Monthly Archives: September 2011

September 29, 2011 · 8:44 pm

Saving Money While Traveling

Day 32 | $31,450 paid | $59,267 till freedom

This will be the last post for a few days since I’ll be in Ann Arbor for the weekend to reconnect with my old friends at teammates.

Since this is the first of three trips in October, I already know I’m going to blow my budget. So it won’t come down to a question of whether or not I do, but by how much. Being vigilant over every dollar will be hyper-critical, and that starts from the beginning of the trip, with parking–a huge, huge waste of money at highway-robbery prices.

I didn’t want to bother my friends for a ride to the airport since they’d need to be available in the middle of the day and I didn’t want to put that on them, so I decided to drive myself. I typically park at the Parking Spot for covered off-site parking at $10/day, including tax. I don’t like exposing my vehicles to the elements such as sun and potential hail, and I always garage them at home. The Parking Spot is a good compromise to the expensive garage parking at Austin-Bergstrom, which is like $20/day or something ridiculous. Surface parking at ABIA is $7/day including tax, but it’s uncovered.

I was planning on taking my Murano to the Parking Spot like I always do, but then I realized that I could actually save a few bucks  each day ($12 total) if I parked at ABIA. I didn’t want to expose my Murano to sun or hail though, so I’d have to take…my motorcycle. I had waxed it earlier in the day, so the paint would be protected from the sun. Also, it hasn’t rained in several months, and while there’s a 40% chance of showers this weekend, a little rain won’t hurt the bike. And if it hails, the plastic bodywork will be fine.

While the trip is not terribly long, it’s not very short, either. It’s three nights, four days (Thurs-Sun), and I’d have to jam the following into my into a backpack to ride my bike:

  • extra pair of jeans
  • two stretch polos
  • long-sleeve t-shirt
  • two short-sleeve t-shirts
  • socks and underwear for Fri-Sun
  • crew team varsity jacket (it’s raining with highs of 55 all weekend in Ann Arbor)
  • laptop & power cord
  • toothbrush, razor, shaving cream, etc.
  • sunglasses
  • phone charger
  • protective case for my helmet

And because I’m going to get in some alumni rows while I’m there:

  • rowing trau
  • rowing UnderArmour
  • athletic sunglasses (can’t use the aviators!)
  • shorts
  • sandals

I had $12 in savings fueling my conservative packing motivation, and I actually managed to do it. The bag was bursting at the seams and actually giving me back pain as I rode the 25 minutes to the airport, but I did it. The rowing shorts and t-shirt will have to serve double-duty as pajamas, but other than that, I really think I have all I need and want. Well, other than my kindle, and my…FLASK. (Yes, I somehow forgot it!)

By doing this, I not only save 12 bucks (and get 40 MPG instead of 20-25), but I have a more enjoyable ride to and from the airport…well, except for the back pain.

As I type this on the plane, I’m still wondering if it’s worth it. $28 for parking, or $40? I don’t know; I’m torn on this one. $40 just feels like so much more than $28. I think it’s just that I hate paying for parking so, so much–whether it’s at the airport, downtown, at a concert, whatever. It’s such a waste of money.

Hopefully nobody throws my bike in the bed of their truck as they leave the airport parking lot.

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September 28, 2011 · 12:33 am

4th Teach-Back’s a Charm

Day 31 | $31,450 paid | $59,267 till freedom

I arrived at SAT prep training at 5:27 PM and only three other trainees were there. I assumed the other two would be along presently, so I was surprised when Ryan announced three minutes later that we had everyone we needed, and class would start.

I understood why one of the trainees got cut, but I was shocked that the person who taught remedial math to kids for a living hadn’t been selected to continue with training. We were down to four trainees total: the two teachers, one other girl, and me.

Stuff was starting to get real. I thanked my lucky stars I had been invited back, and wondered if my background had something to do with it. Surely my “energy” and “personality” hadn’t been enough to save me? Lord knows my concept mastery, boardwork, and interaction in the teach-backs were abysmal. I’m guessing that having teachers with Harvard degrees helps with the program’s marketing efforts.

All that said, I almost self-selected out of the process and elected not to get beaten up a second night in a row. I woke up to a number of negative comments after posting last night, and if I wasn’t already personally discouraged from the beatdown I got at training, the comments from people asking me why in the world I was interested in a job that pays $25 an hour and why I wasn’t staying focused on one incremental revenue stream were almost enough to completely turn me off of the whole SAT prep thing. Serious props to Emily Marcroft for making feel like a tough SOB for sticking with it. I mean, after somebody tells you that  “you’ve got balls” to go after a challenge, it’s impossible to resist the temptation to actually prove it.

I was selected for the second teach-back of the day–my third total–and I walked the three trainees plus Ryan through a critical reading question. I was more relaxed and more engaging than my two teach-backs from yesterday, but I was nowhere near Oscar-performance, and still received a lot of critical feedback. I felt the ice underneath my skates get a half-millimeter thicker, but no more.

We moved away from the reading and writing sections of the SAT and dove into math. As part of our self-introductions yesterday, we had to tell the class our name and something about the SAT prep training that made us nervous. I admitted to the class that I am horrible at public math, and figured that this would be my weakest area. Of course, considering how poorly I did on the reading and writing sections, this probably seemed impossible to everybody now. I was the third student to get volunteered for a teach-back in the math section, and I was assigned to teach the solution to the following:

For all positive values of p, let p(smiley face) be defined by p(smiley face) = p / (p^2 +1). What is the value of 2(smiley face)?

Instead of the words “smiley face,” there was an actual smiley face symbol. Crap.

I had a minute to prepare, and I don’t know where it came from, but I immediately thought of a hook for the class that was interactive. I briefly planned the rest of my lesson, remembering Ryan’s advice from yesterday to have a clear strategy. Then I got up in front of the class and asked, “Who can tell me what we call the symbols that were drawn on the walls of pyramids in ancient Egypt?” One of the trainees raised her hand and said hieroglyphics. I replied, “That’s exactly right. And whenever I see one of these weird symbol notation problems, I think of the song “Walk Like an Egyptian” and I get ready to walk all over this problem and own it.” I thought it was pretty weak, so I was surprised that I actually got some genuine laughs from it. Feeling pretty good, I dove into the lesson, got the trainees really engaged, and closed it out.

Ryan prefaced his feedback by saying it was my best teach-back yet. I also got a couple pieces of critical feedback, but my spirits could not be dampened. At the end of the session, I met with him for one-on-one feedback, and he said that given my background, I’m probably used to thinking through more complex problems and have a completely different target audience in mind when I’m doing so, but I have to make sure to avoid lecture mode with high school students and make them feel invested in the class by getting their engagement. He went on to say that I saved myself with my fourth teach-back because my personality really shined through, I got everybody involved at the right level, and I seemed very comfortable with the material. He told me to come back for the third session.

Unfortunately, the next and final training session is not till Thursday, and I’ll be on my way to Ann Arbor at that point. The next training session will be with a whole new batch of trainees and won’t happen for another month. I’ll be in a tough spot because it will be with trainees I don’t know, whose named I haven’t memorized, and it will be that much harder to engage them. Oh, well. Ryan wants me to call him when I get back to town on Monday to see what we can work out.

Reflection
I think my first three teach-backs went poorly but got consistently better because I learn by doing. I generally don’t read and learn or watch and learn–I do and learn. (And if you were to ask my parents and close friends, they’d also tell you that I do a whole lot of learning through mistakes.) I didn’t make the time to practice teaching on my own, and even if I had, how would I practice engaging an empty classroom, the area I’m weakest in? In fact, practicing might have just made it easier for me to fall into lecture mode, which I have to avoid at all costs.

I also tend to over-think things. My first three teach-backs were not difficult subjects. The first one was a strategy for reading through a critical reading passage, and the second one was simply reading through a paragraph and having the students give me the key take-away from each sentence. The third teach-back was how to answer a question on what the author was trying to convey when he wrote a certain line in the passage. Pretty simple stuff, but I thought I had to go in there and make the lesson a mind-blowing experience. I ended up getting performance anxiety and totally froze.

With the math question, I could see how some students might be confused by it because I was initially confused by it, too. So I was able to empathize with the ”students,” and because I had been getting progressively more comfortable with leading a lesson, I was able to help them walk themselves through it slowly, methodically, and in an engaging manner.

For the third training session, I’m going to have to remember to not over-think any of this stuff, and to ask guided questions to lead the class down the right path. I feel confident that I can repeat this, but I know I’m far from a shoo-in.

Final Reflection
Final reflection on the overall process–remember, it’s the journey, not the destination–I’m glad I went back for Day 2. I could have come up with any number of excuses to skip–I don’t want to leave work at 4:30 to get to 5:30 training downtown because my inbox is overflowing and I really need to work till at least 6 (which was true); I don’t want to miss a second work-out at the gym because I’ve already missed one and I never miss any (which was also true); I don’t want to sit through three long hours of boring training (true); at the end of the day, $25/hr isn’t going to make a huge impact on my gap to $90k (also true).

But really, all of those excuses would have ultimately boiled down to one excuse: I don’t want to risk failure. That was very, very true. But then I would have never known some other, basic truths. Can I teach? Can I impart knowledge? Can I get in front of a classroom and effectively engage a class? When I woke up this morning, I was positive I couldn’t, and I struggled to find the motivation to head back. But I knew I wouldn’t be able to live with myself if I quit.

This SAT prep job has taken me out of my comfort zone, just as so many other things have taken me out of my comfort zone during the past month. Which, incidentally, might explain all of the stress I’ve been feeling lately.

  • Pulling complete strangers with a pedi-cab from bar to bar when I should have been inside those bars drinking with my friends
  • Giving two strangers a key to my house
  • Launching a landscaping business without any idea of how to make it succeed
  • Going to a modeling agency for an interview
  • Cashing in my $30k Screw You Fund and practically living paycheck-to-paycheck
  • Mixing my own drink in the bathroom of a bar with a flask I brought from home
  • Not buying the kinds of things I’d typically buy without a second thought
  • Getting porn solicitations
  • Starting a blog and being completely open about everything–from finances to failures–with complete strangers

But this isn’t the first time in my life where I’ve been outside my comfort zone, and that’s why I returned to the SAT prep training this evening. Because sometimes, you just have to numb up, believe in yourself, remember that it doesn’t really matter at the end of the day, and go for it.

On that note, we’ll kick it old-school as I leave you with a blast from the past: my “optional” essay #6 from the HBS application, written five years ago in the Fall of 2006, a little less than a year before my first day of class.

6. What other information do you believe would be helpful to the Board in understanding you better and in considering your application? (400-word limit)

On the fifth day of my summer job as a carpenter, my boss told me to sheet the roof. I was terrified of heights and I had never been on a roof before, but on that day I would actually be laying down the roofing plywood—the foundation that would support me. As I climbed the ladder to the roof, the lump in my throat became steadily bigger and the roof seemed to become steeper. The first row of smooth, slippery plywood had already been nailed to the trusses at the bottom of the roof, and there was a long 2×4 nailed horizontally to the plywood inches from the edge of the roof. The only thing between me and the ground 30 feet below would be a skinny piece of wood held on by a couple of nails. Should I leave the sturdy ladder and step onto it?

Experience is the best teacher, and stepping out of my comfort zone and plunging into new experiences headfirst has repeatedly helped me grow, develop, and gain new perspectives on life. I lived in two countries, five states, and nine cities before turning 23. I moved 1400 miles away from my family and friends to a city where I didn’t know anyone. I jumped out of a plane at an altitude of 12,000 feet. Eight under-funded teammates and I lined up against million-dollar varsity rowing teams. I took on a manufacturing process improvement project to save my factory money. I started a drive from Detroit with hopes of arriving in Austin in fewer than 24 hours.

Sometimes the plunge ends in success: I love Austin, 1400 miles away from my hometown. The parachute opened. We beat Princeton,California, Navy, and Dartmouth. I saved $175K annually. I drove from Detroit to Austin in fewer than 23 hours…five times.

Sometimes the plunge ends in failure: I have crashed my motorcycle. I have lost a best friend. I have broken my nose. I have been ostracized. I have lost races by several boat lengths. I have had 20 stitches on my face and scalp. I have failed exams. I have had my heart broken.

Ultimately, I want the Board to know that I’m a person who embraces change, welcomes new experiences, and accepts successes and failures.

And I want the Board to know that I did step off that ladder and eventually sheeted 27 roofs.

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September 26, 2011 · 11:59 pm

Mad Respect for My HBS Profs

Day 29 | $31,450 paid | $59,267 till freedom

Per my post last night that highlighted a $5k+ delta to my $90k debt pay-off goal, there is no rest for the weary, and I have to go find more money if I want to be debt-free by the end of June.

I just got done with night one of SAT tutor training/interviewing, and it couldn’t have gone more poorly. To quickly recap the selection process, there is a Skype interview that starts the ball in motion, followed by three three-hour training sessions taking place over three consecutive days. After that, trainees must take the SAT and score 2100, a score which could get a high school junior into a level of schools just below the Ivies.

 Only 2% of all applicants are hired on to be SAT instructors for the company with which I’m interviewing–HBS’s acceptance rate at ~9% is actually better!

The three training sessions simply consist of “teach-backs,” where the “manager of instruction” opens the 300-page curriculum at random, selects a  page, chooses a trainee to deliver a three to five-minute lesson, or “teach-back” on it, and gives them 30 seconds to prepare. If the teach-back goes well, the trainee is invited back for the second training session, and if that goes well, for the third. 

In the delivery of the teach-back, the trainee is evaluated on five areas:

  • Concept mastery
  • Boardwork
  • Personality
  • Energy
  • Interaction

The main call-out from all of these was interaction. Each of the six actual classes is three hours long, and in order to keep highschoolers interested for that long of a time, the trainee must engage the class at a rate of 80/20–the class should be talking 80% of the time, the instructor 20%. This is very similar to the HBS class format which is all about the “case discussion” rather than a lecture format, and the professor utilizes the Socratic Method to get the class discussion heading in the right direction, making sure the students draw the right conclusions from the case study, but draw them on their own. Making this connection, I took solace in the fact that I had experienced top-notch student-led discussions for two years at the West Point of Capitalism, and assumed I would be fine in that regard.

That being said, I did not completely relax, and rightfully so, seeing as how I completely crashed and burned during my teach-back.

First off, three of the six trainees were actual teachers, so right away they had an advantage over me in the area of boardwork, if not everything else. Second, and this one was my fault, I didn’t prep for the training as well as I could have. Trainees were expected to come into the first training session being intimately familiar with the 300 pages of the curriculum and all ten hours of training videos on the website. I had every intention of prepping thoroughly over the weekend, but I worked on  the landscaping business from 10 AM to 4 PM on Saturday, printing flyers, hanging them, and working on Michael’s yard, testing our timing assumptions and ironing out best practices. I also went out with friends that night from 10 PM to 4 AM, got to sleep around 4:30 AM, and woke up at 1 PM on Sunday. Oops. Out of all the stuff I was supposed to do this past weekend–work on the landscaping business, prep for the SAT  training, go out with friends, wash my cars, mow my lawn, trim my shrubs, call my parents, go to church, go grocery shopping, and cook my lunches and dinners for the week–I managed to squeeze in grocery shopping, some work on the biz, going out with friends, and stumbling through 150 pages of the  SAT curriculum and five hours of videos.

(Balance. I need to work on it. I probabaly didn’t have to go out for six and a half hours on Saturday. That being said, I might have been too aggressive in building all of those chores into my weekend itinerary.)

So right off the bat, I wasn’t looking good on the mastery front or boardwork front, but I feel that I have a decent personality and I have a lot of energy, and I thought I could do the whole engagement/interaction thing based on my experience at HBS, watching HBS profs in action.

Wrong.

The manager of instruction, Ryan, asked me to teach page 18 of the curriculum, which is all about how to employ a three-step strategy for reading through a dense and boring critical reading passage. Several students had already done teach-backs on other topics and received public feedback from Ryan, so between the five evaluation points mentioned above and the customized feedback he gave each trainee, I had a good idea of what he was looking for. Beyond the five key areas, it was also important to create a “hook” that  grabs the students, personalizes  the upcoming lesson for them, requires their engagement, and pulls them in. When I turned to page 18 to figure it all out, I broke out into a cold sweat. While it seemed that there had been obvious hooks for the three trainees that preceded me, I had nothing! Literally nothing came to my mind. I had absolutely no idea how to make this interesting.

I’m fairly good at winging things, and I assumed that I could just wing it–this had to be easier than the kinds of presentations I give and the discussions I’m involved with in meetings with executive directors and VPs of the Fortune 500 tech company where I work.

On the other hand, I was sitting right next to the exit, and a part of me really wanted to head out to the parking lot rather than up to the front of the class.

I felt the clock ticking, so I got up from my seat, walked to the front of the class, turned around, put page 18 on the desk in front of me, looked out at the trainees and Ryan, then the looking turned into staring, and I stared at them some more, and I waited for the words to come to me. Nothing came. My visions of leading with a crazy hook and being an awesome MC of a super-intriguing discussion rather than a boring instructor of a boring lecture fell apart before my eyes.

I had no hook! I still had no freaking hook. I couldn’t believe it. My armpits immediately became geysers, and I could feel my face turn dark red. “Oh my gosh, no way. I’m actually doing far worse than the girl who went second, and she completely bombed this,” was basically all I could think. And then I just started lecturing. I didn’t even acknowledge anybody in the room for the first 120 seconds of my spiel, and I still can’t really remember exactly what I said. I do know that I tried to use some big words to try to compensate for the mess I was making. 

Finally, realizing I hadn’t engaged anyone worth a darn, I started asking the class completely random questions about the strategy, questions that provided absolutely zero value-add to the lesson. I couldn’t steer the discussion worth a darn by asking follow-up questions, either. I was in a tailspin, grasping at straws, and going down fast. All the trainees’ faces had this pained look of awkward embarrassment on their faces. Nobody could look me in the eyes. Beads of sweat were gathering on my forehead. I eventually pulled out of my tailspin by just letting them do the talking, which didn’t really work since they didn’t know what they were supposed to say, and I finally took them out of their misery by abruptly ending the lesson.

To any HBS profs who might have happened across this blog: My goodness. Never, ever, ever let anybody tell you that letting or trying to force a bunch of students do the talking is an easier teaching model than straight-up lecturing. The Socratic Method is chaos wanting and waiting to be unleashed, and only the most adept professors can control it. Bravo to each and every one of you. You had my admiration and respect while I was at HBS, and now you have it ten-fold.

The feedback from Ryan and the class was about what I thought it would be–extremely negative. I wanted to hand my curriculum binder to Ryan and drive away in my car, but since Ryan had said some people might give two teach-backs, I figured there might be a slim chance that I could salvage it.

Later on, the final two people who had to give a teach-back read through a part of a critical reading passage, each taking a paragraph and leading a class discussion around it. They got feedback from Ryan and the class at the end of their turn, so it became very clear how this was supposed to be done. Ryan called me up to to lead the class in discussion on the third paragraph, and because I had seen it twice–with post-mortem feedback to boot–I managed to emulate the prior two, add some flair, and–not too surprisingly, given all the prep–I actually did fairly well.

At the end of the class, Ryan sent us all into a room and called us out one-by-one to tell us in private if we would go to the Tuesday training session. If I had been Ryan, I would have been very split on whether or not to give me a second chance. Thankfully, he did, and he said that for tomorrow’s teach-back, I’ll need to have a very clear action plan on how to attack the lesson I’m given because that’s when I’m a much more effective and confident instructor–not when I try to build the plan on the fly. I couldn’t have agreed with him more. I shook his hand and thanked him for the probation.

I’m definitely nervous about tomorrow. The only reason I did well on the second teach-back was because I had a model to follow and build upon. I definitely won’t be so lucky tomorrow, but I don’t have time to prep since I have a full day of work before training. I do want this job. Good SAT performance is important, I want to help kids do well on it, but most importantly, the job pays fairly well at  $25/hour.

Cream of the Cream of the Crop
One of the teach-backs in training today was about why the SAT is important and why high-school kids need to take it seriously. That took me way, way back to my days as a 16-year-old. When I was 16, I didn’t have a clue what I wanted to do. I just knew I wanted to go to an Ivy League school and make $100,000/year when I graduated. That was literally a goal of mine, and that was the salary I wanted.

My counselor shot that dream down, though, during the one-on-one session that all juniors were required to have with their counselors. I told her about my hopes to go to Harvard or Yale, and she advised me to look elsewhere because “only the cream of the cream of the crop go to schools like Harvard.” I can still remember her name, of course, and the lay-out of her office that I was sitting in when she delivered that tidbit of advice to me. I can even remember the visual I got in my head when she told me that line–a cup of coffee, with a little puddle of cream floating on the surface, and only the really, really white cream in the very center of that puddle was worthy of consideration to a top tier school. I remember being envious of that cream, and wondering why it was so much more special than I.

I ended up not applying to any Ivy League schools and instead went to Michigan. But that moment in the guidance counselor’s office has stayed with me today because that was the first time in my life somebody had ever discouraged me from reaching for my goals. My parents have always told me that everything will work out as long as I do my very best. I should have listened to them, instead of putting my trust in somebody whom I considered a subject matter expert.

(By the way, going to Michigan’s b-school for undergrad and rowing on the crew team is probably the best thing that has ever happened to me, so things have a funny way of working out.)

Could I have made it into any Ivy undergrad? I took some AP classes, graduated 12th out of my class of 453 students, had some decent extra-curriculars, and got  a 32 (99th percentile) on the ACT on the first try without a prep course. However, I also got a relatively lousy 1220 (85th percentile) on the SAT on the first try without a prep course, and for east coast schools, the SAT is the critical test. If I had received more positive feedback from my counselor, would I have taken an SAT prep course, scored better, applied to some Ivies, and been accepted? And if I had, where would I be now? I can’t really complain about how life has turned out thus far.

It turns out my parents were right. God bless them.

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September 25, 2011 · 8:56 pm

Progress Report: Month 1

Day 28 | $31,450 paid | $59,267 till freedom

The dust from my financial activities in fiscal September (Aug 26 – Sep 25) has settled. After month of 1 of my challenge, here’s where I stand:

  • Starting Cash: $31,116
  • Starting Student Debt: $90,717
  • Income: $7,339
  • Expenses (including regular loan payments): $4,115
  • Debt Paid Down (excluding interest): $31,450
  • Ending Debt: $59,267
  • Ending Cash: $3,500
  • Total Assets: $62,192
  • Total Liabilities: $59,267
  • Net Worth: $2,925

Predicted student debt at end of June 2012 (i.e., delta to goal): $5,453

Looking at just the $90,717 and excluding any interest that accumulated on it over the month, I put $31,450 towards that figure and brought it down to $59,267. I’m going to go ahead and file that one under “Quick Wins,” and I don’t think that file will ever be re-opened during the next nine months. I was able to pay off one third of my student debt primarily by getting rid of my savings and realizing heavy losses and liquidating $14k in stocks and $12k in an IRA. With only $3,500 in cash now, my Screw You Fund is good for about a month before I have to go hit the street corner if I get fired. That quick win comes at the cost of my sense of security, and at the cost of realizing $3k in losses since I had invested $17k in stocks in October 2008, just before the Great Recession struck.

Assessment of Cost and Revenue Initiatives
I want to take a moment to assess–in terms of wins and losses–how I’m tracking to my cust-cutting and revenue-increasing initiatives that I laid out in Brass Tacks.

Cost-Cutting Initiatives

  1. Debt Snowball – LOSS – I was banking on an $186 extra/mo beginning in September, but this won’t actually kick in until next month. On the plus side, I’ll be adding another $53 to the snowball because I was able to pay off a $4,460 loan with the $30,840. So the $30,840 went to the $24,666 loan at $186 month and to the $4,460 loan at $53/month, and the balance will go to my federal loans. My debt snowball is now $239 starting in October.
  2. Entertainment - LOSS – I budgeted $50/mo and had been trending at $1,400/mo in entertainment at a time when I was budgeted for $850/mo prior to NMHD. For September, I came in  at $501, primarily due to some heavy spending activities prior to starting my NMHD mission, but after the September fiscal month had already started in August. While on the NMHD budget, I spent a little over $100. While I’m chalking this up as a loss, it’s a heck of a lot better than $1,400/mo, and I should be able to get closer to $50/mo going forward.
  3. Stop 401k – LOSS - I was banking on an extra  $550/mo, but only got $287 this month because I wasn’t able to turn off my contribution quickly enough. I should see the full $550 next month and beyond.
  4. Groceries – WIN – I tried to trim my budget from $330/mo to $280, and $280 is exactly where I landed for September. I didn’t actually change my shopping behavior to make this happen, so it was probably just a function of not buying any non-regular items like razor blade cartridges or contact lens solution that tend to inflate the grocery bill.
  5. Car Fuel – WIN – I budgeted $160/mo, had been trending at $225 prior to NMHD, and somehow, magically, came in at $100 for September. That being said, I have three vehicles with fuel gauges all at E, so I’m about to spend $60 + 45 + $12 on fuel for the Murano, S2000, and bike to start October, leaving only $43 in my fuel allowance to last the rest of October. I’m in a tough spot.
  6. Electricity – LOSS – I budgeted $68/mo, and I came in at $124. The $68 is an annualized number, though, since I don’t run my AC or furnace during certain days or even weeks due to the mild wealther that sometimes occurs in Austin, and I can get my electricity bill down to as low as $40.
  7. Lunch at Work – LOSS – I budgeted for $55/mo upside, hoping to cut out out my one weekly lunch out. I spent $36 in September. Oops.
  8. Dry Cleaning – WIN – I budgeted $20/mo and had been trending at $40. I came in at $22. I had no shirts to clean since the weather is hot enough to justify waring polos to work, so I spent only $20 on dry cleaning and was still able to avoid the drudgery of ironing. Score.
  9. Automotive – WIN – I’ve budgeted $200 for a couple of oil changes and miscellaneous things, and I spent $19 on a liter of synthetic oil, windshield washer fluid, and Armor All.
  10. Medical – WIN – I’ve budgeted $10 for the next ten months to spend on a co-pay for my physical, which I haven’t gotten yet.
  11. Clothing – WIN – I’ve budgeted $0 for clothes and didn’t buy any in September.
  12. House Maintenance and Repairs – WIN – I budgeted $100 for three exeterminator appointments during the next ten months. The exterminator was at the house on Saturday, but the check hasn’t been cashed yet, so that charge will fall in October.

I did spend $64 on non-categorized items such as an update to my anti-virus software (I accidentally enrolled in the automatic update, which was my mistake), faxes, casters for my office chair, copies of the house key, and other miscellaneous items.

Revenue-Increasing Initiatives

  1. RSUs – June timeframe; no comment
  2. Raise – Budgeted a 10% rase for an extra $500/mo net of tax beginning in October. I got the new job/promotion, now I just need to transition into it, so the raise might not hit my paycheck until the middle or end of October.
  3. Tax return – April timeframe; no comment
  4. Bonus – May timeframe; no comment
  5. Pedi-cab job – LOSS - in the Brass Tacks post, I  budgeted $490/month, but I actually lost $136 in September through the purchase and return of the bike, as well as the licensing bureaucracy costs.
  6. Landscaping Biz – LOSS - I spent $50 on the site. The first  $25 was wasted on reserving a domain name that ended up not making sense for the business, so we had to reserve a second domain name for another $25. That being said, I have n’t budgeted any income from this venture–or any additional jobs, for that matter-so anything going forward will be complete upside to  bridge the $5,453 delta.
  7. Roommate – WIN – I estimated $650/mo with one roommate, but that was a bit unrealistic compared to the market, which I hadn’t analyzed prior to making that estimate. Now I have two roommates and I’ll be getting $450 + $400 from roommates 1 and 2. This month I got their first and last month’s rent plus $150 security deposit from each, and I banked it all.

October Outlook

Cost Challenges

  • Entertainment @ $50/month

I’m flying out to Ann Arbor, MI for a crew team reunion from 9/29 to 10/2. I’m extremely excited for the trip, and I’ll be crashing at my friend’s house and going to house parties during the nights, so that’s all free. I do anticipate a lot of lunches and dinners out with friends, so I’ll have to keep an eye on spending.

I’m flying out to Detroit, MI on October 21st for my cousin’s wedding. I’ll be staying at my parents’ house, so lodging will  be free. It would be nice to see if I can keep that weekend’s entertainment down to $0. Of course, I’ll want to reconnect with old friends when I’m in town, so that might be difficult.

All flights were purchased months ago, so the plane tickets won’t hit my income statement, but any expenses I incur during the trips will.

  • Electricity @ $68/month

With more 95+ degree days in Austin forecasted for October, it’ll be hard to bring down my $100+ electricity bill–especially now that I have two roommates.

  • Fuel @ $160/month

For reasons already mentioned above, I’m not in a good position to stay within budget.

Revenue Challenges
I don’t think the roommates are going anywhere, and I haven’t built into my budget any incremental revenue from any additional jobs, so there are no risks there.

The only risk is that my new salary might push out a couple of weeks.

Final Thoughts
All in all, a heck of a month. I chopped off $30k from my loan obligation, and instead of spending $1,057/mo on student loans, my new monthly obligation will be $818, a drop of $239. It was a tough and emotional first month, but I think I’m getting into the groove of being frugal and working hard to generate extra revenue, and I’ll continue to chip away at the debt. The full ten-month outlook is below. Note that you’ll probably have to click on the image below twice–once to open, a second time to zoom in.

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Filed under General Status Updates

September 23, 2011 · 7:28 pm

Friday Hodge Podge

Day 26 | $24,666 paid | $66,051 till freedom

Legalized Prostitution
I  was at the gym after work today,  and when I got back to the locker room, this text was waiting for me from an ex:

Message 1: saw you again..I must say I love your body…

Message 2: Going to be out for a bit tonight…I know you r trying to save money…but if I buy…would you join?

My ex goes to the same gym, and I’m guessing she saw me while I was working out.

Definitely feeling like a piece of meat right now, but at the same time…hey, what’s a guy to do?

New Day Job Is Great for NMHD
In other news, the new job is definitely supports my cause. My new role deals with strategic alliances/business development, and I had a lunch today with a supplier. It was my first ever B2B business lunch, and it was a great change of pace from what I’m used to, work-wise and lunch-wise.

Work-wise, as a product line manager, I worked with a number of groups internally, from marketing to engineering to supply chain, and beyond. Lunch-wise, I cook two boxes of spaghetti at home on Sunday and bring it to work for lunch every day. On Thursday, I had an exernal-facing meeting with a supplier for lunch, and also had a delicious reuben sandwich…for free. AWESOME. Right now, life is all about the big things (career development) and the little things (free lunch).

George Best
I saw this quote on my buddy’s FB wall and  I’m stealing it shamelessly.

“I spent a lot of money on booze, birds and fast cars. The rest I just squandered.”

Reminds me of somebody I know. …Or used to know? TBD.

We Are Useless
My friend, Sunil, sent an email out to the crew on Wednesday afternoon–the crew being my close group of friends–that sparked an interesting exchange.

From: Sunil
Sent: Wednesday, September 21, 2011 4:01 PM
To: The Crew
Subject: We are USELESS!!!!

 Forbes came out with their list….

Facebook founder Mark Zuckerberg was the biggest dollar gainer on the list, with a net worth of $17.5 billion that earned him the No. 14 spot.

From: Khalid
Sent: Wednesday, September 21, 2011 4:07 PM
To: The Crew
Subject: RE: We are USELESS!!!!

Sunil,

We are not useless.. but we are clearly not hungry enough..

NMHD is proving that motivation can get you places.. by pedi-cab or lawn mower..

Kidding aside – we’re in a situation where the corporation will take 12 hours from each of our days and pay us enough to be happy, but not enough to break our dependence on it..

By the time we make enough money to invest or break away, we’ll be too old and have too many responsibilities to risk it all..

What to do? Let’s talk..

 Oh, and one more thing.. Mark Z ain’t got sh*t on us!!!

Cheers,

Khalid

Of course I absolutely had to get a jab in, especially after what I had blogged about the night before.

From: Me
Sent: Wednesday, September 21, 2011 4:10 PM
To: The Crew
Subject: RE: We are USELESS!!!!

Saying you’re useless by equating your net worth to your self-worth is sad.

I’m planning to get out of debt so I have a wider range of options going forward—which may include selling my house and getting completely out of the rat race.

I completely agree with Khalid’s assessment. It looks like my friends are getting hungry–or will need to get hungry if they want to stop talking and actually do something. And I’ll soon be in a position where I’ll have some free cash flow…good things could happen if we want to work for it.

This Weekend
This weekend I’m going to go through the SAT curriculum to prep for the training/interview session on Monday. I need to nail it. The job pays $25/hour, and there’s about three hours of work a week, or $300/month, so $2,700 over the next nine months.

Michael and I don’t have any customers yet for our landscaping business, so we’re going to buy some signage for his yard that he landscaped, flyer up some neighborhoods, then take a couple sections of his fence down and work on his backyard, which he’s upgrading. Michael said he always gets several passersby asking him if he’ll do their yard whenever he works on his backyard. I said he’s just trying to get free work out of me! That being said, it will allow us to do time studies and rationalize our pricing system.

I’m also going out tomorrow night with the crew for the first time in three weeks. Pretty darn pumped for that. Flask-in-hand (or pocket), of course.

Comments on Your Comments
Last night, I spent a an hour or two trying to reply to all the comments that dated back to the beginning of this blog. My life was super busy when I started this blog, and I regretted not being able to reply to comments, but now that I’ve  caught up, I plan on being more prompt with comment replies.

9 Comments

Filed under Uncategorized

September 21, 2011 · 1:53 am

I Get a Pass

Day 24 | $24,666 paid | $66,051 till freedom

A lot of my recent posts have been about the second part of my debt-reduction framework, increasing revenue. This one is dedicated to the first and most fundamental part of the framework: cutting costs.

I was at Lowe’s  the other day buying a caster for my chair–by the way, I think this whole not-spending-any-money thing is going to have a remarkable impact on my handyman skills. I broke one of the wheels on my office chair (crappy Staples crap), and instead of paying $120 for a new one, which the old me definitely would have done, I went to the hardware store to see if they sell casters. They do! And they cost only $5. I saved $115!

Anyway, I was at Lowe’s getting the caster for my broken chair, and I saw some of of those huge inflatable plug-in yard decorations for Halloween, and I realized that it was the buying season for all things Halloween–decorations, costumes, and candy. I looked down at my watch to check the date and see how many days I had left before everything was sold out and it was too late to do my Halloween shopping. To say I panicked would be an overstatement, but there was definitely some anxiety.

Last year, I spent over $200 and several hours prepping for Halloween, and that was with some restraint–I really wanted a huge decoration for my yard, maybe a dude in a coffin that leaps out at kids coming up the sidewalk for candy, but I didn’t want to go spend too much money. The $200 and time was spent running around town to piece together a Mike “The Situation” Jersey Shore costume which I wore downtown, a scary costume with which to hand out candy, a voice modulator for the scary costume, a scary music CD to play while handing out candy, and the candy itself. I have a statue of a knight in my foyer, so I also spent some time and cash putting red LED lights in the eye sockets. My goal was to scare the crap out of kids.

I terrified about 90% of all the kids who came to my door and even managed to make a few cry! It was frighteningly fantastic. I wore a black floor-length cloak and a super-scary mask, and during parts of the night, I stood in the open front door and watched kids trick-or-treating, the scary music blasting out of some huge speakers I had put in the windows and the red LEDs glowing in the knight’s eye sockets, staring over my shoulder at the trick-or-treaters. A lot of kids looked at me and refused to walk up the driveway–they passed on by, casting cautious glances in my direction. Others had their parents go get the candy while they waited in the street.

At one point, I stepped away for a second, and when I came back, I walked up behind my then-girlfriend who was holding out a bowl of candy for a little guy who was reaching into it to get a treat. I stood behind my girlfriend and peered over her shoulder, and the mom noticed me before her kid did, so she threw both of her hands over his face and turned him away from me so he wouldn’t get freaked out.

Priceless.

(Well, not exactly–it cost about $130, but you know what I’m trying to say.)

Downtown was also a good time. Dressing up like a Jersey Shore buffoon does, in fact, give one the right to be a douchebag, so I really took advantage of it–Joy-zee accent and all–and had a complete riot.

  • Downtown costume (multiple hair products, bronzer, headband, fake tattoos, bling bling watch, bling bling chain, bling bling sunglasses): $100
  • Scary costume + modulator: $60
  • Candy: $50
  • Scary music: $15
  • Red leds + battery: $5
  • Total: $230

Throw in the cab ride to and from downtown as well as the drinks for my girlfriend and me, and Halloween 2010 was easily over $300.

So, to get back to the original story, there I was, standing in Lowe’s, thinking through a plan to outdo myself and building a schedule and financial budget to get all of the stuff together. My anxiety was growing a bit because I knew it would take a lot more time and money to make more kids cry this year than last, and to get more attention downtown this year than last.

But then I realized that it was all moot because I can’t afford Halloween!

There’s obviously some hyperbole in that statement, but most of it still rings true. I can’t really afford to go big–I have $0 in my budget allocated to Halloween, and I’m over $5k from my goal in the budget I have, so it’s not like there’s any wiggle room.

I basically get a pass on Halloween, and surprisingly enough, that’s actually a stress reliever. I don’t have to try to outdo myself or keep up with the Joneses on my block because I’m on a debt-paydown mission, and–at least in my mind–I’m allowed to bah-humbug Halloween this year.

Want vs. Need
That whole transformation was surreal–one minute I’m in a cold sweat trying to plan the perfect Halloween, and the next minute I’m completely mellow because I’m nixing Halloween. The surrealism got me thinking–where else in my life am I causing myself unnecessary stress by placing pressure on myself to outdo myself, get attention, or keep up with the Joneses? By going out as many nights in a single week as possible? Two cars and a motorcycle? A house at the age of 27? Traveling? Clothes?

Are there areas in my life where I can simplify?

Every since I started this mission three weeks ago, I’ve majorly slowed down my spending, and in fact, I’ve started a list of things I want or need but won’t buy until after my loans are paid off.

As of 9-20, I’d really, really like to buy the following things:

  • Black dress shoes for work. I buy my shoes from Aldo and replace them every six months–my current ones should have been replaced about 9 months ago, and they look it. Yikes. | $125
  • Rear tires for the S2000 | $400
  • 8GB SD card for my camera. The old one broke. | $60?
  • Motorcycle repair, so I don’t have to run-start it every time I get gas or run a short errand | $200-$300
  • Soap dispensers for my master bathroom. I got a couple of really sharp, brushed aluminum soap dispensers from BB&B a year ago, but they aren’t working very well anymore. | $40
  • Replacement subwoofer and speakers for my office computer. Six years later, I’ve finally blown the original set-up. | $150

I could easily spend a grand tomorrow, or 1.5% of what I owe on my loans (about $65k). But this is my “deferred shopping list,” and if I can get it away with it, it’s stuff I’m not going to buy until I’m student loan-free.

Per a comment that Mike made in an earlier post, one should always purchase preventative maintenance or repairs that will prevent a more expensive repair down the road. I completely agree. That’s why I’m having an exterminator come out to my house on Saturday for the $100 quarterly treatment–carpenter ants and termites will destroy a home and cause thousands of dollars in damage. And I’ll still be getting regular oil changes on my cars and my own oil change on the bike. Maybe I’ll invest in a jack and some stands to do the car oil changes myself.

But to get back to my earlier point, are any of the things from my deferred shopping list complicating my life unnecessarily? I would argue that scuffed up shoes can lead to a negative perception at the office which could lead to my termination, and bald tires can lead to an accident, so I don’t know if I’ll go another nine months without replacing the rubber for my feet or my car. I’ll definitely try to hold out for as long as possible, but I don’t know how long it will be before my better judgment wins out.

I can delay the purchase of an 8GB SD card for my 12MP camera since  my phone takes decent pics with its 8MP camera. I can also delay the repair of my motorcycle–run-starting a motorcycle, while annoying, surely builds character.

The subwoofer and speakers for my computer? I already have a killer surround sound system in my living room, so this would be a luxury. Brushed aluminum soap dispensers? Maybe I’ll put those on the wedding registry ten years from now. I’ve since replaced them with $2 Dial soap dispensers.

There’s a difference between want and need, but the line is so often blurred between the two. I need new shoes so I don’t get fired. I need new tires so I don’t hydroplane and crash my car if it ever rains again in Austin. I need a 8GB SD card for my camera so I can lock in memories. 

Or is my 8MP camera phone good enough? Do I need two subwoofers in the house when one is sufficient? Does my soap need to come out of a flashy container? Maybe that’s where the simplification kicks in–things that are nice or luxurious to have, but aren’t critical for everyday living, get the axe.

To take things to an extreme, you could ask to define what is “critical to living.” I need warmth, shelter, and food to live. I don’t need new tires if I don’t need a car to live. So am I supposed to learn how to hunt and build a shelter, sell everything I own, and live in the forest? Clearly, there are unclear shades of gray here that will not get answered tonight.

For now, I’ll continue to update my deferred shopping list.

Materialism & Self-Esteem
An article came out awhile ago that stated the obvious: “Researchers have found that low self-esteem and materialism are not just a correlation, but also a causal relationship where low self esteem increases materialism…” Thanks, Captain Obvious. You mean that the dude flying around in the super-bright yellow Ferrari, with name-brands emblazoned all over his clothes, feels an incredible amount of self-worth, and he’s happy just being himself, as he is, flaws and all? He’s not compensating for a small…amount of self-esteem?

But then the article, in the very same sentence as the one above, goes on to completely blow my mind: “…and materialism can also create low self-esteem.”

Wait, what?

I graduated from grad school in 2009 and I bought a black-on-black 2004 BMW M3. I thought it was awesome, and I thought I was awesome. Upgrading from a lowly Honda S2000, I was sure that I had arrived.

Driving that  car was stressful, though. Everybody was always trying to race me at stoplights and even on the highway. Car enthusiasts would look at me wherever I went. I could never fly under the radar. And because it was black, and I like my things to look clean, I had to constantly wash it to keep it clean, and that was a huge time-suck. Owning that car was a lot of work, mentally and physically.

And then my friends started upgrading their rides. One of my friends got a brand-new 2010 BMW 335. And then my other  friend got one. And then a friend got a new Lexus is350, and another one got a new Lexus GS400, a new Benz C300, a Porsche Cayenne. Suddenly, my old Bimmer was just looking old, but somehow still attracting enough attention at streetlights that I was constantly being forced put lesser cars in their place.

I bought a motorcycle a few months after getting the car since 0-60 mph in 4.8 seconds wasn’t cutting it anymore. I had to get something that did it in less than 3 and could get to 100 in about 7. The motorcycle, due to the enormous smile it put on my face every time I drove it, became my daily driver, and I didn’t see the point in making $500 payments on something I left behind in the garage  every day on my way to work. It just seemed like such a waste of money. I decided I wanted something in the garage that I wasn’t making any payments on. And since I had recently bought a house, I wanted something a little more appropriate for a homeowner. I was on a auto debt-paydown mission then, similar to now,  but on a much smaller scale.

I sold the BMW and got a 2003 Nissan Murano with 126,000 miles on. And something really, really bizarre happened when I drove it home. I fell in love with it. Nobody looked twice at me. Ever. At stoplights, I didn’t exist. I flew completely under the radar. And because I hadn’t spent a lot of money on it and it wasn’t  black, I didn’t care if it got dirty. And I didn’t feel a need to park it away from other cars like I did the M3.  Bring on the door dings!  To top it off, the Bose sound system was actually better than the Harmon Kardon system in the M3.

Like Halloween of 2011, I get a pass by driving the Murano. I’m telling people, “Look, I’m not here to compete. I know my car sucks. I know it’s a slow, utilitarian vehicle. I know your car is faster than mine and costs more than mine and looks better than mine. Bravo.” Nobody wants to race me, nobody cares. And it’s actually kind of empowering. It’s almost equivalent to the hubris of a counterculture that knows it will never fit in and meet society’s expectations and mores, so it flaunts its rebellious nature and amps up its irregularity to an almost excessive level. By driving the Murano, I disqualify myself from the start, and don’t have to go through the stress of being on top and then falling, or clawing for the top and never making it. I willingly and gladly cede the top.

The fight for the top–when it comes to material goods–is not worth it. It’s way too stressful.

Hell, I should put a child seat in the backseat of the Murano just to let people know I’m in on the joke.

The M3, and the materialism that drove me to purchase it, really was bad for my self-esteem. I would constantly compare the car and performance to other vehicles, and my comparison never included a Dodge Neon or Ford Focus, it included my friends’ Lexus/Benz/BMW/Porsche/etc, and as they kept upgrading their wheels, my M3 continued to lose its shine. When friends asked what car I drove, I would tell them the year/make/model, and some would say apologetically, “Oh, the older generation.” Apparently, an M3 is not an M3 is not an M3.

Even if my self-esteem were resistant to my internal comparisons and their judgment, which I think it was, it didn’t exactly make me feel awesome.

(If you’ve been reading my posts, you know I also have an S2000, so please let me get on the pre-emptive defensive here: One could argue that because it has two doors, two seats, a convertible top, and looks decent, that it’s my attempt to seek status with a car and fly at radar-level. But  it’s a 10-year-old car and cost $11k, so that argument doesn’t hold much water. If I really wanted to try to seek status, I could have gotten a BMW Z4 or a Corvette for about $5k more. I bought the S2000 because at the end of the day, I’m an unabashed sun-worshipper and an auto-enthusiast, and anyone who knows the now-discontinued S2000 product knows that it’s one of the few true driver’s cars. And it has Japanese/Honda reliability going for it, unlike the Bimmer.)

Stuff or Experiences
There’s an article that tries to answer the answer the question of how much money one needs to make per year to be happy. Well, scratch that–not happy, but how much it takes to be satisfied. And the answer is about $75k. I already read that money doesn’t buy happiness, but that $75k…is that before or after student loan payments? Regardless, $75k is not much, and it’s tough to buy a whole lot of material goods with $75k. But it can buy plenty of beer, which leads me to my next point.

Between losing my friends in the pursuit of a motorcycle and realizing that buying a nice car doesn’t generate happiness, I’ve started leading a less materialistic life, looking to spend money on experiences rather than stuff–which explains my $1,400 in monthly entertainment spend. And this article indicates I might be on the right track: “Those who never drink are at significantly higher risk for not only depression but also anxiety disorders, compared with those who consume alcohol regularly.” A similar article explains that heavy drinkers outlive nondrinkers! “Alcohol lubricates so many social interactions, and social interactions are vital for maintaining mental and physical health.”

And in case there are any doubts, check out this article: “One major finding is that spending money for an experience — concert tickets, French lessons, sushi-rolling classes, a hotel room in Monaco — produces longer-lasting satisfaction than spending money on plain old stuff. Unlike consumption of material goods, spending on leisure and services typically strengthens social bonds, which in turn helps amplify happiness.”

I wholeheartedly agree. I’ve been stressed for the past couple of weeks, and I attribute it to the fact that the last time I had a drink with friends was over two weeks ago, on September 4th. All of my free-time has been consumed with revenue-searching  ventures and avoiding spending money on entertainment. Nothing has ever, ever made me happier than spending a good night out with my friends. Clearly, it’s time for a night out, flask-style.

To bring this post full circle, the question now is how to have experiences cheaply. I would argue that Halloween for me last year was more about experiences–scaring kids and acting South Jersey in Austin–than it was about accumulating material goods. But as I demonstrated with Halloween last year, some experiences can get out of hand cost-wise. And as indicated by my swing of emotions at Lowe’s, some experiences can actually stress me out when it comes time to redo them to the point that I actually look forward to getting a pass out of them.

I’m glad I’ve gotten over the materialism (at least I think I have). I just need to take some time to reflect on the whole “want” vs. “need” concept in a little greater detail. And I need to learn how to have experiences more cheaply–$1,400 a month in entertainment and $300 Halloweens are probably not a great idea.

The next nine months will be a balancing act:

  • Limit entertainment spend as much as possible and work as hard as possible to generate incremental revenue, but somehow make time and spend some money to go out with friends.
  • Figure out what I need vs. what I want, and spend money on the former only. Also, identify situations where deferred maintenance or repairs will lead to more expensive repairs down the road.

29 Comments

Filed under Cut Costs

September 18, 2011 · 10:48 pm

We Have Lift-Off

Day 21 | $24,666 paid | $66,051 till freedom

Exactly one week ago, Michael called me up to tell me about the money that the city of Austin is paying residents to xeriscape their yards. Today, after having spent 68 hours and seven days fleshing out the business model, we launched a website for our company that explicitly supports this initiative.

I went to Michael’s house at 10 AM on Saturday and Sunday. The old me would have still been sleeping. We worked until midnight on the first day, clocking 14 hours of straight work without any real breaks, and we put in another ten on Sunday for a total of 24 hours over the weekend. Leading up to the weekend, we had put in about ten hours each. All told, we’ve sunk 68 man hours and $50 into the business.

You would never catch me putting in over a single hour of work for my day job on a typical weekend, let alone 24, but it’s a completely different mentality since I’m working for myself.

You would also never catch me missing a night out with my friends, but I missed the fight-watching party on Saturday night that I mentioned in an earlier post. I was supposed to go to my friend’s house at 4:30 PM, but 4:30 came and went, and so did the next seven and a half hours–poof, into nothing. 

I guess priorities change when you’re working for yourself.

The site for the business turned out far, far better than we expected it to, complete with an online design and quote process, a plethora of high-quality xeriscape images, and even an FAQ. It also includes a bio in which I had originally listed Michigan and HBS as my alma maters, and even included a link to my LinkedIn profile. A colleague at work advised me to remove HBS and the link because even if customers believe it, it looks–to use her words–”sketchy.”

That feedback gave me pause. It’s funny…it seems that HBS can sometimes be as much of a liability as an asset, depending on the career field in question. I’d argue, of course, that at least nine times out of ten, it’s a very big asset.

The site has gotten over 200 hits since we launched it at 8 PM, but I’m guessing those are just our curious Facebook friends clicking the link in our status updates.

Demand generation is going to be critical at this stage. Selling our used cars on Craigslist is about as entrepreneurial as Michael and I have ever been, so this will be a huge learning experience with a steep ramp. Word of mouth will be the main growth stimulant for the business, and we have fairly high hopes for that since Michael’s neighbors have frequently asked how much he charges for the xeriscaping work he did on his own yard. Now he has an answer–and a website and business email address, too.

I’m lucky to be friends with Michael. He’s well-paid and has made some very wise investments, so he’s probably not in this for the money. He also has a wife and kid, so any time he spends on the business is time away from his family. I believe he’s in it because he’s always wanted to do his own thing–when we worked in the same office together, we used to constantly talk about going into business together to build a hot start-up, but for whatever reason, it never went beyond talk. A low-budget landscaping business is definitely not what we anticipated, but at least we’re starting somewhere.

Impulsive

I always knew I was an impulsive guy, but my behavior over the past few weeks really highlights that. Who thinks that ped-cabbing looks like an interesting gig on one day (August 30th), and has already gone through the “interview” process, navigated multiple levels of bureaucracy to get a license, bought a bike, completed training, and started pedi-cabbing ten days later (September 9th)?

Likewise, who is pitched a business idea by their friend (September 10th) and launches the business seven days later?

Sometimes an interviewer will ask, “What’s a weakness of yours?” and the rule of thumb is to describe a weakness that could also subtly be interpreted as a strength. I think my response should be, “I’m incredibly impulsive. I dive right into a project and drive for results without understanding what temperature the water is, how deep it is, or if the liquid that I’m diving into is even water.” Good: I drive for results. Bad: I have no idea what the hell is going on.

This probably explains why I never seek out strategy roles at companies I work for.

 The good thing is that the latest venture has a very low monetary cost to start. The time investment was somewhat high, of course, and although I have only ten months to achieve my goal, I think I can afford to spend a weekend investigating a business idea that looks reasonable, at least from a high level.

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Filed under Increase Revenue

September 16, 2011 · 10:08 pm

Another $500 Bike?

Day 19 | $24,666 paid | $66,051 till freedom

You know you’re on a mission to pay down $90k in 10 months when you write two blog posts on a Friday night!

Dating Then Not
So the girl and I are no longer. I called her up and we talked about it, and it seemed like the best thing to do was to end it. It wasn’t a money issue–she didn’t care about money. In fact, she probably lives more cheaply than I do. And while she didn’t want money–something I don’t have right now–she did want time, which is another thing I don’t have right now. It sucks that it ended that way, but at the end of the day, I’m not in marriage-mode right now, and I’m not going to lead somebody on for ten months in a relationship where we hardly see each other for something that’s probably not going to be very long-term, anyway.

Instead of seeing her tonight as planned, I’m going to be posting this blog (one hour) and working on the landscaping business website. At 9 AM tomorrow, I have a meeting with Michael, my friend who thought of the idea, to flesh out the rest of the business plan and launch the site.

Odd Friday Night
On the typical Friday night, I’d either be downtown with my friends or on a date. Tonight is the first Friday that I’ve spent at home in a long, long time–for as long as I can remember, in fact. Even last Friday, I wasn’t home–I was downtown pedi-cabbing. But it’s okay–I’m actually really looking forward to working on the site and planning the business. I think we have such an incredible opportunity on our hands. Michael is a really sharp guy who went to A&M and is a landscaping guru, and I think we’re going to be able to do something really special when we put our heads together. I’m energized.

A part of me definitely misses downtown and hanging out with my friends, and in fact, my buddy texted me to go smoke a hookah at Kasbah, get some Torchy’s Tacos, and go downtown. That sounded incredibly tempting, I was extremely close to saying yes, and it was only with serious willpower that I said no thanks. We’re all getting together at my buddy’s house tomorrow night to watch the fight and possibly go downtown after, so I have that to look forward to. I’ll bring the flask just in case we do end up DT. I haven’t had a guys’ night in a couple of weeks, and I’m looking forward to it.

The Modeling Thing
I met with Nicole from a local modeling agency today and while it went well, it took me to a critical decision point.

The agency has offices in Miami and Hong Kong, and they just started actively recruiting talent for their new Austin office three weeks ago. Nicole and I hit it off and we had a casual conversation for about 30 minutes before getting down to brass tacks.

She had me fill out a form with my measurements and skills. When I asked her if she just wanted my resume instead of a list of my skills, she gave me this really puzzled look and told me no thanks. When I pressed her for details on what kind of skills I should list, she told me to list whatever I can do that a potential client might be interested in when they’re casting models. I still had no idea what she meant, but I didn’t want to risk looking like a complete amateur and asking her to explain further, so I took the bull by the horns and wrote, “ride my motorcycle, run, lift weights, bicycle, hike, business.” I felt like a complete idiot.

Then Nicole told me I’d have to get some pictures taken with a local photographer, Steve, who charges about $400 for a portfolio. Visions of my $500 pedi-cab bike flashed in my head. Uh-oh…here we go again. I swallowed the lump in my throat as she went to explain that without my images, they wouldn’t be able to effectively market me to clients. That part makes sense. On top of that fee, the agency takes 20% of everything I make from their clients. That also makes sense. Both parts make complete sense if the model is awesome and gets assignments left and right. But me…? I wasn’t so sure, but I didn’t tell Nicole that. The meeting wrapped up as she she told me that she never asks anybody to sign on the spot, and that I should call her when I’m ready to proceed.

I went to the gym to work out and talked it over with a buddy who asked me how long it would take to make the $400 back. Valid question–why hadn’t I asked Nicole that?

I called Nicole when I got home,  gave her the context of the pedi-cab situation, told her I didn’t want to get burned again, and asked her to be very, very candid with me and tell me if I even had a snowball’s chance in hell of modeling in Austin and how long it would take to earn back the $400. She assured me that they weren’t taking on models just to fill their roster, and that I wouldn’t have been at the interview if they weren’t seriously interested in me. She went on to say that I have a “clean-cut/businessman/fitness/guy next door” look that will do well for commercial print in Austin, which is apparently more lifestyle/commercial than a place like New York, where “edgy” models tend to do better than guys who look like me.

She also referenced the guy who came to see her after me–I had actually passed him on the way out, so I knew whom she was talking about. She told me that she told him his look might not actually sell in Austin. He has a great face, and while Austinites encourage everybody to “keep Austin weird,” she told me his tattoos might actually be an issue that will prevent him from being picked up. She claimed that she disclosed all of this to him.

I didn’t tell her this, but I’ve never been super confident about my looks. For the first nine years of my life, I had a dark red birthmark on my face that strangers used to stare at and kids at school used to tease me about. They’d laugh at me and ask me why I had “kool-aid” on my face. I got it lasered off at age ten and  had about two years to work on my less-than-stellar self-image until adolescence struck with a vengeance, putting severe acne all over my face, in my ears, and on my back.  To say that dates were hard to come by would be an understatement! I struggled with the acne for several years until I was 16 and got on a six-month Accutane treatment. It worked like a charm and no scars were left behind, but the damage was already done; I had developed a really negative self-image that lingered for years.

I’ve finally gotten over it during the past few years just by increasing my self-awareness and by dating enough attractive girls to realize that I can’t be too much of an ogre. But to go from what I looked like during my formative years to…modeling? I’m filled with skepticism. Nicole told me on the phone to think it over and not be impulsive–nobody has a gun to my head forcing me to sign. She does want me to sign and thinks I would do well, but I should do it only if I really want to do it.

I’m going to marinate on it for a bit and maybe see how the landscaping and SAT tutor jobs go before I commit. I’m leaning towards doing it. I just wish pictures had some sort of a return policy like the bike did! 

Finally Some Incremental Revenue
On a ver positive note, I deposited $1,943 today from the roommates’ first and last pro-rated months and security deposits, and I got an extra $287 on my bi-weekly paycheck by taking my 401k contribution down to nothing. Three weeks after establishing this goal, I’m finally banking some incremental revenue!

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· 7:31 pm

Student Loan Petition

Day 19 | $24,666 paid | $66,051 till freedom

WOW. Have you guys heard about this? My friend just posted it on her Facebook wall.

Want a Real Economic Stimulus and Jobs Plan? Forgive Student Loan Debt!

To be delivered to: The United States House of Representatives, The United States Senate and President Barack Obama

Forgiving the student loan debt of all Americans will have an immediate stimulative effect on our economy. With the stroke of the President’s pen, millions of Americans would suddenly have hundreds, or in some cases, thousands of extra dollars in their pockets each and every month with which to spend on ailing sectors of the economy. As consumer spending increases, businesses will begin to hire, jobs will be created and a new era of innovation, entrepreneurship and prosperity will be ushered in for all. A rising tide does, in fact, lift all boats – forgiving student loan debt, rather than tax cuts for corporations, millionaires and billionaires, has a MUCH greater chance of helping to rise that tide in a MUCH shorter time-frame. The future economic success of this country is wholly dependent upon a well-educated, prosperous middle class. Instead of saddling entire generations with debt from which there is no escape, let’s empower the American people to grow this economy on their own!

Therefore, we, the undersigned, strongly encourage Congress and the President to support H. Res 365, introduced by Rep. Hansen Clarke (D-MI), seeking student loan forgiveness as a means of economic stimulus.
http://signon.org/sign/want-a-real-economic.fb1?source=s.fb&r_by=860306

Apparently they need 230k signatures and are fewer than 900 away from their goal.

I’m torn on this. I, personally, will not sign. I don’t want the government interfering with my life, and I’m not a big fan of charity. Of course, I did take the first-time homebuyer tax credit, so maybe I am! But I had nothing to do with making that money available, and I would have been silly not to take it. Just like if this thing passes, it would be silly for me to not take it.

But I won’t help it pass. I sincerely think that people can cut costs and increase revenue to pay off their loans. That being said, if it does pass, I’ll be the first one with my hand out; I’m not going to refuse it based on principle.

While I won’t help it pass, there are people who will–I’m thinking of the people who took on loans, went to a second-tier school, and couldn’t get a six-figure job after graduating–or even a job at all–because of the economy. And maybe these people should go after the money. When people take on student loans, they assume certain, basic things–one assumption is that the economy won’t crash when they graduate, or if it has already crashed when they enter grad school, that it will recover by the time they graduate. This is probably a reasonable assumption, but an assumption which, unfortunately, has proven to be false.

I think this is an irresponsible program if it pays off the student loans of people who went to a top-tier school, are single, and make six figures. In other words…me. I think there should be strict guidelines in place so that only the people who truly deserve it will get it.

So who “deserves” to have their student loans paid off? Great question. People with families? People with undergrad loans only? People who have been unemployed for two or more years? People making less than $50k/year? What about people whose loans are 20% comprised of the money they used to go on trips around the world while at school? I’ll leave this one for the comments–definitely interested in what you guys think. Something else to ponder–is there any merit to this at all? Will it really improve the economy? I know that when I pay off my student loans, I’m selling my house, quitting my job, and backpacking around Europe, which probably won’t help the US economy one iota!

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September 15, 2011 · 9:18 pm

Relatable

Day 18 | $24,666 paid | $66,051 till freedom

Sarah, the first roommate to move in, got her MBA at a prestigious b-school, she just moved to Austin for a job, and she’s renting a room and driving a used, high-mileage car so that she can pay down her monstrous student loans. She’s the one I talked about earlier who’s doing what I would have done if I could start over. Well, she must have taken a class in negotiations–either that, or I’m a softie–because not only did she negotiate the monthly rent down by $100, but she also negotiated the right to park on the driveway, even though I had explicitly added a no-driveway clause to the roommate contract template I found online. I have two cars and a bike that I park in the garage, the driveway is only two lanes, and while I typically ride my motorcycle to work every day, I like the flexibility to switch it up–especially on the weekends–and I don’t want the hassle of having to move a car just to pull one of my cars out of the garage.

On the first night, Sarah eschewed her parking privileges and parked on the street in front of the house, but last night she decided to leverage her parking prerogative and took to the driveway. I had to run an errand last night, and as I was pulling out of the driveway, I noticed a large puddle of oil in front of the house that hadn’t been there two days ago. I assumed that Sarah’s car was leaking oil, and not wanting a puddle of oil on my driveway, I checked under her car and confirmed via oil that was beading up around her oil pan and transmission area that it was her car. A little irritated, I went into the house and asked her to please move her car.

I was thinking more about myself and the driveway and less about Sarah and her car, so I wasn’t expecting the reaction that I got when I told her about the leak. She was frustrated and angry–not about having to move her car to the street, but because she anticipated a very big, expensive car repair in her near future. I could read the dejection in her tone and in her body language; she was not happy.

Then it clicked. Here she was, making sacrifices by renting a room out of a stranger’s house in a strange city and driving a very used, high-mileage car so that she pay down her student loans, and this was literally the last thing she needed. It struck me that the very same thing could happen to me. I’m making sacrifices by taking on roommates, cutting my entertainment way back, looking for extra work, and despite all that, I’m not immune to an oil leak, either. Some costs are uncontrollable. Heck, I have three vehicles, so my chances are much greater than Sarah’s that something will go wrong.  And random cost hits like that are not isolated just to vehicles–my computer could break, my TV could break, the house AC could break, etc. And I’ve already been a victim to breakage–look at how I have to run-start my motorcycle these days because something on it broke and I don’t want to pay to get it fixed.

It just goes to show you that “the things you own end up owning you.”

I’ve never been able to feel more empathy for a black female than I did at that single moment in time. The empathy I felt for Sarah, my ability to relate to her yesterday…that’s one of the few instant (rather than delayed) benefits of this financial challenge. There’s this powerful feeling of camaraderie and unity that has the unique ability to cross boundaries. Many people have debt that they’re trying to pay off, both genders and all ages and races and walks of life. Out of the 148 comments on this blog, many are written by people who say they also have student loans and that this blog is an inspiration to them. Are these people all white, 28-year-old dudes?

I’m not even three weeks into this journey, but I’ve already experienced several bouts of severe loneliness, like I’m the only guy in the world who’s making sacrifices by cutting costs and working harder to pay down debt. And out of my group of friends, that’s a true statement. But taking a broader cut of the population–taking a closer look at the people around me, and I realize that I’m far from the only person who’s doing what they have to do to get out of debt, and that it transcends all demographics.

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