A F&?K UP

I originally wanted to write this post once I finally hit the $300K milestone, but the events of the past few months made the realization so profound that I wanted to do it while the motivation was still there (and the fear wasn't paralyzing).


I am house poor.


House poor - the concept that one can be a millionaire and still be flat broke at the same exact time because all their wealth is sitting in the equity of their homes.



How does one become house poor? Actually, this is a really important realization. It's why I decided to write this post in the first place. There's really three tiers to mastering money. Those three tiers are making money, cutting back expenses, and investing - "the lever," as many call it in the FIRE community. You really do need to be good at all three tiers to be financially stable, though. And I am not good at all three tiers - I'm only decent at two. So I started really working at the two to compensate for the fact that I'm terrible at the third. When I buckle down, I'm great at cutting expenses. And when I really apply myself, really estate investing works pretty well for me. But when it comes to incorporating new forms of passive income, I'm terrible. It scares me. But do you know where I'm going with this? Do you see how this ends?


I have one main source of income, and that's the living stipend provided by the VA's vocational rehabilitation (aka VR&E) program. It's about $2500/mo. I make this stipend work by not having a car note, renting out two rooms in my house, and splitting utilities. I also have a rental property in SC that makes about $450 after PITI. See there? Investing and cutting costs. I got that shit down.


All of this was good and dandy until January, when a single-digit clerical error turned off my tuition and stipend payments. From December to the end of February, I didn't get living stipend. By mid-February I was pumping gas with the money that came in my grandad's Valentine's Day card.


But listen - this isn't a pity party. All my funds were turned on last week and everything's been worked out. I'm fine. This is about a life lesson. Because while I was going through all my Christmas cards to see if there was any forgotten 20s in them,


*Personal Capitol said I was the richest I had ever been.* My net worth has never been higher.



Aint that something? But it's a rookie mistake: invest: invest everything. Grow your net worth. Buy the index funds. Buy real estate. Invest and grow and real estate and grow and net worth and grow and infuckingvest.


Here's where I'm at though: Investing and spending are the same damn thing when you're broke. If you do not know how to increase your passive income, losing your primary form of income means you're going to hurt - regardless of what your net worth is. Because you can't put a stock in your gas tank. You can't eat an index fund. You need to have cash in your bank account. You have to be good at all three tiers - investing, cutting, and stacking. You come out lopsided if you only know how to exercise one or two.


There's privilege in this post. Part of the reason why I blew through my emergency fund so fast is because ya girl's a spender. I get my hair done professionally, and I always add the deep condition (I'm natural. These ends... they're sensitive). I am halfway through putting someone's child through college the way I order Palaak Paneer and Tikka Masaala. I pay full price for my plants. I know better and sometimes choose not to do better. I am far -FAR - from a victim of circumstance.


But I was a victim of ignorance, believing I could just cut enough corners like having roommates to upkeep my lifestyle... instead of facing my fears and applying myself to establish an income revenue that could support it.


And... that's how I'm going to end this post. Because, to be honest, the amount of vulnerability and time needed to establish passive income streams still scares me - even though I know it's what I need to do. So I guess that makes me no longer a victim of ignorance... it makes me a victim of myself.


So maybe not do that. Keep investing in your 401Ks and IRAs. But also invest your time in a side hustle? In writing an Ebook? Online course? I don't have all the answers. But what I do know is if I find it, I'll let you know.


Peace.

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