Time to see what’s really worth checking out from the past week. I must admit that I was impressed with the personal finance eBook library. This is a collection of free and premium eBooks from the top personal finance bloggers. Not only is it a really neat layout, but it gives you instant access to the best eBooks around.

I also wanted to give out two additional mentions. First I want to think Matt About Money for this weeks Carnival of Personal Finance: Words of Wisdom Edition. This carnival has been a staple for finding new blog readers in the personal finance field ever since I’ve been around. I feel that it’s important that we all continue to link back to this carnival that has helped us out over the years.

Next I wanted to mention Canadian Finance Carnival #72 and Personal Finance Basics: Spend Less Than You Make from The Canadian Finance Blog. Tom has been doing this weekly roundup for a while now and I hope that we all take the time to show appreciation and link back to Tom’s site. I also had the privilege of meeting Tom last year and we ended up chatting for hours as he turned out to be a very cool dude.

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Do you know where you are? No not your physical location. Where are you really? Do you know where you stand when it comes to your position in your field or your industry?

I’ve often heard that there’s a big difference between where you are and where you want to be in life and in business. You may think and want to be successful in your field, but are you really? You could be on the other end of the spectrum. The challenge comes in being realistic about where you are and then moving towards where you want to be.

A few months back I saw a brief news story about Snooki (the short drunk girl) from the Jersey Shore. She was wearing Coach purses in public events likely because she could afford them and wanted the status. What happened was that Coach found out about this and decided to send her a a purse from a competitor. The company didn’t want her to represent the brand in the public. She though that she was classy. Coach thought otherwise.

Where am I going with this? I just wanted to touch upon some basic marketing that I learned in college and just through following successful people online.

How can you get to where you want to be with with your business?

Get rid of those that you don’t want.

One friend was planning on coming to my birthday party but he realized that he couldn’t make it because he was wearing some old pair of running shoes. The venue that we were attending had a strict dress code policy on dress shoes. The policy is simple, no dress shoes, no entry. You can complain all that you want, but it’s their property and their rules.

I also believe in being over-dressed instead of under-dressed. My friend was surprised he couldn’t get in with the running shoes. He just didn’t understand the policy.

The venue’s stance on the  policy is actually real simple: get rid of those that you don’t want. The venue clearly didn’t want its patrons to be walking around in old running shoes. You complain all you want. That’s just the way it is. The venue is getting rid of those that they don’t want.

You should try the same with your business. Get rid of those that you don’t see eye-to-eye with. Get rid of those that don’t share your views. Get rid of anyone that will only bring you down.

How can you get rid of those that you don’t want?

• Bash ideas that they believe in.
• Don’t give them any reactions.
• Ask them to leave.

Once you lose those that are bringing you down, you can move on and help those that you want apart of your cause.

Focus on helping those you want apart of your cause.

Who do you want apart of your cause? Once you figure this out you can focus on helping these people and having them help you. Chris  Guillebeau refers to this group of people as your small army. You will help your small army and in turn your small army will want to help you. I summarized his theory on building your small army with this quick image below:

When you work on helping those that you want to be with you and of your cause you’ll build yourself up towards being much closer to where you want to be. This is a simple formula that I’ve been doing my best to apply ever since I heard of it.

Fake it until you make it.

This is a classic quote and I believe in it totally. You’re not going to make it to where you want to be if you keep on feeling sorry for yourself and simply wishing you were there. You need to pretend that you are there. You don’t need permission from anyone to position yourself the way that you would like to. You just need to be willing to do the work and act as if you already are there.

I hope that you take this article seriously and begin working towards being where you really want to be. There’s usually a huge difference between where you are and where you want to be.

Where do you stand? Where do you want to be in the next few months?

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When we first started our company back in 2008, we decided to name it M-35. To be honest, my friend wanted to name it M-30 at first…. But the  “M” stands for “millionaire” and the number stands for the age when we arrive. I thought that 3 years was a little too short . So this is why we decided to use M-35 as our official name: because we think we can reach $1M in net worth by the age of 35.

As of my last net worth statement, I’m standing at $203,500 and for the record, I’m 30. Therefore, I have to multiply my net worth by 5 in order to achieve my objective. Out of all my personal and blogging goals, this is by far the most aggressive! But hey! Sometimes, you have to set the bar very high if you want to accomplish awesome things, right?

But setting high goals doesn’t mean anything if you don’t have a strong plan. On the other hand, growing your net worth by 800K in 5 years is a bit too much to swallow in one piece. So let’s take this elephant steak one bite at a time:

Employer stocks: + $43,000

I used to cash my employer’s stock once a year to pay off for different expenses. Starting this year, I’ll be keep them and hope to grow this part of my portfolio. Since I got a new job, I should be able to restrict my expenses. I invest $7,800 per year through my pay check in this stock and I only calculate a growth of 4% for the next 5 years. The growth is related to the DRIP plan where the dividend is around 4% at the moment.

RRSP: + $60,000

I intend to invest $10,000 in my RRSP every year for the next 5 years. Here again, my goal was to be conservative so I used a 4% investment return on my money. This should create another 60K. I will use my bonus to make my contributions.

Pension Plan: +37,000

This one is pretty hard to determine as I have no control over its value. I assume that the pension plan will grow by $6,000 per year with an investment return of 4%. This is how I got the + $37,000 number.

House: +75,000

I’m not counting on my house value to burst, but at 4% over the next 5 years, I would gain $75,000 on the value of my home. Since it is a fully equipped property in a nice area, I guess I should be able to expect to see it grow at this pace.

Debts: -$150,000

Here again, this is a fairly aggressive goal considering that I wasn’t able to pay down my debts efficiently over the past 3-4 years. On the other hand , controlling my finances is my goal for 2012. So if I want to make sense… I need to set my debt repayment plan in line with my goals. While my income will decrease in 2012 due to my job switch, this should only be temporary and I head back to 150K-175K starting in 2013. This is why I think I’ll be able to pay back about 30K per year in debts. It’s easier said than done, so we’ll see how it goes after a year .

And… this makes only $365,000 to add to my net worth

Can you see how difficult it is to create a net worth of 1M$ in 5 years when you start from 203K??? Ouch! According to this plan, my net worth would be 568K at the age of 35. I can say that if I reach this level, I’ll be happy but I won’t be “proud”. However, I have one last Ace in my pocket: my online company! Still… I need the valuation of my shares to rise from $98,000 (as of today) to $432,000. Since I have a partner, I need to be able to claim that my company is worth 864K…. hmm.. is this possible?

Let’s take a closer look and we will see!

Our valuation model is quite simple for the moment: 3 times our annual income minus existing debts + cash. So if I need a value of $864K, I need annual income of $288,000 per year with no debts and no cash. If you divide this number by 12 to reach a monthly income target, we get the round number of… $24,000 per month! In 2011, we made a total of $114,158 or $9,513/month. So this represents a 152% increase over 5 years or an annualized growth of 20% over the same period.

I don’t know if it’s just me but if I break down the number as previously mentioned, it doesn’t seem that difficult. If I consider that my plan this year is to go from 9,5K/month to 15K, I’m already aiming at a 57% increase this year! The worst part is that I think it is quite feasible (not to make 180K this year but to get to 3 months in a row of 15K in 2012).

You can argue that my plan to become a millionaire by 35 is directly related to the valuation I give my online company. And I couldn’t argue with you. However, I will only smile thinking that while I have my day job paying me over 100K per year, I’m doubling my pay check through my online company.

So the race is now on… let’s see if I can make it!!

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Wow!

2012 will definitely be a great year!

I’ll be a father for the 3^rd time!

I’m about to pass the ultimate test with my company!

I’ve been awarded the Best Financial Planner in Montreal within my company for 2011!

And I’ll be working 5 minutes away from my house!

Yup, I got the job of my dreams!

I know, it’s a funny line coming from a guy who advises to quit the rat race ASAP. But when you do something that you love, don’t have to work ridiculous hours and that brings you a very high level of security, it’s hard to spit on it!

Once I go back to work after my paternity leave (which is at the beginning of March), I’ll be starting at my new job.  I had the opportunity to leave for 7 months with 75% of my base income under the paternity and maternity leave program. This was my other plan as I really wanted to see how far I can push my companies. With this promotion, I couldn’t take off for that long but I was able to negotiate 6 weeks of paternity leave prior to starting my new job.

The reason why I’m staying in the rat race

There are 2 big reasons why I’m voluntarily staying in the rat race (with a smile on top of that!):

1-      I’m scared to leave the comfort of a bi-weekly pay check

2-      The job offered is the most exciting and motivating job I could think of

Considering the latter, I’d say that it was a no brainer choice for me. While I’m still in the corporate world where I have to report to a manager, the job itself is made of pure magic! My mandate will be to develop my own book of clients as I’ll be starting from scratch. My main targets are millionaires, which is very interesting as it opens the door to infinite possibilities in terms of financial planning (holding companies, business transfers, estate planning, trust structures, etc.).

The job obviously comes with a healthy salary and a generous bonus grid. What I like the most is that my boss will be in different office 50km away from mine. This means that I’m definitely considered as a true professional and that nobody will follow me to see what I am doing on a daily basis. To be honest, I don’t really work well in an army structure with a “general” . I’m better off left alone so I can unleash my talent and start hunting.

Better lifestyle, lower expenses and a career for life

I’ve made this move for the other 3 reasons mentioned above. The fact that I’ll be working at 5 minutes from my house grants me with a huge improvement in qualify of life. I’ll be able to keep blogging, going to the gym everyday and SLEEP full nights as well! How cool is that?

In 2011, my biggest expense was transportation costs. Believe it or not, but it had cost me $10,000 just for me (I’m not including transportation costs related to my Tribute which is driven by my wife). That $10,000 was mainly gasoline, parking, metro tickets and car maintenance. By switching jobs, I’ll be able to cut this expense to almost $0 which will help me achieve my 2012 financial goal of paying down my debts.

The third reason I picked this job is because it can be a career for life. If I like what I do, I’ll be able to do this for the next 25 years and retire at 55 J. I know very well in my industry that once your book of clients is built and you do a good job (this takes about 4-5 years), the money comes in while you sleep. It’s almost like another source of passive income .

I’m very excited to start this job!

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A few weeks ago, a reader asked me to post about the evolution of my income during my career. Since I have a pretty short work history (I only started working back in 2003!) I hadn’t thought about writing such an article. But when you think about it, I have been able to grow my income by 586% in 8 years, from $30K to $176K in 2011.
 
Did I start to sell drugs in the process?
 
Nope!
 
Did I work over 60 hours a week for 5 years before hitting the jackpot?
 
Nope!
 
Did I have to be a brown-noser?
 
No way Jose!
 
So how the hell I was able to grow my income faster than a 15 year old footballer eats a double pepperoni medium pizza? Keep reading, you’ll get the answer
 

2003 – $30,000 – $37,000

 
I finished my bachelor degree in finance & marketing in 2003. At that time, I was able to get a cool job as a clerk in the back office of a trading firm. My job sounded cool at first as I was dealing with traders to “clear” their trades at the end of the day. It was in the stock options and futures department (also called derivatives). But the sad truth is that it was boring me to death! I could have been asked to paint stop signs red and it would have been more fun! All I did all day was balance numbers in an excel spreadsheet and was desperately waiting for the clock to hit 5pm!
 
After 6 months only, I quit my job and watched TV for 2 weeks until I found a better job for a better salary (from 30K to 37K) in a bank.
 

2004 – $47,000

 
The start of 2004 was a great adventure as I started it by being in charge of a $25M RRSP loan campaign. I was in charge of making sure that everything ran smoothly and that all the loans were approved and disbursed on time. As I didn’t have many employees under me, I did the whole job and was working 14 hour days with no breaks (literally, people were dropping food and coffee on my desk so I didn’t die). I was looking like those Chinese zombies who play World of Warcraft non-stop.
 
2 months of work that gave me my first raise (from $37,000 to $42,000) along with a $5,000 bonus at the end of the year. Man, I was almost at $50K after only 2 years on the market.
 

2005: $55,000

 
I really liked where I was working back then so I continued to hustle hard. My biggest strength was that I was able to do my job and then find ways to improve our processes within my work week (which was 37.5hrs/week at that time). Therefore, I earned my first promotion (with another raise to a base salary of $48,000). My boss liked me a lot because all those improvements in his department were making him look good big time. He was a nice guy so he was sharing the wealth and gave me a lot of tricks to go higher.
 
One of them was to get all my tuition fees paid my employer. This is how I got my stock trading license along with my financial planner courses paid.
 

2006: $61,000

 
Another year, another promotion. This time, I was promoted as the senior of my team. This came with a hefty salary raise (up to $52,000) along with a bigger bonus at the end of year ($9,000). I really like this year at work because I was adding a lot of responsibilities and I was invited to all kinds of important meetings with the big bosses. I was about to join the “big guys” one day. This is when I realized that my sacrifices and hard work started to pay off. I was now known by VPs and my name was getting around.
 

2007: $63,000

 
A year later, I was starting to get bored. I realized that being the senior of my team wasn’t only about its advantages. On the other hand, some people were getting jealous and I didn’t have many friends there anymore. While work became another synonym for routine, I had the great opportunity to go on my first week long business trip.
 
To date, this was one of the best professional experiences I have ever lived. I had the opportunity to go visit much of British Columbia speaking with many very interesting individuals. But when I came back from this trip, I got the bad news that our bank held a lot of commercial paper (also known as ABCP) and that our bonus was going to be cut big time. So even if I had a salary increase that year, my overall income almost stagnated for the first time. I was due for a change!
 

2008: $64,000

 
I didn’t tell most people in my entourage but the real reason why I quit my job at the bank to become a financial planner in 2008 was because I didn’t win a contest at the end of 2007! I know, I can be a big baby sometimes, but I really deserved to win that darned contest. This is why I decided to change jobs in the middle of my MBA.
 
It was a really hard year for me; I had to adapt to new colleagues, new systems and a new job while finishing my MBA. On top of that, it had to be the worst year on the stock market for the past 50 years! Anyways, this job change didn’t bring me much in terms of income and I didn’t perform well enough (I had only 6 months to add assets to my book). This is why I finished the 2008 year with the smallest bonus I have ever had: $2,300!
 

2009: $103,000

 
While 2008 was really rough, 2009 was life changing for me. I was performing like there was no tomorrow and I finished the year at almost 200% of my objectives. In the meantime, I finished my MBA and asked for a sizeable raise due to my performance and my new degree. I was becoming a pillar employee in my branch and the manager wanted to keep me on his side.
 
This is the first year where I started to combine my online income to my day job in order to break the 6 figure income for the first time in my life (at the age of 28!). While my online income wasn’t that much at the time, it was just enough for me to bump up my total income in the major leagues.
 
The biggest change in 2009 was not about my income; it was about how many hours I had to work to make it. In 2009, I started working 4 days a week, so 30 hours a week at my day job. It gave me more time to spend with my family and to work on my online company.
 

2010: $135,000

 
2010 was literally a continuation of the past 2 years as I completed a second year in a row with 200% of my objectives. The bonus was similar (roughly 33K) but I was able to negotiate another income raise based on my past performance. In addition to that, the benefits earned from my online company started to increase at that time.
 
My partner and I decided to pay me for my full day of blogging at the same rate I was earning at my day job (bonus excluded obviously!). This was one of the best decisions we ever took as the business has grown way faster since then. With less than 10 hours/week, we were able to make it grow significantly.
 

2011: $176,000

 
There is not much difference between 2010 and 2011 while the income is larger. In fact, 2011 is definitely the sum of all the good decisions I have made over the past 8 years:
 
- Getting my CFP title
- Completing my MBA with honours
- Moving towards a job where the bonus is linked to my performance
- Working 4 days a week to become more productive at work
- Giving awesome service to my clients
- Concentrating on my online business to generate a steady flow of income
- Focusing on value added actions instead of doing what I had to do
 
2011 is my ultimate proof that when you have a solid plan and work on it for several years, the sum of your actions generates exponential results.
 

What’s next???

 
In 2012, I’m not expecting to make as much as 2011. I think this will be my record year for a few years to come. As I mentioned in my 2012 financial goals, my objective will be to pay off debts and take care of myself. I’ve reached very high level of income quite fast without having to work numerous hours (remember, I worked 30hrs/week at my day job in 2011).
 
I think that the most important part is to do things that you love. This is how you can make money and crush it like I did. My ultimate goal is to stick to the 6 figures without having to work much. I am not aiming for a 250K or 300K salary even though I now know that I could eventually get there. I would rather have a low 6 figure income and enjoy life now instead of waiting desperately until retirement to enjoy it!

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