Outsourcing Life: Unconventional Advice for When You’re Financially Secure
Published on - February 10th, 2010 (by J.D. Roth) This is a guest post from Erica Douglass. After selling her online business for a million dollars at age 26, Erica
“temporarily retired”. She now writes an online business blog at erica.biz. This is very much an article about advanced personal finance techniques, and doesn’t necessarily reflect my own philosophy.
You’ve pulled yourself out of debt, are saving a reasonable amount of income for your retirement, have built an emergency fund, and your daily needs are easily met with your income. Congratulations! Now what?
That’s exactly where I was in 2007. I sold my business and generated a huge windfall — over a million dollars. I paid off all my debt. And then I looked around and said, “Oh, crap.”
I had absolutely no idea what to do with my money. Previously, any extra money I’d earned was immediately stuffed back into my business, and I had been running deficits nearly everywhere. This was the first time in my adult life I’d ever had my head above water, financially speaking.
Over the next three months, I proceeded to blow over $50,000. Oh, don’t get me wrong — it was fun! I bought a new car (that I still drive), some really beautiful artwork from artists I loved (that looks great on my walls), and thousands of dollars in clothes, new furniture, and other indulgences, such as $4,000 custom hand-made stereo speakers (that I’m listening to right now.)
It was fun…for a couple months. Then it got boring.
My Spiral into Depression
Like many lottery winners, I spiraled into depression. The business I had spent six years of my life building was gone. I felt adrift — like I had no purpose. Despite having been “successful”, no one knew who I was. I had marginalized most of my personal relationships in favor of growing my business and working myself to death. And money wasn’t going to buy me out of the situation.
Slowly, I pulled myself out of my depression. I realized I had the opportunity to make myself into anyone I wanted to be. I could do anything I wanted. I had complete freedom. The thought was both exhilarating and terrifying.
I bought a shelf full of self-help books and read them all, relentlessly seeking to answer the many questions I had. Some of them were philosophical, like “What made me successful when so many others have failed?” Some were practical, like “How do I invest my money?” But all of them led back to one deeper question: “What should I do to be happy?” I soon realized the latter question was incorrect. The better question was, “Who should I be to be happy?”
In December 2007, I started blogging. I exposed a significant amount of my business life and thoughts. I wrote about my successes and my mistakes and failures. I enjoyed writing, doing videos, and interacting with my readers. Helping others figure out their purpose, their businesses, and their websites and blogs was a fantastic experience.
Spending with a Purpose
I made a point of trying to achieve greater states of happiness on a daily basis. Instead of being merely content — or even apathetic — with my current state of being, I realized I could be happier daily. And suddenly it hit me: I understood what I wanted to do with my money. I wanted to outsource pretty much everything I hated doing.
In order to live a simpler, calmer, but more effective life, I had to drop the shackles of wanting to do everything myself. To allow time to meditate, think, write, and create, I had to get rid of the drudgery of daily tasks. I realized my money could serve a fantastic dual purpose: To allow others, whose passion is cooking, cleaning, or assisting in various ways to help me — while I supported them by giving them income to do what they loved.
My life fundamentally changed that day. I started hiring people to do everything I didn’t want to do. The first step was to hire a cleaning service. Then I hired a personal assistant to work out of my house, filing papers, doing laundry, and organizing. I hired virtual assistants to do all the menial tasks I hated doing: bookkeeping; video editing; audio editing; even setting up my Facebook fan page. (Lisa, my VA who set up the Facebook page for me, said happily: “I can’t believe I get paid to do this!” And I realized…we’re both lucky.)
My Daily Routine
I wake up in the morning and my VAs have sent me their updates. I am building a business where I create how-to videos for small business owners and bloggers who want to drive more traffic to their sites and get more customers.
I learned meditation, and currently spend about 40 minutes a day relaxing. I also spend a few hours a day doing the parts of my business I love, from creating videos to writing to programming. When I walk down to the kitchen, it’s clean; Elia, my housekeeper, comes in every week to make sure it’s spotless. She spends 2 hours cleaning our kitchen; total cost to me: $30.
My VA in the Philippines edits my videos and does a fantastic job for $3.33/hour.
Whenever I do an interview with another entrepreneur, I send it to another VA in the Philippines, who, for $9/hour, edits it perfectly, getting rid of all the strange pauses and “um”s. I send the edited interview off to a transcriptionist. For less than $30, I get back an excellent transcription, often 12-16 pages long.
Lisa, my VA here in the U.S., has set up an entire website and integrated it with a shopping cart for my customers to order products and access them once they have ordered. She charges $30/hour (my most expensive staff member) and she’s worth every penny.
I treat my staff members well, and they love the fact that they can work from home and get paid great wages ($3/hour in in the Philippines is equal to about a $65,000/year wage here in the U.S.) They are happy — I can see it in their emails and text chat messages.
My partner Richard and I fight less. There’s no scrapping over who will do a certain task. If no one wants to do it, we work together to figure out how to hire someone.
A Disease Opens My Eyes
I was recently diagnosed with Celiac disease. The management of the disease may sound simple, but it’s not: eliminate wheat, oats, barley and rye from your diet. Most restaurants have very
few gluten-free items; I’m lucky if I can order one non-salad item from a typical menu. Some restaurants are impossible to eat at; soy sauce, for instance, has wheat in it. I’ve gotten sick from things as odd as bacon, cake frosting, and ranch dressing.
After a few weeks of eating mostly hot dogs and tuna fish, I grew tired of my limited options. I thought about learning to cook, but it wasn’t something that excited me. So we hired a personal chef to cook our meals — one who understands the challenge of cooking gluten-free. We pay her $10/hour, including travel time to deliver the food to us, and she gets a fun side job.
In a randomly-chosen week before I hired a personal chef, I ate out four times and went to the grocery store twice. I spent a total of $179.91 on restaurants and groceries. Last week, I spent $215.49, including groceries, for eating out and paying my personal chef. My “eating out” expenses dropped from $86.14 to just $32.28 — over 60% less! My total spent was $35.58 more, but to me, that’s a small price to pay for gourmet food of my choice delivered to my door. Another remarkable and unexpected side effect was that I no longer have an urge to go out and spend money at fancy restaurants — I simply ask my chef to make what I want and deliver it to me.
It has been more than two years since I sold my business, and I am happier than I have ever been. I made different choices than most: We rent a house instead of owning (a savings of nearly $4,000/month in our neighborhood — more than our monthly rent payment!); we only have basic cable; we don’t have a landline, credit card debt, car payments, or student loans.
I chose, instead of buying more Stuff, to live a more fulfilled life. For me, even more important than holding onto my money tightly was to learn to let it go — to give it to others in exchange for work well done, and to trust that they could do tasks well. It’s one of the best decisions I’ve ever made.
Previously at Get Rich Slowly, Erica shared Finding Time to Pursue Your Dreams: How to Free Up 750 Hours a Year with One Simple Change and The Ten-Minute Budget. Download her free Blog Success Manifesto, which offers 30 tactical tips to grow your blog faster than
you ever have before.
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@199 Crystal,
It might be the value system difference. A lot of folks don’t believe in hiring others if they can do the same job themselves.
My mother runs a store. She hire people for inventory, tax and other stuff, but I know for a fact she will never hire anybody to brush her toilet. Not a chance.
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I value time with friends, with family, and even time in front of the tv more than I value cleaning my bathroom or weeding…wouldn’t everyone? Well, unless you truly enjoy cleaning, wouldn’t you rather be doing something else?
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I guess my real question is, what makes it wrong to hire someone else? If they need/want the work and you don’t want to do it and can afford it, why not?
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With all due respect, I must say that I wholeheartedly and vehemently disagree with the sentiments expressed in Post #200. I feel JD has displayed remarkable maturity by allowing the platform he has created and nurtured to be used to discuss diverse topics offered by people who have had different experiences. JD cannot possibly speak to every nuance of the spectrum of experiences in the world of personal finance. Every post cannot and should not be about discretionary spending, reducing debt, and considering living a credit card free life. I also think the body of JD’s work, on Get Rich Slowly, speaks volumes about his character and commitment. I do not think it’s a reasonable expectation to expect that you will thoroughly enjoy every post as this is a public forum. I live in a high rise apartment building in a Midwest burgeoning metropolis; I do not have the space to accommodate a garden as the outdoor spaces are common areas that does not mean I abhor the Gardening posts. I learn something from virtually every post, and the commentary, irrespective of the topic, is always insightful. JD should not be tethered to his computer every waking moment of the day because people cannot simply stand to read a post that he has not personally authored. My preference is JD, but I dare not say that no one else can offer something that can help me along on this marathon of fiscal fitness. JD – I implore you to remain courageous and continue to offer divergent viewpoints on the different stages of personal finance. A scarcity mentality is a sad thing and can represent a very real psychological obstacle to attaining and sustaining wealth. Debt is the place where I am now, but it is not the place I want to always be. Being a visionary means creating in your mind’s eye, the end game, -picturing yourself and the people who mean the most to you enjoying the fruit of all your labors.
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How do the outsourcing efforts affect kids? Do they see that mom and dad don’t do any housework, cooking, etc. and lose out on learning the value of work? Those with experience, I’d love to hear your thoughts.
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@Crystal
A lot of it is emotional. But there is a lot that can go into it.
For example my grandmother never would have hired a maid because of privacy. Not necessarily the thought of someone going through her things, but the general knowing how messy her family was and what kind of ‘stuff’ she had.
For some people it’s an issue of self sufficiency. Sure, I am a professional, but what does it say about me if I can’t cook and I’m dependent on someone else if I want something more complicated than Cherrios?
For others it’s the whiff of snobbery. They think someone unwilling to do their own drudgery may think themselves too important for it, rather than it simply being a question of efficiency (I think this is big in this discussion as people latched onto the idea of cleaning as a ‘passion’).
And some people find it a waste and the antithesis of getting rich. Instead of buying ‘stuff’ you don’t need you are spending money on ‘time’ you don’t really need. As others pointed out there is a grey area where hiring someone to do a task frees up your time. But I know people who make that claim and use the time to sunbathe or something equally as productive. That isn’t to say that downtime isn’t necessary but it IS a ‘waste’ if you are capable of doing the task yourself. Just read some of the discussions about how big of a house you ‘need’ and you will find the same attitude about big houses.
Ultimately I think there is also a generational thing, not just Erica looking at things differently, but also because she’s so young. It is one thing for a 50 year old to say “I’m sick of cleaning my toilets. I have money so I’ll pay someone else to clean up.” But it is something different for someone who has only been out in the world for a few years to do it. There is an assumption of paying dues and developing a competence before putting off these chores.
And there is a legitimate argument made when people talk about how long $1M will last. Any resources spent now aren’t saved for the future. That doesn’t mean that everything needs to be saved, but the spending/saving decisions she makes now will be huge later. A maid for one week now might be a month of a maid in 30 years.
Her money, her decisions. But it doesn’t mean there aren’t legitimate criticisms. Especially when she puts it out there for public consumption and discussion.
As I said above: my criticism isn’t for her spending, but her writing. I don’t think she left a true impression of what she was trying to say. People have been caught in the specifics rather than the story she was TRYING to tell.
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Oh, and perhaps I am old fashioned in this, but I think doing your own chores can build character. No matter how qualified you are for your career, taking care of yourself is a specific set of skills at which I think everyone should remain competent (this is general as I don’t know enough about Erica to comment on her specifically).
It bothers me a little how much emphasis she puts on seeking happiness. I don’t think you can find happiness when you’re searching for it. And it rings a sour note with me to read ‘I will be happier if I don’t have to cook or clean.’ That sounds immature and short sighted to me. What if her new venture goes under and she can’t afford a maid? Will she be less happy?
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I’m curious – how do you know that the people who didn’t like this post are poor and the people who liked this post are rich? You can’t possibly know that. Preposterous!
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JD thank you for providing these guest posts. ( I love yours too!) They bring different viewpoints and get lively discussions from your readers. I would like to read about peoples successes and their failures, and am frankly tired of get out of debt, scrimping and saving stories. Yes, you have to start somewhere, but where do people go from there?
This particular post seems to have brought out the nasty in quite a few people. I will call them “haters”, since many were critical and sounded a bit jealous. “How DARE a 28 YO hire a maid and chef…ooh isn’t she all high and mighty.”
Of the 200+ replies none offered her any sugestions about investing her money or ways to preserve her wealth. Is it because she’s young and they feel she’s “got enough” or more than she deserves?
Everybody “outsources” everyday, yet when it comes to cleaning and cooking it’s something that’s taboo or only reserved for the “rich and famous”.
It’s really about your priorities and what you enjoy and what your trade-offs are. Some would rather not have cable TV or a latte a day and hire soemone else that can do a better job at cleaning or cooking.
At the end of the day we’re all running the “business” of our lives and weighing the opportunity cost of doing it ourselves or hiring someone else to do it.
@ Cashcow- When I was growing up I was the “outsource provider”, I had chores- some were paid via an allowance and some were not and were more about learning responsibility and self reliance. I grew up poor but priviledged in my associations and contacts. Some friends had live-in housekeepers, some just had maidservice once per week. The maids only cleaned common areas such as living rooms and kitchens, my friends still had to clean their rooms and bathrooms and keep the other rooms free of clutter. When I asked my friends why the maid didn’t clean the whole house they said that their parents’ expected them to know how to be self sufficient and when the kids could afford to pay the maid for her services, she could clean their rooms. Of course it never happened because they realized if they did the work themsleves they’d be able to spend the little money they made on fun stuff.
I think you can outsource some things while still providing opportunities for kids to learn the value of work. I have “outsourced” yardwork to my teenagers, but my standards were too high and they didn’t want to do all the work, so I hired a professional.
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While I’m not sure I would make the same decisions as the author, I’m intrigued both by the article and by the responses.
I really love the premise of the post – namely, what do you do when you’ve attained financial security? With the immediate goals of getting out of debt and making the big purchase (such as a house) you’d been planning for, it’s great to get ideas on how the remaining funds available to you can enhance your life.
I’d love to see more posts with different approaches to the same situation!
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I think it was a great post – very inspiring! Of course, the comments on GRS is more entertaining than the actual post in most cases.
Its great to see things from the other side once in a while, especially someone who is not in their traditional retirement age. Given I am still young (31) with some physical limitations from a chronic illness, I would love to be able to hire someone every once in a while to cook, clean, etc. I definitely could have used someone when I was at my worst physically. Being able to hire someone, even occasionally is what I’m working towards so that I can have more time to just take care of myself.
Why cant we be happy for someone who “made it”?
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I was really pleased when my parents (both busy professionals) hired someone to do the ironing, because it meant that all the fighting stopped. The lady was grateful for the work, too.
Having it all doesn’t have to mean doing it all.
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Naomi
I think many of us are assuming that those who didn’t like the article aren’t financially rich because many of them made comments like “It must be nice to find out that having all that money made you depressed”, “I wouldn’t make those terrible choices if I had that much money” and “I don’t have a job because of evil outsourcing by people like Erica” and lots of other comments to that effect.
I haven’t read one comment that from someone who has said they have as much (or more) money than Erica but are choosing not to outsource some of the work in their daily life. I haven’t heard anyone speak as a business owner and decry what she is doing. And I haven’t heard very much at all constructive questioning of how Erica has invested her windfall, how much of her principal she has invested in her new business or what her financial long term plans are. I think that is why many of us read the negative comments as sour grapes and jealousy.
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I agree with poster #99, the amount she has isn’t really all that much. If I had that much in the bank, I would consider that a reasonable start on my retirement fund, and would keep working and spending responsibly.
My partner and I do have a cleaning woman and gardener, a couple who have worked for him before I met him for many years. They need the money to support their family and we would not want to deprive them of their source of income, even though I was initially uncomfortable with the idea of paying someone to do something I could do myself. We pay them a good living wage and treat them with respect, so I have reconciled myself to the situation. It doesn’t have to be a slippery slope.
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JD,
If you’re taking votes on content like this, I say “keep ‘em running every once in awhile.”
As others have written, there’s only so many times those in the PF blog-o-sphere can write about creating budgets, getting a second job, paying off credit card debt, cutting up credit cards, cutting out starbucks, dropping premium cable, don’t rent-to-own, drive a used car, etc.
I’m ready for “what’s next,” too.
One advanced topic worth introducing to your readers is that of Net Present Value. Just as “a million just ain’t what it used to be” your mortgage payment on the 360th month of a 30-year mortgage just isn’t worth the same as that those same dollars on the 1st month of your mortgage. When comparing the true cost of a 30-year mortgage of a 15-year mortgage, it’s wrong to neglect that… and every single PF blog does. (Or should I say, no writer has covered that topic.)
I like the controversial topics, too. I’ve learned a thing or two from reading them. One thing that no other blogger has talked about is charitable giving. Run a post on the merits of it, and let your readers have at it. Personally, I get paid by the hour, and as someone who has yet to reach the American dream (positive net worth, home ownership) I want to know why I should be giving it away when I have outstanding debts. I mean, if I’m just going to give it away, why not just work less? Where does charity belong in the realm of PF?
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I know exactly what I’ll do when I win the lottery. First, the usual: pay off everything, buy the things on my lottery version of the bucket list; and travel the world at least once and see everything (should take about a year to get the full effect).
Right about then would be when boredom would set in. To combat that, I’d go to grad school; get an MFA in Creative Writing and a PhD in I’m-Not-Sure-What-Yet; spend inordinate amounts of time playing with and riding my horse; and read. A LOT.
I should be so lucky as to have the “problem” of being so financially above-water that I’m bored.
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@sashie. That’s my point exactly. Comments like those aren’t made by someone who’s at Erica’s level of net worth or higher. Someone who is a business owner is usually high net worth. Though someone who has high net worth isn’t always a business owner. Erica’s post is about taking her personal life and treating it as a business.
I think the greater disconnect in the comments are from employees, than from business owners. It’s a different thought process for each. I can understand the angle employees are coming from, but I don’t agree with it.
Having others do work for you is foreign to anyone who’s never owned a business.
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Erica and JD
I enjoyed the article immensely and will go over to Erica’s blog and learn more. I took a lot away from the article and didn’t expect every point made to agree with what I would do. I was hoping to find articles here and there about people who have made and/or inherited money and what they wanted to achieve out of life.
Personally, I live below my means so I can afford a housecleaner once a month to do those tasks I find harder to do. I also do my hair and go out to eat sometimes. My word, I must be squandering my hard earned dollars according to some here. Apparenty JD did not agree with Erica’s viewpoint on her article but it was a different point of view which I appreciated.
That said, I felt many comments to be quite judgmental toward Erica. I figured she didn’t have the space to list everything she decided upon with her money. Sounds like she is living and spending her money and time where she feels it is appropriate to her situation. Very informative…
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I enjoyed the post and comments – and I love watching this site evolve!
From my perspective why not hire a maid if you can? Being able to work instead of clean during that time could net more money or give one more time to relax, hence it is a better choice for Erica. Another thing – consider that the people Erica hired are working on being successful and need her and other employers to achieve their own walth. If her employees were let go because Erica decided to do all of those things herself then we would have that many more people struggling with their own goals in a bad economy. I’ve worked lower paying jobs before just to stay afloat, but it was with a goal in mind – I needed that work to get to where I am today.
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@DJ for economics to work, you need to look beyond your own doorstep to the world at large.
We are in a global economy. Sure there are people in the US who need the work, but they can’t do it for the price the people in the phillipines can do it for. This is called free trade. In return the $3.33 the person in the Philippines gets is actually really good for them in their market where there are even fewer jobs, and allows them to get ahead. As their standard of living and economy improves, the prices they set will also increase to a form of parity. The US is not isolated in a bubble; it needs to compete with the rest of the world. If someone can’t do the job for the same price, then they need to find something else to do that they can do to give value.
A really good book to read on the subject is The Undercover Economist (check Amazon). It explains these things far better than I could.
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I found this post to be rather sad, actually. I read nothing in it to indicate to me that she found what she was searching for. There isn’t the ring of epiphany of a life changing moment. Somehow, I don’t believe that hiring people to do her manual labor and working on a new business are really what matters. These are things to fill the time.
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I really enjoyed this article and found it valuable. I should look into outsourcing more of the things I don’t like to do. To the people who find this sad, get a life. If no-one hired anyone else to do the things they didn’t want to do, the unemployment rate would be higher not lower.
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I’m amazed at how many people here are equating outsourcing a job to the Philippines with hiring a neighbor kid to mow your lawn! They are not the same. The difference is one of investment in one’s own community.
I live in a community that I love and I hire locally. I buy locally, I shop at local merchants and keep my money in my town as much as possible, even when it costs more, because I see what happens when people don’t. Keeping the local small hardware store open is more important to me than finding the lowest price, since the value I get from spending my money is not solely measured by the thing I buy, but by the community relationships and diversity of small merchants that my purchase maintains.
I don’t work because I don’t have to. I am NOT poor, yet I disliked this article. Please, folks, accept that thinking that outsourcing to foreign countries is bad for our neighbors does not make us jealous, poor, hateful, or any of the other names you have called us. We have different values. I value keeping my community afloat because I know and like my neighbors.
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@Willow:
What you describe is nationalism and with a dash of isolationism. How do you truly do such things you describe in a globalized world?? I assume you have an “American” made car? You do understand while it may be assembled in the US, many of the parts of that car are not built in the USA? How does any country or local area do what you describe? You can’t. We are all inter-connected in some way. Not every place has the resources to do everything! It’s just not possible.
What you are doing is artificially supporting local merchants. OK fine for you, but if everyone did that would decrease the standard of living. A local merchant CAN compete with a big box store or a foreign company, it’s just not on price. As you imply, products and services consist of many more things than just price alone.
It’s other things like service, personal touch, combining other items into a package deal, etc…. These are the only reasons I’ll choose a local vendor. In the end it’s all getting the best value for your money and is ultimately why people choose one vendor over another. Location, while always a factor is becoming less and less of an issue than previous times in history. Your community is becoming the world at large and with specific niches that you enjoy. After all you are commenting on a blog that the world has access to. I’m sure most of your local community could care less about the subjects discussed here.
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Lots of comments! A friend forwarded this article to me. Interesting.
It’s good to see people ‘financially independent’ (from here on known as “FI”). Especially when they continue to contribute after their success has blossomed. Like Erica, I’ve seen some people run into the dilemma as to what to do when they do not work anymore. I’ve found that what really has changed is purpose. You use to wake up and your energy was spent “working”. And then one day, you don’t need to anymore. It happens a lot with those who retire. Some even fear it because they don’t know what to do with the rest of their lives.
In my opinion, this is a good article to remind me of what NOT to do. If I may share some points from the article and combine it with what I have learned so far in my life.
Like many who receive a quick windfall of money, few of them go to financial advisors. Even fewer go to other seasoned FI people to ask what they did after crossing the FI bridge, and what their advice is for others who are crossing. As well, from the smarter FI people, you get the same consensus of “The harder you work for your money, the more you value it”. So those who reach this FI point slowly, more planned out, don’t swing to the wild side of spending their money like there was no more poverty on Earth. Moreover, those who enjoyed their life as they attained their FI goal, rarely change their lifestyle afterwards. It’s why you find lots of millionaires still shopping at discount stores and driving around in their reliable not-so-new vehicles. They found out that happiness is found in everything, not after x and y happens.
FI should never be a goal for happiness. Specifically, becoming FI does not make you happier. Erica’s depression was a clear result of that expectation that a million dollars may bring. I believe that is a common illusion.
There are lots who love what they do in their job and consider it being free because they get to do what they want to do. FI does not mean you should stop working, it just means you can focus more on the things you have a passion about without the distraction of a “job”.
Real happiness comes from helping others (and not just paying them, but making a difference in people’s lives that ripple for generations). It’s why Erica probably feels that sense of fulfillment she has by outsourcing her life. So now Erica is independent of the things she has chosen to not like. That seems to be clear. She’s outsourced duties she considers to be chores to which have very little if no value. Because if the opposite were true, she’d be doing them. This is common for all of us. We are happy when we get immediate gratification, or feelings of joy. And when we don’t, we think we are unhappy. It’s why those who put joy in their experiences find happiness in all areas of life. I can understand why many those who responded here felt that despite the fact that she is giving paid opportunities for others to do what they like, there might be this sense of justification she is displaying of having others serve her for low pay (in our standards). This is a much longer topic of discussion but basically comes down to paying what you are think they are worth, not what they are willing to take. Clearly, she is proud of she think they are worth.
Eating out is a luxury. So getting a chef isn’t cheaper. It’s just a less expensive way to not cook.
The difference between someone when someone is financially independent and one who is not, is mostly dependant on their choice of lifestyle. Those content with less, will find they can be FI sooner than those who are not. And everyone can choose when to begin and how to get there. Notice I didn’t say “when”… because real freedom begins when you have that choice. And if you enjoy each day of that journey, then you have lived free and FI takes on a less important role. And if you want to reach FI sooner, then don’t require so many ingredients for your happiness.
Definitely this article is quite the opposite of what I would recommend. As a financially independent 32 year old, I have done the opposite of what Erica has done. I actually spent less after becoming FI because most of my expenses had to do as a necessity to make my income (when I finished my job, so did those expenses)
Don’t outsource your life. The displayed article is not in any way advanced personal financial techniques and even dangerous as at the beginning it presumes you are in a position of non-financial independence with a scenario of still saving for retirement and daily needs met by your “income”. I would say keep saving until you are FI. And when you are, don’t start spending like Erica did. Especially to avoid fights with your loved ones. If you need money to fix your problems, then your dependant on money for happiness.
Erica’s quest to “what should she be to be happy?” is the wrong question in my opinion, her question should be “Who can I help?”. Help others to get what they need, and you will as well.
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I enjoy cooking and lots of the day-to-day cleaning up of things around the house, though I could see hiring someone to do some of the more infrequent “deeper cleaning” tasks if I could afford to.
The comments of Arturo and others are food for thought, though I will say again that not everyone finds charitable work or donations a fulfilling use of their time or money. If I were financially independent I’d do a lot of work for animal rights/rescue organizations, but my partner and I have made a committment to never donate to charities that benefit people.
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@Honey – I can understand your position about not donating to charities that benefit people. I think, however, it depends on the reason you would be helping them. Would you say it would make sense to help people if in turn they helped in the area of animal rights/rescue? You can do great work on your own, but put yourself to the power of a million and you have a force to which can make a difference worldwide.
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I see what’s attractive about that line of reasoning, but I would rather make a huge difference in a limited number of lives than a tiny difference in a huge number of lives.
So I’d rather adopt a cat from the Humane Society and take care of it for a decade than I would to donate a small amount of money every year to them (as it is I have only donated to specific emergencies, like when I donated to PETA after Hurricane Katrina).
Similarly, I think Erica’s doing more good by hiring 4 people to work part-time for her than she would by donating the equivalent of their salaries to a charitable organization.
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@Honey – That line is not only attractive, I live it. And it’s using the same idea as the compounding nature my investments take as they take care of me. You help a few to get on their feet and do what their passionate about, and they in turn go and do the same. You can narrow down your focus to a group of people who want to do this. You grow in turn as you help them. Your purpose gets fufilled and when you eventually pass, you can say you helped more than just a few. Instead, you empowered many to empower others to carry on. But ideally, a few decades from now, organizations like PETA will not need to exist.
Maybe my aspiration is too high for some, but the underlining behaviour of what we do is from what we think, and comes from what we believe. And I know we are all capable of outperforming our greatest dreams. Just need to help each other.
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JD, I liked this article. Thank you for offering a diverse array of views. It’s nice to have something other than a “how I got out of debt” article once in a while.
As for me, I am currently a poor college student. I have paid to have my laundry done every 2 weeks. Does this make me lazy? I volunteer, work, go to school full-time, and am involved in extracurricular activities. Having my laundry washed, dried, and folded for me for $40/month is pretty amazing and I don’t mind paying for it. Should I be criticized for that? I hope not.
When I get out of college and begin to work full-time, one of the first things I will do is hire someone to clean my house. I’m not the cleanest person. It takes precious time out of my studying or time that I could be using to actually enjoy myself to clean. I’m a slow cleaner and I HATE it. I couldn’t think of a better way to waste my time than cleaning, yet I hate living in filth, so I spend a few days a month doing a massive cleaning, but feel guilty about the time lost doing it, and during the rest of the month, it builds up again.
So where did this notion come in that having a cleaning person is a bad thing? Why are some of you stigmatizing it as something that only the “rich” and “elite” enjoy and criticizing them for it? That’s the feeling I’ve got from some of these comments. In other countries, it’s very common for even the middle class citizens to have a cleaning person. For example, I lived in Guatemala with a host family and there was a lady who came every day to help my host mom cook and clean and she’d stay and eat lunch with us. She was like part of the family! My host mom wasn’t rich; her only income was from having students pay to rent a room in her house.
Anyway, I am somewhat offended by the notion that those who choose to hire others to pay someone to do a job for an agreed-upon price is somehow a bad thing. The fact that some of us find no joy out of cleaning and doing laundry does not make us lazy.
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@Arturo, yes! I have a PhD and lots of writing center and graduate program administrative experience, so I’ve helped friends revise their resumes to find jobs, get into grad school, etc.
Animals pay loads of dividends, too. One of my cats is rescued from the pound the day before she was set to be euthanized (no one wanted her b/c she was 6 years old) and she has been one of the best things in my life for 7 years now. My boyfriend similarly adores his dog, which we found abandoned in a parking lot and who may have been a puppy mill breeder.
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and you say, “I am happier than I have ever been”. After reading the 4-Hour Work Week and reading your post on your site. I realize if I outsource the mundane daily things then I can focus on the important factors, like spending time with my family.
Great post.
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“my partner and I have made a committment to never donate to charities that benefit people”
Why?
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@ Naomi, #233 – easy! Because with very few individual exceptions, we’re misanthropes.
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@Honey – That’s great. Goes to show how financially independant or not, one can still accomplish to live out their passions and help in the process.As for your misanthropy, that’s sad to hear if it’s true.
@Hilary – Post #225 relates to what you are saying. But I was taught that the very basis of happiness was never dependant on anything other than making the choice to be happy. As well, that our dislikes, like cleaning, was not only a choice of attitude, but also a financial cost. The original post spoke of what one person did after they became financially independant. This in turn seems to have led to very interesting shared opinions. What I find as a common theme here is that there is this large justification in how we spend our money… and that is directly related to our values. So it makes sense that you might be offended. Someone challenged your values. And that’s good. It’s an opportunity to analyse why you might be offended. I was too before I became financially independant. But in my case, I refused to pay for my mess. I downsized my place and got rid of most of my stuff. I decided that items just accumulated dust and caused more time for me to clean it. If it wasn’t useful, then it went out the door. That not only saved me from hiring someone to maintain my stuff, but it saved the money from buying things. That got all invested. Now I make money from my “maid” and “my junk”. On top of that, my “house duties” take less than 2 hours total a week, giving time to more important things like family. The best part was that learning to clean my own things gives me perspective of what I consider of value, what my ecological footprint is on this planet and how grateful I am of the things I do have. And that’s just my opinion and where I have put my values.
Check out what this Australian did: http://www.theage.com.au/executive-style/luxury/tycoon-trades-high-life-for-bedsit-20100209-npsx.html
I don’t quite endorse that, but I do admire those who make the necessary changes to put their virtues back on track.
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@Honey
I don’t understand why human beings are less than animals that we don’t deserv to be helped. There are elders, young ones, disabled ones all over the world that need others to help them. I don’t quite understand why animals are precious, but our little kids are not?
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@Kittyboarder – I never said that. I just don’t think that private charitable organizations are the best way to improve people’s situations. Economically I lean towards socialism…I’d rather be taxed at 40% and have the government provide services than have people be helped through charity or churchwork (I am also atheist).
Also, since the world is overpopulated by at least 3 billion people and people (unlike animals) have a choice about whether or not they reproduce, I think withholding my money from organizations intended to benefit people is consistent with my values. Though once I am financially stable I would TOTALLY donate money to an organization that gave free IUD’s to impoverished people in the US and abroad who felt they were unable to raise a child.
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Jeez, Honey, your website needs a NSFW warning. Innocent people could click on it thinking it might have cute kitten pictures.
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It’s Erica’s money and she alone can decide what she does with it. But to say “I realized my money could serve a fantastic dual purpose: To allow others, whose passion is cooking, cleaning, or assisting in various ways to help me — while I supported them by giving them income to do what they loved” is just sad.
I’m having a really hard time relating with this article. It’s hard for me to believe that the people Erica hires just love their jobs. I don’t love cleaning my toilet. And I especially don’t love cleaning other people’s toilet. I wouldn’t call that passion, I would call that a desperate necessity to make money to feed one’s family.
Grow up Erica. Maybe by making other people happy (besides throwing a “lifechanging” $3/hr jobs” at people at impoverished countries)—-maybe by serving them for once (volunteerism) you might find a little bit of happiness too.
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#237 (Honey) – wow, how gracious of you to want to donate your money to impoverished people to get an IUD. According to you, the world is overpopulated – and somehow you feel that poor people should be the first in to give up their reproductive rights. That’s your idea of charity, its disturbingly replusive
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Jim and Naomi – you ask how I know the financial situation of the commenters? Simple, I read them. A lot of the comments here actually include details of the financial situation the commenter was speaking from – most notably the ones who were improving their lot or financially secure already. There was a distinct LACK of any such mention on the part of the flamers, though. Yes, that may be ‘unsubstantiated assumption’ on my part to think that they might not be in the same category as the others, but from personal experience I know what my situation was like when my focus was on things like nitpicking and finding ways to hate people better off than myself, vs when I learned to value both money and myself, and allowed my life to start expressing that open attitude.
So far I’ve only seen ONE commenter who identified that they didn’t fit in with that generalisation, but then they went on to explain that although they hated the article, there were entirely different reasons for it!
Bottom line, your focus says a whole lot more about you than you think it does… and it also does a whole lot more to shape your bottom line, too!
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The people pushing altruism as the only means to happiness in the comments are sickening me. Erica earned her money by selling something of value (her business) to someone else who voluntarily paid for it. She did not receive a handout. The idea that she is somehow obligated to turn around and give away what she earned is immoral.
Those who are upset that she is paying 3$/hour for services are in for a reality check. We don’t live in an isolated society any longer. If someone in the Philippines is willing to do something for 3$/hour, and if you offer the same service, then you’ve got some stiff competition. Why the hell should people in the U.S.A. get preferential treatment? You’re not entitled to a job just because you live in the states, your not entitled to the fruit of someone else’s labor just because you “need” it.
Those who are trying to tell Erica what she should and shouldn’t do are are the ones who are suffering from the delusion of entitlement. It’s Erica’s money, not yours.
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242 comments — then on her blog, she has a special offer to buy her secrets on guest posts to drive traffic. She certainly knows how to play the blogging game. I wonder if she put a few hot button issues in on purpose? (outsourcing, class divisions)
I must say that even now living overseas where I could hire nannies, cooks, housekeepers really cheap ($150/mo), we’ve avoided doing it. Just an extra lack of privacy I guess.
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I think we have to just admire Erica for how much she’s milking telling everybody she sold a business. She’s done a commendable job and is proud of her work. If she can build a reputation on making $1 million gross selling a business, and then upselling followers on whatever else she makes, that is the American way!
It’s not the Samurai way, but to each their own.
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Meh, If I were rich enough to stop working, or not have to work as much I wouldn’t mind cleaning for myself. I think there’s a lot to be said about performing “menial” jobs for yourself. Even though I don’t LIKE cleaning, if I didn’t have to work 40 hours/week I think I would get satisfaction out of cleaning my home. I would take pride that I did this, I made it/keep it this way.
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I live in NYC, and my net income is less than $40,000 and my rent in a very so-so neighborhood is $975/month. But, like Erica, I’m in the “Now what?” phase of my financial life.
I spent almost five of the past six years paying off debts and the last year and a half saving an emergency fund. I understand Erica’s bout with depression, because I’ve felt somewhat lost since funding my emergency fund. There is a huge gap between having a fully funded emergency fund and having financial freedom. Attaining that goal seems almost impossible with my current income. But the goal itself isn’t impossible, so I’m always looking for new ideas.
Therefore, it was very refreshing to hear another person’s perspective on how they deal with the “Now what?” phase. I would love to see more posts about this stage of personal finance.
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I never said (nor do I believe) that impoverished people should be the first to “give up” their rights. I think that impoverished people have financial barriers to getting IUDs that the majority of people in developed nations do not have. Further, I think that if they choose to EXERCISE their reproductive rights by making a decision that’s responsible within the realm of their own circumstances as well as society’s/the planet’s, then we should help them do so.
I don’t understand why that’s controversial.
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Surprised no one has really looked at the value of outsourcing, hiring a maid, etc: By hiring this person, am I allowing myself to be more productive in another area of life, and is the value I get from that productivity greater than the money I’m paying to free up that time?
Paying someone to transcribe interviews so you can put more time into furthering your business or spend more time with your family is useful. Paying someone to transcribe interviews so you can play Xbox is lazy.
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I’m reading the anger regarding the VA overseas and trying to wrap my head around it. Is the objection to the outsourcing, or to the low wage it appears to be?
Erica stated this VA handles video editing, this is for her business, she not a lazy rich gal paying people run her errands while she watches soaps, she’s offering some insight as to how she’s staffed up for her job.
The $3.33/hr? do you all have any idea on a global scale how much this is? 86% of the world makes less than this. See globalrichlist dot com if you doubt that. It’s not manual labor in the hot sun or freezing cold, it’s technical work for a fair wage. We have a very distorted view of money in the US.
More important, would the world be better off if Erica or anyone else who outsourced like this, stopped? Would the Filipinos who all work as VAs be grateful the US flow of money stopped because someone thought we were taking advantage of them? Me, I don’t know what I’d use the VA system for, but if I ever found the need for that kind of help, I’d be asking Erica for a referral.
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Many of you just don’t ‘get it’. A few have mentioned it, but it bears repeating…
Some of us are just disheartened that this young woman seems to be extremely UN-gracious, UN-selfish, and self-righteous on top of that. It’s the ‘tone’ of the post and the whiff of snobbery that we find offensive.
My eldest daughter goes to a VERY exclusive college prep school (scholarships) and she is mostly finding out that just because you’re well-off (BTW, we are not, but I would consider our income places us in the top 10%) that does not mean you aren’t nice; most of the girls are very kind and charitable and those who are not are considered show-offs, spoiled, and stand out from the crowd (not in a good way).
What we are aware of is that Erica has simply become just another American with a silver spoon mentality.
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