Author Topic: This really amazes me  (Read 7558 times)

SC93

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This really amazes me
« on: February 16, 2018, 12:39:57 PM »
I've thought about it for a long time but just now posting about it. It amazes me that so many people on here are all fired up about taking the chance of not paying off your debt and investing the money instead.... GO FOR IT!!! Let's Take that chance!!! Yet they took the s l o w way in life of making money and didn't take the chance of starting that million dollar business where they work for their self and might possibly be rich in months..... too risky? I sit back and laugh when these same people tell others to not pay off their debt.... take the chance in the stock market yet they played it the safe way and got a J O B instead of putting their self at risk and making their own name, doing their own thing and making more money in a month than they do at their job in 2 years. Kind of like putting a mirror on both walls and looking in it.... see those 2 faces?

For the new folks.... pay off that debt and invest in yourself! If you are going to take a chance, make it so YOU are in control of your life instead of a boss and the stock market. It seems as though most on here are stock market rich while others of us actually have money! Take control of YOUR life, don't put it in the hands of others.

Eric

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Re: This really amazes me
« Reply #1 on: February 16, 2018, 12:46:18 PM »
Only successful business owners have a grasp on math and statistics?  Is that the gist of your ramblings?

J Boogie

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Re: This really amazes me
« Reply #2 on: February 16, 2018, 01:00:08 PM »
SC93, you've been watching too many wantrapreneur youtube videos.

Starting your own successful and lucrative business requires far more energy and intelligence (and in many cases, luck) than your stream of consciousness would indicate.

If you're really on to something, I challenge you to post your numbers. Show us how much you've made through your investments in yourself.








jlcnuke

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Re: This really amazes me
« Reply #3 on: February 16, 2018, 01:10:05 PM »
Historically, the majority of small businesses fail (~50% in the first 4-5 years). The vast majority never make their owners massive wealth (the Zuckerberg's of the startup world are vastly outnumbered by the "you've never heard of me because my business went under" and the "you've never heard of me and I work tons of hours to barely scrape by running my business" people).

Historically, the majority of long-term index investments make money (99.999%).

It's absurd to try and compare saying 'go ahead and invest instead of paying off your debt faster because it's more likely to result in a higher net worth" with thoughts of starting a business. Starting your own business is statistically more likely to reduce your net worth than increase it.

wordnerd

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Re: This really amazes me
« Reply #4 on: February 16, 2018, 01:39:51 PM »
I have no aptitude for starting/running a business. I have an aptitude for maintaining well-paid employment. I imagine I'm not unique in this.

Scortius

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Re: This really amazes me
« Reply #5 on: February 16, 2018, 02:03:16 PM »
It's a little ironic that you started a thread about people who don't understand risk-reward trade-offs by writing a post that clearly demonstrates that you have no idea how to evaluate risk-reward trade-offs.

wenchsenior

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Re: This really amazes me
« Reply #6 on: February 16, 2018, 02:07:44 PM »
I have no aptitude for starting/running a business. I have an aptitude for maintaining well-paid employment. I imagine I'm not unique in this.

lol

I have no idea if I have aptitude for starting or running a business apart from the small, sole proprietorship I have as a side gig.  Maybe if I had an idea for one that I was passionate about, I would try it.  But ideas for businesses don't grow on trees, as far as I know, and I've never had such an idea.

Also, I am a hard core introvert, and the 'hustle' and constant need to self sell and interact with strangers that a new business (or even a lot of established businesses) require? No fucking way am I doing that unless I 1) suddenly have the idea that overwhelms that severely unpleasant prospect with the excitement of putting it into practice; or 2) I have to because I have no other options.

Both of those are highly unlikely conditions. 


Rufus.T.Firefly

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Re: This really amazes me
« Reply #7 on: February 16, 2018, 02:16:57 PM »
I'll chime in as a solo-preneur (entrepreneur with no employees). I love my work, have tons of freedom, and make decent money.  It feel like I've found a loophole in the "system."

Yet, when I describe it to others and they realize my income is completely not guaranteed in a given time period, they give me a funny look. "Oh yeeaahhh ... that's not for me," is the next thing they say. Everyone's wired differently. My job is a dream situation for a small % of people - and hell everybody else.

SC93 has a lot of energy and passion for this business owner lifestyle but he doesn't realize how it isn't a fit of a lot of people. Which is a good thing because without solid employees, no business would ever run well.

slappy

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Re: This really amazes me
« Reply #8 on: February 16, 2018, 02:23:08 PM »

SC93 has a lot of energy and passion for this business owner lifestyle but he doesn't realize how it isn't a fit of a lot of people. Which is a good thing because without solid employees, no business would ever run well.

SC93 seems to have a lot of passion for how great SC93 is. :)

Holocene

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Re: This really amazes me
« Reply #9 on: February 16, 2018, 02:30:26 PM »
The risk of investing in the stock market is completely different than the risk of quitting a good paying job to start your own business.  Trying to equate the two is pretty ridiculous.

The risk is extremely low that the stock market will gain less than 3.5% nominal per year over the next 30 years (including dividends, not adjusted for inflation).  So I feel comfortable investing over paying down my mortgage.  I think the risk is basically 0 that I would go bankrupt from this approach.  I'm investing in thousands of companies across the US and the world.  And if all of these companies fail, I think we'll all have much bigger problems.

While working for yourself and starting a business may be a great way to build wealth, there's also a huge amount of risk in that path.  You're putting all your eggs in one basket and if it fails, you're back to square one, needing a new J O B with possibly outdated skills.  Yes, you have more control over how successful your business is based on how much work you put into it.  But there may still be factors outside your control that cause your business to fail.

It's one thing if you have some brilliant idea that would make a good business, or you're super passionate about your business to the point where it wouldn't even feel like work.  In that case, the risk may be worth it.  But for most people, it's easier to just show up at an office for 40 hours a week, get told what to do, and get consistently paid for it.  So it's not at all surprising to me that this is the path that many choose.

Holocene

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Re: This really amazes me
« Reply #10 on: February 16, 2018, 02:37:13 PM »
Also, I am a hard core introvert, and the 'hustle' and constant need to self sell and interact with strangers that a new business (or even a lot of established businesses) require? No fucking way am I doing that unless I 1) suddenly have the idea that overwhelms that severely unpleasant prospect with the excitement of putting it into practice; or 2) I have to because I have no other options.

Both of those are highly unlikely conditions.

Haha, this describes how I feel 100%.  The selling part of running a business would indeed be a special kind of hell for me, especially if my livelihood depended on it.
« Last Edit: February 16, 2018, 06:15:27 PM by Vapour »

ysette9

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Re: This really amazes me
« Reply #11 on: February 16, 2018, 02:44:19 PM »
As a kid I had a million get-rich quick schemes that I tried to put into action. Lemonade stand, selling produce from our garden, fancy wrapping paper, magazine subscriptions, baby sitting, piano lessons, etc. I found that it is really really hard to get people to part with their money, and every thing I tried was significantly less successful than I had imagined it would be.

Lesson learned: I’m not cut out for this entrepreneur thing. I love showing up for a set number of hours per day, doing my thing, and letting someone else worry about monetizing what I can offer. Screw taking on all that risk. Let someone else worry about selling products and keeping the money flowing. I’m going home to hang out with my kids.

NoraLenderbee

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Re: This really amazes me
« Reply #12 on: February 16, 2018, 03:14:54 PM »
I could work 70-100 hours a week, nights and weekends, no vacations, for the possibility of a big reward or big failure. Compared to that, working 40 hours a week for a fixed paycheck, and enjoying the rest of my time, sounds almost like retirement.

Gimesalot

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Re: This really amazes me
« Reply #13 on: February 16, 2018, 03:26:15 PM »
When I think of running my own business it makes me want to puke.  I would have to deal with customer or clients, until I get to hire someone.  Then I would have to deal with HR issues for the person I hired.  I would probably have to hire an accountant to deal with taxes and payroll.  Then I would need to make sure that my clients paid me.  I would need to buy different types of insurance.  I probably would need to hustle and get certifications.  Sure I could make more money, but I don't really need that much money. 

Telecaster

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Re: This really amazes me
« Reply #14 on: February 16, 2018, 03:41:42 PM »
I own my own company, which I love, but it is definitely not for every one.  Back when I first started and for a period in 2008-09 my income was very close to zero.  There was one time when a client stiffed me on a major project, and not only did I not get paid for my end, I owed thousands to my vendors.  I live below my means, so I can handle things like that.  But not everybody can or wants to do that.  I've also worked a bazillion nights and weekends.  And not everybody can or wants to do that.  The upside is that in the last few years I've made a good bit more than if I was doing the same job on salary, and I have quite a bit of flexibility.   But I never recommend people do what I did.  Reasonable people could conclude the downsides aren't worth it. 

I love, love, love SC93's entrepreneur stories.  But I don't want to do it the way he did it either.  And there is nothing wrong with being stock market rich.  There is a lot to be said for the Green Soldiers working for you. 


Mustache ride

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Re: This really amazes me
« Reply #15 on: February 16, 2018, 04:14:40 PM »
There's only 3 things in this world that are guaranteed. Death, taxes, and SC93 posting about owning your own business.

undercover

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Re: This really amazes me
« Reply #16 on: February 16, 2018, 06:04:53 PM »
The survivorship bias is strong in this one.

While working hard for two years to build a successful business and give it up sounds great on paper, it's obviously not that simple. First, life isn't a race. Nothing is free. Working that hard that fast will definitely burn you out and could lead to severe health issues...and that's if you're successful. Imagine struggling the entire time and having nothing to show for it when you're done.

Part of willingness to eliminate debt as quickly as possible is also because when you're working for yourself there is more uncertainty (not that a job is guaranteed) and debt seems more risky. Debt will likely be a lower percentage of your net worth if you're working for yourself regardless of your tolerance for risk.

While I'm totally with you on working hard and investing in yourself and taking risks, this post is just short-sighted and doesn't take into account the perspective of 95% of people. You're comparing the probability between something that is statistically probable and something that isn't and pretending they're the same thing and that the least statistically probable still makes more sense for everyone regardless of who you are. That's just crazy.

bacchi

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Re: This really amazes me
« Reply #17 on: February 16, 2018, 09:10:47 PM »
Been there, done that. Talked with VCs, got seed money, got second round, put in the hours, and...it folded.

Then I realized that the best risk-reward is consulting for entrepreneurs who have dollar signs in their eyes. It's a lot fewer hours, too.

GU

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Re: This really amazes me
« Reply #18 on: February 16, 2018, 09:54:19 PM »
Quote
it seems as though most on here are stock market rich while others of us actually have money!

I would bet a lot of us aren't rich in either manner.  Or maybe I'm projecting :)

Laura33

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Re: This really amazes me
« Reply #19 on: February 17, 2018, 08:14:20 AM »
As Clint Eastwood so famously said, a man’s got to know his limitations.  I am very good at certain intellectual pursuits.  I am atrocious at details and paperwork and people.  I am also very external-deadline-driven, not self-motivated.  Ergo, I have been infinitely more successful as a lawyer in a niche field than I would have been trying to start and run my own business.  And the parts of my job that I dislike and struggle with are the “business-ey” aspects of it - marketing, managing the clients, and the like.

Plus I’m happier.  Don’t forget happier.

FallenTimber

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Re: This really amazes me
« Reply #20 on: February 17, 2018, 10:11:19 AM »
It’s interesting to see the various responses here. I’ve always had an entrepreneurial mindset, as does my wife, but I know a lot of folks who prefer to go into work from 9 to 5, forget about work at 5:01, forget about work all weekend, and start over on Monday. There are certainly advantages to putting in your 40 hours and enjoying the remaining time. A lot of folks, including many family members and friends, find comfort in that. Even the ones who complain about their jobs have no interest in starting their own business. I wouldn’t try to push my own mindset on them. I will say, when you have a salary position, you rely heavily on a defensive strategy, as a set income means the primary way to save more is to spend less (aside from raises and climbing the ladder, of course, but those are typically 3-10% increases). Obviously a strong defense is  a huge component of MMM philosophy.

Personally, my wife and I thrive off of the challenge of starting new businesses and making our own schedules. If we ran into a windfall of 1 million dollars, we would invest all of it into new businesses. Our passion is creating and marketing businesses. When we lose excitement over one business, we start another business. We mitigate the risk of self employment by running 5-10 businesses at a time. And none of it ever feels like work simply because we love every second of it. It’s true that an entrepreneur works 80 hours to avoid working 40, but what’s important is enjoying those 80 hours. It’s also important to remember that an entrepreneur may make in 2 months what a salary employee may make in 2 years.

For the folks interested in entrepreneurship but feel like you don’t have a brand new idea, you should remember that in this day and age, almost every thing you could ever dream up has been invented, monetized, or turned into a business of some kind. But the most successful businesses aren’t from the inventors. It’s from the folks who see an idea being done, and they improve upon it by 10%. You could name 50 businesses and I’d venture to guess that 49 of them weren’t the first to do it.

FIRE47

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Re: This really amazes me
« Reply #21 on: February 17, 2018, 02:30:35 PM »
I've thought about it for a long time but just now posting about it. It amazes me that so many people on here are all fired up about taking the chance of not paying off your debt and investing the money instead.... GO FOR IT!!! Let's Take that chance!!! Yet they took the s l o w way in life of making money and didn't take the chance of starting that million dollar business where they work for their self and might possibly be rich in months..... too risky? I sit back and laugh when these same people tell others to not pay off their debt.... take the chance in the stock market yet they played it the safe way and got a J O B instead of putting their self at risk and making their own name, doing their own thing and making more money in a month than they do at their job in 2 years. Kind of like putting a mirror on both walls and looking in it.... see those 2 faces?

For the new folks.... pay off that debt and invest in yourself! If you are going to take a chance, make it so YOU are in control of your life instead of a boss and the stock market. It seems as though most on here are stock market rich while others of us actually have money! Take control of YOUR life, don't put it in the hands of others.

With the risk of simply piling on with the others with what has already been said the major reason would be risk... a business entails a much higher risk than investing in an index fund. One puts all your eggs in one basket - that of a tiny startup. While one is invested in hundreds of stable enormous businesses.

A business also involves a great deal of work - you can't just give a recommendation to someone to start business but anyone can invest in an index fund. One is a tried and true formula that WILL work 99% of the time.

I do agree with you that investing in yourself is by far the best investment - carefully selected new skills and credentials that increase your earning power are going to make you 10x the return compared to any conventional investment.

 A successful business can also make you a far larger return I doubt anyone here will argue that.

« Last Edit: February 17, 2018, 02:38:18 PM by FIRE47 »

11ducks

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Re: This really amazes me
« Reply #22 on: February 17, 2018, 02:53:25 PM »
Also, I am a hard core introvert, and the 'hustle' and constant need to self sell and interact with strangers that a new business (or even a lot of established businesses) require? No fucking way am I doing that unless I 1) suddenly have the idea that overwhelms that severely unpleasant prospect with the excitement of putting it into practice; or 2) I have to because I have no other options.

Both of those are highly unlikely conditions.

Haha, this describes how I feel 100%.  The selling part of running a business would indeed be a special kind of hell for me, especially if my livelihood depended on it.

Thirded. Every time I consider applying for a promotion, I come back to this - I don't want to 'manage' adults, or constantly be 'on'. As a single parent, I chose my job for its security and the demand in the area. I will always have a job and a steady paycheck if I want it.

nick663

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Re: This really amazes me
« Reply #23 on: February 17, 2018, 03:02:01 PM »
Yet they took the s l o w way in life of making money and didn't take the chance of starting that million dollar business where they work for their self and might possibly be rich in months
I know many people that took that chance and none were rich in months.  Most worked a ton of hours with little to show for it.

Maybe I'm just risk adverse but with a target of a little over a million dollars the "slow way" isn't slow enough that I'm willing to take a statistically very risky approach to wealth accumulation.

Neo

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Re: This really amazes me
« Reply #24 on: February 17, 2018, 06:18:52 PM »
It’s interesting to see the various responses here. I’ve always had an entrepreneurial mindset, as does my wife, but I know a lot of folks who prefer to go into work from 9 to 5, forget about work at 5:01, forget about work all weekend, and start over on Monday. There are certainly advantages to putting in your 40 hours and enjoying the remaining time. A lot of folks, including many family members and friends, find comfort in that. Even the ones who complain about their jobs have no interest in starting their own business. I wouldn’t try to push my own mindset on them. I will say, when you have a salary position, you rely heavily on a defensive strategy, as a set income means the primary way to save more is to spend less (aside from raises and climbing the ladder, of course, but those are typically 3-10% increases). Obviously a strong defense is  a huge component of MMM philosophy.

Personally, my wife and I thrive off of the challenge of starting new businesses and making our own schedules. If we ran into a windfall of 1 million dollars, we would invest all of it into new businesses. Our passion is creating and marketing businesses. When we lose excitement over one business, we start another business. We mitigate the risk of self employment by running 5-10 businesses at a time. And none of it ever feels like work simply because we love every second of it. It’s true that an entrepreneur works 80 hours to avoid working 40, but what’s important is enjoying those 80 hours. It’s also important to remember that an entrepreneur may make in 2 months what a salary employee may make in 2 years.

For the folks interested in entrepreneurship but feel like you don’t have a brand new idea, you should remember that in this day and age, almost every thing you could ever dream up has been invented, monetized, or turned into a business of some kind. But the most successful businesses aren’t from the inventors. It’s from the folks who see an idea being done, and they improve upon it by 10%. You could name 50 businesses and I’d venture to guess that 49 of them weren’t the first to do it.

Interesting. Have you written here or elsewhere about your strategy? I would love to know more about what kinds of businesses you run, what works and what doesn't, pitfalls, etc. Do you mind sharing more?

Mr. RME

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Re: This really amazes me
« Reply #25 on: February 17, 2018, 09:05:50 PM »
I like the concept of investing in yourself.  However, most people don't exactly know how to go about starting a business.  For many folks, owning and running a business is just not right for them.

For example, the first few years of owning and getting a new business off the ground can be brutal.  It takes a considerable amount of time and commitment early on to make a business work.  For those with a young family, this might not be a trade off they are willing to make.  Investing in index funds on the other hand is low effort and reasonably reliable, and the right path for most folks.  It may not make them rich overnight, but over time it'll do the trick.

I am big fan of hanging on to mortgage debt while putting discretionary cash into the market, but would get rid of all other consumer debt pretty quickly. 

AnnaGrowsAMustache

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Re: This really amazes me
« Reply #26 on: February 18, 2018, 09:20:21 PM »
I don't understand. Am I stupid here? Surely it's better to pay off debt, unless you can expect a higher return from investing than you're paying in interest on your debt? And that's not really realistic, even if it were guaranteed, which it ain't. I'm pretty sure that applies to all debt everywhere, except for mortgages in the USA which appear to be structured in such a way that paying them off early is not a particular advantage.... I could be wrong. And possibly fixed term, interest free credit - for the same reason.

As for running a business... I'm someone that oscillates between freelance and employment. There are massive pros and cons with both. On the whole, employment is far easier, the main con being that someone else is in charge of how much you can earn. That's when the side hustle comes in.

I don't understand how you've related investing with running a business. Running a business is far riskier, and requires far more effort. That would be why banks invest and don't buy and run businesses?

alanB

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Re: This really amazes me
« Reply #27 on: February 20, 2018, 11:38:50 AM »
Be amazed.  I am 5 years into my 7 year career path to FI and I like my job.  That is fast enough for me.

"Stock market rich" and owning a business are the same thing.  Your business has a market price too, you just choose to ignore it.

I love your posts SC93.  I will take control of my life as you suggested.

mm1970

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Re: This really amazes me
« Reply #28 on: February 20, 2018, 11:43:32 AM »
Historically, the majority of small businesses fail (~50% in the first 4-5 years). The vast majority never make their owners massive wealth (the Zuckerberg's of the startup world are vastly outnumbered by the "you've never heard of me because my business went under" and the "you've never heard of me and I work tons of hours to barely scrape by running my business" people).

Historically, the majority of long-term index investments make money (99.999%).

It's absurd to try and compare saying 'go ahead and invest instead of paying off your debt faster because it's more likely to result in a higher net worth" with thoughts of starting a business. Starting your own business is statistically more likely to reduce your net worth than increase it.
+1

And +1 to, it's just not my thing.  I'd like to think I have the skills, just not the interest.

And...stock market rich is still rich...

Mr. Green

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Re: This really amazes me
« Reply #29 on: February 20, 2018, 12:15:15 PM »
If there's a business out there I can start and make a mil or two in months, I have money to start tomorrow. Just tell me what it is.