might be as robust a leg on which to retire from full-time employment as $200,000 invested towards passive income.

[George the original one]

Reading through your list of financial lifestyles, I think you left out the classic "Have a bunch of children who support you in old age"?

[BlueNote]

Reading through your list of financial lifestyles, I think you left out the classic "Have a bunch of children who support you in old age"?

That's an idealistic version of the idea. I think what usually happens is: have a bunch of children who support you, on a net basis, in old age. As you have more children the odds of disability and other dependent situations emerge but you hope that the other children overcome those issues and have enough left to help with your retirement (I have some extended family in this situation).

[BRUTE]

Therefore, I think the premise of "The $100 Start-Up" which is that it is not that difficult for a motivated, intelligent individual to make $50,000/yr self-employed with little initial capital investment, if willing to throw 40 or more hours/week at the endeavor is likely true.

So, it should follow that it is also a pretty robust assumption that a motivated, intelligent individual could likely make $10,000/yr. self-employed with little initial capital investment, if willing to throw solid 10 hrs. week at endeavor.

brute thinks both of these assumptions are inaccurate.

first, almost no human ends up making $50,000/yr while self-employed. many dream about it, but of those that try, 95%+ don't end up making it. so either most humans are not sufficiently motivated, intelligent, or able/willing to put in 40hrs/wk. sure, a few do it, and 7Wannabe5 might be among those, but it's not a valid strategy for most humans in brute's opinion.

second, just because 40hrs/wk lead to $50,000/yr doesn't mean 10hrs/wk lead to $10,000/yr. few things are linear. learning skills, building a reputation, and getting ongoing work, for example, all have a critical mass aspect to them. the threshold might be below 10hr/wk, but for most professional/self-employment jobs, it probably isn't.

[7Wannabe5]

George the original one said: Reading through your list of financial lifestyles, I think you left out the classic "Have a bunch of children who support you in old age"?

True. I suppose that Social Security is the equivalent in our culture?

@BRUTE: I agree that $50,000 for 50 hours/week self-employment and $10,000 for 10 hours/week self-employment may be poor estimates of robust assumption, but there has to be some level that would be a robust assumption OR, at least, as robust an assumption as those that apply to ERE version FI. I mean, there is a level of common infrastructure and free resources to which anybody could apply their own units of labor on one end of the spectrum and then there are huge conglomerations of private capital investment to which you could lease your labor and/or lend your own capital at the other end of the spectrum. So, if we set the goal income at $10,000/ year and the goal level of freedom at "not working for somebody else" then at one end of the spectrum you could purchase $333,333 worth of business assets with robust expectation of 3% return given maybe 1 hour of your management labor/month (so you would be self-employed at pay rate of $833/hr.) At the other end of the spectrum, maybe you start with nothing but a library card and access to your local dumpsters, so your initial pay rate is $2/hr, so you will have to work 96 self-employed hours/week in order to make $10,000/yr. It seems pretty obvious to me that it is pretty pessimistic to posit $2/hr as self-employment pay rate over the long-run for an individual who is also skilled/intelligent enough to live a good life on $10,000/yr.

[classical_Liberal]

...

[7Wannabe5]

@classical_Liberal:

Good point about the S-curved being compressed due to low barrier to entry. What BRUTE said about cost of entry or overhead being prohibitive to scaling down from 50 hours/$50,000 for some industries/opportunities is true, but the opposite is also true for some other opportunities. For instance, a skilled individual might be able to make $50/hr working 20 hours each year gathering mushrooms during season with no possibility of scaling up. I have to carry a minimum rare book inventory in order to cover my fixed costs (mostly licensing fees), but it is also true that the costs of acquiring each book goes up and my profits go down per unit or hour worked, the further I extend my range.

When you buy a share of the stock in a company, you are buying a portion of a collection of ideas, methods and tools for making profit by creating/fulfilling market desire/demand. When you start your own business you just put the collection together yourself. I think the reason why small business creation or self-employment has a high fail rate is that too much money is borrowed/invested relative to experience at the get-go. If you start tiny and scale up, then it's hard to fail if you put yourself out there. Putting yourself out there is really the hardest part. It's actually a lot like dating.

[userqname]

The common threads in your reading list are:

1)Buy income producing assets
2)Frugality/Distinguishing between needs and wants
3)Find unconventional/nonfinancial ways of meeting needs and wants

With varying emphasis on each of them. Successful financial literature also has to [at least appear to] be generalizable to a large audience. It has to pass the "anyone can do this" test.

[Laura Ingalls]

Don't forget about
https://www.amazon.com/Living-Poor-Styl ... B0012X5QDK

[jacob]

@LI - Absolutely! I'll note that the initial "poor with style" edition(s) is much more useful than the subsequent watered-down "cheaply with style" editions. So anyone wanting to read it ... get the original! Callenbach is definitely one of the great ones. I kick myself for not contacting him before he died.

[Laura Ingalls]

I read Poor with Style circa 1978 (I would have been 8-10 years old). My frugal father had a weakness for "hippy" books and mags. He kept a stash of early Mother Earth News too.

[7Wannabe5]

@Laura Ingalls: Thanks for the recommendation. It looks very interesting. I put it right on my scavenge/scout list along with a couple of the author's other books.

I was rummaging through my stacks and would like to add the following to the list.

1) "Making a Living Without a Job"- Barbara Winter
2) "The Renaissance Soul"- Margaret Lobenstine
3) "Savvy Chic: The Art of More for Less"- Anna Johnson
4) "Discards: Your Way to Wealth"- Lebda and Quinn
5) Assorted works of Barbara Sher on alternative lifestyle design
6) The Foxfire series
7) "The Art and Science of Dumpster Diving" - Hoffman
8) "The Scavenger's Manifesto"- Rufus and Lawson

In "ERE", Jacob wrote:

In a growth economy, there are workers, organizers of workers, owners of assets, and owners of land. In a complete ecology, there are abiotics, producers, consumers, and decomposers...The economy has many unrecognized inefficiencies-it is, for example, possible for more people to play the role of decomposers (recycling, upcycling) and producers as well as becoming less dependent on abiotic resources.

(4) (7) and (8) are interesting because they particularly examine the often neglected decomposer role in the modern market. If you even half agree with John Michael Greer's model of how the future might look with declining resources (Industrial Age, Scarcity Industrial Age, Scavenger Age, EcoTechnic Age) then you can comprehend how easy it is to survive as a scavenger while we are still somewhere on the peak of influence of the Industrial Age. Unfortunately, I own one of only a few copies of "Discards: Your Way to Wealth" still in existence. Mike Lebda was the "Fat Tony" discard king of Chicago in the 70s, and he developed a simple model for profiting from inefficiencies in this part of the economy, with discarders specializing in salvaging, rescuing and promoting.

Has anybody read a particularly good book on the topic of the Sharing Model? It's interesting how this model frees value from empty rooms, unused vehicles, large designer handbag collections, and even under-utilized relationship partners if extended to include the practice of polyamory.

[Dream of Freedom]

Van/camper living ~1200/mo http://tosimplifyold.blogspot.com/2009/06/my-van.html
Expatriate lifestyle ~600-1500/mo http://reachfinancialindependence.com/guatemala/ (I Know these are not books but you have mmm )



You could probably split the list into nomadic vs stationary. You could further split stationary lifestyles into lean vs fat inventories. A freezer full of food that was on sell and tons of miscellaneous parts and materials for bodging a solution contrasts quite nicely with the writings of Jacob here, for example.
I am sure there are other metrics by which you could sort them, but I'm drawing a blank at the moment.

[7Wannabe5]

@Dream of Freedom: Good suggestions. Nomadic vs. stationary and lean vs. fat are interesting dichotomies to me because my lifestyle is kind of all of the above.