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In my previous post, I put forth the proposition that America is chock full of opportunity, and the only reason a large number of Americans fail to grasp this is because their minds have been corrupted by opportunity deniers. In other words, the amount of opportunity you perceive is based on your mindset. If you’ve been trained to recognize opportunity, you’ll have no trouble finding it. On the other hand, if you’ve been trained to believe that the “system is rigged” and “social mobility is a myth,” you won’t even look for opportunity. After all, why waste your time and effort looking for something that doesn’t exist?
But in all honesty, finding opportunity is only half the battle. To actually take advantage of opportunity, you’re going to need money. And that’s the rub. Let me explain.
Opportunity and Money
In my previous post, I offered six ways to become an opportunity slut. Here they are again.
- Find a castle in the air. Buy into a company before the crowd gets excited about that company.
- Run with the dogs. Take advantage of “reversion to the mean” and invest in stocks or sectors after they have had a particularly bad year.
- Go slumming. Look for grungy or mundane business opportunities.
- Make the complex easy. The creator of WordPress is rich because he made starting a website super easy for the average person.
- Look for market failure. Uber and Lyft exist because the taxi industry sucks.
- Look for problems at work. Become a problem-solver and your boss will love you.
Now a question. Of the six ways to become an opportunity slut outlined above, which one requires absolutely no money? If you answered number 6, look for problems at work, go straight to the head of the class. All the others require money—not necessarily a lot, but without some money, numbers 1 through 5 can’t be acted upon.
Taking advantage of opportunity, then, is largely a two-step process. First, you must train your mind to recognize opportunity, and second, you must have some money to jump on most of the opportunities you come across.
So remember this key insight. Opportunity battens on money. If you want to become an insatiable opportunity slut, you’re going to need some money. The more money you have, the better.
A Groovy Example
Don’t let the need for money deter you from becoming an opportunity slut. Mark Goldman, for example, the founder of Goldman Sachs, began his business career as a humble peddler with a horse-drawn cart on the streets of lower Manhattan in the 1850s. Numbers 1 through 5 in our opportunity mindset don’t require a lot of money. Buying 50 shares of Microsoft in 1986—a castle in the air—required $1,050. To go slumming and buy a bread route, my friend Marco needed a $10,000 loan and a co-signature from his dad. Get the picture? Money is and isn’t an issue.
From my experience, there are two ways to get opportunity money. The first way is the traditional route. You spend less than you earn and you save the difference. Way back in 2003, when Mrs. G and I first realized that we were financial dolts, we were saving little if anything each month. But then, as our understanding of personal finance grew, and we put concerted effort into building our expense-minimizing and income-maximizing muscles, we became excellent savers in relatively short order. By the time we moved down to North Carolina in 2006, we were saving $2,000 a month.
The traditional route is nothing to sneeze at, of course. Save $2,000 a month for a year or so, and you got a nice chunk of opportunity money. So at the very least, anyone wishing to become an opportunity slut should master the skill of spending less than you earn. But if you really want to grow your opportunity money—and do it fast—I suggest a radical second way. Orchestrate a BIG HAIRY DEBT ANNIHILATION.
A big hairy debt annihilation (BHDA) is my twisted take on the big hairy audacious goal strategy popularized by James Collins and Jerry Porras in their 1994 business book called Built to Last. And as its name suggests, a BHDA is when you wipe out all or most of your debt in one dramatic move.
In 2006, Mrs. G and I orchestrated a BHDA when we sold our New York condo at the height of the real estate boom and moved to low-cost North Carolina. That one move completely wiped out our debt. And I credit this move more than anything else with really making Mrs. G and me opportunity sluts. It’s one thing to have a chunk of opportunity money, but when you’re completely debt free, your psychological capacity to handle risk grows exponentially. I should know. I only acquired the cojones to jump on castles in the air and chase Wall Street dogs once my debt was vanquished.
The lesson could not be clearer. If you want to be an insatiable opportunity slut, do whatever you have to do to unleash a BHDA, and get rid of your debt.
Opportunity Sluts of the Month
Before I end this post, though, I want to introduce you to a very inspiring couple. Here’s their story.
In 2015, they were “normal” Americans. They had a 1,500 sq ft home and were, largely because of a mortgage, $240K in debt. But in 2016, they made the bold move of exchanging their normal home for a 536 sq ft “weird” home. In amazingly short order, they reduced their debt load by $185K. Talk about orchestrating a BHDA.
In November of 2016, they made their final mortgage payment.
Once they vanquish $10K in student loan debt over the next few months, they will be completely debt free.
They are on course to reaching the Mustachean Threshold (aka financial independence) sometime in 2019.
The female half of this amazing couple recently quit her job and decided to turn her digital marketing side hustle into a full-time vocation. Having virtually no debt and trivial living expenses is very conducive to risk-taking.
Speaking gigs, advocating minimalism and frugality, touring the country in a tiny house, owning and managing a mobile home park—the amount of opportunity they see before them is nothing short of spectacular.
They love tomato pie and margaritas.
And, finally, they’re every bit as charming and amazing in real life as they are in their blog. So without further ado, I now present, Freedom Is Groovy’s first opportunity sluts of the month, the great Claudia and Garrett of Two Cup House.
Final Thoughts
Okay, groovy freedomists, that’s all I got. Did this post encourage you or discourage you? Money, sadly, is indispensable to opportunity. But the key takeaway is twofold. First, you don’t need a lot of money to increase the number of opportunities available to you. Second, you are in control of the amount of opportunity money you possess. Nothing’s stopping you from spending less than you earn. And nothing’s stopping you from orchestrating a BHDA. So what say you? Are you on your way to becoming an insatiable opportunity slut? Do you spend less than you earn? Are you ready to unleash a BHDA? I’d love to hear how your quest for lewdness is advancing. Grease for peace.
I see debt as a sword of Damocles that hangs over your head, waiting to crush your prosperity at a moments notice. Debt can become voluntary enslavement where you narrow your own choices through your need to service the debt master. For me, part of the joy of being debt free will be the sense that my work is no longer beholden to another. My wife and I are working on it, and save our (relatively modest) mortgage, should be there in a year or two. I see being debt free as the point where we can truly unleash our dreams, because we can afford to take risks, because we have no debt to service. We could move to another state on a moments notice. We could change to any job, within reason, because we have no debt monster to serve. We can invest more for the same reasons.
“Debt can become voluntary enslavement where you narrow your own choices through your need to service the debt master.”
That one line says it all. Thank you, Mark. And best of luck on managing all the opportunity you’ll have once your mortgage is retired. You and your wife are going to have a blast. Cheers.
I like how being debt free gives you the cojones to take on more risk…
Similar here: after selling the rental and using some to finish works on our house, we did an extra downpayment on the mortgage. Our stash is now a few times bigger than the outstanding debt… I see risk different now
Nice, my friend. Isn’t easier now to sleep at night when your stash dwarfs your debt? And now your at liberty to take risks you never would have considered before. Well done.
Yep, I’m encouraged even more by the follow-up. With this past week at work being a hell of a “one off” for stuff going wrong, I’ve had lots of opportunity to jump in the fray and create solutions to all kinds of issues.
Enough so that my boss is asking me to be his DOA while he’s gone around Memorial Day. Not that I want to go into mgmt, but hell yeah, I’ll take that as a compliment. Can’t say I’ve been an official DOA before.
Volunteering for the dirty jobs at work is a great way to get recognized, get promoted, and move your career along for sure. Provided you don’t make them worse than when you started, lol.
I love it, Mr. SSC. Here’s an example from my life. When I was a foreman for a road crew in the highway department, there was a worker who couldn’t get along with anyone, and no foreman wanted him in his crew. Taking on this worker was the ultimate dirty job. But I volunteered to do it. And for about two years it worked. Eventually, however, this worker couldn’t keep it together and he was eventually fired. But even though I failed, so to speak, I gained a lot of respect for taking on an impossible task and nearly making it work. So kudos to you, Mr. SSC, for jumping at the dirty jobs in your workplace. You might not always succeed, but you’ll gain a lot of respect, and the pecuniary rewards will surely follow.
It’s encouraging! Actually anyone who does anything different, bold, or unique to get ahead is inspiring! Right now at my full time job, I have the opportunity to lead, learn, manager, and learn about many other soft and hard skills (tech wise) that could somehow better prepare me for whatever next step I take! That mindset gets me through the tough days.
Exactly! Thank you, Tonya. At the very least, everyone should be taking advantage of the opportunities at work–whether that means learning how to manage people or developing a new skill. Like you said, Tonya, it’s all about your mindset. Sadly, I didn’t acquire this mindset until I was almost 40. But then it hit me. I’m getting paid to learn new skills! After that epiphany, everything changed for the better.
I wonder if the reason some people can’t see opportunity is because, as you’ve pointed out, you need a seed to pursue it. Just a little capital to give you the boost to chase your dreams (however humble they may be.) For some folks, saving and living below their means is enough. For others, freeing up extra money means radical changes because there is nothing to cut.
Opportunities have to be taken, and that takes hard work and effort. It’s just a lot more hard work and effort for some than others, and there’s no getting around it but it seems to be a larger and larger gap between starting points. I wonder how many kids will never work their way to the starting line.
Great point, Emily. There’s no way to eliminate the gap. And some kids will never get to the starting line. If we dedicate ourselves to freedom and maintaining our political and economic liberties, however, all will end well–even for those who have stunted opportunities. I see the situation as analogous to the NFL. There are large gaps in pay between the players. The starting quarterback gets paid a lot more than the third-string offensive lineman. But the poorest paid player in the NFL is paid more than 99% of American wage earners. Our job is to keep America the NFL of opportunity. Not everyone will have the same amount of opportunity, but the most disadvantaged soul in America will have far more opportunity than most of the people on earth. Short of creating heaven on earth, I’m afraid that’s the best we can do.
Money begets money 🙂 You are very right about opportunities Mr. Groovy!
I would go one step further – there are so many success stories of people who just noticed an opportunity and a burning desire to succeed. Now, these people didn’t have the capital.
They pursued their dream and achieved it anyways. There is no excuse for not trying.
Agreed. I think stories of how people took advantage of opportunity with little means is going to be a recurring feature of this blog. Such stories need to be told. Not only will they inspire others but it will force people to confront the BS excuses they use to defend mediocrity or failure. Thank you, Michael. As always, you provided another great contribution to our conversation.
I’m outraged by the lewdness! Actually I’m outraged that I didn’t think of it.
A good friend of mine recently said, “Luck favors a prepared mind”.
The Grumbys’ Lewd BHDA/Opportunity Slut story: We sold our house in 2015 and became renters, taking advantage of an insanely escalating Portland housing market. After 1.75 years, the following has happened;
-We paid off our only debt, which was the $70k balance on our mortgage.
-The proceeds from the home sale have grown faster than even the housing market.
-We’ve eliminated time consuming tasks related to home ownership, giving us many more opportunities to use free time any way we want without the nagging guilt of neglecting a home maintenance task.
-Our annual expenses are lower, even with fairly high rent payments.
-We are FI now and will work until early 2018 to add some additional padding to our nest egg.
I am fortunate to have a good job, that the housing market was robust and that Mrs. G and I were able and willing to seize the opportunity we saw. I’ll forwardvtgis post to some folks that could benefit from the wisdom.
Thank you, Mr. G. Your friend is very wise. He offered a great quote to capture the intersection of opportunity, attitude, and money. I definitely have to remember that one. And I love your BHDA/opportunity slut story. Not many people believe that moving from home ownership to renting can dramatically advance one’s finances. Great freakin’ job. You’re now in the run for our next OSOTHM award. Kudos, my friend.
I feel encouraged by this post and I hope it inspires many people to take a look at the real opportunities around them, ones that others may not see (or too easily dismiss). Encouragement is one thing, but a being real life example and shining a light on another example shows how it really is possible.
Thank you, Gary. I totally agree. It’s one thing to say there’s opportunity; but unless you provide real examples of said opportunity, it’s just talk. And we’re all inspired more by action than talk.
“What can be added to the happiness of a man who is in health, out of debt, and has a clear conscience?” -Adam Smith
I recognize that there are tons of other kinds of challenges, some of which I’ve experienced and others I’ve only read about, that often keep people from pursuing certain opportunities.
When I ran into these barriers, I would convince myself that it was necessary to suffer because of our financial situation. As we approached mortgage freedom, we decided to grab hold of the crazy number of opportunities surrounding us. I felt more secure, in the financial sense, to pursue these opportunities. I don’t feel the same barriers I felt before and I certainly don’t feel the same financial stress I did either. Much more to say on this subject in a couple of weeks…
Thanks for the shoutout! You and Mrs. G are awesome.
Whoa! The father of economics nailed it with that quote. And your musings on this topic are smashing as well. No one is going to experience a barrier-free life. It’s all about context and mindset. Sure things are tough for people growing up in inner-city Detroit or rural Mississippi. But how do the challenges they face compare to the challenges faced by people in Mozambique or Afghanistan? And what about the barriers we shackle ourselves with because we are slaves to our egos. No one needs a hundred pairs of shoes. No one needs a Lexus. And no one needs a McMansion. The average person’s opportunities and ability to seize those opportunities would magnify significantly if they just lived more modestly. Thanks for stopping by, Claudia. Mrs. G and I are big fans of you and Garrett, and we can’t wait to see the great things you will be doing in the very near future. Cheers.
It’s refreshing to hear an honest take on opportunity. I know everyone says you can be whatever you want in America, but the truth is that you need capital to back up your dreams.
Money is definitely the lubricant of opportunity. There’s no getting around that. I think the key point is to jump on all the free opportunity you can while you’re young (i.e., free education, libraries, volunteering, honing your frugality muscles, solving problems at work, etc.). Take advantage of the free opportunity and the money to take advantage of more expensive opportunity will come. Thanks for stopping by, Mrs. PP.
This post encouraged me! Start with getting your financial plan in order. If you need a boost, start with #6 Look for problems at work. Become a problem-solver and your boss will love you. Which as you said doesn’t cost a dime, only effort.
That can only lead to good things and possible more money. Which in return could lead to opportunities, and so it begins…..
Amen, Brian. I like the cut of your jib. If you want to get your financial house in order, do two things. First, learn how to spend less than you earn. Second, look for problems at work and solve them. The average person could solve 90% of his or her money problems with that simple strategy. And as you so eloquently pointed out, this simple strategy won’t cost you a dime. Brilliant! Thanks for stopping by, my friend.
I heard this quote this week and wanted to shout AMEN! “The easiest way to take away people’s power is to convince them they don’t have any.” We all have power. We all can make choices. Some choices help us and some hurt us. Growing up poor might have made it 10x harder for me. But that just meant I had to work 10x harder. And it took longer. Whatever. That doesn’t even matter. But when people try to take away the inherent power and choices we have, or down play the honest amazing amount of opportunity in this country, then I get a little pissed. Helping people is different than discouraging them. I love what you do by inspiring people to see their power, instead of labeling them and in so taking away their agency. It’s true that some people in the US can take ground foot by foot, and others inch by inch. But we all can take ground.
That’s a great quote. Where did you hear it? It’s so true. For most of my life I was powerless. And the person who took away my power was me. In other words, I had a sad habit of telling myself I couldn’t do something before I even tried. I suspect a lot of people suffer from this affliction. And as you pointed out, Ms M, as soon as we recognize our own “agency,” that once seemingly intractable powerlessness melts away and we become super heroes. Here’s another quote to consider when thinking about the large number of Americans who are in dire straits financially.
“We have met the enemy and he is us.”
Shoot, I got it close but not quit.
“The most common way people give up their power is by thinking they don’t have any.” Alice Walker
Thank you. Awesome quote. Got to remember that one.
Takes money to make money, right! I found the original post to be very inspiring and this follow up has me thinking of creative ways to put my money to work. If I find something interesting then you can be sure I’ll be applying for OSOTM!
Thank you, Ty. Your kind words mean a lot. Perhaps I can make the OSOTM a thing. There are a lot people out there like yourself who are doing amazing things financially. Let me mull this over. I’m thinking of creating a badge similar to “As Featured on Rockstar Finance.” How about this: “This Blogger Is a Certified OS”? It’s a bit cheesy, but it might work.
BHDA, Love it! We did exactly that when we sold our “house in the City” and moved to our “mountain cabin” 1 year ago this month. We took the equity from our city home, and paid off the mortgage on our cabin.
Bam! In one fell swoop, we pulled off a BHDA, and are now entirely debt free. Add to that our consistent saving, and we hereby declare ourselves Opportunity Sluts, on the hunt for Opportunities!!
I love it. It’s amazing how one move can dramatically change your financial position for the better. Thank you, Frtiz. It’s always great hearing from another OS who pulled off a BHDA.
This post encouraged me! I want to quit my job and go full time in consulting and building my business. Not the popular move, but a move I may make sooner rather than later…
Thanks for the post. I love your content, you are a good writer. Have a good one!
Thank you, Erik. Best of luck on the consulting venture.