Is the American Dream a Trap?
The Impossible Path Out of Moderate American Poverty
Most Americans are stuck in a rut that is nearly impossible to get out of. They work hard and are careful about spending, but they just can’t get ahead. I call this rut, “moderate American poverty.”
I’m making a play on words with a very old Confucian idea called “moderately prosperous society.” The idea was that society would be better off with a functional middle class. Moderate prosperity was revived by the Chinese government over the past 15 years in an effort to encourage the growth of a new middle class in China. Since adopting a policy of encouraging middle class, China’s middle class has boomed.
What does this mean, in China? It means that China now has more middle class households than the entire population of the United States. Moreover, what it means to be middle class in China is not what it means to be middle class in the United States. In China, a middle class wage earner actually makes about as much as a middle class wage earner in the U.S. There’s a big difference, though. The Chinese person is living in an economy where housing is a fraction of the cost, food and dining out are far less expensive, and a middle class household can hire a full time staff member to help with the kids, cooking and cleaning. Moreover, the Chinese person is not a slave to student loan debt, credit card debt, and a huge mortgage. Thus, a middle class Chinese person is far more financially independent than an American in the same position.
What has happened to our middle class? Debt. Housing costs. Taxes. Cost of living. Inflation. What if our middle class was debt free, owned their homes, and still made the same wages? They would be far more powerful. But, we our so-called middle class is stuck in the rat race. Certainly, our middle class is not made up of people who can hire a full time housekeeper/cook or nanny. Our middle class is stuck. We are not poor, but we are not free.
What we have in America is not moderate prosperity, but moderate poverty. I call it moderate American poverty. Our middle class are in a sort of prison, maybe of our own making, that keeps us from actually attaining financial freedom.
If you want to gain financial freedom, you have to start by understanding moderate American poverty. If you make $36,000 per year, you are probably not in poverty. Not by government standards, at least. However, if you make $36,000 per year, you lack financial freedom. Everything you make goes to pay your bills and your taxes and what’s left is eaten up by medical co-pays, dentists, car insurance, and the little expenses that somehow leave you with too much month and too little paycheck.
But, even at a higher income, a typical family of four is stuck in a state of moderate poverty. I’m not talking about the federal government’s designation for someone who makes less than a particular amount of money. I’m talking about a financial state that renders one powerless. I’m talking about a financial state that is not prosperous.
What do I mean by moderate American poverty? I’m talking about the fact that it is nearly impossible to “get ahead” for the average American. Haven’t you ever felt that way? Like no matter how hard you work or how much you make, or how well you budget, you just can’t get ahead?
There are many forces that create a social and economic inertia that holds you in the place where you are.
The median wage in the for one person in America is about $27,000, and about $52,000 per household. Based on that figure, a household that has 2 spouses and 2 kids, has a net income after taxes of about $1,400 every two weeks. Rent and utilities will take half of that. The other half is what the family of 4 must live on.
This is moderate poverty. No financial freedom. Not living with the power to choose your destiny. Yes, many people make more. But 66 percent of Americans earn less than $41,212. At that income, a single person will take home only about $1,044 every other week. Consider the cost of rent, utilities, groceries, minimal transportation costs (car maintenance, gas, insurance), and you don’t have prosperity. Thus, two-thirds of Americans make just enough to live. Anything that they want other than their basic needs will go on a credit card. Dental bills. Medical copays. Bank fees. Anything unexpected can be just another setback.
Even at retirement, most Americans are stuck in moderate poverty. The median American has a retirement account with just $148K at age 65-74. How in the world can the typical American retire with that much in total savings? They rely on Social Security (right now, about $1400/mo), and the fact that their house, mobile home or condo is paid off. But, even with Social Security, Medicare and their home paid off, this is not a sufficient amount of money to live through the end of their lives. This amount will be eroded by inflation, taken by taxes, excess medical expenses, and not provide a prosperous retirement. At the same time, this amount of money is no where near enough to use for long term medical care if their health fails, yet it is enough to prevent the retiree from receiving Medicare coverage for long term care.
An American has to work his or her entire life (often at a job they dislike) in order to spend the last 20 years of their lives with a small savings and Social Security income, only to use all of their savings for nursing care and then die with just enough to cover the costs of burial. This is not the American dream. But, it is the American reality. It is moderate poverty.
I’m not a physicist (of course), and maybe inertia is not the right word for the phenomena that I’m talking about. But, here’s the idea. In our society, it is damn near impossible to rise out of modest poverty. The reasons are many, but one of them is the fact that it is difficult to deviate from the path that society requires. If you are a typical middle class kid, you’ll be told to go to trade school, get a job, and eventually get married, buy a small condo, have a kid and pay your bills like a good American should. If you are an upper-middle-class kid, you’ll be told to go to college and start in a profession. You’ll get a job as an investment banker, get married, but a large house and two cars, and raise your family in a life with only a few benefits over the lower-middle class kid. Either way, you are stuck in a pathway that is difficult to escape, and both are traps.
Inertia is the resistance of any physical object to any change in its state of motion, including changes to its speed and direction. It is the tendency of objects to keep moving in a straight line at constant velocity. Wikipedia. In modern American life, there is a resistance to any change in your state of motion. You can try to change speed or direction, but doing so is a move against inertia. If you want to do something different with your life, you will encounter obstacles at every level. Those forces might include your family and friends. It might be a spouse or lover. It might be what you have in your own head; your own ideas are a big part of the inertia that keeps you from changing. But, society itself is built to keep you from deviating. Let me elaborate.
A System Built for Your Poverty
The systems that are around us are not built for our success, but for our contribution to someone else’s success. Corporate American does not want you to really be happy. They want to sell you happiness in order to motivate you to buy something. Buy a new car and you’ll be happy. Buy this fancy watch and you’ll be happy. In the end, you are not any happier, and you have transferred a portion of your blood, sweat and tears to some large company. You are now poorer, with no way to get that money back. The business world will drain most Americans of most of their life’s blood, leaving them with $148,900 to retire on and live their final years on a tight budget and financially powerless.
At the same time, another force is at work that is undeniable: inflation. Inflation is a way of taxing the people without raising taxes. I love this little book: What Happened to Penny Candy (yeah, its got my affiliate code so I make a few pennies if you buy it). But, there are definitely more sophisticated books on the subject. I’ll relate this in a real story, the story of my great-grandfather’s wealth, and why I am not the heir of a great fortune.
My great-grandfather was one of the captains of industry in America at the turn of the last century. Charles H. Grasty owned a number of America’s newspapers, including the controlling interest in the Baltimore Sun Papers for a period of time. He died in 1924 with one heir, my grandmother, who took her first chunk of cash when she came of age in 1937. The fortune included substantial cash of about $300,000, but also a trust fund with another $300,000 in it.
What was $600K worth in 1937? Millions by today’s standards. In 1937 the average cost of new house was $4,100, the average wages per year were $1,780. The cost of a gallon of gas was 10 cents. The average cost for house rent was $26 per month. A loaf of bread 9 cents. A new car $760. One inflation tool I used on the Internet put $600K in 1937 at $10 million in 2015 dollars. Thus, my Nana inherited an estate equivalent to $10 million if it was today’s dollars. Half was in cash and half in a trust paying 6%. That’s like getting $5 million cash and monthly income of $25,000 in today’s dollars.
But, by the time my Nana hit retirement age in the 1980’s, she lived in a modest mobile home. The money had dissipated over the years. By the time she died, what was left of her cash would not even buy a condo in San Diego. What happened? Inflation. The value of her dollars went down every year; year after year until the value of her money was no where near what it was worth when she inherited it. The wealth of an American captain of industry literally melted away over just one generation. $600,000 went from a value of $10 million to a value of enough to live in a mobile home. In her early years, she spent the income and lived a fabulous life. But, as inflation rose, her monthly income did not. $1500/month went a long way in the 1940’s, 50’s and even 60’s and 70’s. It was not a fantastic income by the 1980’s.
My Nana went from one of the richest single women in the country at 18 years old, to an average American pensioner who had to watch what she spent each month. The wealth of her father was completely eroded by inflation.
Imagine the same impact on a middle class American worker over the past few decades. Another of my relatives, my mother’s father worked all of his life as a utility manager and saved for thirty years. The amount he saved and accumulated by retirement was a lot of money in light of how much he made. But, the value of that retirement account today is just enough to provide for his widow.
My father’s money was earned in the 1960’s through the 1980’s. He made money in yesterday’s dollars and saved and invested out of those dollars. He then retired, and for the past 20 years has had to see inflation erode the value of his income year after year. The cost of living has risen drastically since he retired.
These forces make it nearly impossible for the average American to ever get out of the hole. No matter how much you save, or how hard you work, you are stuck in moderate poverty until the day you die.
How do you break free? How do you get out of moderate poverty?
You’ll hear some people say that the solution is investing, in the stock market in particular. I disagree. Owning some stock is wise, but the stock market is not a solution to moderate American poverty. In fact, it contributes to the state of moderate poverty for the average American. The great recession shows what can happen to America’s 401K’s when there is a dramatic issue with the economy. I know people whose stock portfolios have never recovered to the same level as pre-2008. In fact, the parties who make real money in the stock market are not you and I.
You and I are “retail” investors. That means we pay the full retail price, just like when you buy something at the mall. Everyone else makes money on the computer, purse or watch that you buy… except you. You pay for it and everyone else has made money. The stock market is the same. Private equity and professional investors are the ones making money in the stock market. It is not a sufficient hedge against inflation to make up for the squeeze that inflation puts on those who are in moderate poverty. It is just another part of the overall trap that keeps so many people in moderate poverty.
What about real estate?
Yes, real estate has proved to be one of the best insurance against inflation. Lucky for most Americans they own a home. But, this just insures that when they retire, they have a house that they own in a market that would have become too expensive as a result of inflation. Owning more real estate (other than your home) is a better hedge against inflation. In fact, I argue that owning at least a little bit of rental property is one of the best ways for people to dig their way out of moderate American poverty. I have an article on owning rental property here.
I think most people who are in moderate American poverty know it and want out. When you finish the bills and can’t figure out where the money went. When you get a dental bill and have no idea how you are going to pay it. When you see how much you need to have at retirement, and you realize you are not even close to on track. You can still afford to eat. You can fill up your gas tank when you need to. But, you are trapped. You are not getting ahead.
If you are in this trap of moderate American poverty, I’m here to help. I have three books that may be helpful. Check those out at danarobinson.com/books/. I want to help people find their way to self employment. I want to help people find their way to financial independence. But, to get there, you have to recognize that you are stuck in a rut, and that getting out of it won’t come from a lottery ticket. It won’t come from dreaming big. It won’t come from visualization. It comes from seeing the truth and taking responsibility for it. Recognizing you have a problem is the beginning, but nothing happens when you deny it.
Are you in moderate American poverty? Want out? I’ll take you on a journey through my own experiences. I’m not selling magic formulas or snake oil. But, I have a unique approach that has worked out for me, and just might help you along your own odyssey. Join my tribe. Follow me on Facebook. Get on my mailing list and watch my blog for more articles about how to get out of moderate poverty.
The Candy Store
What can we learn from Holly Golightly? You remember her? The beauty from Breakfast at Tiffany’s.
Here’s a conversation between Holly (Audrey Hepburn) and Paul Varjic (George Peppard). They were talking about a very rich woman.
Holly: WELL, LET ME TELL YOU SOMETHING. IF I HAD HER MONEY, I’D BE RICHER THAN SHE IS.
Paul: HOW DO YOU FIGURE THAT?
Holly: BECAUSE I’D KEEP THE CANDY STORE. OLD SALLY TOMATO–THAT’S MY CANDY STORE. I’D ALWAYS KEEP SALLY. –
What was the “candy store”? Holly says she’d be richer than some rich lady, even if she had all the same money because she has a secret income stream that she’d keep doing, even if she was rich.
In the movie Holly would deliver the “weather report” for Old Sally Tomato at Sing Sing prison once a week. For that, he’d give her $50 for the cab and $50 for the powder room. That was her Candy Store. A weekly task that made her $100/week.
Paul asks her, “and what do you mean, ‘the weather report?'” to which Holly replies, “just a message I give Mr. O’Shaughnessy so he knows I’ve really been up there. Sally tells me things to say like, Uh…Oh, there’s a hurricane in Cuba…cloudy over Palermo, things like that.”
Holly’s Candy Store is something that she’d keep, even if she had a million dollars. In her mind, it would make her “richer” than someone else with the same million dollars. Even with $1 million, Holly would still be making $400/month for taking a visit with Old Sally Tomato at Sing Sing prison.
Holly’s “Candy Store” is a side gig. It’s something that brings a steady stream of cash coming in every month. One of my principles of financial independence is that you ought to have a Candy Store. I think of the Candy Store as a side job or business that doesn’t require a lot of effort, but makes a regular amount of money on top of your day job or other business. It’s not a business, per se. You don’t lose sleep over it. You don’t have to work a lot of hours. You don’t have to invest a lot of capital. There’s relatively low risk. If you have some “side money” from something that has these elements, you have a Candy Store.
Whatever you do vocationally (i.e. your Day Job or your business), you need a “candy store” like Holly Golightly. Everyone should have a Candy Store, and do their best to not let it diminish on the one hand, nor become their primary vocation on the other. Finding a Candy Store is not the same as owning a business. It needs to be something that is not a burden, easy to maintain, not require any significant capital unless it is recouped immediately, and be something that is able to generate a consistent week after week return.
Let me make this clear. Your candy store is not a business that you should sink tons of money into, or that requires much of your time. In fact, this is extra important if you would like to eventually start a business of your own. You need a Candy Store that makes money with little effort so that when you are pouring all of your time into your new business, the Candy Store doesn’t require any attention, and it supplements your income.
Let me give you some REAL examples.
Jim’s Red Glue
Jim Johnson is a long time entrepreneur. He spent a long time in a construction business where he mounted decorative facades on the inside and outside of homes. New home tract homes often have exterior moldings to give shape and dimension to the outside of the house; these moldings are also often foam. This foam is cut and then assembled into shapes, columns, window boxes, and the like. The polystyrene components are “glued” to each other to hold their shape. The glue that adheres the foam pieces to other foam pieces isn’t the same as the mastic that is used to glue the thing to the wall of the house. The foam-to-foam gluing has to be a unique product.
Well, Jim found that product a long time ago, and it wasn’t really made for this particular purpose. He found one source for this glue, and began buying it in 50 gallon drums for about $100 each. He ran into other people in the business that needed this type of glue. Instead of just telling them to go get their own 50 gallon drum, he said that he could get it for them in 5 gallon buckets for $50 each. These other guys were ecstatic. They needed smaller volumes, and $50 for 5 gallons was cheap, considering that a 1 gallon can of construction mastic costs over $20. They were saving 50% by using Jim’s glue.
And so it began. Jim would take a monthly trip to get the big drum of glue. He would pump it into 5 gallon buckets and stick his own label on them and sell them for $50 each. $100 for the glue plus $50 in buckets and labels would yield a gross of $500 in income, and a profit of $350. Some months, Jim would sell just one drum, others three or four. His total time commitment was a once a month trip in his truck of one hour each direction, and then an hour or two to fill the buckets. Ten years after Jim sold his construction business, he has kept the Candy Store. He might use up to 1 hour each week to be sure that he filled orders, but the overall monthly commitment was no more than 8-10 hours. He could run the Candy Store in the evenings or on the weekend. He never lost sleep over the Candy Store. He didn’t lose other business because of it. He might have missed some television or golf for a day, but for $350-$1400 per month, he was able to substantially improve his life for a decade by keeping the Candy Store.
Think of how hard it is to earn this sort of cash at a “regular” job. If you take a job at a convenience store at $8/hr, your gross pay is $1280 if you work full time for a month. Your take home is likely about $950. Jim averages $700 per month for 2 hours a week, and because his glue reselling is a legal business entity, he gets a lot of tax benefits that offset the income. He writes off his home office; his mileage, his cell phone and internet connection, and more. He keeps all $700 of this money. To say it like Holly Golightly, if you have a full time job and Jim has a full time job, Jim is richer than you because he’s kept the Candy Store.
The Sunday Night Fax
My brother-in-law is an avid golfer. He golfs two or three times a week. He’s semi-retired, but he’s kept a couple of Candy Stores. One of them gets him free golf. Many years ago, he found a software program that would auto fax to a list of recipients. Someone at the golf course mentioned how they needed to tell their constituents about the weekly golf special. After some discussion, he learned that the golf course wanted to send a fax every Sunday night with the weekly specials, and other information to a list of players that had signed up for the fax. It seemed complicated and like a lot of work to the golf course folks. So, he offered to take care of this for them in exchange for free golf. For him, it would be an hour every Sunday night, but would not really cost him anything. For the golf course, they would have to buy software, or get an outside firm to do this service for a fee. Giving my brother-in-law free golf had no actual cost to the golf course. Thus, both parties have a virtually cost free transaction, but each saves hundreds of dollars every month. If the golf course paid an outside service, they might charge $100/week for the service. If my brother-in-law paid for golf twice a week at $50 each, he’d pay $100/week for his golfing. His Golf Candy Store gives him a tax free value of $400/month if he only golfs twice a week. He’s kept that Candy Store for many years and even as things transitioned from fax to email, he’s made the leap and kept the deal going forward.
I have a website that I purchased back in 1997, freelegalaid.com. Its been the subject of about 5 different “lives” over the past 12 years. My site was originally launched with great success in 1998, when it had a rather large traffic base, but like many “.com” businesses, it lacked a revenue model. After a few failed attempts to rehabilitate the site, I finally decided to just make it a free database of legal resources. I dumped a bunch of data into the site; some useful and some not. I let it ride like that for a year, and then discovered that Google lets publishers place ads on their website and share some of the revenue when a consumer clicks the ad. I put some code on the site to pull Google ads, and viola! I made about 8 cents the first day! That was free money. I didn’t have to do anything once it was set up. The website itself took a couple of days to install, an hour every few months to update, and $200 in license fees and custom development. But, now I don’t have any real ongoing “work” to do on the site. I put the ads all over the site, and just sat back to see what would happen. The revenue grew steadily from 8 cents per day to 80 cents to 8 dollars a day, then to $500 per month, and it grew from there. The site now makes substantially more and it takes very little management from me. This is only one of the Candy Stores that I own, and one of the reasons I am able to sit in Bali by the pool and write.
Erica has a bit of an animal addiction. She owns a horse that cost $10,000, a $2,000 dog, and some sort of exotic cat whose breed I can’t pronounce that cost $3,000. Erica’s penchant for exotic animals could be her husband’s financial ruin, but Erica’s pets are actually her Candy Store. Rather than just owning expensive pets for the fun of it, Erica owns them, loves them, feeds them, and breeds them. Take the $2000 dog, 5 litters later, she’s made $50,000. The horse is a bigger gamble, but once a horse has certain certifications, he can be “bred” for quite a lot of money (footnote: they don’t really breed horses like dogs, but the effect is the same: you sell your horse’s stuff for thousands of dollars). Once the horse has proven to be a good income stream, you can actually sell the horse for a lot more, say $50,000 for a horse that you paid $10,000 for.
I’m not an expert on this business at all, but Erica is. She’s been doing it since she was a kid, when she’d apparently breed spiders (either she’s messing with me on this, or its true that you can breed your pet tarantulas). For Erica, she has the combined effect of being able to buy and enjoy her animals, and making a nice side-living on them. The Candy Store for Erica isn’t a full time job. If it was a full time job, she might work far more and make less per hour for her time. She’d have to buy insurance, deal with liabilities, buy software, deal with licensing and permits, and a host of other things that don’t worry her at this stage. She’s an animal owner who knows how to pick the right animals, breed them and make a little Candy Store income on the side.
Tim is a prop guy in Hollywood. He’s been in that business for a long time. Along the way, he realized that the studio sets used highly sensitive microphones that pick up any little sound. Thus, in the world of stage props, the key is to find props that don’t make much noise, or you have to fix them so that they aren’t noisy. One of the most noisy things on the typical sitcom set is a paper bag. Tim came up with and patented the Silent Bag.
It was a few thousand dollars to obtain a patent, and a few hundred on a trademark for SILENT BAGS. This, plus his expertise in the prop industry made him the sole source for Silent Bags. He was going to be able to generate a few hundred dollars every month for many many years. In fact, his kids worked for him assembling bags in the garage, earning money and helping Tim so that he didn’t have to spend his weekends building bags. Tim has been able to enjoy a decade of Candy Store income from his Silent Bag business. As with many other Candy Stores, Tim gets the benefit of tax deductions for his business operations.
What I have observed from many people’s Candy Store businesses is that if they are run properly, they are not taken “big.” There is an equilibrium to achieve. If you take Tim’s Candy Store, I don’t know what he makes, and its none of my business. But, by way of example, if he makes $8000 per year, but he uses the business to pay himself back for business mileage, travel, meals, and writes off his home office, pays his cell phone bill and internet, he may very well write off $8000 per year in expenses, and thus make his entire Candy Store income tax free. The value of that income stream is quite significant. It is an asset.
If Tim wanted to make $8000 per year in tax free income, he would have to buy about $200,000 in municipal bonds. That would make Tim’s little Candy Store worth at least $200,000 to him, and over time, his income from the Candy Store climbs, increasing this value each year. If he sold the business, he might only get $50,000 for it. If he took the $50,000 and put it into a safe investment, he would be lucky to make $150/month. He’s wise to keep the Candy Store.
But, he’s also wise not to try to make the Candy Store his vocation. He’s got a well paying job in the entertainment business that he’s mastered, and he can’t, and shouldn’t give that up to “go full time” into Silent Bags. He’s far better financially to keep the Candy Store as just that and to make his “primary” living doing what he’s good at. Thus, he’s able to maximize the value of his time by making the most for each hour of his time in his vocation, while keeping the free money that keeps coming in from the Candy Store.
If Tim tried to take his Candy Store big, he would suddenly have to spend a great deal of money on marketing; liability insurance; professional fees; etc. He would have to run a business that is 50 times the size of the current business, and incur significant risk. He would also have to quit his well paid day job. He wouldn’t have a Candy Store, he’d have a business to run.
Bill’s used car a month
Bill keeps it simple. He’s not a car dealer, but sort of a car lover. He’s got an instinct for a deal, at least for cars that he knows well: exotics. He’s got a few investments that allow him to live semi-retired, but he has turned his car-obsession into a Candy Store. He’ll buy an exotic car about every other month, when he knows absolutely that he’s gotten it for far under its value. He’ll then drive it, and circulate the info to exotic dealers and even do his own advertising. If he does it right, he can make a couple thousand dollars every month doing this. Now, this isn’t for everyone. Bill has to play with cash, often over $100,000. But, his return can be several thousand dollars. If he only makes $3,000, then his return on $100,000 is 3% per month, or 36% per year. He gets to drive some amazing cars, and he isn’t working very much for that money. He doesn’t have to own a car dealership, deal with returns, customers, liability, mechanics, and the full time hassles that come with being full time. He’s keeping it simple, and keeping the Candy Store.
Cory’s audiobook studio
Cory is a long time friend, business partner and brilliant entrepreneur. He and I co-founded ChristianAudio, now the largest Christian audiobook publisher in the World. Like many of us, was a hungry entrepreneur as a young man, running a house painting franchise, doing landscape and hustling wherever he could.
In the early years of ChristianAudio, Cory needed an audiobook studio; not just a typical recording studio. So, he studied extensively on the subject and decided to build a studio in his garage. He rents the studio out to his business to produce audiobooks.
As his business grew, he experimented with outside studios, and continues to use other studios all over the U.S.. He uses studios that are convenient to his book narrators all over the country. But, it turns out that his little studio is so perfect for book reading that he can keep using it for his business. He also rents it out to others who want to record voice-over, audiobooks, podcasts and more. He doesn’t even have to work to earn this extra money. His wife just lets people in, and they bring their own people for production and narration. Cory can keep the Candy Store, let it make money for him, and head off to run a real business in the day, and when he returns, he’s made money for letting someone use his studio for the day. He has one of the best Candy Stores I’ve seen.
Golf cart GPS units on lease
I’ll tell you just the little that I know about a really smart guy I met once. He purchased a company out of bankruptcy. The company had owned golf cart mounted monitors that showed the players the holes and the distances. He then sold the “business” to another golf company, but he kept the equipment that was leased out to various golf courses. As I understand the story, he made back his investment by selling the ongoing business, the brand, and technology. But, he kept the Candy Store. He kept the GPS hardware that the golf courses lease. Each golf course pays him a monthly fee for the units that are connected to their golf carts. He has one employee to manage this business and it generates something on the order of $50,000 per month. He doesn’t really run that as a business, he is off doing bigger things. But, you can imagine how well he can live if the Candy Store makes $50,000 per month, and he can still go run another company and make even more than that.
Bill’s pool cleaning
Bill is a maintenance supervisor. Its a good job. Income is stable, with good benefits. He’s done it so long that he can do it with his eyes closed. Bill is quite handy of course. He can fix anything, clean anything, probably do just about anything. For the past 5 years, Bill has cleaned the pools at a couple of apartment complexes every week. He makes $200 each per month. So, he’s got $400/mo in income in his Candy Store. He has no out of pocket other than 4 miles worth of gas to get to my apartments. Lucky for him, the apartment buildings are near each other. If Bill was to run a full-blown pool cleaning service, he wouldn’t have a Candy Store. He’d have a business. He’d have to charge more, work harder, and drive all over town every day. At the end of the month, he might make the same as he does with his regular job plus the $400. Since he’s just “the pool guy” for apartments that have their own insurance, he doesn’t need any liability insurance or bonding. He doesn’t need any fancy accounting or corporate bookkeeping or tax filing. He still gets to write off his mileage, some of his business related expenses, etc.
Ricardo’s hair cutting
I know of several people who’ve trained to cut hair and done it professionally. Often, the salon is an early career that is abandoned later. Your legs hurt; customers are mean; you cut your fingers every day; you get tired of talking; whatever. The upshot is that I’ve known a few capable people who can do a mean haircut or dye job on a Saturday afternoon for 30% less than the salon. They may not like it much, but they realize that they are simply good at it, and a quick $50 for a dye job or $20 for a good hair cut is not bad for some extra weekend income. This Candy Store is a bit less appealing than a website, but for many people, its a way to secure that extra $200 per month that will make a big difference in how you live, how much you can save and ultimately you need some kind of Candy Store if you are going to make it to financial independence. Even if you aren’t super happy to be the Saturday Super Cuts, if that’s your talent: do it.
- Sell an ebook, run a blog blog, take over an existing useful website, run a fan-site, open an eBay or Amazon store and sell something you can make a substantial mark-up on.
- Rent your garage.
- What are you good at compared to others? What you do pretty well and without stress, that can bring $200/mo or more with an hour a week)
Bankruptcy court can be a unique opportunity for similar investments. I once bid on book rights that had existing royalties. The collection of rights eventually sold for about $200,000, but there was about $30,000 in royalties already due, and an estimate of about $40,000 per year that would continue being paid indefinitely. This is a Candy Store that I missed out on because I couldn’t bid high enough.
There are so many ways to make some money from getting weather reports from Sally Tomato. All of them are legal. If its really a Candy Store, its easy, and once you get it going, you’ll enjoy the income for many many years.
Requirements for a Good Candy Stores
- Low capital outlay
- Low ongoing capital requirement
- 2 hours a week on average
- $200-400/mo base with upward potential without much extra effort
- Low liability, low risk
- Low stress
One Apartment Complex Away from Insanity
You Need to Own Real Estate
For most Americans, there is a mistaken belief that owning a home is the same as having an investment in real estate. Your home is not an investment. It is a liability. Your home costs you something. Even if you own your home cash with no mortgage, there are expenses tied to the property. You must earn other money in order to pay those expenses. When your home has a mortgage, then your expenses are that much higher. These expenses make your home a liability; it costs to own it. An asset is something that generates income.
I am not saying that you should not own a home. It is a reasonable means of preparing for retirement. In California, where Prop 13 keeps our property taxes locked in at our purchase price, it is an even wiser long-term financial play than in other states. A home is a wise hedge against the ravages of inflation. But, just because it is a wise use of financial resources to own your home (in most cases), it should not be considered a “real estate investment.”
A real estate investment is owning real estate that generates income that offsets the cost of ownership, and also appreciates with time. In most cases, where the property also has physical structures, the real estate asset also provides a unique opportunity to “shift” some of what you would otherwise pay in taxes through depreciation. See my article on non-monetary currency about shifting here.
I tell people to own a home, one that they can afford easily. Live in it and enjoy it and pay it down over time. Don’t get an interest-only loan. Pay your house off! Don’t think you can just buy a house and live in it and then sell it based on the house value going up (with one exception that I discuss below, where a house is lived in for 2 years and then flipped to take advantage of tax free gains). Sure, own a home. But, owning your home is not the same as owning a real estate investment.
Lets talk about real estate as an investment.
Before I tell you that you need to own real estate investments, I’ll give you the hard-truth about investing in real estate.
It’s a bitch. It is a total pain in the ass. Those who own real estate can attest to the fact that it will interrupt the most important and intimate moments of your life. One great example was when I was out with friends celebrating my birthday, eating the most amazing dulce de leche at Extraordinary Desserts. My phone rang, it was my sister who managed about 90 units of apartments in Phoenix for me.
“Hi Dana. I’m so sorry to bother you on your birthday. I tried to avoid it. But, I have a problem.”
“Hey sis. No worries. It comes with the territory. What’s the problem?” I said.
“Well, there was a leak. I had to get a guy out here to find it. He’s got a five-by-five hold dug in your parking lot, and he found the source. Its several feet down. He can fix it. But, we don’t have an account with him. He needs your credit card to finish it.”
“Ugh,” I moaned, stepping away from the table. “How much does he need?” I was thinking this would be expensive, like at least 500 bucks.
“Sit down if you aren’t already,” she said. I sat. “Five thousand dollars,” she said quietly.
Nice birthday present, right? Five grand in one drop. The icing on my dulce de leche!
“Okay, here it is,” I said.
In the end, the cost was actually a little less, but it is typical in real estate that you get hit with surprises like this…and often when it is inconvenient! If repairs aren’t a problem, tenants are. I owned one building for about 10 years. My staff nick named the property “Jerry Springer” because the tenants were just those kind of people, with that kind of drama. That drama will effect your life.
But, while I will tell you that property ownership is full of hassles and unpleasant surprises, I will also say that it is one of the keys to building wealth. Whether you are a seasoned investor, or trying to climb your way out of the rat race, you will need to invest in real estate. I’ve told you why you might not want to own real estate. Let me give you the reason you should own at least a minimum amount of income property as part of your financial strategy.
The $25,000 tax reason to own real estate
I’ll write a longer article on the ownership of commercial and large apartment complexes. But, for purposes of this article, I want to talk you through owning “just enough” real estate to take advantage of depreciation, while getting the benefits of appreciation, and as an inflation hedge.
When you buy rental property, you own two components of real estate: the land and the building(s). The land theoretically appreciates over time. Appreciation can come from buying land that goes up in value as the area becomes more dense. It can also “appreciate” by maintaining its value while the value of the dollar goes down. We call the dollar’s value going down inflation. Here’s a great book on the subject: What Ever Happened to Penny Candy (buy it with the link and I make like ten cents). I also address inflation in this post, about Moderate American Poverty.
Let me talk about inflation first, as real estate can act as insurance against the impact of inflation. You know that things will cost more dollars in 10 years than they do today. It’s inevitable. A cup of gelato today is $3, and in 10 years it might be $5. A beer costs more now than it did 30 years ago, or 80 years ago. This is inflation and it impacts almost everything. But, land and income property both tend to hold their “core” value while the dollar’s buying power drops over time. Thus, even if there is no significant increase in the “value” of the property, you can sell it for more dollars later. As I noted earlier in this article, this is one reason buying a home makes sense, even though a home is not really an asset. Of course, if you buy real estate wisely, you will get both a hedge against inflation AND an increase in value from positive growth in the geographic region of your investment.
But, hedging inflation and getting appreciation in the value of the property are not the only reasons to buy at least some income property. There’s a tax reason as well. You get to “write off” the cost of the structures that are on your property. You write these off over time. For most properties, the time-frame is 27 years. You write 1/27th of the cost of your structures off each year. For example, if you bought a property for $500,000, and the structures were worth $270,000 of the $500,000 purchase price, then you’d get to “write off” $10,000 per year (1/27th of $270,000).
You can write off up to $25,000 per year in this type of loss against your other ordinary income. Thus, using my example above, you could own 2 properties worth $500K (with structures each worth $270K), and then another one worth half of that, and you’d maximize your $25K per year depreciation limit. That should provide you with a loss of about $25,000 per year that you can write off on your tax return. The result of writing off $25,000 is that you net at about $7,000 in actual cash that you get to keep rather than pay the IRS. If these three properties made nothing at all in terms of net income, you would still be $7K per year ahead. Of course, if you pay the properties down over time, and raise rents over time, then you will also end up with additional gains. But, if all you get is $7,000 more per year, you will have almost $600 per month that you can be putting into your retirement account, or using for other investments. At the same time, you may have additional income that the property generates, adding to your cashflow. If the property goes up in value, then you can eventually sell it and move that cash into other properties, or other investments.
I note (throughout this blog) that I am not a CPA or tax attorney. You need to be sure you follow the rules and use a great CPA to help you understand the tax implications of your investing.
One caveat: when you sell the property you will have to “recapture” your depreciation and pay taxes at that time, unless you do a like-kind-exchange (aka the “1031 exchange”). I’ll get to the 1031 in more detail in another article.
If you are currently trying to scrape your way out of what I call “moderate poverty” you need to add real estate to the tools you need in order to gain financial freedom. You don’t necessarily need to own 90+ units like I did, but you should consider trying to maximize your passive loss limitations, and shift some of the money you would pay the IRS to your investments instead. The super rich do this on a grand scale. You should maximize the passive loss limitation if you want to take advantage of one of the loopholes that is available to the little guy. For those who are full-time active as real estate investors, there are ways to defer even more tax than I discuss here. I’ll save that for another article.
I’ll also get to some of the bigger and more sophisticated strategies used by the rich. But, for purposes of this article, I’m trying to teach the basics, and help those who are new to the game. Owning a minimal amount of rental property maximizes your depreciation and passive losses to pocket money you would otherwise pay the IRS, and at the same time, gives you an inflation hedge. Everyone I know that has dug their way out of moderate American poverty has used real estate as part (if not all) of their financial strategy. It is an important tool in your tool chest.
Let me talk a strategy that is often used by those who are just starting out in real estate. It involves another small tax loophole that helps the little guy, and not just the super rich.
At the outset of this article, I said that your home is not an investment. It is not an asset. It is a liability. Well, there’s one exception: those crazy couples who buy a house, fix it up while they live in it and then sell it.
Why does this matter?
Well, there’s a tax exemption for the gains you make on a house you have lived in for 2 of the previous 5 years. This means that if you live in any house for 2 of 5 years, when you sell it you don’t pay any federal tax on the gain. Imagine that you paid $350,000 for a house, and you live in it for 2 or 3 years. You fix it up. You make it pretty. You then sell it for $500,000. The $150,000 that you make is not taxed at the federal level. You can do this as many times as you want. The exemption is $250,000 for an individual and $500,000 for couples. This exemption is on the GAIN, not on the sales price. Thus, you can experience extraordinary profits, tax free, by using this loophole.
Some people will buy a house, live in it while the rehab it for 2 years and then immediately sell at the end of 2 years and take the gain tax free and move to the next property. Others will live in the house for another 2 or 3 years and wait for its value to increase. Either way, the gains are not taxed at the federal level ($250K per person, so couples get a $500K gain tax free).
Some people will actually do this in twos. Here’s what I mean. They will buy a house, fix it up for 2 years and then move out and rent the house. They buy a second house, live in it for 2 years and fix it up. At the end of the 4th or 5th year after they bought the FIRST house, they’ll sell it. This means they lived in it for 2 years (out of 5) and then rented it for 3 more years, making rental income, depreciating it, and letting its value go up, and then when they sell it they don’t pay federal tax on the gains. Then they are in a second house they’ve already fixed up and lived in for 2 years and they can move out, rent the second house for 3 years and buy a third house that they move into, and then a fourth, etc. Its not for the faint-of-heart! You have to move every few years. But, as a wealth building tool, there are few loopholes that are as effective for those of us who want to dig our way out of the hole and attain financial freedom.
The key with live-fix-and-flip is that you really have to know your market, and you have to be very wise about how much fixing you do. It is easy to watch too much HGTV and spend your wad at the Home Depot and Lowes, only to realize that your idea of what buyers want in a house is not what buyers really want. Redoing a kitchen or bathroom sometimes brings a return, and sometimes it doesn’t. Sometimes there’s a rational basis for a total rehab, and other times, you just need to make the house habitable. Be careful if you take this route. It is a great way to get ahead, but also a wreaking yard for the dreams of the unwise.
Ultimately, you can take either path to success in real estate. Get a couple of rental properties and let the income pay the mortgage and let the tax savings put money in your pocket every year. Or, get buy a house to fix up, live in it for two of five years and then sell it and keep the gains tax free…and do it again. Either way, you’ll find that this is one of the best pathways out of moderate poverty available to the average American.
Want to own a $45,000 car for $14,000?
Cashless Currencies: Shifting, Swapping and Trading Things of Unequal Value
I’d like to introduce you to one of the most important concepts for bootstrappers. I’ll the concept “non-monetary currency.” I want to teach you to look for currency in places other than your wallet. I’ve given these ideas titles that I’ve invented, but of course, I’m not the only one actually doing these things.
Trading Things of Unequal Value
I was having a beer with a very smart friend of mine, many years ago. He was an Ivy League engineer and attorney. He’s incredibly smart. One of the smartest guys I know. What I love about him is that he’s not just your typical rich Ivy League guy. He’s resourceful…one of the personal traits I admire the most.
At the time, I lived in a gorgeous home overlooking the Pacific Ocean in La Jolla, California. We were sitting in the den, where I had antique animal trophies mounted, and a large humidor full of cigars.
“That’s a lot of cigars” he said.
“Yeah,” I replied.
“Seems like a waste of money, dude.”
“Ah!” I said. “No, I actually get them from a client for free.”
“Seriously? How much is a typical cigar?” He replied.
“I actually don’t know, but I think these are 15 bucks, some of them are $20 or more”
“You must have a thousand dollars in cigars.”
“I suppose so,” I said, sipping on my Speedway Stout.
“How about that expensive humidor?” he asked.
“Same” I said and waved my beer in the direction of the humidor.
“Okay, I’m curious, dude, what else, in this house or wherever?”
“What other trades have I done?” I said.
“Yeah,” he replied.
“Hmmmm.” I leaned back and sipped my the black velvety beer. “I once got a log house for my niece. Well, not a full sized log house, but you know, a playhouse out of foam logs.” I said as I continued to think.
“Okay, what else. Hmmm,” I continued, “storage shelving, vodka, clothing, shoes, a watch, a MacBook Pro, software, spa robes…I can keep going if you want,” I said.
“Haha,” he laughed. “I’m picturing you in your free spa robe with a free cigar and a free glass of vodka working on your free computer!”
I thought a bit more. “The chair you are sitting on was from a trade. As was my bedroom furniture, my daughter’s bedroom furniture, and this Persian rug under our feet.”
“I like your model.” he said.
“I call it trading things of equal value,” I replied.
“That’s funny because I’ve done similar things and I call it ‘trading things of UNequal value,'” he continued, “it’s not an equal trade. You aren’t really trading an hour of your time at your real rate because you are using time that is otherwise not spoken for. You are trading less valuable time, but for a full priced trade. That makes the trade cheaper from your perspective, while also giving the full value to the guy on the other side because if he hired you he would pay your full rate.”
“I like it,” I said. “It’s a trade of two un-equal values where both parties benefit.”
My friend when on, “exactly! The other guy is also trading something of unequal value. To him, he may not be able to sell all of the equity he needs in order to pay you. So, the cost to him is not the full value he is getting from your services. He’s getting a good deal as well, by trading something of less value in his hands for a service he would have to pay more for if he paid cash.”
“You are totally right on,” I said. “As long as I’m trading hours I would not otherwise sell, then its a deal for me. As long as the other party is trading at a lower value in their hands, then they get a deal too. Its the ultimate win-win.I’m changing my name to trading things of unequal value.”
We finished our beers and moved onto discussion of real estate depreciation (which I’ll save for another blog entry).
What is important to understand here is that everyone in America has something of “unequal value” they can trade. Do you cut hair? Trade that for advice from an attorney, or your CPA for filing your taxes. Do you sell retail goods? Trade at full retail, which means you are actually trading something that cost you half of what you are getting in the trade. Whether you have a good or service to offer, you can find ways to create currency from that and get other things you may want or need without having to come “out of the wallet” for everything.
Let me move on, and get to the next cashless currency concept.
Shifting is my label for taking money that would go to one place (such as the IRS) and using it for another purpose. My favorite example is also one of my favorite cars of all time. I once owned a Mercedes ML320 (like the photo above). That’s the SUV model. For those car snobs who want to know why I didn’t get an ML500, it is because a V8 is a waste of money, and requires more maintenance and is totally unnecessary on the short roads in and around my little seaside village. So, stuff it if you don’t like the ML320. Anyhow, a friend was selling his ML320 with 30K miles.
I bought the ML320 for $21,000. I could have paid cash, but the friend was doing well and basically said, “pay $7K down and pay the rest off over the next year or two.” I agreed, and that same day I was the proud owner of a beautiful Mercedes SUV. Let me remind you that a new ML320 at the time would have been over $45K. So, for starters, I’m buying a car that is only 3 years old that is less than half of the cost. That’s an important financial lesson in itself. Buy used. That car lost $24,000 over the course of 3 years.
But, that’s not the main lesson. The thing that was great about this car was that it was over 6,000 pounds in weight. What that means is that the SUV is actually categorized as a “truck” or what we might call a “work truck” or “farm truck” (haha, right?) for IRS purposes. I bought the car for business purposes, and in fact used it for almost 10 years as a work truck for my property management business. I’m not a CPA, and I don’t know the current IRS rules, but at the time, there was a rule that let a business owner accelerate the depreciation on work vehicles over 6,000 pounds. That meant I could write the entire $21,000 off that year as a business expense. This saved me $7,000 in taxes that year. Thus, the effective price to me was $14,000. And, I didn’t even have to pay the car off up front. I put down $7K, and then saved $7K in taxes. That meant I was into the car for zero dollars. I had shifted what I would have paid the IRS. I still paid $7K, but instead of to the IRS, it was to my buddy Ron. And, the net cost of owning a $45,000 Mercedes was $14,000 ($21K purchase minus $7K in saved taxes). And, I paid for it over 24 months.
Rich people are masters of “shifting.” They are particularly good at “shifting” when it comes to taxes. They use shifting to take money they would owe in taxes and use it for investments, real estate, vehicles, and even private jets. They use captive insurance companies and a variety of other shifting devices to expand their wealth, while paying a little less (or a lot less) in taxes.
For those of us “little guys” the shifting is more difficult. My story of the Mercedes is a small victory. Another one is actually real estate. I’ve got an article on maximizing your passive loss on real estate here.
Look for creative ways to shift what you would pay to something you don’t want or need and re-focus that money into something you do want or need.
In many ways “trading things of unequal value” at the outset of this article is a type of “swap.” But, swapping can simply be finding “things” you don’t want or need and trading them for things you do. Your garage full of neglected possessions might be a trove of things you can swap for things you do need. Before you go spending real money on more “stuff” consider taking some of your idle stuff and putting it to work. There are swap and trade sites all over the Internet. Craigslist is full of swap opportunities.
Swap your airline miles for something you need, or vice versa.
Swap the use of your house for someone else’s house for your next vacation.
Swap the use of a room in your house for something of value (I talk about renting a room through AirBnB in a separate article).
I’ve swapped some old landscape equipment for labor, had a guy do a lot of landscape work I would have paid for, and instead paid with my old equipment.
Of course, a trade of unequal value is always better than a swap, but don’t forget that your stuff is a currency. Your time is a currency. Your skill, talent, or even your artistic ability is a currency. Learn to use the non-monetary currencies at your disposal, both as a tool to gain financial freedom, and for entrepreneurs, as a means of bootstrapping your business without using precious cash.
Nice chair, maybe there’s a matching one under those bags
I am a fireplace junkie. One of my favorite things in the world is a huge crackling fire in a big fireplace. I can sit for hours and read by the fire, write, or have conversation with friends and family. But, firewood ain’t free. In fact, its damn expensive, and burning firewood is like tossing dollar bills in the fire like Richie Rich.
For many years, I lived in a beautiful, old, Spanish-style house on La Jolla’s “Street of Dreams.” How I came to live in this house is a story of its own, but for now, I’ll stick with the fireplace. That house had a fireplace that was large enough to cook a fucking pig. It. Was. HUGE. It was perfect for a fireplace junky like me. In fact, this great old house also had a fireplace in the outside courtyard where I could sit with friends and have scotch by the fire while enjoying the outdoor environment. Perfect for cigars. And, three other fireplaces throughout the house. Yeah, five fireplaces. It was a grand old house.
For anyone who has been to the typical grocery store, you have probably seen stacks of “firewood” near the front of the store, usually where ice and charcoal is sold. You know the grocery-store-firewood; usually shrink-wrapped into tiny bundles and maybe a hemp-rope handle stapled to the wood, so you can carry it out. How much wood do you get? Five pieces, if you’re lucky! For $6.99, you get five crummy pieces of wood. Each time you toss a log on the fire, you are burning a buck-fourty. Now, imagine how much firewood a guy like me could use in one cold season (between 5 fireplaces). One sitting for a couple of hours could easily cost $100. I could save a little money by ordering wood from a tree trimmer. But, still, after paying for delivery, the cost of firewood is just a lot of damn money.
One drizzly day, years ago, I was at home when my wife called me. “Babe,” she said, “I just passed a spot where a dead tree is being cut up into pieces by city workers.”
Now, she didn’t have to say more than that. I actually knew the spot she was talking about because I had passed a dead tree on my way out of La Jolla many times. I had fantasized about borrowing a chainsaw and taking that precious wood home in beautiful, pine-scented stacks.
“I’m on it,” I replied.
“I’ll be passing back by it in an hour, actually,” she said, “I’ll meet you there and help.”
Ha! I didn’t think twice about the fact that I lived in a multi million dollar house on the nicest street in the nicest town in the county. I didn’t think that it was beneath me to drive my Mercedes over to a public street in a rich town and pull off to the side of the street to scavenge some wood from a felled tree. So, that I did. I drove my black Mercedes sedan over to the spot, and met the wife, also driving a Mercedes, SUV. I took off my dress shirt and kept my t-shirt on and just started filling the back of the SUV with luscious free fresh-cut firewood. I filled the back of the truck and was putting in the last few pieces when a convertible BMW drove by, full of rich kids, and one of them yelled “TRASH DIGGERS!” and I could hear them laughing as they sped up the hill.
I laughed, then I paused and said aloud, “hey…those spoiled brats probably didn’t have to pay for that BMW with their own money” and then I shook my head and said “motherfuckers” under my breath. Heather laughed, and said “they don’t know what its like to pay for anything, and they never will.” I nodded, and then got my happiness back when I looked and beheld an entire SUV full of free firewood.
Do you know anyone who would see $100 bill on the ground and not pick it up? I don’t. Yet, every day most people do just that. They don’t want to be a trash digger. If you happen to be rich, then it is certainly your prerogative to walk past a $100 bill. Scrooge McDuck burns $100 bills to stay warm. In this wonderful free country of ours, it is your choice to do what you want with your money, and for the majority of Americans, they do just that.
Alright, so you don’t want to dig in the trash. That’s fine. It’s a metaphor more than anything. So, even if you don’t want to actually touch trash, if you want to get out of moderate American poverty, you need to tap into your inner scavenger.
I am a trash digger at heart. I vividly remember the first time I dug in a trash can as a child. It was after a neighbor’s house was cleaned for a move, and their trash was full of delightful things, auto magazines, nicknacks, jewelry, dishes. I brought a treasure trove home. Much of those “treasures” ended up in our trash, but a few items found a home in my room. The second time I dug in a trash can was even more amazing. There was a full sized dumpster in the next-neighborhood-over from us. I rode my Scorpion BMX bicycle (with Shimano cranks and a numbered Haro handlebar plate) in that neighborhood often. One day, I was riding and noticed the new large green dumpster. I thought, “why not have a look in this thing, it might contain something valuable.” I hung over the edge with my head inside the dumpster to find that it was almost entirely full of blown glass sculptures, glass vases, ceramic figurines, and more. Was some of it broken, you ask? Of course. Was some of it not broken? Hell yes. I climbed into the bin, and carefully extracted dozens of unbroken hand-blown items. I found a box that had originally held some glass items and filled it with my new possessions and then managed to climb back out and walked home with my bike as the trolly for my box full of glass treasures.
“What in the world did you do?” my mother asked. “I found this all in a trash can. You wanna come see? Maybe there’s more stuff I missed!” I exclaimed. My mom rolled her eyes. But, not my little brother. He was immediately at my side, fondling my precious glass swan (with fiber optic plume intact), and asked, “can I go see?” Damn right he could go see! And see we did. We rode back on our bikes and dove in for round two of the dumpster dive. He wasn’t disappointed. I can’t entirely recall how we got my little brother into the dumpster but we both ended up in that dumpster and we picked through all of the hundreds of broken items to acquire many more unbroken things. We were kings! We lugged more stuff back home, and to our mother’s chagrin, we showed off our trash digging finds. We shared them of course! Not only did we hand things out to friends and neighbors, well, you can guess what our aunts, and grandmothers got for Christmas that year? Yup. Random glass figurines, vases, and at least one person got a glass swan with a fiber-optic plume.
It isn’t like we were poor. But, we weren’t rich either. That position, between poor and enough, is just uncomfortable enough to motivate a kid to look for something valuable in the trash. In fact, it was one of life’s great lessons. I have many stories about success later in life that flow from my willingness to find value in unconventional places. I’m talking about things as simple as a computer monitor, and as complex as an entire business. Trash digging, if you want to call it that, has allowed me to claw my way out of the socioeconomic class that most people want to rise out of. I’ve never won the lottery. I’ve never inherited a dime. I’ve never had a huge paying job. What I have done to rise out of the middle class is to embrace my inner trash digger. If you’d like to learn more about how, then follow me, and watch for more articles. I’ll take you along a series of journeys and help you find your own unconventional path to success.