Possibly the Most Unattractive Statement I’ve Ever Heard

Just a phenomenally timed photo! – Image courtesy of Jean-Marc Buytaert

No matter what your goals are with the opposite sex, you will probably have to play the numbers game. And since my divorce a few years ago, I’ve done just that. Not long ago, I met a woman who seemed pretty worthwhile at first. She was attractive and clearly intelligent. But my assessment changed in an instantaneous and permanent manner when she said something that absolutely appalled me. “I wouldn’t want to be with someone like you because you clearly live a healthy lifestyle and I don’t want to feel pressured to live that way too.”

One issue with dating women in their early to mid twenties is that you can’t necessarily assess their lifestyle very easily. Sure, some of them are already significantly overweight at that age and others are showing signs of aging prematurely, both of which are indicative of consistently poor choices in one or more areas. But many of them still look great thanks to nothing but a combination of age and genetics. And that was clearly the case here. She went on to describe her party girl lifestyle, which sounded like it mostly involved staying out drinking at bars, clubs, etc until the wee hours of the morning, rather proudly. This was clearly a woman who is well on her way to hitting the wall head first and at full speed.

But it wasn’t even the fact that she’s squandering every resource she has – her health, her money, and the time her very life is made up of – that shocked me. I see women her age still living that way all the time. Consequently, the reason I tend to date women that age, as opposed to younger than that, is because the smarter ones tend to be starting to realize that they aren’t going to be young forever and adjusting their choices accordingly. The reason I usually avoid women thirty and above is that many of the ones who are single at that age have never made those all important adjustments, but now want kids regardless – with whoever is foolish or desperate enough to attach himself to that mess for a couple of decades at a minimum.

Anyway, don’t get me wrong. I’ve suspected plenty of women of harboring this “I don’t want to be with someone who looks like he might have even modest expectations” mentality. I’ve just never met one who was actually willing to admit it before. She apparently wants to date a man with no more drive or self discipline than she has. And the crazy part is that she went on to talk forlornly about being single as the minutes, which started to seem like hours, passed. Of course she is single! What kind of man would be attracted enough to someone with an attitude like that to have anything beyond casual sex with her? What are the odds that she herself would find a man like that attractive? It’s amazing how self destructive people can be. But in this case, she has an almost unbelievable combination of awareness of what she’s doing to herself and insistence on continuing to do it.

The lesson here, of course, is to live exactly the opposite way this woman is. Make the right choices, not the easiest ones. Surround yourself with people who motivate you to be better in every area of your life. Avoid people who are going to drag you down to their level with their mere presence. I’m sure you have all heard the quote about being the average of the five people you spend the most time with. While I don’t think it’s quite that simple, I’m a big believer in the basic concept. Clearly the woman I met was, too. She just had a very perplexing vision for what she wanted her “average” to be. More power to her, I guess. But I strongly recommend you choose the best life you can for yourself. Why would anyone want a crappy one?

What I Learned From the Latest of My Many Car Purchases

Sunrise, sunset. As you can see, when it comes to cars, I definitely have a “type.”

Happy Tuesday, Folks! I took yesterday off since it was Columbus Day and I’ve decided to do more to make holidays special, even the more dubious ones. This post has been a long time in coming, since it happened about a month ago now, but after months of researching and deliberating, I bought my next car. As the picture shows, I replaced my 2014 Hyundai Sonata 2.0T Limited with a 2015 Infiniti Q60S. This was pretty out of character for me since I ended up buying a totally different car than I had planned to and I committed some car buying sins I never would have previously considered in the process. But at least so far, I’m very happy with my decision. I’ve been buying cars for almost two decades now, and while some aspects stay the same, every purchase is also a little different. So here are the specifics from this time.

What stayed the same?

I did a ton of research before I even stepped foot on a dealership lot.

In this case, I found what I thought was the perfect car for me – on paper. I was going to buy a 2015 Lexus ES 350. In addition to having the usual bulletproof Toyota reliability, it has a venerable, naturally aspirated engine, meaning none of the turbo related issues so many of the cars being sold today are likely to suffer from somewhere down the line. The gas mileage is a solid 21/31 and it doesn’t require premium gas like most luxury cars do. It is a big, smooth, comfortable car, which is important for someone who drives a lot as I do. The main compromise I felt I would have to make is that like most cars today, it is not very pretty. But that’s not terribly important and other than that, the car checked all the boxes.

Doing the research is crucial. You need to know everything about the car you’re looking at – the fair market value, the long term reliability, any specific problems the year/make/model is known for, the features in different trim packages, etc. Most salesman suck at their jobs and will not know a lot of these things, especially with used cars. This doesn’t mean they won’t answer any questions you have; it just means you shouldn’t rely on the answers they give you. Keep their motivation in mind and go in armed with information from unbiased sources.

I also had financing lined up before I went to any dealerships.

I decided to finance this car instead of paying cash because my credit score has suffered some since I paid off my last car years ago as a result of having no current installment debt on it and I want it back where it was. No, there isn’t much practical difference between the mid 800s and the low 800s. But this stuff is literally what I do and yes, there is also some ego element to it. Anyway, another reason I got a loan is that at today’s interest rates, a small one (just over $10k in this case) costs basically nothing. I had a sub 3% rate ready to go at a local credit union.

 I walked away from two potential cars because the deal I wanted wasn’t there.

This is extremely important. Car salesmen know how to toy with your emotions and if you aren’t careful, they will have you feeling that you MUST have THIS car. Or that they’re such nice people that you owe them something. Or any number of other psychological tricks that they might play depending on what you respond to. Any time you start feeling yourself having an emotional response to anything involving money, it is a good practice to walk away until it has passed. And when buying a car, if you sense that you’re at the salesman’s limit and the numbers aren’t where you want them, that is the perfect time to walk away anyway. If he lets you leave, you know it really was the best he had to offer. And don’t believe any bullshit he gives you about this being “a one time, today only offer!” I promise he’s lying. And even if he’s not, if he was willing to give it to you, someone else will be too. If you remember nothing else, remember this: you will never lose money by not spending it. Think about it.

Like many of my previous car purchases, I bought a late model used car and saved a ton.

My Sonata was actually the one new car I’ve bought so far. I only bought that one because it was a demo model (6000 miles or less on it but still legally a new car) and it was selling for about an $8k discount off of its retail price of $31k. But even though I got a deal that good on that “new” car, and even though this latest car was significantly more expensive when it was new, I still paid less for this one. With options, the Infiniti retailed at just shy of $50k. But five years old and with only about 30k miles on it, I got it for $21k. I wasn’t concerned about the year/mileage imbalance affecting my resale value since I put on a ton of miles and will quickly reverse it anyway. Considering this car has a long proven, naturally aspirated engine and the Hyundai had a turbo, you could make the argument that this car’s powertrain probably has as many trouble free miles in it as the Hyundai’s did when I bought it – but this powertrain is in a considerably nicer car. And in case you think this particular model depreciates unusually quickly, there were plenty of available ES 350 options at right around $20k for that same vintage as well. Keep in mind that the secret has been out on Lexus for some time so they depreciate slower than almost anything on the road. But even there, the late model used discount is alive and well.

What was different about this purchase?

I bought my car from a “no haggle” dealership.

Most people know that Carmax is a fantastic ripoff by now. If you still don’t, compare any car on their lot with other comparable options in your area. Even without factoring in that most dealers will negotiate some on their advertised pricing, thus making it even lower, Carmax is going to be at least 10% higher than the best available options on nearly anything. They make it simple for you…to pay them an enormous premium for a car. This time around, I found a lot of dealers that appeared to be copying that business model. However, upon further inspection, I noticed something surprising. Many of their prices are actually pretty competitive and some are even exceptional. The dealership I wound up going with happened to have the exact car I wanted at the lowest price available for hundreds of miles. Could I have found a similar car for a thousand or two less somewhere else? Possibly. But it probably wouldn’t have been worth the time and effort. I only buy black cars with black leather interiors and the Q60S is a fairly rare car to begin with. This is a preference that always costs me money but one that makes me happy and thus, that I’m willing to pay a little for.

Anyway, I ended up getting a pretty decent deal on the car without the fun of negotiating, which normal people don’t seem to enjoy anyway. So don’t ignore all the “no haggle” dealerships; not all of them are ripoffs. I will, however, note that this was not one of those “delivered to your door” dealerships. I would NEVER buy a car I couldn’t inspect in person first, whether new or used, although it is significantly more important with a used one. And yes, I know they offer return policies, albeit for very short time/mileage windows. Do you want to try returning a car? I can’t imagine any scenario where that would go smoothly. For example, there will already be a loan in your name. That will have to be zeroed out or paid off. I can’t imagine that will report cleanly on your credit report. The titling process will already have been started. Do you think they refund that money? Do you think you won’t also be paying to title the second vehicle? Those are just a couple of issues off the top of my head. If you can’t inspect a car in person, don’t buy it. These aren’t tv sets; no two are alike.

I actually wound up financing through the dealer.

This particular dealer only dealt with a selected group of finance companies. Ever the cynic, I figured this meant they were going to add one or more points into my deal, which is a very common practice at dealerships and one of the main reasons to line up financing before you go. Had they tried to do that, I would have simply bought the car with cash or walked away. However, they wound up getting me a loan within a quarter point of the one I had already lined up. And with a loan as small as the one I took, I will pay basically nothing in interest anyway and a rate difference that small means nothing. Why did I take such a small loan?

I actually wound up trading my car in.

I have always sold my own cars in the past and have been very successful with it. In my experience, I’ve gotten anywhere from 20 to a whopping 50% more than dealerships were offering by doing things this way. But in this case, the dealership actually made me a pretty fair offer. I know because I did my research in advance. If I had sold the car myself, I would most likely have gotten $1-3k more for it. However, that would have involved spending time I simply don’t have and dealing with at least some people I absolutely don’t want to deal with. When you’re dealing with the public, you’re usually going to meet some assholes, some weirdos, etc. But the bigger issue was the time factor. For me, at this stage of my life, I decided it wasn’t worth squeezing every last dollar out of my car. Plus, the $10k I got for it by trading reduced my sales tax by $625 (you are only taxed on the sale price that’s in excess of your trade and the rate is 6.25% here), further reducing my motivation to sell the car on my own.

I threw my research in the trash and started over.

Like I said above, the 2015 Lexus ES 350 would have been a nearly perfect car in my situation. So why didn’t I buy one? Because I test drove one. I can honestly say I have never been so disappointed with a car in my life. The car was, in fact, nearly perfect – except for one little problem. It was the most sterile driving experience I’ve ever had. Although the stats were pretty similar to my existing car, the performance didn’t feel like it was. And even if it had been, it wouldn’t have mattered. I could have been in a car as fast as the heavily modified Supra I had back in the day (you know, when they weren’t just BMWs marketed as Supras), but so what? I couldn’t feel anything. It was like someone set out to create a car that felt like you were floating in it rather than driving. The car is extremely good at what it does and I thought I would like it. But I absolutely didn’t.

By the by, this is also a strong selling point for the Hyundai. I wanted to get out of that car for two reasons – the mediocre build quality (don’t get me wrong – it wasn’t a Chrysler product or anything, but it was starting to creak and groan way too much for a car its age) and the turbo engine that would inevitably start costing me money well before I wanted to get rid of the car. I drove a car that is significantly more expensive and objectively better in almost every way and yet, it didn’t feel like much of an upgrade at all. For anyone looking for a lower priced car that still offers an awful lot, you could do a lot worse than a Hyundai. And if you get a maxed out one like mine was, you might have a harder time noticing the differences between it and a luxury car than you would expect.

Anyway, after that colossal disappointment, I decided I’m at the point in life where I can compromise a little more between financial optimization and enjoyment. I do have to drive this thing after all. The car I bought is significantly faster, sportier, and more fun in every way than the Lexus. It will not be quite as reliable over time, although it should still hold up decently, especially for being a sports car. And while the gas mileage will rarely be north of 30, again, it’s not terrible for a car this fun to drive at 19/27. And like with most cars, I’ve already been finding that it does a little better than its EPA rating in real life since I don’t beat on it. So far I’m averaging a little north of 27 with probably 75% highway driving.

And I actually love the car. It is a few years “behind the times” in terms of technology, but I think that’s great since I want a car, not a computer. The reason I was looking at a 2015 Lexus in the first place instead of a 2016 or newer is that after 2015, they started adding more and more of the self driving features I have zero interest in, at least until further notice. In the case of the Infiniti, 2015 was also my year because Nissan caved to the turbo trend in the next model year. It’s no race car, but it’s a sporty, fun little car with a very nice interior and everything I want in it. I’ll do another post on the cost of ownership between the three cars (the Hyundai, the Lexus, and this one) but for now, suffice it to say, while this one is the most expensive of the three, I still consider it a reasonable compromise compared to something very sporty like a Corvette. It is certainly well within my means and as long as you stay there, at the end of the day, I think it’s ok to enjoy yourself a little every now and again.

Your Life Is Going to Change; What Do You Want It to Look Like When It Does? Part 2

Happy Friday! Here is the conclusion to Wednesday’s post.

Waiting our turn to taxi. Jets are usually prioritized and with good reason – they’re burning hundreds of dollars of fuel in just minutes!

I’ve discussed how I got here plenty over the life of this nearly year old blog so I won’t revisit that here. This would be a good post to check out if you’re interested in the cliff notes version. Over the last few years, I’ve met all sorts of people and seen all sorts of things – a whole world I never would have experienced if my old life hadn’t ended so catastrophically that I decided to start over nearly from scratch. And one thing I’ve learned is that you aren’t defined by your current circumstances. You can be anything you want to be. If you don’t like your current circumstances, change them. It will probably require making some changes to yourself, but that is possible as well.

In fact, beyond being just possible, it’s inevitable. Remember those “cool kids” from high school? The quarterback and the hottest girl, who were always at the center of everything? Well, they changed too. They got married and had kids. Now he’s fat, bald, and trapped in a crappy job he hates while she’s fat and bitter and sits at home watching daytime tv all day. Obviously, that isn’t what always happens, although I do think peaking too early in life can be disastrous. But every person on this planet will change and so will their circumstances. Winners today are definitely not guaranteed to be winners tomorrow. And blessed are the “late bloomers” among us. We had to fight through significant challenges before the sun would shine in our worlds and as a result, today it’s shining brighter than we could ever have imagined it would. 

So who do you want to be and what do you want your life to look like? You do have a say in these matters. Look around you. Do you see the people you DON’T want to be? Those people had a choice too. Chances are, their attitude was that they didn’t. Life just “happened” to them. And look at them now. They didn’t decide what they wanted and force it to come into their lives, so they got the leftovers no one else wanted. Not making a choice is still a choice. I strongly suggest that if you’re a pessimist, you make changing that your first priority. I’ve recommended some great books on the subject in the past, but anything by Martin Seligman is probably the best recommendation I can possibly make.

From there, think about what you want your life to be. Envision it. If you were who you wanted to be, and you lived exactly the life you wanted, what would that look like? Now don’t just let it fade away like another daydream. Write it down. Next, figure out what steps you need to take in order to make your reality look like the one you just imagined. This may require some research. Finally, break the necessary changes down into small, actionable items and start doing them. Don’t get caught in the traps of perfectionism or “analysis paralysis.” Starting imperfectly is much better than never starting at all.

That’s it. You should start to notice changes in both your life and yourself almost immediately. Taking action is very powerful. It’s one of the main differences between people who life “happens to” and people who mold their lives into what they want them to be. I know someone who bought his first rental house five years ago and now has over seventy of them and a seven figure net worth to boot. I know someone else who has gone from a beginner sales rep to one of the best and most successful in our company in about that same timeframe. You really can transform your life, and in a lot less time than you would probably guess. But it won’t happen unless you decide to make it.

Your Life Is Going to Change; What Do You Want It to Look Like When It Does?

The very coffee machine referred to in the post making the very coffee I was waiting for when I conceived the idea for it.

The other day, I heard a song that reminded me of a very different time in my life. My then fiancé and I were both working what felt like dead end jobs with few prospects for anything better. We lived in Wisconsin, suffering through the standard six months of hellish weather on an annual basis. Everything I did in life, including staying in Wisconsin, was dedicated to her – something I now know was a terrible mistake and would have been whether or not our eventual marriage had only lasted two years. But how could I know that? I hadn’t been with many women before her, so like most men in that situation, I held on for dear life and smothered any chance of her remaining interested in me out of existence. Anyway, we lived in a decent, but modest apartment, and we each drove a 10+ year old vehicle. We had some fun, but mostly it amounted to hanging out with family and friends. Every spare dollar went to paying down our student loans. From an objective perspective, our life together wasn’t much to look at. However, I was naively happy and didn’t expect any of the fundamental parts of it to change too dramatically from there. There’s a powerful sense of security in that, albeit a false one in many cases.

But as I waited for the fancy coffee machine in the clubhouse of the luxury apartment complex I live in to finish brewing the amazing coffee I enjoy every morning I’m in town, I marveled at how vastly different my life is today. While it can certainly be stressful, and is particularly so lately given the current state of the industry, my job pays about three times what I made back in the time I was referring to in the last paragraph. My side business adds almost as much as I was making back then with very little time commitment required on my part, bringing my total income to about four times what it was. I still have friends and family, but now instead of a long term relationship, I tend towards enjoying being with someone while it’s mutually enjoyable, then moving on when that passes. I appreciate every experience and I look forward to the next. I have no trouble finding women who want to spend time with me, so there isn’t any over-committing on my part and as a result, my relationships tend to be much better while they last. I fly planes and write for this blog in my spare time, and enjoy both activities immensely. Oh yeah. And I’m enjoying all of this stuff from the comfort of my favorite state, over a thousand miles from bitter Wisconsin, and I get to spend regular time in four of its biggest and best cities – Houston, Dallas, San Antonio, and Austin. Why choose just one?

Problems that used to seriously worry me aren’t even problems at all now. I was having some trouble with my computer the other day. And while I was able to get it fixed with the help of my teacher turned IT professional mother, it occurred to me that if I had needed to replace my year and a half old computer, I could do so and I would barely have noticed the difference in cashflow that month. I’m considering going on a nice vacation early next year and it has already occurred to me that once again, I can pay for it out of monthly cashflow and not really think twice. Oh. And I just bought myself a luxury sports car – although I did stay true to my principles in the way that I did it. I’ll get into that next week; I promise this time! The point of this isn’t to brag. The point is that there is a night and day difference between these two periods in my life. I’m going to guess what you may be thinking here. There must have been a decade or more of hard work separating these two almost polar opposite chapters of my life, right? Wrong. Try six years. And if you’re going from the demise of my ill fated marriage until today, when things still weren’t dramatically different from the first paragraph above, you can make that three and a half. I have wasted much of my life so far as a pessimist. I still struggle with it. But it is much easier to challenge that way of thinking now that I’ve seen the seemingly miraculous changes that are possible in life.

To be continued…

How Much of Your Life Will You Spend Working for Free?

Someone paid an awful lot in taxes en route to buying this beauty!

The FIRE movement is everywhere these days and at times it seems like every possible related topic has been covered. But somehow, I haven’t seen a lot of discussion of the topic I want to cover today. As a finance guy, I’m all too familiar with how taxes work. When I was younger, that was one of the reasons I wasn’t too keen on getting a high paying, high commitment job – although I eventually found myself in one anyway. What my younger self saw, and what will ultimately lead to my much earlier than average exit from such a situation, is that there is a diminishing return effect. And that is especially true when you consider that in most cases, making more money requires working more hours. Those hours are literally the building blocks that make up our lives.

The more you make, the more of your money is taken away. It can seem fairly innocuous when you’re working forty hours a week and making an income somewhere in the average realm. In fact, all things considered, many people are breaking even or even getting more than they put in to begin with. But someone has to pay the bills, and if you’re working closer to eighty hours a week and making six figures (or more), that someone is you. For some folks, the reality is that when all taxes are considered, about half the money they earn is gone before they ever see it. So in another way of looking at the situation, they’re working twice as much, but only being paid for half the time.

Why would anyone take that deal? Sure, some people are workaholics. Some truly love what they’re doing to such an extent that they would be doing it even if it paid nothing. But for the vast majority of us, we do it because we want the money because we have expensive lifestyles to pay for. But what good is an expensive lifestyle if you’re spending well over half your waking hours working? What good is it if you don’t even get paid for a lot of those hours when all is said and done?

The cheaper your lifestyle, the less you have to work for free. Let’s say you only spend about $20k a year, as my ex-wife and I did when we were first out of school and clinging to the student lifestyle for a little longer so we could pay off our student loans quickly. If all you needed was $20k a year, you could work a job paying just a little more than that and live very nearly tax free (actually, you would almost certainly be getting back more than you paid in). In another way of speaking, your income efficiency would be at or around 100%. If you could tolerate that lifestyle, there would be an incredible upside in terms of having to invest very little in it. But now let’s say you spend $50k a year, which is actually still below average for United States households I believe. There’s no way you’re going to make that much without paying taxes. So your income efficiency goes down and your lifestyle costs you more of your life. And the trend continues until you’re well into the six figures and your income efficiency gets to be as low as roughly 50%. It can go even lower than that in places like California. And lifestyles tend to be a tad expensive there too, so it’s no surprise that those people are fleeing to Texas in droves.

It pays to keep your lifestyle expenses as under control as possible – quite literally. And remember, to the extent that more money correlates to more hours worked, you are literally paying for your lifestyle by working more hours (in other words, giving away part of your life) for free. This brings me back to the title of the post. How much of your life will you spend working for free? The foundation of the answer is in the cost of your lifestyle.

So next time you’re considering spending money on something, you may want to try framing the question this way. Would this purchase bring enough value into my life to compensate me for spending even more of it working for free than I am now? In some cases, the answer is going to be yes. Most of us have decided that being able to drive where we want, when we want, in a safe and reliable vehicle, is worth it. But you have to decide where to draw the line. Most of us aren’t driving Ferraris, for example. Today my suggestion is that you take the portion of your life you are literally giving away into account as you make these decisions. You only get so many hours before your time is up.