They say you learn something new every day.

Posts tagged ‘money’

Becoming a Millionaire One Penny at a Time (10/02/2012)

I have no business sense. It’s just something I have to live with. I’m never going to be an entrepreneur. If I went on Dragon’s Den I’d be one of the ones you laugh at. Luckily, I work in the public sector, so this isn’t a problem.

However, yesterday, I realised that the secret to being rich – or at least, sustaining yourself on freelance work, or earning extra income – isn’t to come up with a million pound idea. It’s to come up with lots of small ways of making money.

The secret to Microsoft, for example, isn’t that they sell one £1billlion computer a year, they sell a million copies of Windows and Office.

I realised this when a friend asked me to host their website. It turns out my hosting allows me to resell it (like reseller hosting), so I can set myself up as a very small ISP. I don’t plan to do it in a big way, and I only plan to do it for friends and colleagues, with a bit of consultancy thrown in (I’ll set up their DNS for them or something like that, and advise them about their code). But I can charge a few pounds a month. Obviously, £2 a month isn’t very much, but if you get 50 people doing that, that’s £100 a month – or £1200 a year, and suddenly that’s quite a bit. It’s two months rent, for example.

And maybe that’s something that you could scale. If you set up with a friend, they could do some touting too, and suddenly you could have a few hundred people.

Really, it’s just a thought that lots of minor projects could come together to produce a significant income. Or at least a viable one. My Amazon Associates account has earned £85 in a couple of years, which is okay. Especially considering I don’t really advertise it, or have any particularly popular websites. It’s something that can only really go up.

So really, my revelation was in a way of looking at things. I don’t think I’m going to go freelance any time soon, but I like the idea of running a number of smaller projects as a web host and web consultant or something like that.

Don’t look back in anger (24/01/2012)

I’m in the middle of a situation at the moment. My landlord (a hideous multi-million pound corporation) has cut short my contract and is throwing me out of my flat (they gave me notice on Christmas Eve). They want to sell the flat. But they don’t have a buyer lined up, they haven’t put it on the market and they don’t even know what the flat looks like.

When we asked for a month’s extension, they refused.

I’ve taken this opportunity to see if I can afford to buy a flat, and at the moment I’m waiting on the seller to come back to me. It’s a hideous experience, and the most stressful thing of my life.

A few times now, when thinking about my project to “write about something new I’ve learnt every day”, I’ve thought that if I get this flat I’ll write about how disasters are an opportunity. And if I don’t I’ll write about how sometimes you have to know when to walk away.

However, this is ridiculous. I’m arguing it both ways. And an explanation that works both ways is meaningless. It can explain anything. I came across this idea in Thinking Fast and Slow a few days ago:

A story in Nassim Taleb’s The Black Swan illustrates this automatic search for causality. He reports that bond prices initially rose on the day of Saddam Hussein’s capture in his hiding place in Iraq. Investors were apparently seeking safer assets that morning, and the Bloomberg News service flashed this headline: U.S. TREASURIES RISE; HUSSEIN CAPTURE MAY NOT CURB TERRORISM. Half an hour later, bond prices fell back and the revised headline read: U.S. TREASURIES FALL; HUSSEIN CAPTURE BOOSTS ALLURE OF RISKY ASSETS. Obviously, Hussein’s capture was the major event of the day, and because of the way the automatic search for causes shapes our thinking, that event was destined to be the explanation of whatever happened in the market on that day. The two headlines look superficially like explanations of what happened in the market, but a statement that can explain two contradictory outcomes explains nothing at all.

Again, this is something I’d come across before (and even written about before) in a talk by Michael Blastland:

It’s amazing how powerful these beliefs can be. Michael Blastland tells the story of a journalist looking at the figures for alcohol consumption during the recession. He saw that alcohol consumption had gone up.

“Oh,” he thought, “that follows, since people have lost their jobs and have gone out to drown their sorrows.”

Then he realised, this was before the recession had started. After this, alcohol consumption had actually gone down.

“Oh,” he thought, “well, that makes sense, since during the recession people have less money and so can’t afford to go out.”

Then he realised the figures were for 2007.

In each case, he was able to justify the figures by fitting them into his existing worldview. The point is, he could have justified it either way, and then used it as a headline to support his argument.

The point in both of these things is that as humans we look for “agency”. By that, I mean we assume there is a reason for things. In fact, often there isn’t. Often stuff just happens.

As Daniel Kahneman explains:

The prominence of causal intuitions is a recurrent theme in this book because people are prone to apply causal thinking inappropriately, to situations that require statistical reasoning.

I think this is a key thing. And there’s a confirmation bias here as well. When we do something, and then things go well, we assume that things went well because we did that thing. If we pick our lucky number, or pray or even something that seems logical, like make a compelling argument, and then something happen, we think we made it happen. In fact, that thing might have happened anyway for a different reason entirely.

If you want to get to the heart of something and make a difference, you need to fight against this view. Which is very difficult because we’re hard-wired to think like this. There’s a video of some triangles moving around, created psychologist Fritz Heider. It’s just shapes, but as you watch it it’s almost impossible not to create personalities for the different triangles.

Sometimes, you have to avoid seeing patterns where there are no patterns. 

Walk in the park (23/01/2012)

I walked to work today. In London! That’s really living the dream.

Generally, you only get to walk to work if you live in a tiny town somewhere with one shop and one house and you live in one and work in the other.

It took 45 minutes, which was my best case guess. And I felt really good.

I’m going to start doing this more. Not only does it save me money (£1.35 each way on the bus – which adds up over a year), but also it’s healthy!

At Christmas when I went home I took a picture of myself to draw. Due to an optical illusion I looked really fat, and I had a hideous premonition. I’d really hate to be massively fat. I should add, despite the fact I work in IT, and my hobby is sitting in front of a computer not moving very much, I’m actually pretty slim. I guess when you’re hobby is not moving very much it can go either way.

It’s beginning to occur to me that I’m reaching the stage in my life where I may have to do something to keep looking like this. Oh, ageing!

My attitude towards exercise is largely the same as my attitude to backing up my stuff:

  • It must be free.
  • It must not affect my life.

I’ve realised this is probably a little harder to achieve with fitness.

But I’m reminded of when L and I lived in Dulwich. She had to walk up a hill to get to the train station. She said she kept in shape doing that more than any gym membership or exercise regime.

I guess the thing here is, if it’s “automatic” (in the sense you have to do it), you will do it. If it’s optional, then you won’t. “Oh I don’t feel like the gym today, I’ll go another day”, you’ll moan to yourself.

One thing that surprised me about my walk to work was how much it took out of me. I’m not sure I’m quite ready to walk 3 miles, work a full day, then walk 3 miles back just yet. But if I walk there each morning and get the bus back, not only is there a financial reward for me (as long as I don’t spend it on chocolate when I get there), but it will boost my fitness too.

Tag Cloud