What I Learned from Steve Jobs

I had the pleasure of reading this interview Steve Jobs gave in 1985 to Playboy Magazine.  It’s clear from the interview that he is a man of passion, who lives his life to his fullest.  It really takes a special person to create a company as wonderful and innovative as Apple.  It takes years of strenuous work and non-stop intensity.  That’s not for me, nor is the reward something that I would want for myself given the price.  But clearly, in my quest to retire at a very young age, I’ve lost the ability to live in the present — to enjoy the here and now.  I don’t believe I live every day to its fullest.  Instead, I sit around in my office doing work I’d rather not be doing.  All for the sake of continuing to earn a high salary so I can retire in a few years.

When the time comes, I’m not even sure if I can just quit.  It may be very difficult to walk away from a big paycheck.  In essence, this is the purest notion of golden handcuffs — my life or a fistful of money.  I’m on a relatively fast track at my firm.  If I work hard and stick it out, I should make partner.  I should make the big bucks.  My projected lifetime earnings is very high and walking away in a few years will be like walking away from 80-90% of that total.  But staying will impose a significant cost to my lifespan, happiness, and sense of fulfillment.  I hope that when the time comes, I can recognize the personal toll my job takes from me and realize that I can earn all of that back by walking away.

Steve Jobs never cared about money.  He cared about pursuing his passion.  I care about money and don’t know what my passion is.  I want to live more like how Steve lived.

Summer Update

It’s time for a summer update!  Financially, things are going well.  My savings rate is still up there, although I feel less disciplined in controlling spending.  I especially like getting frozen yogurt in the summer!  I have to tell myself that $3 for a small yogurt x 10 or even 20 is a drop in the bucket when saving $150,000 a year.  Also, my previous diligence in grocery shopping and not getting take out is also slipping.

Actually, I’ve been focused on getting in really good shape this summer.  I’ve always felt like I had difficulty putting on muscle and burning fat.  Obviously the reason is my diet — not because it is especially unhealthy, but because I probably just don’t eat enough to gain muscle mass. This summer, I’m going to make a particular effort to eat enough in total calories and protein, while keeping carbohydrates down (except following intense workouts).  Hopefully I’ll start to see some changes and motivate myself into continuing the eating habits.  I’d love to recomp and replace 10 lbs of fat with muscle.

Also having some growing pains with my relationship.  I’ve been feeling a little tied down and focusing on her flaws, rather than appreciating her for who she is.  Maybe that is a sign of a relationship running its course.  Or maybe I need an attitude adjustment.  It’s been on my mind a lot.  Can’t imagine how people stay married for 50+ years.  There must be a lot of ups and downs.

Perspective

I’ll be the first to admit that I can be a little obsessive sometimes.  I’m certainly obsessive about net worth and expenses.  Until recently, I thought that by having my finger on the pulse of my financial well-being was important.  But recently, I’ve come to think that I’ve lost perspective.

Of course, I recognize that life is to be lived in the present moments, as a collection of present moments.  However, I’ve found that my relationship with money took priority over a lot of other important things.  I’ve gotten stingy, even with friends.  I’ve started keeping score, e.g., who drives and how often, who (perhaps accidentally) doesn’t pay their fair share.  Of course, in the long run, none of this is important.  It shouldn’t even been important in the present.  My friends are generally high earners like me and there’s really no need to fuss about money because it all balances out.  In fact, getting worked up is the worst thing because it actually gets to affect me.

What I’ve started to do is to let go (somewhat) of the daily tracking of net worth.  (It’s just too easy to log in and see that number.)  In fact, I’ve unlinked my asset accounts from the online tool I use — the liability and rewards accounts are still linked.  This way I can track net worth once a month using a spreadsheet and still have records of expense related transactions at my fingertips.  Also this is good for security purposes.  I’ve never felt comfortable providing username/password information to a third party.  I’m not as concerned about credit card information being on there — if there are fraudulent charges, I can get a new card and the charges reversed.

I still plan on hitting my spending goals.  My income is not going to change.  Hopefully, these steps will help me mellow out a little bit.  Plus, I’m hoping the market continues to decline, so I can finally (finally!!) execute my investment plan.

Aimless…

It’s been a while since I last posted.  I feel so aimless these days.  It’s like I’m running on autopilot.  Everything is bland.  Or stated differently, things that used to excite me don’t.  I don’t have any fire in my belly.

My savings are on track.  My “career” is still on track.  Still have a g/f.  Still hanging out with the same group of friends.  I identified some problems in my life and fixed them.  Everything should be going great, but I don’t feel that way.  Is something sucking the life force out of me?  Do I need a reboot?  Am I wasting my life energy in my job?

Right now the plan is to take time off in three years.  I will take at least a year off.  I may never come back to the practice of law.  As long as my income and expenses remain in check, I should be able to save a significant amount by then.  I just wish in the meantime, I could feel more like myself…

Designing My Ideal Lifestyle

Lately I’ve been thinking a lot about what my ideal lifestyle would be.  I guess I can’t say for sure because I haven’t lived it yet.  I can have a single track mind and when I focus on a goal, I do it with such a laser like focus that I don’t get a chance to explore alternatives.  Sometimes, it takes a shake-up to get me to reorient myself and make adjustments.

The last time I posted about my future plans was 1 1/2 years ago in this post.  It’s funny how things change after 18 months.  I’ve lost interest in poker, wouldn’t apply to a clerkship, wouldn’t get an MBA, not inclined to start a high overhead company, lost interest in developing mobile apps, and despise patent trolls more than ever.  That basically leaves going in-house and teaching.  I suppose I’m not crazy about teaching either.

Recently, I discovered the location-independent / digital nomad lifestyle.  I have to say I’m intrigued.  It’s not something I could see myself doing forever, but certainly for a few years.  This would also allow me to spend more time with family.  Here’s how I could work it out.  I would spend 3 months in my current area, 3 months at my parents’ area, 3 months in a foreign locale, say Argentina and 3 months in another foreign locale, say Istanbul.  Of course, I could mix up the time periods, as 3 months at home and 3 months with family might be a bit much.

Now, if I save 25x annual expenses and keep my expenses abroad within my current expenses, then I’m golden.  Ideally, I could continue to consult on IP and/or other legal issues.  The great thing is you can do this type of work from anywhere.  For example, I could help on a technology transaction or do some patent prosecution all from the comfort of a cafe in a quaint South American town or a flat in Europe.  Maybe I’m romanticizing the concept, but it’s definitely very attractive.  Even if I only earned $3-5K a month, it would go a long ways towards offsetting my travel expenses and maybe even covering them entirely.

There are an increasing number of virtual law firms, some of them with excellent reputations and high pay.  I don’t know if they would work with someone with a nomadic lifestyle.  Also, my g/f also has a job that is conducive to working remotely.

Anyways, I’m very excited about pursuing this line of thought.  I will still endeavor to hit my magic number in non-retirement funds (which should occur in 3 years).  And maybe this traveling thing will only last a few years and I might be ready to return for an in-house position.  Who knows?  I will try to be more open minded about where life takes me and just be as prepared as possible for the ride!

March Update

I received a bonus payment recently.  After taxes, it was over 1.5 years’ worth of annual expenses, or stated differently, a 10%+ boost to my net worth.  The mental satisfaction of receiving such a bonus certainly wore off faster than I thought, although I would be more unhappy if it were somehow taken away.  Funny how the mind works.

The overall networth is $479K.  Liquid networth is about $310K, after subtracting value of car and retirement assets.   I’ll be halfway to my goal of $750K soon.  Just another $65K, which I should have in 7 1/2 months.  Assuming my salary,  bonus, and expenses are fixed and no stock market appreciation, I should reach my total goal in less than 3 years.  By then, I would expect to be a junior partner.

Who Wants Partnership?

How much do I really value prestige?  Is seeking prestige a sign of low self-esteem — to validate one’s self worth?  Sometimes I ask myself these questions.  I really don’t know the answer.  I honestly believe that I’m a year or two away from making partner.  It would be nice to have all my efforts recognized by getting this promotion.  I once saw a poster that said something like “success is the best revenge.”  Wouldn’t that show all the naysayers, the ex-girlfriends, etc. that I’m a successful guy?  Plus, it would come with a healthy boost in salary!

On the flip side, they say making partner is like winning a pie eating contest where you win more pie.  I’m not so worried about that — I think partners get rewarded financially and don’t necessarily work harder than associates.  They delegate a lot of work, but are also responsible for developing business.  What I really worry about is the prestige version of golden handcuffs.  You get addicted to the idea of being partner and the fat paycheck.  You all of a sudden can’t see yourself doing anything else, unless you’re a VP or assistant GC at a Fortune 500 company.  Simply stated, your identity becomes fused with your status as a partner, which I think is a mistake.  I’m not just a lawyer, I’m much more than that and refuse to limit who I am.

It’s hard to weigh the pros and cons of something you don’t have and don’t know.  I can only imagine what being partner is like.  I can already sense the rush of power.  Unfortunately, there are no role models for me to look up to.  Everyone I know is such a striver, or has significant financial obligations, whether it be to creditors, mortgage companies, spouses, or children.  Some folks have dropped out of the law game, but they dropped out early, certainly well before making partner.  Some have disappeared and rumor is they are struggling and others have come crawling back to the practice of law.

If I do decide to retire early, maybe as a junior partner (after all I need to work another 5 years), one of the biggest worries I have is unknown expenses.  There’s college expenses for kids — tuition is still going up at a healthy clip.  Is this a bubble or not, who knows.  There’s health costs.  Still going up.  Who knows how much I’ll need in 20 years?  There’s real estate.  Will I need a house for a family in the future?  These and other expenses could delay retirement by a few years.

On a lighter note, work is getting a little better.  I’m adjusting to my new role as a manager for my litigation matters.

Stress Strikes Again

I’ve been very stressed lately; not from working too much — I’m in a position to delegate a lot of work to more junior associates, but from something else. I think it’s the expectation that’s been placed on me. I’m no longer the associate who goes from one discrete task to another, doing each one well, but rather the lawyer who’s responsible for significant aspects of cases.

Honestly, I’ve never been more tempted to take my 2010 bonus and run. The added stress makes me feel like I am wasting the prime of my life doing something I’m not naturally suited to do. I’ve adapted myself to perform well as a lawyer, but it doesn’t fit my personality. I need to figure out what I was born to do.  What’s my passion? What’s YOUR passion?

Separate Ways…

I’ve been spending some time with friends over the New Year.  Most of them are attorneys a few years older than me.  Many of them are very successful, e.g., newly-minted equity partners or on the fast track to partner.  One female friend just had her second kid and is talking about buying a 3 BR condo in an expensive part of the city.  Another male friend who made partner just bought $1.5M condo.  Another friend bought a $70,000 weekend car.  Meanwhile, I’m here in my low cost rental w/ roommate.

My friend who made partner is not sure if he wants to be partner for the long-run.  Too much stress, I suppose.  I suggested that a partner who makes $600K a year could probably save a ton of money after five years.  I mean just limit spending to $50K, right and you can live off the savings.  Everyone laughed.  Really!  Someone said that was basically impossible — he’s the guy with the two nice cars and a vacation home.  The gal with two kids said I was dreaming.  Someone else brought up taxes…even at 50%, you’re still saving $250K a year!  I didn’t ask, but I assume that means they spend wayy over $50K a year.  I didn’t mention that I only spend $27K — I guess they don’t notice, which is a good thing.

Anyways, this background brings me to my point.  I used to be really close with these folks — still am — but really started to feel like we were going our own separate ways.

Christmas Update

The last few weeks have been very busy at work — to the point its almost outside my comfort zone.  I’ve assumed a lot of responsibility for my cases and it feels imposing.  This makes me want to hit my magic number even faster.   But, this professional growth  is  necessary if I want to make partner and really rake it in and significantly lower amount of time to FIRE.

Expenses: 2010 expenses look like they will be between $33-34K.  I did not move to my lower cost rental until June.  A lot of automotive expenses in December.  Also the usual Christmas spending, although I only gave three gifts this year.

Net worth increase in 2010 was over $100K.  About $65K in cash savings, $20K in retirement savings, and the rest from the market.

Investments:  In 2010, I waded into the stock market (~10%) in May and it’s paid off handsomely (>20% in seven months).  I also waded into a municipal bond fund (~5%) recently when municipals took a rapid dive.  I still believe the worst is to come given the Fed’s policies and high unemployment.  I still hold significant amounts of cash.

Miscellaneous: I signed up for a high-deductible health plan.  Will open an HSA next year.   Due to some uncertainty, I will wait to fund it in December 2011.

Personal: Not engaged/married yet.  May happen in 2011.

Here are some projections for 2011.  Assuming my expenses stay at the current level ($27K), I should be able to save >$130K next year, with >$105K in cash.  This works itself out to almost 4 3/4 years of expenses.  I will consider investing periodically, while keeping quite a bit of powder dry if the economy blows up.  This way, I will not be making a 100% bet on a downturn.