The Great Office Escape

Are you an Entrepreneur, or are you “Just” Self-Employed?

Written by Mike on April 12, 2010 — Leave a Comment

Entrepreneur. Solopreneur. Self-Employed. Small Business Owner.

I throw a lot of terms around that, when looked at objectively, might mean something similar. But in many ways an entrepreneur is no more a small-business owner than a pig is a slice of bacon. A slice of bacon once was part of a pig but a pig does not have to become a slice of bacon. And it takes a long time for part of a pig to get there (and many argue that it shouldn’t get there in the first place!)

All oinking aside, there is a big difference between a true entrepreneur and someone who is self-employed. The latter can become the former, and generally speaking, the former is almost always the latter! If you understand this confusing relationship, you’ll understand more about what these heavily-misused terms actually mean!

But Which One am I?

An entrepreneur is someone who creates new business in an untested new area. Entrepreneurs seek new opportunities through often unexplored business ventures and often create a new market. Bill Gates is an entrepreneur, because he created Microsoft, which was more than just a software company. The guy started by programming non-stop in his garage as a Harvard drop-out because he had a vision and an idea. Entrepreneurs need both.

A self-employed individual, by contrast is simply someone who replies on himself to create his own income. They also run a business. This is really an umbrella term than can include freelance writers, photographers, journalists, salespeople, web designers, plumbers, doctors and lawyers. These people are “self-employed” because they don’t collect a monthly paycheck from their employer. Their pay comes from their clients.

But your average doctor is not an entrepreneur! The notion of this actually seems kind of silly, when you think about it! A Doctor may have patients (and a lot of patience) but unless he patents a cure for Hepatitis-Q, or some other disease, he’s generally not doing anything groundbreaking that hasn’t been done before. He’s there to make your leg feel better. :)

There is some overlap between terms, of course – entrepreneurs are self-employed by definition! This article explains it all quite well too, especially the differences between building a business and simply running a business.

For Comparison

Entrepreneurs

  • Have an idea or vision
  • Find a way to create income that is unusual, untested, or in a new market
  • Build an “empire” or at the very least, build something that is uniquely their own
  • Design and run a system that they have created
  • Do something groundbreaking and different

Self-Employed Individuals

  • Have clients
  • Work for themselves, but are doing work that others have done before
  • Might have a unique business model, but are not straying too far from a proven system
  • Work and specialize in a certain industry
  • Often run a business that require them to be “at work” in a similar manner to a standard job

Employees

  • Collect a steady paycheck
  • Apply for jobs (when unemployed)
  • Have benefits, 401k etc run by their employer
  • Work on company hours and company time
  • Sit in a desk all day and slowly rot (kidding! :) )

Becoming an Entrepreneur

Entrepreneurs are a rare breed. The leap from a self-employed individual to an entrepreneur requires a certain amount of risk, vision, and ability to truly think outside the box. It also requires a person to stop thinking about their professional life as a “career” and more as a means for the expression of a great idea or business venture.

Not all self-employed individuals want to becomes entrepreneurs. Many are perfectly happy running a small business, or being an attorney with some well-paying clients. It’s really a matter of personal choice and ability. But the romantic term “entrepreneur” sure gets thrown around a lot, doesn’t it?

You like bacon, don’t you?

(Actually, I don’t, but I do like entreprenurs!)

Posted in Self Employment

The Courtesy of a Rejection Letter

Written by Mike on April 11, 2010 — 2 Comments

As a fresh-faced recent college grad excited about his entry into the “real world” in the spring of 2005, I encountered one of my first soul-crushing obstacles that helped set me on a slow but sure course toward the entrepreneur I am today.

I would send out job applications and never hear anything back.

This sounds pretty silly, if you think about it. Obviously if I was never getting a response it meant that the employer I had submitted my application had chosen a different candidate. But it wasn’t the obvious nature of the rejection that bothered me. It was the fact that I never got a response. Compounded over the course of a couple months and ten job applications later I began to doubt the strength of my resume (and I lost some faith in the very institutions that I was applying to.)

My First Rejection

That spring I got one rejection letter. Though I changed the name of the company and position, it looked something like this, and it came by email:

Dear Mike,

Thank you for your application for the position of Giraffe Cleaner at Bats R’ Us. Unfortunately we have elected to go with another candidate for the position. Best of luck in your job search.

-Chas

I was incredibly confused. I had just been rejected, but it actually felt good! Someone had given me the time of day and had actually taken a few minutes of their life to write a letter, albeit brief and likely a template.

Employers, take note. If you want to not only contribute some good to the lives of many unemployed people looking for jobs, but also build your reputation as a “nice” company, send out rejection letters. It’s the least you can do. Yes, this can be difficult if you have a lot of applications, it can be frustrating for you to try and reply to all of them. But it’s also a courtesy. Even if you send a standard rejection letter that you downloaded from a template site online, it’s at least a response. This way you are not keeping hopes alive. It also makes your company look better.

As for me, I will make you this promise: if you apply to an ad for a job that I have posted, I will get back to you, even if the news isn’t all that rosy. I know how it feels.

Posted in 9 to 5 Culture

New Workplace Trends: 9 to 5 is So Last Decade!

Written by Mike on April 10, 2010 — Leave a Comment

I have an old friend who works as a software engineer. He holds the same position with the same company as he did over five years ago. His salary has increased steadily each year. Coming from a traditional family where his father valued hard work ethics, integrity, and professional stubbornness, my friend was ecstatic to land his first job right out of graduate school in the Fall of 2004.

At the time, I was in my last year of college as an undergraduate. I’ll never forget the night I came home from my evening class and he told me the good news. His job had benefits, (dental and medical) 401k, a share in the company and a salary in the mid-60s. Every college grad’s dream.

He is still with this same company today. His story is becoming increasingly rare.

And this is a good thing.

Really, Mike? A Good thing?

Yes. Our economy is struggling, and workers are getting laid off at an alarming pace. People are desperate to find work. (If you are one of those people, I’ll be my friends’ position sounded pretty good, didn’t it?) It seems like we are all underemployed. But what are we really struggling to find? My friends’ work. The work of yesterday. The paid benefits, the salary, the company car and the whole shebang.

The sooner we wake up from this “dream” the better off we will be! Why?

Because 9 to 5 is Soooo Last Decade

And this is a good thing. It’s your time to shine.

What is happening is that a new, more flexible workforce is emerging. This is a workforce that is not run by the power of the corporation, or the middle manager. It isn’t run by the clock or the benefits. It’s run by you.

Your talents, skills, and abilities are valued. These talents are a piece in a large jigsaw puzzle that when put together with the talents of other individuals can make great things happen. Project work is replacing bean counting. We have computers for this now. “Pay by the project” work and “billed hours” are replacing the 40-hour workweek. And the idea of one person working in one career for his whole life is going the way of the dinosaur. And this is all great news.

It’s great because more than ever before we have the ability to grow professionally. If you are a great web designer without a full-time job and you land a project that requires some graphic design, you can either call a graphic design colleague to do that part of the work, or you can do it yourself. And as a web designer, adding graphic design to your repertoire is a very useful thing.

If you work 9 to 5, it’s very difficult to grow in this way. Try telling your manager that you want to take over his duties because you want to “grow professionally” or “learn” or “earn a bit of his income.” He’d laugh at all you all the way to the unemployment line!

The disappearing 40-hour workweek is also a good thing. Most people don’t actually work 40 hours a week. They are just scheduled to be at their desks, behind their counters, or in front of their computers for this amount of time each week. A majority of the time, workers aren’t doing anything job related. (One study suggested that the average office worker actually only puts in about 3 hours of work in a given day!)

I don’t know if this statistic is true for my friend, the software engineer, but I sure wouldn’t want to waste 47,000 hours of my life doing nothing. Human brainpower is a valuable thing. A whole lot of it is going to waste. The transition from an employee assigned to performing a task while collecting a paycheck to a self-motivated individual with talents and a skill to offer the world is an important step in professional evolution.

What to do if you Want my Friend’s Job

Instead of fretting over your lack of benefits, a decent salary, or a job, ask yourself what you are good at. What skills do you have to offer the world? Who would be able to make use of these skills? Are your skills valuable where you live?

The 9-to-5 job is slowly becoming a thing of the past, as more employers are wising up to the fact that freelancers, contract workers and home business owners can often to the same work without the benefits and the hefty salary. Even if you want this kind of job, in 10 years it may become so rare that it is more of a pipe dream.

You don’t really want a 9-to-5 job. You want to become part of the new workforce: the land of the skilled professional. You may have a lot more fun doing it, and you’ll feel valued as a citizen of the planet, not just a member of your company.

Perhaps instead of lamenting the increasing unemployment rate and the lack of “fair wages” we should embrace this brave new professional world! What do you have to offer?

Posted in 9 to 5 Culture, Self Employment, Society and Culture

How to Find Legitimate Telecommuting Jobs

Written by Mike on March 31, 2010 — 2 Comments

When I was starting out in the freelance web development business one of the biggest obstacles I kept stumbling over was the pervasiveness of “garbage jobs” and junky “job search engines” that clogged the internet. At the time I needed to be able to find remote work from real businesses and clients. During my initial search I kept running into the same three problems:

  1. Scams and MLM Marketing schemes clogged job search (and even Google search) engines with junky “work from home” garbage posts, making it difficult to find authentic telecommuting positions
  2. Many businesses were outsourcing my work to other countries, such as India, where they would do the same work for an unlivable (by US standards) wage
  3. Great looking jobs were seeking “local candidates only”

Let’s get something straight right off the bat – it is possible to earn a full-time wage, or make a living freelancing by doing all of your work from home, or telecommuting. I do it. But it isn’t easy. Often you will have to have more than one remote job/client to make it work. I’ve put together a guide that will hopefully help you make some sense of taking on the often daunting task of telecommuting.

Where to Look for Work at Home Jobs

Let’s start with one of my favorite websites that has paid some dividends over the last couple of years:

Craigslist.

I know this sounds kind of silly. After all, Craigslist just launched a massive campaign targeting illegitimate job postings. They have alerts at the top of all their webpages warning you not to respond to postings that ask for personal information. Obviously there are scams all over craigslist, but it’s been getting better.

Why suggest craigslist? There is a trick you can use!

First, you can choose to respond to a job search ad in any city you would like. The advantage of telecommuting is that you aren’t restricted to one location! The best way to find a legitimate job or project using craigslist is to do the following:

  1. Pick a city (preferably a larger metro area like New York, Boston or LA)
  2. Under the “jobs” tab, choose the field that matches your specialty
  3. Click on the “telecommute” option at the top
  4. Search for jobs

This will filter out any jobs that are for local candidates only, and you’ll be presented with a list of openings that will be all remote, online positions. Not finding what you are looking for? Switch to another city and repeat these steps!

Flexjobs

For a fee of $14.95 a month, you can have someone else do the filtering for you. Go to Flexjobs and take a look around. This is a good option if you want to save time. They have been featured on CNN and have helped hundreds of jobseekers find work. They are legitimate and work with some interesting companies all over the United States. If you do sign up, remember that there are no guarantees that you will find work – it’s just a method you can use to make your search a little bit easier and save you some time.

5 Tricks to Increasing Your Odds of Landing a Telecommuting Job

1. Apply the day the job was posted.

If today is March 31st, don’t apply to a job ad that was posted on January 26th. It’s incredibly likely that the position has been filled and the poster just neglected to take the ad down. (Don’t we all wish they would take them down when they no longer are hiring?)

You are much more likely to be considered for a position if your application is one of the first to be viewed by the employer. This is especially true with telecommuting positions, which often get upwards of 300 responses!

2. Make Sure Your E-mail to the Hiring Company/Individual is Personal

If you simply create an e-mail template and “mass apply” to twenty positions with the same text in each e-mail, you are likely to get ignored. With each job you should attempt to put some care and thought into what you want to say. In the day of the internet, the initial e-mail is like a cover letter. You will want to be conversational, friendly, and professional. It’s ok to crack a joke (and in fact, this might help you stand out) if it looks like the position you are applying to is staffed by fun-loving, laid back types.

I landed one freelance gig by joking about the content of this website (The Great Office Escape) and how it would make me an ideal candidate for remote work!

3. Search for Telecommuting Jobs on Tuesday, Wednesday, and Thursday Mornings

Think I’m joking?

Applying for remote work on a Friday often gets your application shelved until the next week where it will eventually join the applications of your competitors who applied over the weekend. This is because many companies take Fridays off from going through the hiring/resume-reading process. It’s too close to the weekend and golf beckons.

Monday is usually bad too, because people are notoriously slow to get to work on Mondays. You want your application to be looked at right away. The longer your application sits in a virtual bin somewhere, the more likely other applications are to join it. That’s more competition, and that’s bad.

4. Include a Link to your Online Portfolio

It’s very helpful to have a pretty website that showcases some of your work. It will help you stand out from the crowd of applicants, and it will be easier for the hiring company to get to know you. You don’t have to be a web designer, graphic designer, videographer, or other creative professional to have a nice online portfolio.

As a side note, if you are looking for someone to build you a simple website or online portfolio, I’ll be happy to help! Just send me a message :)

5. Treat a Remote Interview Like Any Other Interview, but be More Open than Usual

So you had an interview for your potentially new remote-job. Wonderful! Don’t forget to send a thank you letter after the interview. Reiterate your desire to work for the company you applied to, your interest in the position and make sure to give the company correct contact information where you can be easily reached. It’s much easier for information to get lost/messed up when everything is remote.

Since you likely interviewed on the phone, anything that you can do to help the interviewer get to know you as a potential client or employee will increase your odds of landing the job or project. Don’t be afraid to be open about yourself, your work history, and what you do. Transparency is everything in a remote job, where it’s harder to build trust!

Posted in Careers, Escape Routes, Self Employment

Why Won’t the Rich Share the Wealth?

Written by Mike on March 27, 2010 — 5 Comments


The age-old question.

I grew up in one of the richest suburbs in Minneapolis. Everyone and their dog had a BMW, and people would take their yachts out on Lake Minnetonka for fun on the weekends. The prom was a national holiday at my high school – parents would shell out hundreds (sometimes thousands) for their kids to dress their best and for the after-parties. Living in this kind of bubble as a kid, it’s difficult to grasp the concept of what it would be like to be poor, or to have to struggle to earn a living. To me, a house, a nice car, and a beautiful suburban paradise by a lake was the entire world.

Wealth is a strange thing. As someone who considers himself a “self-made” person, I have a lot of respect for those that live with a “trial by fire” approach to life. People who have become successful financially by their own intelligence, skill and consistency should be praised and rewarded for their efforts. Should they be expected to “share their wealth?” There is a dual nature to this position because there are those of us who:

  1. Don’t care about making money
  2. Try, but fail to make money
  3. Make money but then spend it in equal or greater amounts

Plenty of people are happy with their jobs and see the “ultra-rich” as greedy scoundrels who care nothing about the suffering of the poor. Some people who have a lot of money think that if you work hard enough, anybody can become successful. The government shouldn’t help out out, they figure, “because I was able to make it work. Why shouldn’t you?”

The truth is, there is a middle ground, and I fall somewhere along this spectrum. If you care about others at all, then so do you.

Why Hard Work isn’t Always Enough

It is a hard world out there, no doubt about it. Hard work can make you successful. It can put you squarely in shrinking the middle class. It can put you in McDonald’s making minimum wage. I’ve met plenty of McDonald’s workers who “work hard.” Clearly this is not the answer.

Someone with a college degree coming from a wealthy background might argue, “but if you had just gone to college, put together a professional resume and looked for a well-paying job, you’d be fine.”

But they are coming at it from their own perspective, which maybe be valid for them, but it will not hold any water when applied to someone else. For example, if I grew up in inner-city Detroit with an abusive father, no mother, 5 siblings, and no money, I would likely be more worried about my own survival than getting a job at a software company some day. It would definitely put me at an enormous disadvantage.

So no, hard work is not always going to make you wealthy, or even get you off food stamps in some cases. I cringe whenever I hear someone from a wealthy background (like where I grew up) slam any government effort to better the state of the country by increasing taxes on the wealthy and corporate interests. Sure, they are coming at it from their frame of reference, but not everywhere is Orono, Minnesota.

The Other Argument

There are plenty of people who don’t understand the value of money. They work hard, earn a decent wage, and then watch it blow out the window, often because they spend it on things that make them (in their minds) look good. Who really needs a Hummer? Really think about it. Nobody needs one. It’s all about standing out. Why do you need to spend $40,000 to stand out?

Image is incredibly powerful – we are all effected by its pervasiveness. Perhaps if we were not so concerned with how we looked to other people we wouldn’t mind taking some of that $40,000 that we spent on the shiny new Hummer in the driveway and saving it. Heck, if you invest $40,000 the right way you can be a millionaire in 30 years.

Or even better, you can give some of it to people who really need it.

Which brings us full circle. It’s a confusing circle. Personal responsibility, insight, and ingenuity are valuable traits. It’s nice to be able to work hard (or work with a degree of foresight and intelligence) and make a lot of money. But it’s also nice to share it with those who do not have the ability, the insight or the resources to make their own. Not everybody grows up in a standard of living that makes it possible to become wealthy, or even to live well.

This is why I feel that it is ok for the government to help it’s least fortunate citizens AND it’s ok for citizens to work hard and become wealthy. There is a balance that needs to be achieved at some point for any kind of global financial health to succeed.

Yes, I grew up in one of the richest suburbs of Minneapolis. But in other ways it was perhaps one of the poorest places in the world. Poverty of spirit, of “big-picture” understanding, and of caring for those who have no chance are the traits of a different kind of poverty. Growing wealthy is fine. Growing wealthy at the expense of others is unethical. Ignorance is commonplace in bubbles such as in the city I grew up.

I’m sure glad I don’t live there anymore.

Posted in Money

Wise Student, Foolish Student (Part 3)

Written by Mike on March 24, 2010 — Leave a Comment

(Also see Wise Student, Foolish Student (Part 2) for the second part of the series)

Veronica, the Wise Student Continues Her College Career

When we last checked in with Veronica, she was doing well in school, but making sure to balance her education with some real-world experience early on. She got a part-time internship working at a nearby physical therapist’s office.

Before long, the internship turned into a permanent job, which the management was more than happy to let Veronica split between her studies. She managed to work 20 hours a week at the physical therapist’s office, her responsibilities increasing as her courses soon caught up. Before long she was learning in her classes what she would eventually be expected to do on the job.

By her third year she had made numerous connections in the medical community and was always on the lookout for new opportunities. She never took too many classes at once, but stuck to a level of coursework that she could handle. The extra work helped her pay for her college expenses and courses, and she graduated in four years with only $3000 of college debt from her last semester.

Lesson #4: If you can work while you are in school, you should. If you can work in a field that is related to what you would like to do after you graduate, this is even better!

Patrick, The Foolish Student Continues His College Career

Patrick wasn’t required to declare a major until the end of his second semester at Wynn University. Because of this, he waited until the last possible moment before finally electing to study Philosophy. He figured that since people loved to come to him for ideas about the world, and because he enjoyed trying to figure out the “meaning behind it all” it would make a perfect major.

Ignoring some advice from a cousin who told him he’d never find a job, Patrick figured with a college degree life would be easy.

He continued to borrow more and more money for loans, taking the maximum amount out each year. He refused to work while in school, feeling that there just wasn’t enough time between his coursework and all the rigorous studies he was going to do.

Patrick toiled for two and a half years as a Philosophy major, finally graduating a bit late with $120,000 in student loan debt and still not sure what he wanted to do with his degree.

Mistake #4: Don’t pick a major that has gives a low chance of post-graduate success unless you can pay for your entire college education in cash. If you are interested in philosophy, that’s wonderful. There are much, much cheaper ways to study it. Until college becomes less expensive, it’s wise not to pick this kind of major.

Veronica Enters the Real World

Veronica ended up with a full-time position at the very physical therapy rehabilitation center she first interned for her first year. While she had a bit more schooling to do, the center agreed to cover her entire cost of tuition while she worked for them! She worked hard for two years, not owing a dime for her continued education, and eventually was able to get her doctorate in medicine.

Five years later, Veronica opened her own practice, and today she enjoys a six-figure income.

Case closed. But, what happened with Patrick? I know you are dying to find out!

Patrick Enters the Real World

Patrick ended up like many of us, sadly.

He graduated, frantically applied for a lot of different jobs (in much the same ay that he applied for a lot of different schools five years before) after realizing with horror that there are no jobs for Philosophy majors with no work experience.

After having to move back home to Buffalo to live with his parents, since he could no longer afford his living expenses and his loans would be due soon, he finally found a job as a data-entry processor at a large accounting firm for $12 an hour. This job had nothing to do with anything Patrick studied in college. He was very depressed.

For three years Patrick bounced from data-entry job to barista job to store clerk job until he realized that his education had failed him. Where was this great full-time position with benefits he was sure would come after graduation? When could he home to move out of his parents’ home? When was he going to be happy again?

Epilogue

Education is important, whether you are self-educated or choose to go to college. But one of the most important ways you can educate yourself is to understand that the way the system is set up, you will need to be a bit creative financially. You will need to understand that college is very expensive and unless you follow a plan much more like Veronica’s than Patrick’s, you’ll end up a good deal worse off than you wanted to be.

And no, it isn’t fair. But educate yourself. Think before you just do what everyone else is doing. The real world is not easy!

I hope that I could help you out a bit with this guide. Sadly, there are far too many Patricks in my generation. I don’t want you to become another one.

Posted in Education

Wise Student, Foolish Student (Part 2)

Written by Mike on March 23, 2010 — Leave a Comment

(Also see Wise Student, Foolish Student (Part 1) for the first part of the series)

Remember our good friends Veronica and Patrick? Let’s meet up with them again to see how their first year of school is going.

Veronica, the Wise Student

Veronica enrolled in the University of Northern Nebraska (don’t even try to look it up – it’s fictional.) She had lived in Omaha her entire life, and going to a state school decreased her tuition substantially. She also spent the summer doing research on grants, and applied for quite a few. Just before the beginning of summer, she was accepted for a “Future Healthcare Worker of America” grant that would fully cover all of her college tuition of the first two years. This was excellent news. On top of this, she could use the $7,000 she had saved in high school to help cover her living expenses while she was in school.

Lesson #2: Look for grants before you take out a student loan. You’d be surprised at how many grants are available for new and continuing students each year. You could save thousands of dollars.

Patrick, The Foolish Student

Sick of the cold, grey, snowy winters in Buffalo, New York, Patrick was excited to escape to Florida for his first year. He was so excited that he forgot to look into his housing situation until it was too late. The available dorms were full, so he had to rent an unfurnished apartment off-campus for $600 a month with a roommate. Since his parents were already paying for his first year of school, he didn’t look into loans or grants. He just figured it would all be handed to him on a nice, silver platter.

Mistake #2: Housing costs at school can eat up a huge amount of your income (if you have any at all.) Do your research on all available options, but don’t just settle for dorms by default. Sometimes those can be expensive too!

Veronica’s First Year

Veronica had a good time at the University of Northern Nebraska. She worked hard, but also made a lot of friends and enjoyed her time in school. While she did go to the occasional party and involve herself in campus activities, she never let this interfere with her work.

More important than her grades were opportunities to gain real-world experience. Veronica applied for several internships her second semester, and she ended up getting a part-time position as a cold-compress girl. She was responsible for maintaining and delivering the cold-compress ice packs for injured athletes at a small physical therapy rehab center every Tuesday and Thursday night. She was even paid for her efforts. This offset the rest of her living expenses and she made it through her first year with $4000 still in the bank and not a dime spent on school.

And she already had learned a lot in her classes, which she found engaging.

Lesson #3: Internships are gold during your college years. If you can get one during your first year, that’s even better. It will put you in immediate contact with the real world and give you some experience, whether or not the internship is paid.

Patrick’s First Year

Patrick decked out his new apartment complex as much as he could. He wanted to have THE happening place in south Florida, where all the great parties would be. His prophecy came true, as he threw weekly kegger parties and his place was popular with the undergrads, due to its location off-campus and proximity to the beach.

He took a random assortment of required courses his first year, focusing on classes that would be easy and could earn him an A without much effort. The only research he did before he signed up for classes was on ratemyprofessor.com so that he could see which profs were the easiest.

Because he had so many expenses, he needed to take out as many loans as he could to cover the cost of his apartment, the cost of his parties, and his other living expenses.

Patrick failed two courses his first semester and almost got kicked out of school.

Determined to “shape up” he started studying very hard his second semester, pulling all-nighters and cramming like a madman before his tests. He didn’t eat and he barely slept for months. Grades became everything to him. For his efforts, he got 3 B’s and an A- his second semester in a bunch of random courses. He still hadn’t declared a major.

Mistake #3: Work-life balance is essential in school. It’s ok to have some parties as long as you focus on the work you are doing. It’s also not a good idea to study and work so hard that you are exhausted. You should never have to pull an all-nighter.

Next

Veronica and Patrick’s adventures continue! How will their college careers go? Will Patrick survive Wynn University? Check out Wise Student, Foolish Student (Part 3) for more, coming soon!

Posted in Education

Wise Student, Foolish Student (Part 1)

Written by Mike on March 20, 2010 — Leave a Comment

Just about everyone under the sun has heard of Robert Kiyosaki’s bestselling empire Rich Dad, Poor Dad. I’ve read it myself, and for the most part it’s a worthwhile read, even for those who know nothing about personal finance. (Actually, especially for those who know nothing about personal finance!) But some of the principals in the book can also be applied to young people looking to attend college and who are using their post-secondary institution of choice to springboard into their careers.

I’ll be honest: I don’t know anybody who fits the following descriptions of students perfectly. But perhaps you can see a little bit of yourself in these two students.

Veronica – The Wise Student

Veronica has been interested in health, healing and making others feel better since she was a little girl. While she was never certain she wanted to be a doctor, she knew that going into some kind of medical profession would be good for her. While in high school Veronica worked at a video store over the summer and babysat for her neighbor’s kids to earn money to save for college all four years of high school.

Patrick – The Foolish Student

Patrick is a dreamer who loves people. In high school he was never really sure exactly what he wanted to do with his life, but he knew he liked spending time with his friends, talking about life, and spending his spare time watching too much TV. His grades were not great, but good enough to get into college. By the time he turned 18 he still had never held a job in his life.

Veronica Applies for College

Veronica narrowed her choices down to four good schools, and decided to apply. But she was worried about the cost of two of them, since they were private, four-year liberal arts schools. One of these schools, Puppydine College, cost $49,500 per year to attend.

That January she was riding in her bobsled with the kids she was babysitting and the sled lost control. Down the driveway she went, tumbling headfirst into a briar-patch. She emerged full of thistles and with a broken ankle.

Veronica’s ankle took 2 months to heal, and she was ordered to do physical therapy that spring for rehab. While in physical therapy, she found that the way her therapist communicated with her, taught her to do the exercises and joked around with her made the profession seem like a lot of fun.

“How did you get into Physical therapy?” Veronica asked her therapist one day. “I went to school for it,” her therapist replied, and then she went on to explain that you could go to school specifically for physical therapy, get a license, and be practicing within 4-5 years. Veronica was thrilled. She knew what she wanted to do.

She went home, did some research, and found a few much less expensive schools that offered Physical Therapy programs where she could get her DPT degree. She focused on the schools that were the least expensive but had the most opportunities for her to do internships and get some real-world experience early on.

Lesson #1: Pay attention to the things you are interested in before you go to college. While you don’t need to know exactly what you will do afterwords, it helps to at least have a good idea.

Patrick Applies for College

Patrick was bored. He was bored all spring, waiting anxiously for the day when he no longer had to live under his parents’ roof. He delayed applying for schools month after month until the last possible second, and then, at the urging of his parents, applied to as many as he possibly could without really giving it that much thought. He knew he wanted to go to school somewhere warm, and he knew that the more prestigious the school he got into, the better his career afterwords would likely be.

He sent in 23 applications, 9 of which were to schools in Florida, 3 in Hawaii, 6 in California, 2 in Arizona one in Barcelona and the other two in Central America. He could afford the applications because his parents paid for all of them. Incredibly, he got into a couple of these schools. One of them, Wynn University in Florida, ended up being his choice. It was a good school with a good reputation. It was in the 70′s and sunny in January. The girls were pretty when he went to visit.

Patrick was stoked.

Mistake #1: Don’t apply to schools willy nilly, and don’t accept an offer to a school just because the weather is nice and the girls are pretty. This should be common sense.

Next in the series: Wise Student, Foolish Student (Part 2) – Veronica and Patrick enter college!

Posted in Education

The Self Employment Test

Written by Mike on March 19, 2010 — 5 Comments

Do you have what it takes to be self-employed? Take this short test to find out!

Note that there is a difference between being self-employed, the owner of a business, a wise investor, and otherwise financially self-directed. For the purposes of this test, all fit in the same category of “not collecting a regular paycheck.”

1 – When life isn’t working out the way I want, or people get on my nerves, I like to complain about it to my co-workers and friends.

A. Yes

B. No

2 – Which of the following scenarios is preferable to you?

A. Spending my days at work around a group of people with great personalities and hobbies

B. Spending my days at work around people who have great business ideas and goals

3 – What is a better way to make a living?

A. Look for a good job that pays well, find a good deal on a mortgage and live within your means

B. Start a business, buy real estate, and/or invest in assets with the goal of achieving financial independence

4 – Jack works at a software company and makes a salary of $50,000 per year. Who is responsible for Jack’s income?

A. His software company

B. Jack

5 – Are you capable of working late into the evenings and weekends while your friends and family are out having fun?

A. Yes

B. No

6 – Which is more important?

A. To create opportunities

B. To earn money

7 – The idea of having my own clients…

A. Excites me

B. Scares me

8 – Consider this extremely simplified scenario: Malcom, a retired millionaire, finds a way to purchase hordes of diapers wholesale and sell them online for an amazing, unbeatable price. He markets himself very well, because he has the money. As a result, many online baby supply retailers go out of business. Malcom is thrilled. What does this make Malcom?

A. An intelligent business owner

B. An unethical rich “scrooge” who took advantage of other businesses to make more money for himself

9 – Be honest – do you have a spending problem?

A. Yes

B. No

Tally up the total “B” answers in questions 1-4 and the total number of “A” answers in questions 5-8. Add them together. This is your score. Ignore question number 9 for now.

Interpreting Your Score

6 and above – You definitely have what it takes to be self-employed. In fact, you probably should be, since you’ll do well, and likely enjoy yourself!

3-5 – You might want to consider reading more about what goes into running a business before you actually go out and do it yourself. You are close, though!

2 and below – For now, you should keep your day job. This doesn’t mean that you can never run a business, but you have some learning to do about what it takes. But hey, life is all about learning!

Explanation of scores

If you answered “yes” to question number 9, you can pretty much reset your score on this test to zero. The problem with “having a spending problem” and running your own business is that they are completely at odds with one another. The lifeblood of your business is your financial bottom line. Without enough revenue, your business will not survive. Spending problems can precipitate a lack of emotional control when it comes to making financial decisions, something that is essential to running a business. If you are constantly depleting your revenue and resources, you will not have a business.

The first question is also important. Successful business owners (and happier people in general) have what is called an internal locus of control. That is, when things are not going well, they take responsibility rather than blame life. They are not complainers. The sooner you learn to take responsibility for your failings (and successes) and don’t attribute these to luck, the better off you will be.

Finally, in question 8: Malcom may have driven a lot of his competition into the ground to make more money. But he still is a good businessman. You don’t have to be “likable” to be a good entrepreneur. Still, I would hope that as you go into the world of small business operations that you do so with a longing to do good in the world and not take advantage of other people.

How did you score? Share your thoughts below!

Posted in Feature, Self Employment, Self Tests

Don’t Buy the Newest Gadgets

Written by Mike on March 18, 2010 — Leave a Comment

The all-new Apple iPhone 3GS was just released. According to Apple it is the fastest, most powerful iPhone ever – it can launch websites and applications twice as fast, has voice control, satellite mapping with GPS, a built in compass, the ability to take pictures, videos, write text messages and send them all to your friends in the blink of an eye. It can also go to the DMV for you and fill out your paperwork. (That’s a joke.)

As a downshifting rat race escapee, it’s difficult to get me to buy anything I don’t need. As a web developer who constantly needs to be on top of his game when it comes to new technology, I can’t just ignore the new toys that come out. If I did, I’d risk not knowing something potentially valuable that my clients might want me to use while building a site. I’ve recently had to get into Twitter (something I didn’t like at all at first) for just this reason.

But even I understand how alluring and tempting some of these ad campaigns are. Just go to Apple’s homepage and today (March 18th, 2010) you can see the huge new iPad ad. It looks so sleek, elegant and important. “I want to be sleek, elegant and important” we think. So, we buy an iPad, thinking less about whether or not we need an iPad and more about how it will make us feel about ourselves.

For a long time I had a cell phone that came out in 2001. It did what it was supposed to do – I could call people, send them text messages, and it even had speed dial. I learned to value these functions and was able to make use of all three of them frequently. The phone finally died last year, so I was forced to upgrade. I saved money by purchasing an old model from 2006. This one takes pictures and has voice dial. I don’t use the last function. I would argue that owners of this new iPhone will not use 85% of the functions that the phone is capable of performing throughout the course of ownership. Some of these phones go for about $200, while my simple phone from 2006 was about $60.

And I’m getting far more worthwhile use from this phone.

Do I really need to be able to check my e-mail while I’m sitting at a restaurant? Or play video games on my phone while on the bus? If I want to do these things, I can go home and do them. I can get on my laptop to check the internet, or I can go to an arcade to play video games (if I want to be a kid again!)

If you really want to try downshifting your life, and save money while you are at it – join the bandwagon. Don’t buy the newest gadgets. Make sure that everything you own has a purpose. If you have an item that’s just sitting on the shelf collecting dust, then you don’t need it! But if you have a perfectly good cell phone that does what it’s supposed to do, why upgrade?

Your hi-tech, sleek, pretty new gadget doesn’t make you hi-tech, sleek and pretty. It just makes you a person with a high-tech, sleek and pretty gadget that is $200 poorer and needs to work on his self-esteem. :)

Posted in Simple Living
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