Afford Anything - What's in Store for the Economy and the Future of Work?, with ChooseFI hosts Brad Barrett and Jonathan Mendonsa

Episode Date: June 21, 2021

#323: Brad and Jonathan from ChooseFI join us for a deep philosophical and practical discussion around what we learned from 2020. We explore... What the pandemic taught us about work, finance, and life The importance of being mentally and logistically nimble and flexible The distinction between directionality vs methodology What we’ve learned about how to get a job, what type of education to get, and what to do with the rest of our lives For more information, visit the show notes at https://affordanything.com/episode323 Learn more about your ad choices. Visit podcastchoices.com/adchoices

You can afford anything but not everything. Every choice that you make is a trade-off against something else, and that doesn't just apply to your money. That applies to any limited resource that you need to manage. Like your time, your energy, your focus, your attention, saying yes to something implicitly means that you are turning away all other alternatives. And that opens up two questions. First, what matters most?

What's most important to you, to your family? to the life that you want to build. And second, how do you align your decision making to reflect that which matters most? Now, answering those two questions is a lifetime practice. And that's what this podcast is here to explore and to facilitate. My name is Paula Pant. I am the host of the Afford Anything podcast. And today's guests need no introduction. Brad Barrett and Jonathan Mindana, the hosts of the Choose FI podcast, join me for a very deep conversation, philosophical and practical, about what we learned from 2020, how 2020 was a line in the sand, and what this experience of going through a pandemic has taught us about finance, about work, and about life.

What have we learned about the importance of being mentally and logistically nimble and flexible and portable? What have we learned when it comes to the distinction between directionality and methodology? What have we learned when it comes to how to get a job? What type of education to get? What to do with the rest of our lives? And how do we assess whether we're leaning into our confirmation biases or whether we're really onto something?

We're going to talk about all of that and much, much more in this conversation. Before we get into it, one super exciting announcement. What are you doing? on Monday, June 28th, 2021. No plans? No plans? All right, great. Well, I have the best evening planned for you. Myself and Jonathan from ChooseFI are going to be hosting an online live event, a virtual live event on Monday, June 28, 2021. It's at 8 p.m. Eastern, 5 p.m. Pacific. And we are going to be expanding on the ideas that we talk about in today's upcoming episode. So if you enjoy today's episode, then please go to afford any...

something.com slash career and sign up to come to this virtual live event with myself and Jonathan from ChooseFI. Again, that's afford anything.com slash career to come to this virtual live event. And if you sign up, you will get all kinds of goodies delivered to your inbox, loads of helpful information, thoughts, ideas, actionable advice. You'll get emails that blend ideas and action. philosophy and framework combined with how to actually apply this in the real world. So the emails that you'll get just for signing up to come to this free live event, these emails will blow you away. And then on top of that, of course, our live event on Monday, June 28 is going to be amazing.

I've been looking forward to it all month. You're going to love it. So afford anything.com slash career. Now with that said, here is a conversation between myself, Jonathan Mandanza, and Brad Barrett from the ChooseFI podcast. Hey, Brad and Jonathan. Hey, Paula. Thanks for having us back. Yeah, excited to be here, Paula.

Oh, thank you so much for coming back. You know, in preparation for this episode, I was listening to the last time the two of you were on the Afford Anything podcast. It was episode 160. It aired in November 2018. And listening to it, it felt like something that we recorded in a different era. A bygone time three years ago. Holy cow.

Exactly. I mean, my entire life has kind of been divided into two phases. like before 2020, after 2020. It's kind of like a line in the sand. You know, it's funny because as soon as you said, two phases, I was like, where's he going? Is he going to say before or after you were a pharmacist? Is he going to say before or after choose FI? No, it's 2020.

It's the year we all lived through. Yeah, survived. That is crazy to think, actually, Jonathan. Think about all of the transformative changes in your life in the last five or six years. But yet that is the line in the sand, 20, I wonder if other people would have similar feelings, but I feel like I worked harder and had to be more creative and just bring more to the table in 2020 than probably the last decade combined. I'd have to really sort through why that is, but structurally I'm a different human being constituted differently than I was like in 2019. And I probably would need a therapist couch to fully work out why that's a true statement. Probably won't be able to do it completely on this on this episode. But, um, I think there's probably more than a single person listening to this right now that would say, yep, me too. I'm going to see how much we can unpack into that.

I mean, without going too far down the 2020 rabbit hole, what fascinates me about that is that you've been through so many life changes. You know, you were a pharmacist. You changed careers. You started a business. You had a family. And yet there was something unique about this past year that caused you to draw upon strengths and skills that perhaps you hadn't quite developed in the same way that you have. What were those strengths and skills?

And by contrast, what were the, for lack of a more diplomatic term, what were the deficiencies that you unearthed within yourself and within the structure of your life in the past year? You know, I can start this, but I think I'll probably need Brad's help to really help me, you know, flesh it out and do it to justice. It's a big question. I think there was a level of personal responsibility. So part of it was just related specifically to Chusify, both as a small business with people that support what Chusify does that rely on Chusify for forms of income, et cetera.

So having a team that helps us produce Chusify on a weekly basis, that was part of it. And it was also for a community of people that listened to Chusify and have taken actions over the years based on suggestions that they've learned and realizing that all of us were hurting in some capacity over the past year. And so talking about this sea change and what we were expecting, many of us started 2020 thinking brand new decade, best decade ever. What are we going to build? And by March, it was like, what can we rebuild from the ground up? Because nothing is as we expected. All of the plans, all of the war games, all of the strategy, et cetera, like, you know, all the vision mapping that you could come up with,

nothing survived March 13th of last year. It's like, all right, let's scuttle that. Let's start over what are we going to do? And then I think, and this is actually, this is interesting. I think it applies to people not just that are, that are small business owners, but people that, you know,

have families that are responsible, you know, other people that depend on them for income, et cetera. It was like a game of musical chairs. We didn't know what the factors on the ground were going to be. We didn't know that their, your life, all of our lives, in some way are affected by other industries which are being crushed.

Totally crushed. And so there was no one that came out of 2020 unscathed. Some people were like I have friends with physical brick and mortar businesses that they got they shuttered. They had to shutter down. And I had some that they were barely making it based on, you know, government stipends effectively. As someone that tries to think, how do you win in that scenario?

That's what we do, right? We try to stay just a little bit ahead of the curve. and we try to take the information that we have at our disposal and make the best decisions that we can to position ourselves in the best possible way. And what do you do when all of the known variables are just like cratering down around you? I'll give it back to Brad. I will say that if you have the tenants of financial independence in place, if you've paid down your debt, if you have a high savings rate, you are in a very, very strong position compared to the rest of the world, it doesn't mean that you are in the perfect position. It does not mean that you've got a

free pass on this. So it was just grappling with that reality and there's, there's more realizations that we can talk about today. But I mean, I just was astonished at how rapid the shift was. On February 20th, we were down in South Carolina helping Alan put together an event around entrepreneurship, you know, helping business owners start small businesses. And it was a pop up in a mall in South Carolina. By March 13th, all of us were making plans to not leave our house for four months. Right. Yeah. I mean, the word that keeps coming to my mind is clarity. On a lot of levels, this entire scenario that we've been through for 14 plus months now has been, has been clarifying in so many ways. You know, I look back, Paul, if you remember, FinCon, right,

2019. And that felt like we were all on top of the world. And I think a lot of us had these big plans. Oh, we can do this and we can have a conference and we can do this and we can do that. And then the world changes at a moment's notice. And you realize, okay, what's truly important and what's truly helpful? What's necessary? Where do I want to spend my time? Where do I want to spend my energy, right? This is not just business, but this is, this is life. And that's where it gets into this being useful for the audience, right? Because not everybody's small business owners. You get into those questions really, really quickly when everything you know changes in a moment. And that's why that clarity, like that has been the word that has just been ringing in my ears

for 14 plus months. And I don't know that I necessarily have an answer. I know what my life used to look like and I know what I used to want and what the plans were and what the goals were. And even for someone who, you know, like me, I probably, if you would talk to me at the end of 2019, and I would say, I think, you know, I've been working on this real, on this being my life for the last decade, you know, like really trying to figure out how do I put together a life that works for me. And I don't know in all candor that that I had to figure out nearly as much as I thought I did. It's been a tough year for all of us. And I think there's great strength in that also is going deep within and saying like, hey, what actually matters to me? What brings me joy? What do I

want to do on a daily basis? What I want my life to look like in five, ten, 10 30 years, right? Like, these are the things that, like, ostensibly we in the in the fight community talk about and think about. But do we really? Do we really? And, yeah, I've found, I found the last 14 months to be a real significant time of introspection. You know, I remember at that 2019 FinCon sitting between the two of you at the Plutus Awards.

I have such a clear memory of that. And we, it was that exactly what you talked about. We all felt like we were on top of the world. We had just thrown a joint fundraising party together. And we had all of these plans. And like you said, everything changed almost in the blink of an eye. And when I think about the people who are listening to this, of course, we've all been through 2020. So everyone can relate to that shared experience of that year.

We can all relate to the shared experience of a pandemic. But beyond that, there are other people. listening to this who have also had the experience of everything changing in the blink of an eye because of a car accident, because of a diagnosis, because of a job loss, or conversely because of an unexpected investment that they made casually or flippantly that ended up doing really well. I took a call from someone who absentmindedly threw some money into Tesla stock many years ago and surprise, now he's got $600,000. The theme that I'm hearing is rapid change and how, you know,

us being in the financial independence space, we are in the business of making long-term plans and promoting the ideal of long-term thinking. And yet things can change quickly, either due to Black Swan events or due to unexpected windfalls. And we're also seeing the world change. rather quickly as well. So I don't even know where I'm going with this because this is not a question. No, but it's fascinating. It feels like an observation and I like it. No, keep going, Paula, because I'd love to hear. I mean, where have you seen the change? Like, what anticipations did you have? Because this is not, hey, three successful podcasters whining about their business. Like,

that's not what we're doing here. This is a shared experience. And that clarity that I'm talking about, I think we're all undergoing this moment of introspection as a global community. And I'm seeing a manifest in a lot of different ways. You know, I'm seeing people exhibiting anger at everything in ways that I have never seen before. And just people that I know in the neighborhood. And like, it's just so out of character. But it's not. I mean, we've been through a trauma.

And then there are other people who look at, hey, this was the best 14 months of my life because I got to spend all this time with ex person, you know, or ex people or whatever, you know, my family, whatever it may be, right? And everything in between. I think all of those experiences are valid because there are those people's lived experiences, you know, and this has been a trauma. Again, I don't know if I have a question either, but, you know, I'd love to hear your thoughts. Well, one thing, and we were chatting about this a little bit before we hit record, but in parallel with how quickly our lives have shifted. And when I say hour, I'm talking about every single person who is listening to this podcast

because we've all had the shared experience of our lives in one way or another shifting very quickly in the last 14 months. But in parallel with that, we've also seen the external world shift very quickly. We're seeing Bitcoin and cryptocurrencies become part of that mainstream conversation. around money. And yes, that was also true in 2013, 2014, 2015, but not like this. We're seeing NFTs and SPACs and acronyms that two years ago we had never heard of that are now part of that financial landscape. We've been through the roller coaster in terms of asset prices. I mean, you want to talk volatility, look at the span of where the stock market was in March

2020 through today. And then you look at all of these other assets. asset classes, you look at real estate, you look at lumber prices, you look at, I mean, used cars? Yeah, yeah, exactly. Used cars, right? I mean, things that we've never had a conversation about used car prices before, but here we are. And so, in addition to not knowing, I think many people have the shared experience of not

knowing what's happening in their inner life, in their personal lives, in their careers, and simultaneously, we're also experiencing. the great unknown when it comes to the outside world, the high risk of uncertainty when it comes to making any predictions about where we will be six months from now. When you said that, I wanted to point out to something, where will we be six months from now? And this is actually where I was hoping a little bit of this conversation will go because I think it's fundamental to the old system versus the new system. If you look at the majority of people, to find the concept of personal finance,

find the concept of financial independence. By the time they find it, they are on a track, maybe a track that they got on at the age of 17 or 18 years old when they picked a career. And in 2020, something happened and we started playing a game of musical chairs with the entire industry.

And entire industry is just one of the, one of the legs got taken out, one of the stools got taken out. My point with this being, and this is one of the biggest things, and to some degree, and it's kind of, It's a little bit of a pushback to some degree.

The landscape shifted and we were all becoming more aware and taking more seriously things that maybe some of us had discounted in the past to varying degrees. On the other end of that, trends that we saw and we're already talking about like, get ready, this is coming. Get ready. This is coming. 10 years from now, five years from now, this will be the norm.

Happened overnight. Working from home happened overnight. So this idea of you needing to live in a particular area for a particular area for a particular reason, completely invalid argument these days. And that's actually maybe causing a little bit of a change in housing. We could, you know, that's a whole lot of conversation, but home offices clearly are a higher priority now than they were a year ago. Right.

That's probably had a small impact in the housing market and what people are looking for. And an extension of that were, what is the path to get a career? So when I was in school, if you wanted to get a doctorate in something, if you wanted to get an above median income, there were specific career tracks for me, it was four years of undergrad, four years of pharmacy school, multiple six figures of student loan debt. And then it was this long, long, 10 year process. And even if you didn't go get a doctorate, but you wanted to get a professional degree or you wanted to go get, you know, an above median job, 90% of the career tracks were a very linear, very predictable, very college-based thing.

And what we have just seen is that you don't even know where you're going to be six months for now. You want to make a commitment that's a multi-10,000, maybe a six-figure investment. You don't know where you're going to be six months from now with dubious levels of ROI. We saw that argument get dialed up to a 12 over the last year. Because again, one of many, one of many things that have actually happened. But it's kind of this like this convergence of a long-term mindset, making the best decisions that you can with the information you have. But now, and I think there's a greater.

level of urgency, not making plans that lock you in to the world being exactly the same way five years from now that it is today. Right. And that needs to start way, way sooner than we have a lot for most of us start kind of figuring things out where we are at the age of 33, 34 years or not. Now I'm going to start getting serious and I'm going to start figuring out. No, we don't have that luxury anymore. You need to like as soon as you're able, you need to start thinking about this from this lens of flexibility and being able to recognize rapid see changes and pivot with them, hopefully be just a little bit ahead of them. So what I'm hearing you say is flexibility, portability, those two concepts, and they're

subtly different being flexible and being portable. They're related, but they're subtly different concepts. Both of those are increasingly important, right? To your point, geographic arbitrage was something that we've been talking about. We are the weirdos who are talking about. it before it was cool. Now, it's mainstream. Not mainstream. It should be demanded. It's like it's literally it's a core function. Employers, you know, if they're not offering this, they are at a disadvantage to, you know, the competitor across the street. Right. But now geographic arbitrage is mainstream accepted,

meaning that three years ago, if you told people I work from home, you would get the standard response of, wow, you're so lucky, or, you know, it would be, or you would be immediately asked what you do for a living. I mean, it was unusual to work from home. Today, it's the norm, at least in many fields. If you met somebody who worked from home, you wouldn't be shocked by it. If you actually go back and listen to our episode that we did, as you mentioned, a decade ago, with you, if you go listen to that episode when we were all young kids, at the end of it, we actually talked about FI versus RE. And this was a big thing at the time. Everybody was trying to attach a label to it. Is it retire early? Is it, well, you know, is it slow fire? Is it,

is it, et cetera, et cetera. The reason that they were all trying to attach a label to it, and we all maybe felt a reason to attach a label to it is that I don't think we had enough off ramps in the middle. Too many people get stuck on, it's this ostrich strategy. And this is what financial defense has always been pushing against, but this ostrich strategy. We get stuck in a career. We just spent a cumulative decade getting into the career and another half decade to a decade paying off the debt we accrued to get in the career. And now we're like, well, that was a lot of sunk cost. So let me just stick my head in my sand and let me wake up at retirement. And then we're trying to figure out like, what am I going to do it on the other side? Brad, I'll give this back

to you. But I think now in 2021 from where I'm sitting right now, that is no longer the only option, like to retire or to not retire. To get to find it like do I just keep my head in my sand and the said, do I just grind it out, stay where I'm at? And then just wake me up when it's all over. a laa the Austria strategy, or do I look for other options? Yeah, and I think kind of what we're talking about here and what we're dancing around is change is scary. That's what a lot of this, things are changing so rapidly. But I think what we in the financial independence community do so well is we try to stay ahead

of the game. You know, the fun part about FI is you survey the landscape, you understand the rules, you understand maybe where things are going, and you try to do your best to win at the game of life. That's how I've always looked at it in a kind of cutesy way. And when you see the rules changing so quickly, when you see the landscape changing so quickly, that can be scary or it can be exciting.

And that again is like how I look at it. No, granted, I think it's both. But like Paula, when you're talking about some of these things, like, you know, I'm thinking about the, autonomous vehicle fleet that's eventually going to take over. And, you know, like you're saying with NFTs, like that will be you won't have a concert ticket anymore or a basketball ticket anymore. It'll be a special NFT for that particular game with X, you know, special item to corroborate that you were there. Like, this change is coming quickly. Right. I personally forecasted in my own head,

a lot of colleges would have gone out of business already. And I clearly was very wrong about that. I think there is great change coming in that industry. Anything that's been calcified, anything that just like, we know there's something wrong. Like that's, I almost think in terms of like the infinite game, like on a long enough timeline, can this possibly stand or does it blow up? And so that's how I kind of, my mental model for approaching a lot of things. The US healthcare system, perfect example. On a long enough timeline, is there any chance that it doesn't blow up in my estimation,

there's a zero percent chance that it doesn't blow up because something can't keep going up 10, 12, 15 percent every single year. Same with college. Like I think there is a zero percent chance that 300 years from now, the college system looks the exact same that it does today. So then you work backwards, right? And it's like, okay, I don't know when that change is coming, but it certainly seems like it's accelerating. And that's what this has been. It's been an accelerant for a lot of these changes. I think that's what you're alluding to before, Paul.

And that can be scary or that can be exciting or it can be both. What it means is we need to be mentally nimble, right? We need to educate ourselves, even on things that we might have been closed minded to previously. You know, Paula, we talked about this whole blockchain and cryptocurrency and NFTs and things. I'm like, if you would ask me this four years ago, I would have laughed in your face. I thought it was preposterous, just completely made up nonsense.

And now I think there's a high probability that five, 10, 15 years from now, somewhere in that time span, that technology is going to change the world. I view that as exciting. I don't know. I'm not smart enough. I don't know enough to know when that's going to be, what it's going to be, what technology. I'm not trying to prognosticate in that regard. I'm fairly certain that it's going to change the world, just like I'm fairly certain on a long

enough timeline, nobody's going to own cars anymore. We're not going to have parking lots, acres and acres of parking lots at malls because there's going to be on an autonomous vehicle fleet. Like it's just like that to me seems preordained. But again, I don't know if it's 5, 10 or 70 years from now. I have no clue. But I'm trying to stay ahead of this. And I think that's what all of us should do is educate ourselves and say that, hey,

just because this is the way that it's always been doesn't mean it's the way it's always going to be. And I think that's what Jonathan's talking about with. with a lot of careers and industry is, you know, look, maybe what you thought was going to be your path. That might not be the case. You might not have that job for the next five to 50 years. Educate yourself. Be aware of trends. Try to find out how can I reskill. How can I learn new things? How can I find, like, ways to pivot? Because you might find that your safe job isn't so safe. What I'm hearing from both of you is that given all of the uncertainty, and 2020 certainly highlighted how much uncertainty we live in, given this uncertainty, it's important to look for core underlying qualities.

Brad, you mentioned being mentally nimble. Jonathan, you mentioned being flexible. And we also talked about portable. So these are underlying qualities. And oftentimes it is not the what. It's not the thing itself that matters. It's what underlying qualities does that what represent. And if that what has those qualities that you're looking for, those values that you're looking for, then you can have a higher degree of certainty that it is a wise direction to embrace or a wise direction to shift into.

Yeah. And I think, you know, with all of us on a long enough horizon, a long enough timeline, all of our survival rates. go to zero, right? So time is our most precious non-renewable resource. I'm not exactly re-event the wheel here when I, when I say this on this type on this show. But when we start to scale down, we look at these phases of our life. So we started at the beginning, we kind of looked at this before COVID after COVID. We actually, if we were to be more specific, we could start thinking about our lives in terms, there's very clear, you know, when I got married, the first five years of my marriage, the time that I was in college, my career track, when you start looking at these

things that you commit yourself to, my 30-year mortgage, my college, my college, college choice, my student loan debt, commitment. When you start thinking about these phases, you start realizing that, and I'm looking at this through the lens right now, flexibility, portability, financial sovency, and giving yourself the best chance to kind of ride the rapid change that we're discussing in Bob and Weave, you know, sting like a bee float like a butterfly. I'll edit this in post and it's awesome. Yeah, there we go.

Um, no. So like, you know, you got to be able to put it like a butterfly sting like a B. I think of it. Thank you. I knew it could get rearranged. Um, but I mean, you got to be able to pivot. So each of these phases, each of these commitments will prevent us, prevent our ability to make these different pivot. So when you look at the core tenants of what we talk about in the financial independence community, all of them, the underlying qualities that you're referring to, Paula, they give us the maximum ability to make pivots when we get new information because we weren't in debt up into our eyeballs, because we weren't financing everything that we could afford the payments on, because, you know, the exact, I mean,

just go through it, go through the list of qualities. What do they ultimately do? They give us the ability to pivot when we get new information and to take luck, quote unquote luck, and turn it into opportunity. And so as I start thinking, like tying it back to what we just said, let's just take a look at the one that most of us is a real pain point for most of us right now, industries that have just been obliterated. So let's talk about jobs. People have lost their jobs. Individuals with businesses have gotten shuttered.

So what is the default solution for that? For most people, if I'm in an industry that just went under, I should probably go back to college and get a degree that will allow me to get into a different industry. Okay, let's look at the cost of that. Okay, let's look at the time commitment of that. How does that map up with what we just learned about how quickly, we need to be able to pivot.

Your solution to a problem that things are changing rapidly is to lock yourself into a commitment, which is going to tie you down for four years. That doesn't work with the, you know, and Brad's mindset, he just laid out in 300 years, I don't think it's going to look like what it looks like. It doesn't look like it now. Right now it doesn't look like that. Now, the rest of the world may not have figured it out. So we're spoiling it for you, but people are slowly realizing this right now.

So there's a tiny, tiny fraction of people, and most of them are probably 16, 17, 18 years old that are going for the college experience. But increasingly, those of us that are financially saying, right, are looking at college through the lens of ROI and time commitment. It does not make sense with what we're just talking about. If you're, if you had this wake up call and you realize them in an industry that's going and your solution is four more years of school in another degree so that I can come seize the bull by the horn. It's a fundamentally broken thesis. We'll come back to this episode after this word from our sponsors. Fifth Third Bank's commercial payments are fast and efficient, but they're not just fast and efficient. They're also powered by the latest in payments technology built to evolve with your business.

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Black Friday deals for up to 70% off. That's W-A-Y-F-A-I-R.com. Sale ends December 7th. Sometimes we're in situations where our backs against the wall, we know we need a change, We know we need a pivot. And when we make that choice on how we're going to pivot, we want to do so in a way in which we preserve our future flexibility. And so a very expensive student loan, a six-figure student loan, is not a choice that is going to preserve future flexibility. A mortgage that is excessive or that is attached to a property that you cannot easily rent out, a property in which you don't have multiple exit strategies. such that you could rent it or sell it, you know, that's another example of something that will lock you down and decrease your future flexibility. So to the extent that we take future flexibility off of the table, regardless of whether it's in the form of student loans, mortgages, credit card debt, payday loans, I mean, however it is that we choose to do that, when we take that future flexibility away, we remove our ability to respond to the next environmental change that we will face. And Paul, it's so interesting because I was actually going to ask you about the mortgage side because that that's where my mind went in terms of this future flexibility. It's locking yourself in. You know, you said like a mortgage that might be too big, but I would even, and then I think

you kind of pivoted to maybe even a mortgage at all, maybe even owning a house at all potentially. And like, I'd be curious your thoughts. And that's not to say homeownership is bad, clearly. We're not implying that. It's just in terms of this nimbleness that we're talking about, did you have pre-pandemic advice to someone for, hey, if you're going to live in a city for X number of years, you know, maybe you should consider, and obviously this is broad strokes, but maybe you should consider buying a house versus post-pandemic.

No, nothing has changed. It's all stayed the same. Okay. What I've consistently said about mortgages is that you want multiple exit strategies. So you don't want to be in a position in which the only way that you could get out of a given situation is that you have to sell. You want to be able to sell or rent or Airbnb or, you know, X or Y or Z. You want multiple options so that if something happens and one of those strategies gets pulled off the table, you still have the other ones that you can turn to. What you saw in 2008 was that if people were forced to sell their home,

at a time when the value of that home was down, if they were forced to turn a paper loss into a real loss, that's when they suffered. But if they had the flexibility to hold on for five more years, then they came out okay. It's similar to not wanting to liquidate a stock position, right? If we know that the stock market is volatile, and if during a recession you're forced to sell your stocks,

then you're going to convert that paper loss into a real loss, loss and it's going to have a very real negative impact on your net worth. So if you have the ability to hold on because you have other sources of capital, then you're not going to have to convert paper losses to real losses. The same is true in a home. If you have to move out, you want to have multiple strategies for what you can do with that. And that doesn't mean you have to love it. You know, you might be the reluctant landlord who's gritting their teeth, holding on to it for looking forward to the day that you can sell. That's fine. As long as you can tolerate it, as long as you can live with it as long as it's an option. Oh, I love that. So that to me, that's like a rethink upon a

rethink, right? So there's the standard advice to just general public, which is, it's the American dream, buy your house. That's the only way to get wealthy, right? And then maybe some people, some, you know, kind of idiots like me who say, oh, you should maybe only consider buying if you're going to live there for X number of years. Like that would, that would be like my kind of just off the top of the, I don't like to give people advice. I just like to make them think and just put that little bit of space between like that stimulus and response. Right. So it's like, hey, I'm moving. I'm going to buy a house. Right. That's what I do. As opposed to like, I would say, hey, how long are you thinking about staying there? Is there any chance you're going to

leave, et cetera? So like, again, I don't want to give people advice, but it's like, okay, maybe there is another option. So like in my head, that would have been the rethink. And then you're much more nuanced and intelligent rethink upon that rethink is, hey, really think about this in terms of multiple exit strategies. Think about it as a business. Can you rent this thing? So, yeah, I absolutely love that. But that is nimbleness.

You're going in with that. That's what we're talking about here. So, yeah, that's, thank you, Paul. Of course. Very clarifying. Of course. And that seems to be, no matter what we talk about, the theme that we keep coming back to is preserving the ability to be nimble.

And oftentimes I will pause right now for this meta overview of what's going on. Anytime that I'm engaged in a conversation like this, where I'm talking to people whom I've known for years, we all already are coming to this conversation knowing that we share a lot of the same philosophies. I always pause and say, hey, are we just reveling in confirmation bias? Like big surprise, three people who all love the concept of financial independence get together and decide that financial independence is the Are we just reveling in confirmation bias? And so I've been having that thought going through my head as we've been talking. And what I keep coming back to is, and I would love to hear what the audience thinks, what this community thinks.

But I cannot, when I think of the counter, like I cannot think of a situation in which being nimble, being flexible, being portable would be a disadvantage. I mean, certainly if there are tradeoffs, second order tradeoffs, you know, if being flexible requires that you are doing some type of work for which you are not indispensable, right? If there's a tradeoff between being indispensable in your work versus being flexible, sure, if that were the case, then we could weigh those tradeoffs. But in a vacuum, in and of itself, if you can be nimble and flexible and port, and still be valuable to what you do, you know, and still be indispensable in what you do, then that tradeoff doesn't exist.

And so I can't think of any situation in which these things would be a drawback. Right. I guess if you're arguing, if you had to make suboptimal decisions to get that nimbleness, then that might be that clearly is not what we're talking about. You're saying all things equal. Correct. If you can have more options, can you think of an example of where that puts you in a worst position. I think that's pretty clear that the answer is now.

It's trying to figure out this person that's disagreeing with the three of us. And what's interesting is I doubt all three of us have the exact same perspective. I know Brad and I don't line up one to one. It's like nuanced, right? And I would imagine, Paul, if we really explored it, we're directionally going the same way. We think we probably all three of us would blanket agree time is your most precious non-renewable resource. And so you should build a life strategy that allows you to reclaim as much of that as possible. Now, the actual mechanism to get there is going to be very personality-based. But that's kind of like the thing, you know, but to the whole nimbleness thing,

you'd have to then really talk to that individual. And then that's where you get into the preference of, oh, well, I think, you know, if you always rent, you're more nimble than a homeowner. Well, that's probably true. It's probably like a blanket, true statement. But then to your point, yeah, but have you thought about exit strategies? Because then you can figure out whether or not it's, you know, better to rent or buy in a given area based on market conditions.

So probably with any one of these, it might be a straw man and you could explore it down and find the, you know, the desirable level of nuance for that given situation. Well, Jonathan, what I think, I like your use of the word directionality because I think that there's, because there's a distinction between direction and methodology. And so all of us are directionally pointing in that in the same way. You know, we're all directionally pointing at financial stability, financial. solvency, flexibility, all of these themes that we've been discussing throughout this episode, throughout this conversation. But then the methodology to build that into your life on a day-to-day basis, that can vary wildly from person to person.

So using the real estate example, there are some people who preserve flexibility or nimbleness by renting. There are others, like me, who would argue in some cases, the opposite could be true. in some cases, having equity that you can borrow against could give you a greater degree of flexibility than someone who doesn't have that option. Again, assuming a whole bunch of certain preconditions and certain assumptions. That's just one example of how there can be two different methodologies that look diametrically opposed to one another, but that both speak towards the same set of values and that both are directionally pointing towards FI or in a given value set. You know, Paul, I think actually on this call, we have a little room to explore that with that, you know, and I think it's valuable for people.

Just that directionally, we're all going in the same place. But from a methodology perspective, we have some different representation here. And I'll give you an example, just, just Brad and myself, and we can do a little compare and contrast as well. But Brad is, it's very clear. It's the five story. It is, you have an individual that has a clear grasp of the numbers with the family that lives beneath his means, despite not having like this lavish, extravagant income. It's, you know, it's a good income. I don't think he would say it's not a multiple six figure income. It's not even, I don't even think it's a just barely, if anything,

crossing into the six or maybe at the peak. But mostly it's, I understand the numbers. We live below our means and we stay the course and we do this over a period of, you know, a decade or so, decade, 12, 15 years at the high end by just understanding the power of savings rate and living beneath our means, focusing on housing, focusing on transportation, taking advantage of tax advantage vehicles, rinse and repeat, do this for a decade. The numbers just work. Brad, would you, would you? Yeah, that's a pretty succinct summation of my adult life.

Thank you, Jonathan. Sorry, sorry, brother. I'm not putting you into a 200 character story, but that's what you did. It is what you did. And so in contrast, I agree with the ethos of everything he did, but let's talk about it. Brad didn't start with six figures student loan debt. I started with six figures of student alone debt. And I spent the first one,

first four years of my professional career paying off my student loan debt. I got some FU money saved up, which we define as kind of roughly having like two years expenses. And I was also, you know, paying down my debt and then I'm also putting money into my 401k. So I'm doing what I can, but I have to pay off the student loan debt. As soon as I felt like I had FU money, I started focusing on entrepreneurship. And when I got to a point where the numbers made sense and I could fund my life from the entrepreneurship. And I felt like I had a small cushion. You know, if anything, anything went wrong. I had a couple years to figure it out. I walked away from my corporate job and I kept building it through this vehicle of entrepreneurship. And Paul,

I'll give this back to you. I'm sure there's different components of what both, you know, I just kind of laid out for Brad and myself, but I'm sure it's not one to one, you know, in terms of what your own path to financial independence was. Well, so to quickly summarize what I've just heard, the two of you are examples of different methodologies pointing in the same direction. The two of you are both examples of increasing the level of freedom and flexibility in your life. But Brad, you did so by working a W-2 job as an accountant for a number of years and then spending dramatically less than what you earned. And Lather, rinse, repeat, you did that until you reached financial independence. And then Jonathan, you paid off a hefty

student loan debt and then waited until you had a couple of years. You basically had an emergency fund, like a super emergency fund that gave you a runway of about two years worth of expenses, and then you quit your job and you started a business. Yeah, a slight order of operations there, but, you know, for all intents of purposes, that was the pathway. Think about this. I recognize the flexibility and the portability I had by not having the debt. That is a fundamentally different person then was there at the point of graduation where you're coming out, you have six figures of student loan debt. And you have to figure out a way to cover the cost of your life,

plus cover the cost of your debt and cover the cost of paying down your debt, which, by the way, it's close to half your salary. You know, it's if you want to do it quickly. When you, when you make the moves to get that done, you say, all right, now the, I don't, I no longer need to account for the bandwidth that I was just applying to paying down the debt. What do I want to do with that?

And for me, I was like, well, we could, Let's just start building some exit ramps. What would that look like? Yeah, and you were exactly what we're talking about here. You were flexible and nimble, right? Like you followed the path of FI in that you paid off your student loan debt. Your life did not cost very much. And that gave you options.

That's what we've been talking about is how do you build the options into your life? That was really cool, Jonathan, and that you had the ability to do that when this was a just getting off the ground business. a little small business. And again, because you had lead the groundwork of paying off a crazy amount of student loans and having a life that wasn't extravagant, it gave you the options. I think that's the five story too. I know you like to say, you know, mine is the, the traditional five story, but that's pretty darn close. I would say it's pretty close. Paul, I don't want to like not include your story because we're talking about these methodologies,

though. Like, you have an entrepreneurship story. And you also from our conversation with you on our show, you took a little bit of risk early on, but it wasn't as risky due to the flexibility you had built into the framework for your choices. I did. So the way that I think of it, the framework that I like to use is F-I-R-E-F financial basics. I nailed that down first. And then once the F was taken care of, IRE, investing real estate entrepreneurship. So the ire of fire, that all got built on top of those financial basics. Did you just add an option to the fire definition a la carte menu. I sure did. That's how I think of fire. Financial basics investing real estate entrepreneurship. Take care of the F first and then pivot to focusing on the IRA fire. We'll come back

to the show in just a second. But first. So the financial basics really doesn't require any particular point or dollar amount, et cetera. I think it infers a level of steady state. It infers that you've brought the power back to your side of the court, you know, which is something you got to get some traction. It's going to take a little, a little bit of time. But it doesn't necessarily require that you hit, you know, 25 times your annual expenses,

12.5 times your annual expenses, some crossover point where your investments are. No, it's a recognition that you have flexibility, you have portability, you understand where your numbers are taking you in the current construct. And with the benefit of the lay of the land,

we start building options. We start building exit ramps for ourselves. And you just labeled three of them under the, the Iyer umbrella there. And you've kind of explored all those, and I feel like we have as well, I think there is something to this. And so it really, it really begs the question for people that are hurting, you know, in 2020, are we focusing on the ire or are we focusing on financial basics? Or do we need to make decisions? Do we need to make

transitions? Do we make pivots that give us the ability to move to the ire faster? Right. Exactly. So that F is solvency. It's solvency and stability. It's paying down your credit card debt. It's saving up a basic emergency fund. It's getting that foundation underneath you. And once you've got that, then you can certainly increase the foundation, right? You can improve the foundation. And that's where the ire comes in. So first you stabilize. And then from that stable state, you then start looking towards the ire. You start looking towards more broadly the multiple exit ramps. You know, when the two, you're of you were on the Afford Anything podcast, episode 160 back in 2018, we ended that episode with this conversation around FI versus RE, retirement versus not, you know, that was a big discussion back then. Jonathan, to your point, I think a lot of people were focused on that conversation, especially in 2018, because that conversation is binary. You're either working or you're retired. And that type of binary all or nothing thinking is a reflection of an environment and a construct in which you're either commuting to a brick and mortar office or you're not.

And one of the silver linings that has come out of 2020 is that it accelerated mass adoption of a far more nimble construct around work. And that's something that we all in the Phi community have been talking about for years. Yeah, I mean, you nailed it there. If we identify, you know, if we have a focus coming in, and you could go in so many different directions, but if we were to pick one of the many different things and focus on kind of a linchpin, a flexibility and portability, when you're talking about financial independence versus retire early, I think one of the biggest defining factors is how much do I love my job or how much do I hate my job or what are my options inside my job? So, for instance, Paula, you are an advocate for financial independence. You reach tens and tens of thousands of people. And you teach people about financial independence and, by extension, early retirement. You're not retired.

If anybody calls you retired, that would be crazy. You work very, very hard. Brad and I work relatively hard. You know, varying extensions of hard, different seasons of life. but we're clearly not retired. And so it's really a disservice for us just to talk about the goal of getting to retirement when that's structurally and functionally, not the goal for our own personal lives.

And it's not for many, many people inside the financial independence community. What they want is they want more options. Now, we sometimes we need to take a break. We need to be able to step out and step back in. We need to be able to reassess. And at some point, maybe we do completely.

step out. But I would say for the vast majority of individuals, we're looking for more autonomy with how we spend our time. We're looking to maybe pivot out of one industry that literally is killing us quickly and into one where it lights us up to check back into work on Mondays or a varying degree of that. You know, like we like humans like to work. We like to feel like we're invested in something that has meaning and purpose. And whether that's doing it for ourselves through the lens of entrepreneurship or whether it's working for an employer. And Brad, you reference the infinite game all the time, but we're working for an employer whose goals align with your own for what you want to see the world become. That's what people do when they have more time. If they can pick any job

they want, they pick the ones where they want to be a part of the mission of that company. They stay there longer as long as it's not killing them quickly or killing them slowly, frankly, right? If it's adding value to their life, they're like, I'm going to stay here. And this is why you have to really, really try to get people to walk away from those when, and they're working long past when they really have to because they love that. But it's not a reality. We can look at job surveys that quite carte blanks, and you can probably pull the study, you probably have it, you probably referenced it.

70% of American surveyed in 2017 are deeply unsatisfied with their current job situation. It doesn't mean they don't want to work or they don't want a job. It means they're deeply unsatisfied with their chosen career or the job they currently find themselves in. The ones that have flexibility and portability are going to be the ones that are able to shift disproportionately. They're going to be able to shift faster and they're going to reap the rewards of doing that. They're probably going to stay in those and those longer. So it begs the question for those of us that are having this awakening now, how do we do that? Because even five years ago, the answer was if you want to get into a new industry so you can go work for a company

who's ethos lines with your own, you've got to go back to college and get a new degree. That was the answer, the stock answer as recently as like five years ago. And I think functionally, it's not today, but we need a new toolkit in order for people in mass, not a person. A person can be an outlier, but the community at large, when you're talking to a lot of people, you're not given a individual one and one advice. You're given a large group of people the best chance to be able to pull this off. We need a new toolkit for this transition. And I think what I've seen personally, again, with this kind of nim on this, I've seen a company, like Google, provide cover to a lot of other companies to potentially change that social

construct of everybody needs a four-year degree. Google has come out recently with their Google certificates. And they've said that we are accepting these in our own notoriously difficult hiring process. If Google is accepting a couple of month program certificates, to hire people in their own company, then they've now partnered with dozens upon dozens of other major employers to do the same. And then who knows when additional companies

come out with their own certifications? That to me is exactly what we're talking about here. And frankly, like, I'm someone who went to a four-year college. I enjoyed my experience. I learned a lot. I have this significant network. But it's pretty cool to have that option of, oh, wow, I can reskill in a couple of months or I can just learn something new.

Right. That to me is extraordinarily exciting. And you know, Paula, we're talking like long enough timeline. On a long enough timeline, I see that becoming the norm as opposed to, hey, go to college and learn something. I don't know exactly what that something is, right? Right. Well, fundamentally what we're talking about is the distinction between skills and degrees,

because Brad to your example of these Google certificates, it's a certificate that states that you've learned a very specific skill that is applicable to a very specific type of job. And that can be lucrative. And maybe that's something that you want to do forever. Maybe it's something that you want to do only for the next two or three years while you're figuring out what happens after that. Either way, you're not holding yourself back.

You know, you're not committing to a four-year degree or an eight-year degree. you are staying nimble, entering a good work situation, whether it's forever or whether it's temporary, you're staying nimble and you're using the skills that you've learned in order to go into a good work situation that you can stay in for however long you choose. And so that example of, you know, the Google certificate is just a perfect example of preserving that flexibility, that nimbleness, that portability while you search for some type of career that brings you a sense of autonomy, mastery, and purpose. Because what we know from the research is that autonomy, mastery, and purpose, if a person

has all three of those in their work experience, then they are more likely to enjoy their work. Another example, being a real estate agent. I have a, until last November, I had a real estate license. I let it lapse. But until last fall, I was a licensed agent, and that didn't require a college degree. that was a 100-hour certification. I took 100 hours of courses, capped it off with a test, and boom, I had a real estate license. Now, to actually do the work of making money with that would require the day-to-day of being in that career. That wasn't something that I was

interested in doing, and that wasn't the reason that I got it. But that's another example of a career option that many people choose in which, with a 100-hour course, boom, you could have this entirely new career opened up to you and you don't have any sense. student loan debt. You know, and I think there are a few things that need to happen for people to really feel confident and how replicable this is because clearly the big takeaway was not go apply at Google and it was not go become a real stage. And this is what we have for you. Look, we're in the future. We're living in the future. No, it was rather we are seeing a system-wide change on the approach to landing a job. And I'll just give you a clear example. And maybe there's many people

that understand this and have been given this advice. So, hey, someone's looking for a job. And then that helpful friend, maybe mom and dad reach over and say, well, you know, you need to update your resume, you need to update your CV, and you should just go knock on doors. You go knock on doors and you can lay in that job, just be industrious. And they don't realize that that information is woefully out of date and you will not get a job by updating your resume and going and knocking on doors and handing out that, you know, card stock, uh, eight and a half by 11. It's just not, it's not how it works anymore for the vast majority of jobs, especially those that pay it above median income. So what is the process? And I was just thinking through this ahead of this call. If we,

if we ended up talking about this to try to help people think, here are the five or six things that if you can do this, then you can pivot quickly. And it's based on a little bit of experience for what we've seen with the job placement program that we've actually been working on. But it's also, I think most people will say that's just true.

Like once you see it, it's hard to unsee. So one, and you pointed this out, it's skills versus degrees. Degrees used to mean that you were confident and capable of a skill. And for some professions, it still means something.

But I would challenge the liberal arts, major, you know, at the point of graduation, is trying to figure out what job they're going to be eligible for to really think through, is that statement still true in 2021? For some people, it may mean something, but for the vast majority of employers who are trying to get a high ROI on a hire, the fact that you know how to learn is going to be lost on your resume. Employers are looking more selfishly, what can you do? What is the ROI if I hire you? And liberal arts degree does not scream immediate ROI to them. And let me just corroborate what you just say. said speaking as an employer, speaking as somebody who has just recently hired a handful of people,

frankly, I don't even know what degrees they have, nor do I care. Right. Okay, exactly. So if you don't care about what they degree to have, which as an employer, I agree with your assessment, all I need to know as a small business owner, and let's just be very clear, the vast majority of jobs right now around the world are from small business owners, right? Now, we took a beating last year, but we are still the number one group of segment, you know, that are hiring people. Most of the jobs are to small businesses. I don't care about your degree.

And I don't mean that a bad way. I'm not devaluing your degree. I'm just mean it doesn't mean anything to me in terms of what our goals are for our business. We need to know as when I'm hiring someone, what skills do they possess? What can they do? When we're hiring, we're looking to get something done. And we're looking for someone that has those skills. Now, there may be overlapping a degree, but we're very focused not on the degree, but the competencies, the work experience, the what have you done approach? So what does that mean? It means we're looking at skills. And whether, you know, in your business, you can say, all right, well, I need maybe email marketing. I need web design. I need copywriting. I need sales. I need communication. I need business administration.

I need accounting. I need legal. I don't know. You know, any number of these things. But you have a requisite. You have a prerequisite set of skills that you're looking for when you go into the hiring process. We need skills. So do degrees convey skills? Maybe not always. And if that's, the case degrees can be very expensive and they can take a lot of time. So if we know Paul is looking for someone with skills, what are the list of skills? And we don't need to go at that granular of a level, but in general, what are the skills that are the skills that are the fastest best way to get those that employers look over it. When you work down the list, all right, so I need to be able to have the skills.

Is the certificate the best way to get a skill? Maybe. Maybe it's just being able to get a, you know, go do some YouTube training. Learn it. Now, all right. So, all right, so you learned on YouTube now what? Well, and that can, case and employers definitely going to look for, you know, what have you done? A better way to demo, what have you done would be to lock down some personal branding. Does that mean start your own blog to start building out your personal branding? Maybe does it mean to build out a LinkedIn profile where you link back to the blog and highlight some of the projects you've worked on? Maybe. And then from there, you need to have a network. What is one of the biggest attractions of

going to college? It's the network that you form. We don't lose that. That's not going away. You need a network. But we all know at this point in time, a social network counts just, as much, if not more, than who you went to school with back in the day. And we need to all keep that in mind that it's important to cultivate a social network. Well, what does that actually mean? Well, if you're in some certificate-based industries, are you in groups where those individuals are constantly sharing tips and tactics and strategies to get better? Very, very easy to pick a target skill set and then get immersed in that online community.

So you're constantly focusing on building, getting better. and you're getting to know the people that are engaging with the group and you're helping other people come you know that is building your network in 2021 experience i'm going to give all these back to you but i just i have this list your experience employers want experience we don't care what you think you can do or how much you think you can do it employers ultimately want to know what have you done and so that's very challenging for someone that's never done anything you know like i think i can do it i think i can learn anything i have a liberal arts but yeah but what have you done and this gives us the opportunity to now really put the focus on volunteer experience or doing it on our

own in a sandbox. So for many, many skills, there are ways that you can do it in a sandbox or a low risk way. And if you can't do it for yourself, a la, you know, if we're talking about a digital business, et cetera, that you own, even if it's not for profit just to experiment, can you volunteer and do this in some capacity for an organization's. And there's ways that you can do that in a replicable manner. And then I would just add on to this and I'll give this back to you for comments, both of you, is that we have to be able to convey this collection of things that we've locked down. We have to be able to convey that in an interview. We have to understand how to take the skills that we have, the personal branding that we've

locked down, the network that we've built, the experience that we have and convey all of that in an interview. So an employer that's talking to us for the first time has confidence that when they invest in us, we're not going to be a waste of six months of their life. That's what you really want to know, Paul. Selfishly, when you're talking to someone that has a resident, that you're looking at and has gone through that first lady and you're actually going to take the time to talk to them. If you give them the chance to work in your organization, the biggest fear

is that this is going to gobble up six months that you could have putting into a better candidate. Right. And so the person that can convey all of those other things that we just talked about and convey that via communication interview can transition very, very, very quickly. Jonathan, I'll pull my Charlie Munger and say, I have nothing to. further to add. That was an incredible summary. And I agree on every point. The world is changing. That's a very compelling case for skills matter. Be nimble. Understand that there's an opportunity cost to college. There's an opportunity cost to learning new things. Skills really matter. How can you prove that you can actually do something? And again, we know, we always talk about the

talent stack on our show. And, you know, we certainly didn't coin the first. is, but it's having this diverse set of skills and putting together things in your brain that you don't need to be world class at any of these necessarily. But if you're top 20% in 10 different skills that nobody else on earth has that combination of skills, you are extraordinarily valuable. To me, what's so exciting about these things is you can learn anything and you can learn it really quickly and you can prove that you can do it. That is a sea change that I don't think this stuff, Paula, you know, to our point earlier,

this stuff sneaks up on us. And I don't think sometimes we take that step back and realize, wow, the world has changed dramatically. I think this is a really good example that we might just kind of gloss over otherwise. And Paul, this is just, I worried originally that this was just like a thesis or that this was maybe a platitude that would just end up being buried in the books. And it's just kind of one of those. An apple a day keeps the doctor away type things.

You know, when I started working with Bradley Rice, who was a member of our community, and he had told me about this one track in the world of Salesforce that was just unbelievably in high demand, like unfathomably in high demand. But he was working with a group of people, it was like a group of like 3,000 people in this free, Facebook group. And Paul, I used to think that maybe this was just a thesis. This was just

another Jonathan rant. I was getting very excitedable. But over the last year, I've had the privilege of watching quite literally hundreds of people that in 2020 were scared about their industry, about their career, about their perception of what the job market looked like. Because all of us knew when the economy falls apart, jobs go away. All of us, quote unquote, knew that, except that some businesses blossomed. Some businesses 2x, 3x, 4x, but they did it in ways that were unexpected. We go back to choose if I in our own way.

Choose if I, I talked about the stress that we had. We had to be creative. As a business, we had to pivot and we had to move in a new direction. Businesses all around the world, your business probably had to do something similar. Your plans, middle of 20, 20 did not look like your plans at the beginning.

You had to pivot. And that means that you're looking for different skill sets. You're hiring different things that you weren't planning. on before. And this isn't just us. This is business all over the country. And I saw people that were able to put together this stack skills, personal branding, network, experience and interview prep, people that were able to figure that out. I literally got to witness hundreds and hundreds of people land jobs and an industry that they were completely unfamiliar with. You know, we're talking three to six months, three to six months pivot into a new industry. And I realize that's a true statement

generally going forward. If that's true during a pandemic, when everybody says there are no jobs, you can't get jobs, everything is over, that's a, that is true forever. It will never be more difficult

than it was last year. If you figure that out, you no longer need college. And what does that mean in terms of your ability to maintain and preserve your flexibility and your portability? It's like a secret to life

that was only unveiled and couldn't be put out as a character. because of what we experienced in 2020. People would have always said, if 2020 hadn't happened, people would have always said, well, that works because we're in a bull market. What's going to happen if you have a, if you have a pandemic or a black swan event, then all those people that didn't go to college, you're going to be at the bottom of the hiring, pal.

I'm telling you, no, we started in the worst, in the worst possible scenario, this is true. How much more true for the entire future? So this goes back to if you're, if you're wondering, whether or not you have confirmation bias, ask yourself if it applies in all situations. And what I'm hearing you say is that there are certain values or qualities, similar to how flexibility and portability and being mentally nimble are values or qualities. There are also values and qualities in a job candidate, things like having a powerful social network, things like being able to have specific skills that employers want and then being able to communicate those

skills, things like having some degree of experience, even if it's volunteer experience. And these are universal qualities that apply in all situations, regardless of whether it's a bull market or bear market, pandemic or not pandemic. When we go back to these fundamental attributes and we ask ourselves, does this apply always? If the answer is yes, then we know that we're on to something and we're on to something that can change and pivot with us over time. I hope people hear that. I hope the power that it gives you when you recognize that,

like if you get one thing out of this episode, just for you're not stuck, you're not trapped. If you don't feel like you have flexibility and portability right now, you can have it in a very, very short period of time. And it's going to follow the ethos that we just laid out. What aspect of that can I build today?

I think this is going forward. And this would not have been true. Maybe 10 years ago would have been tougher. People were doing this, but they were outliers. This is a truth going forward. This 300 year future that Brad described, this is going to be a more fine-tuned version.

And it will be the path that everyone is on. And they will be starting at a younger and a younger age. But right now, when you're listening to this, you are ahead of the curve. You are just, and it doesn't mean you necessarily have to take action on this yourself, but you should really think about what does this mean for me over the next six months for sure, if applicable.

If you're one of those 70% of people that's deeply unsatisfied. and for the next generation, or the person that you have influence on, for the person that's thinking about making large financial decisions, like signing up for six figures of student loan debt, for the individual that is trying to put aside, you know, hundreds of thousands of dollars in a $529 account instead of focusing on saving up for their own level of financial independence.

These are just structural things that we all need to realize, and what are the downstream effects of realizing that I don't care what your opinion. I don't care if you think that I'm right or not. it's happening. It is absolutely happening. It doesn't matter what your opinion on. This is a new reality. I've seen it over and over and over again. And the world will catch up. They'll figure out the truth of this. But you're getting this right now. So what are the downstreams effects of this that we want to go and account for in our own financial model? And when I say you, Paula, I don't actually mean you. It's the larger we. We. Exactly. This community, this audience.

This community. Yeah. I also want to make a meta observation about the conversation that we're having. This conversation wouldn't have happened three years ago. November 2018, the last time that you were on the show, this conversation wouldn't have happened because back then, the dominant narrative in the FI community was all about entrepreneurship. Entrepreneurship, side hustles, you know, and we're all entrepreneurs, the three of us, you know, we're all big fans of entrepreneurship. But, notice how what we're talking about in today's conversation is not side hustle entrepreneurship related. It's broader and deeper than that. It's what skills do you need? How can you stay

nimble? It's more concept-based. Again, directionality versus methodology. Entrepreneurship is a methodology. Side hustles are a methodology, but developing skills, being nimble, being flexible, being portable. That's the direction. And Paul, as we look at that, I think to myself, because you hear I'm more angry and intense about this than I would have been three years ago. And angry is the wrong word. I'm passionate for people to take this more seriously than I was three years ago.

Three years ago, when we were having this conversation, I would have subtly hinted to Brad's point about not wanting to give people advice, but just get them to think. I would have settled for just getting them to think. but now I'm angry on their behalf for not thinking through what does it mean to sign up for six figures of student loan debt and an eight year commitment when you have you don't have all the facts. You don't understand what is going on in the world that we're living in right now in terms of what your other options actually are. I didn't have this information. I did not have this information. And so think about this just as a line in the sand. How far do you have to be pushed

before you're not going to take it anymore, before you're going to say, what are my other options, before you're going to question just what the standard path is. What is that line? What line is it going to require? How far do you have to be pushed?

How far out of your comfort zone? Does this world have to shove you before you say, all right, I'm not, I'm going to look for another path. I'm not following the standard narrative anymore. That's fine in a nutshell, right? I'm not following the standard path anymore.

Right. And we all need to be ahead of, of it. It's too bad you can't put a subtitle on a podcast episode because the subtitle would be title, 2020, the line in the sand, subtitle. I'm not following the standard path anymore. There is nothing more powerful that we can say than that line. So we're going to end it there. Thank you for joining me back on the show. First appearance, November 2018, second appearance, June of 2021. Let's not wait three years for the third appearance. I'll be very old by then. And can you imagine what the world looks like three years from now?

Oh, goodness. It's been a lot of fun, Paula. Thank you so much for having us on the show. It's been a real pleasure. Absolutely. Where can people find you if they would like to hear more of you? Yeah, well, we have a podcast called Choose FI. So obviously, you're listening to a podcast now.

Just search us out and hit subscribe. Thank you, Brad and Jonathan. What are some of the key concepts that came from this conversation? We're going to discuss four. Number one, the importance of playing the infinite game and being mentally nimble. I'll let Brad describe this in his own words. On a long enough timeline, can this possibly stand or does it blow up? I think there is a zero percent chance that 300 years from now, the college system looks

the exact same that it does today. So then you work backwards, right? And it's like, okay, I don't know when that. change is coming, but it certainly seems like it's accelerating. And that's what this has been. It's been an accelerant. That can be scary or that can be exciting or it can be both. What it means is we need to be mentally nimble. And so that is the importance of thinking about the infinite game and being mentally nimble as we think through our assumptions about what that means about the world today, the world six

months from now, the world in the next five years. Key concept number two. In addition to being mentally nimble, we also want to be logistically nimble, meaning we want to make choices that allow us to preserve our future flexibility. And here, Jonathan will describe the importance of that. So when you look at the core tenants of what we talk about in the financial independence community, all of them, they give us the maximal ability to make pivots when we get new information. Because we weren't in debt up into our eyeballs, because we weren't financing everything

that we could afford the payments on, go through the list of qualities. What do they ultimately do? They give us the ability to pivot when we get new information and to take luck, quote unquote, luck, and turn it into opportunity. We need to make choices that allow us to preserve our future flexibility. Don't make choices that lock us in, whether it's locking us in through student debt, locking us in through credit card debt, locking us in through all kinds of methods that tie us down to such an extent that when we come out of the other side, the entire world may have changed and our assumptions may have been proven wrong as we were going through the gauntlet. To the extent that we can avoid that while also not compromising our indispensability. In other words, to the extent that we can remain nimble while also maintaining the value that we bring to the world, that is the approach to take, the balanced approach to take. And so that is key concept number two. Key concept number three, the distinction between directionality versus methodology.

Directionality is broadly, directionally, knowing where you're going. So, for example, financial independence is a direction. But the methodology as to how we get there can greatly differ person to person. And so anytime someone tells you that there's only one way to do it, you should immediately be suspicious of such a claim. And when it comes to a concept like financial independence, of course we understand that there isn't just one way to do it. You don't have to just save 25x your current day living expenses, and that's the only

way to do it, right? Of course, any of us who have spent any time in the financial independence space know that there are multiple paths to get to the same end goal. But we don't necessarily apply the same framework or understanding to other things that we're told. So for example, when parents or society teaches us, like you have to go to college or you have to go to grad school, you know, I would always hear that from my family. Masters is minimum. To this day, I live with this guilt of thinking that my education is incomplete because I've always been told since I was a little kid, masters as minimum, and I don't yet have that minimum. And yet I also simultaneously understand

that that world, the preconceived notions and assumptions about the way in which the world works that led to me being taught that at an early age, taught the master's is minimum message at an early age, that world has radically shifted. And if education is about thinking critically, then what I need to understand, the challenge for me is to understand that the methodology as to how to create a good life is very different than what it was 30 years ago. And if I am responsible for making the best choices for my life, rather than cowtowing to what others want of me, then that means that I need to update my mental models and respond to the world as it is, not as it was.

we're directionally going the same way. We think we probably all three of us would blanket agree, time is your most precious non-renewable resource. And so you should build a life strategy that allows you to reclaim as much of that as possible. Now, the actual mechanism to get there is going to be very personality-based. And so understanding that distinction between directionality versus methodology, understanding that you can be moving in the right direction, but it might not look like what you expected it to look like. That is the third. key concept. Finally, that fourth key concept is that there is a distinction between skills and diplomas and the broader trend that we are seeing, particularly with the advent of

the internet, the emergence of very robust online education, with the prevalence of remote work, the trend that we are seeing is the decoupling of skills from degrees. This is not the 1980s anymore. And those of us who are going to be the most successful are the ones who are able to adapt to the world as it is today, not the world as we believe it was because that's what we were taught as children. When it comes to education, there are specific careers that require degrees, that there's no other way to go into a particular career. You can't be a veterinarian or a dentist without a very specific type of degree and a very specific preordained course of study and certification and licensure.

That path is laid out. It's clear. Everyone knows exactly how to do it. And that's not what we're talking about. What we're talking about are careers that you can build where there are, to go back to directionality versus methodology, multiple pathways, multiple methods of getting to that same end goal. If you want to work for a particular type of company or you want a particular type of work,

and there are multiple ways of getting there, there is. isn't just one required method, well, now you've got flexibility in how you get there. And when you have that type of flexibility, when you have multiple pathways of getting to that same end goal, the nimble way to do that is by asking yourself, what skills do I need and what experience do I need in order to be able to follow this path? The question is no longer what degree do I need. It is what skills do I need? It's having this diverse set of skills and putting together things in your brain that you don't need to be world class at any of these necessarily.

But if you're top 20% in 10 different skills that nobody else on Earth has that combination of skills, you are extraordinarily valuable. And so that broader societal trend of the decoupling of skills from degrees, and our responsibility of updating our mental models and making life decisions and career decisions accordingly. That is the fourth and final key concept from this conversation with Brad Barrett and Jonathan Mandanza. And if you would like to hear myself and Jonathan elaborate on the ideas that came from this episode, join us Monday, June 28 at 8 p.m. Eastern, 5 p.m. Pacific for a live event that we are doing where we talk about how you can earn more money outside of the context of entrepreneurship and side hustles, how you can earn more money in a job and how you can do so without having to

go back to grad school and get yourself buried in thousands or tens of thousands of additional student debt. We're going to be talking about that decoupling of skills from degrees and what that means for you and the opportunities that are ahead of you. So myself and Jonathan Mandanza are going to be elaborating on what we talked about in today's conversation. And that's Monday, June 28 at 8 p.m. Eastern, 5 p.m. Pacific. You can register. You have to register in advance. Registration is at afford anything.com slash career. That's afford anything. dot com slash career. Thank you so much for tuning in.

If you enjoyed today's podcast, please sign up at afford anything.com slash career. And I will see you there. Please also share this with a friend or a family member. That's the single most important thing that you can do to spread the message of good financial habits, of earning more, of growing your net worth, of mastering your money and your life. So please share this with a friend or a family member and make sure.

that you hit follow in whatever app you're using to listen to this show so that you don't miss any of our amazing upcoming episodes. Thanks again for tuning in. My name is Paula Pan. This is the Afford Anything podcast, and I will catch you in the next episode.