How Much Money I Want to Make
Feb 04, 2021 7:01 pm
LEARN THEN APPLY
Hi there!
Would love to start by getting your feedback. Could you respond with A, B, C, or your thoughts?
Why Do You Read This Newsletter?
A. To get exposure to and summaries of various resources (books, articles, courses) you're consuming.
B. To see behind-the-scenes of someone who's trying to create (projects/businesses/random cool 💩).
C. I know you bro.
Or reply to the email and tell me your thoughts. It'd be great to hear from you. 😊
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🧠 LEARN
The Challenge
I want to work for myself.
I want to spend all my time working on projects and experiments I'm excited or care about.
But I also want to pay the bills (and support my eventual family).
In 2019, I took some time off after a 3-Month contract to do freelance work while I "worked on my projects".
That turned into many 8 hours on YouTube and self-loathing.
I learned that time wasn't the problem. Rather my objectives and systems weren't clear.
I decided if I'm going to take that leap again, I have to first prove that I can make consistent money on the side.
But how much do I need?
Resources
I'll be honest: I knew about this book for years but never read it because I wasn't a fan of Robert Kiyosaki from the soundbites and quotes I saw.
But I'm going through all the popular personal finance books I've heard of in order to test my assumptions before I write personal finance content.
Rich Dad Poor Dad is ubiquitous.
My biggest takeaway from this book is to invest in assets that pay for your expenses.
Most of us depend on a paycheck from one source to fund our entire lifestyle.
Robert recommends using your money to purchase assets. His primary one is real estate but his site also mentions stocks/funds/bonds, commodities, businesses, and crypto.
So how does this help me become a full-time creator?
Insights
As I mentioned in the last newsletter, I'm thinking of buying a house or condo this year.
The idea of a mortgage is a little intimidating since I haven't been tied to many payments thus far.
My college loans were paid off pretty soon after graduating, I'm driving my dad's old car, and I've been living at home since I graduated. (Hey I tried to warn you why you shouldn't listen to me 🤷♂️.)
I've calculated that with my current income, I can afford a mortgage up to $2000/month without having to cut my Roth contributions and other expenses.
But that becomes much harder to swallow without a consistent full-time paycheck.
If I go full-time working for myself, I need to make $4000 a month post-tax ($5700 gross assuming 30% tax).
That would cover:
$2000 mortgage if I can't get renters
$500 Roth IRA
$500 for health insurance
$1000 expenses
That's a worst-case scenario, but that's what I want to prepare for.
So my goal is to gross $2500/month in passive income before leaving full-time work.
At that level, I am confident I can find contract work or cut expenses to close the gap.
What do I define as passive income?
Money that is earned whether I show up or not.
Right now, almost all my income comes from my full-time job and contract work. That work requires me to be on meetings and calls and show up when someone else needs me to.
The only passive income source I have right now is commissions from t-shirt design sales. Here's a tracker I made to capture all the income going forward.
I want to create more shirt designs. But to reach $2000, I'll need to build out and monetize projects like the wedding marketplace, the finance app, and the book club cohorts.
It won't happen overnight. But I believe by consistently building, I can reach this goal in 2021.
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🚀 APPLY
Project Updates
Unfortunately, the garage that was working on the car has been closed due to COVID regulations but here is what it looks like now:
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✌ See y'all next week
If I don't send a newsletter by next Wednesday (2/10), venmo request me for $10 @monitormonkey.
Have a great week!
<3 Aswin