Let’s Talk about Leverage.
Not the kind you acquire when buying real estate investments, i.e., ‘good’ debt.
I’m talking about the act of leveraging areas of your life for the benefit of other goals.
In this case, money goals.
I mentioned this concept briefly in the Frugal vs. Cheap article. After a little searching, I was unable to find articles discussing leverage in a similar way. I think this is mainly due to not knowing exactly what others would call it.
Second, I think it is due to the fact that leverage in the financial space is typically associated with the business or investment side of things.
Leverage typically means borrowing money to increase your return on investment potential.
This is the main big-ticket tool used in most people’s real estate strategies. Honestly, it is a strategy I had to warm up to using in our own real estate goals, given my background using the Dave Ramsey program and experience growing up in a family that used an all-cash method of investing and building.
Today, I’m talking about leverage in terms of intentional life choices.
Leverage Life
Leveraging life is the best phase I could come up with that captures the daily lifestyle decisions we make in service of reaching a greater goal.
Some would likely call leverage in this sense a sacrifice. And I’d say they’d be right.
A sacrifice, though, just sounds too back-pedal for exactly what we do.
The way we organize our life is very intentional and uses our small actions over time to multiply the force applied in an area to bring about a significant change that relates our goals.
I mean, in terms of physics, the parallel kind of breaks down, but in looking at the definition of a simple machine, like a lever, the beam or rod would translate to the passing of time, the fulcrum or pivot point would translate to the amount of decisions we’ve made in an area, and the input force would relate to how aggressive we’ve pushed in leveraging an area of life in service of another goal.
Some Examples
A small example of this would be my car washing and cleaning habits.
I very rarely wash my vehicle. I don’t wash it at home and I have only once run it through an auto car wash. I’ve owned my car since 2016. The same goes for the interior. I have only vacuumed and wiped it down a handful of times. It’s not disgusting, but it’s certainly not clean.
I’d love a clean car, sure, but I don’t want to allocate any of my time to achieve this. I also certainly don’t want to pay someone to do it, because that would negatively impact the financial goals we have. I rather choose to let go of scheduling these activities in my life to:
- Save that money
- Make time for more important things
The same goes for my home keeping habits.
I am not the best at cleaning my home and routinely push these duties off in service of other areas. I’ll clean the kitchen most nights and sweep and wipe down counters, but even that, will sometimes get left to another day so that I can spend time developing my writing, learning, or side hustles, for lack of a better term.
Oh, So You’re Just Lazy
Now, I know it sounds like this is an excuse for being lazy and undisciplined, but hear me out.
First, to be fair, you’d be right in thinking that I’m lazy and in need of more discipline. It’s true. If I cut out YouTube videos and social media (something I am working to cut or significantly limit during my weeks and now during my weekends as well), I’d have time to push forward in the areas of development and entrepreneurship annnnd be able to clean my bathrooms and mop once a week, of course.
I 100% agree with that.
There’s a lot of room for me to grow in valuing a clean house over my little leisurely activities. So, that’s caveat #1, I struggle with this, regardless of my schedule having anything to do with pushing the envelope forward in areas of my side hustles or main hustle.
Caveat #2 is the fact that a main goal is to not incur any extra expenses. Sometimes we leverage our dinner to eat random stuff like chips and salsa and a few other things, sometimes we wait to do a power clean before we have people over, or let the yard go a couple of extra days too long before we cut it.
These decisions are directly related to us not wanting to set aside time or money for those things. Paying someone would defeat the main purpose, so we just go without for the time being.
The Sweet Spot
The sweet spot of all this leverage talk is not allowing myself to feel the pressure of the little things in life, like a clean car or pristine home, and rather be able to freely focus the extra time after a 40-hour week to dedicate to my other goals:
- Real Estate – spending concentrated time studying the markets in my area, noting new areas to drive by, studying rentals, looking at what’s out there, planning and learning about the renovation projects we have coming up, taking care of our tenants needs (if any), etc.
- Blog Research – web development, goal-setting, reading, researching, learning, developing / building, and planning and writing content–this has been a huge one the past few years.
- More Writing – I not only focus on writing blog content, but I also focus on my creative writing outlets.
- Health – I’m always trying to push my understanding of nutrition and cooking, this is lower on the list, but sometimes does soak up quite a bit of my spare study time
For someone who falls into the ‘type-A’ / high-achiever category of person, having the freedom to not feel the pressures of bringing my A-game in every. single. area of life is super important for allowing myself the freedom to work, create, and spend lots of time deep-diving into building out my side hustles and other projects.
Lean FIRE – FIRE Movement
FIRE – Financial Independence Retire Early movement – is a movement founded largely around Peter Adeney, creator of Mr. Money Mustache.
Mr. Money Mustache is a personal finance blog with the persona of a brash Canadian who calls people to task about not spending and consuming so much in life so they can live a lean lifestyle and enjoy early retirement.
This is a whole can of worms in itself, but many credit this blog and the cult following that resulted as a main catalyst of the FIRE movement.
The FIRE movement is essentially a race to lower your daily spending ‘needs’ save 25x that number and invest it in the market so you can stop working for a paycheck and live off your investments using the 4% rule.
(This is also the blog I discovered in late 2015 that got me jacked to continue down the path of my extreme savings percentages.)
The FIRE Movement demands an in-depth blog post, but I bring it up here as an example of a movement that uses this idea of leveraging life–the conveniences, the desires, select comforts–for the goal of being able to retire at a very early age.
Leverage Rules and When to Break Them
So here I am, in a state of considering and reassessing some of the habits and areas of my life that I have many times fully leveraged for the sake of extra time and money in other areas.
This is a little tricky to unpack, but essentially, I am becoming okay with going on fewer trips so I can afford to spend a little more on the comforts of a trip that creates a more peaceful time.
I’m not talking about being able to order dessert after a meal (I’m still going to try to split my meals with friends and never order dessert, haha), I’m more talking about spending money on small conveniences that will overall prioritize my peace over the money being spent.
Second, I am prioritizing the discipline of cleaning my kitchen and living space more regularly. Just because I have leveraged these areas for gain in the past, doesn’t mean that I will now suddenly be in a habit or routine to be disciplined in these areas.
So, these days, I’m allowing the time spent maintaining my home to help me become a more disciplined person in that area, and second, I am playing with the ratios, so to speak, so that I don’t have a meltdown every month or so when I’m surrounded by a less than spiffy space, to put it lightly.
Also, I’m more so than ever trying to make time to cook well-balanced meals. We don’t buy the worst ingredients, but this is a main area of reassessment and one I’m spending more time diving into.
I’d say a major key to all this is knowing when it’s time to reintroduce or when to cut out a behavior. I like to think of leveraging life as creating rules to live by, living by those rules for a time to reap the benefits and then readjusting those rules.
These rules come out strong and staunch because they are ultimately in service of a greater good, but it’s only for a time. This is honestly kind of how budgeting as a new couple is. Sort of a trial and error.
Room for Growth
There’s always room for growth and room for finding out what works for your life in each phase. For all my rule followers out there, here’s a small reminder that while we may set up rules to live by, we can also just as easily adjust them as things change, goals shift, and we get a clearer picture.
