“Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.” – Archimedes
Leverage can be defined as the power to accomplish something, or a strategic advantage. We’ve heard it used in many different ways. Archimedes, assuredly, used it in a much more mechanical/mathematical sense. Financially, it’s been used as term to describe the use of funds in lending and investing. It’s been used in a social way to describe the advantage someone has over another person. But, I don’t want to talk about those usages. I have no current use for moving anything large, haven’t the funds to lend or invest in large enough amounts to warrant leverage, nor, do I have any crazy ideas of leveraging information to advantage one person over another. Instead, I want to talk about leverage in a completely different sense. Leverage as it applies to you, me, and each of us, individually.
LEVERAGE DIFFERENCES
We each have some form of leverage. For some, it’s money. For others, it’s social influence. But, wealth and society aside, we also have one other very important lever that we can use to gain ourselves some leverage. Time. It’s taken me a while to realize that. In our everyday lives, we have the advantage of determining how our time is used.
When I quit my job, I thought that I was quitting because the demands that had been put on me were more than what the job called for. I thought I was doing it because of personality conflicts and conflicts with management style. What I’ve come to realize, several months later, is that, while those other things played a part, one of the biggest reasons I quit was because I was done trading my time for money.
Despite putting in several years (7+) at the company, I had no leverage to show for it. My experience, and loyalty to the company was expected, and I got nothing in return except a small raise every year.
IN THE MOMENT
Now, I spend my time using my time to build something online, with the help of the Yakezie network, that rewards me directly for my time. I’m leveraging my time to build something that will increase in value, increase in reward, and, hopefully, increasingly help those that read it. I’ve learned to leverage my time to increase my fulfillment, and my reward potential. I’m no longer limited by the minimal rewards that the company decides I’m worth. The sky is the limit.
Despite what I’ve just made it sound like, leveraging time doesn’t have to be about reward. At least, not monetary reward. Because I’m leveraging my time for myself now, I also have the ability to do what I want with my day. Sure, most days, I’ll spend in front of my computer just like I did at my old job, but I also have the ability to take the time to drop by the school for lunch with my son if I so choose.
Since I’m not working long hours at each month end, I’m able to go trick or treating with my kids, or, go to dinner with my wife on our anniversary (yeah, we got married on a month end. Talk about terrible planning.) and have it be the right date. In many ways, I’ve traded leveraging my time for money, with leveraging my time for freedom. Sure, I still have to make money, but I have the freedom to do that in whatever ways I see fit.
MOVING FORWARD
Take some time today, and think about how (and what) you’re leveraging. Not only your time, but your other resources. How are you leveraging your money to become better financially? How are you leveraging your talents to improve your way of life? And, is the way that your leveraging yourself true to you? If it isn’t, it’s time to have a serious talk with yourself, overcome your fear, and find a way to leverage yourself towards a better tomorrow.
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Yes I am building both a financial as well as fun social presence. It’s nice when you can do the things you love and get paid for them too.
It’s not only nice, Jai, but I’m beginning to think that it’s necessary. After all, if you aren’t enjoying the things that you are doing, what good is the money they bring?
I am using my opportunities to help me get where I want to go. For so long what I thought I wanted was more money but actually I just want more freedom. Freedom to do the things I enjoy. I don’t mind working but like you stated I have gotten to the point where nothing I do is appreciate but more or less expected. My time is very important to me.
Divorcing money from freedom in terribly important. I’ve always thought that to some degree, but even more so now that I’ve made a giant step towards a full separation of the two.
Nice overview of the advantages of financial freedom-not necessarily wealth by the standard definition, but the ability for YOU to decide what’s important for you, rather than a third party. Good luck!
Self-employment isn’t going to be for everyone, but being able to make the choice of whether you are going to continue doing what you are doing, or leveraging your time in a more efficient manner is available for everyone.
This was an excellent post- I know so often we hold onto jobs simply because they’re easy but not because they utilize our strengths and help us build a name for ourselves. Sadly, many employers don’t want to utilize our strengths or help us develop leverage since we could use it to ask for more money or take away some of their power! At my old job I experienced this- they wanted me to give 110% but in the prescribed areas, not in a way that could be brought up with corporate to complain that I had been paid what I deserved..they kept me running on a hampster wheel at full speed without giving me ways to really show off what I could contribute. I had to leave!
I am so much happier now that I’m working for myself (and consulting with a company) that earns me more but I can express my thoughts and contributions without being censored out of fear or bureaucracy.
For anyone out there- LEVERAGE THE HECK OUT OF WHATEVER YOU’VE GOT! Whether it’s being fun on Twitter, having writing skills, being good with Photoshop- if you’re not playing it up even as a side hustle, you’ve gotta give it a try,it’s fulfilling. Great post!
Part of my plan, when I quit, was that I could always find something else should the need arise. That’s still part of my plan, I guess, but the longer I’m without, and the more I think about it, the less I like the idea of ever going back to work for someone on a full time basis. You also bring up another interesting thought. Freedom isn’t necessarily the ability to do whatever you want with your freetime, but to also do whatever you want with you work. It’s a balance that is severly upset in many peoples lives.
@Shannyn It’s funny what you say about companies wanting you to give 110% only in the prescribed areas. I no longer work for my previous employer and it is all because of what I’ve achieved through my efforts online. The funny part is that about 18 months before I left they began an online campaign. They freshened up the website, started using Adwords and tried to develop a social presence. During this time I was asked for my input, but when I approached them to be part of the new team I was denied, stating I was more valuable where I was on the tech side of the business and that the job of promoting the website would be a marketing function. This despite the fact that I was able to show them the successes I already had working in my spare time.
The nice part is that I am no longer working for that company and their online presence is still mediocre. It just boggles the mind that when given a chance to leverage what they already had this company turned it down for political reasons. Especially since the company is quite small (under 100 employees) and one would think that they could be agile and easily adapt to new ideas.
I’m having the best time of my working life now that I no longer have to let others determine my “value” to the company.
My company had a few more than 100 employees, but they were trying their hardest to become a “corporation”, so outside advice that didn’t come from a paid corporate consultant wasn’t taken with any seriousness. They had (have) a serious case of the “if it isn’t expensive, it isn’t any good” attitude. Congratulations on getting out of your situation. I too, am loving it now!
Great point BB – there’s no point in having something if you’re not going to leverage it! Keep finding your skills and then finding ways to turn them into cash!
Absolutely. And, keep in mind that everyone has more than one skill. We aren’t one-dimensional, so you don’t have to earn all your income from just one skill!
excellent post. one of my favorite sayings of all time: “do something you really enjoy doing, then find someone to pay you for doing it”
Another that I’m particularly fond of is the one that goes something like “Make your Vocation, your Vacation”. It doesn’t work for everyone, but if you’ve got the freedom, you can certainly bring elements of your “vacation” into your “vocation”.
Brilliant post! I really like the whole idea of leverage. Once I started using it to weight positives and negatives in decision making my life improved drastically.
I think that using it that way really helps to put everything into perspective a bit and drive us towards the right choices.
The problem with time is you only have a limited amount. How much are you willing to spend that time trying to please other people? Lately, I found that I’m not willing to do that anymore.
Exactly. You’ve gotta live like you’re dying. Because, you are. It sounds a bit morbid, but the truth is that we’re all on a limited time schedule, so why waste so much time on things that won’t get us anything more than a bit of money?
I hear you on this. When you hit 40, I can’t imagine people will have the time or patience to deal with as much crap as before.
The concept of leverage in comparison to your employment was powerful. I completely understand putting in considerable time and effort into a job only to find you have little leverage at the end of it. Ownership and investment into that company can provide leverage, but that is not an option for most employees. I am working to leverage my time and abilities into something I own and am responsible for.
Most companies make the mistake of seeing their employees as resources, like printers and computers, instead of seeing them as humans who have dreams, lives, and feelings. It’s easier to just hire some new fool off the street than it is to try and make an employee feel like a part of the company family. I think that leverage also means having some feeling of purpose, and if you’re only percieved purpose is to fill a seat and make the computer do it’s work, you won’t be long for the position.
“Every Day I’m Leveraging” is the new “Every Day I’m Hustling.” (scuse the Rick Ross reference).
My talents are about all I have to leverage at this point, but at least I can’t lose them in market crash.
And, now that song is stuck in my head. Thanks, John. ;) Our talents are all we really ever have to truly leverage. Everything else can be taken from us. Leverage based on talents is the best leverage there is!
Ha – sorry about putting that song in your head! I’ve been humming it for about two days now
I definitely agree that working for yourself may allow you to leverage your time better, especially when it comes to spending time with your family and utilizing your personal resources better, but I also believe there is a trade-off to some degree.
You may not have as much leverage at a company, as all employees are expendable in the end, but you do probably have more stability with a steady paycheck, benefits, insurance, etc., which might mean less stress to that end for you and your family.
Whereas working for yourself allows more freedom to leverage your own time directly and create something that hopefully increases in value, there is somewhat more risk involved and more aspects that you can’t control, which can threaten your ability to utilize your leverage in the end.
I don’t think working for someone else is necessarily giving up your leverage, it’s just deciding that the trade-off for your time is better in one situation than another (If you read Sam’s previous article on Facebook employees, they may have leveraged their time pretty well in the end and their company dedication is paying off for them in that situation).
It’s all relative on how much you love your job and what you do, plus nothing is guaranteed either way, as you could lose your job tomorrow.
That’s definetly a good point, Max. For me, the demands that were being put on me were way more than they should have been. Combined with the lack of any leverage at all, and it was a bad situation all around. I don’t know that using your leverage necessarily means that you have to be self-employed, but you certainly have a lot more control over how much leverage you have, and how it’s used if you are. Find the right company that treats it’s employees as more than resources, and I think it can be a good situation too.
I need to build up my leverage still, but I plan on leveraging everything for my time. There is not guarantee how much time we have, so I want to spend it doing what matters most, which luckily for you you are now doing.
It is very good to hear you are now making the most of your time.
Exactly. I think more and more people are beginning to see that now, and the dynamics of “work” are starting to change to conform to that. Good luck in your ventures!
I’ve used financial leverage in the past to buy hotels. At one time, I used to own three large hotels. With the real property, you can use leverage wisely to buy property and sell it with huge profit. But, I agree with you that everything we do in life leads to one and only one purpose — to achieve happiness. And, time is the best leverage to achieve happiness.
Maybe you would agree with me too, when I say that leveraging your time in a beneficial way can lead to opportunities to leverage other things in a beneficial way.
I think this is by far one of my favorite posts! Very well written! Congratulations on taking a risk and investing in yourself!
This was why I left being an investment banker and moved on to civil service. Investments were fun and I earned more, however, I was working 5 to 6 days a week and seemed to never have down time. I also learned that my passion was real estate. I now work for the government 3 days/week (I actually really like what I do and the pay and benefits are great) and I spend the rest of my time with my 14 month old, building my site, and purchasing more income properties. My properties have allowed me to build some awesome passive income and that’s the entire reason I got into being a landlord.
I value my time with my family more than anything! Even though I really like my job, they cannot pay me enough (yes even if it is $500k/year) to work for them forever. My plan is to retire in 5 years and have my investments in real estate pay for my lifestyle. Passive income from my site with be a nice addition but I’m not counting it in my calculation (a little more risky than rental income).
I want to enjoy wathcing my son grow, take him places often, not have excuses to miss his games, and more important teach him how important it is to stop and smell the roses. I think too many of us just go through the motions and not stop and think this isn’t a freakin rehearsal, it is the real deal! One shot, one chance!
Taline, how long were you an investment banker for? It’s a rough life I know. Are you sure you could quit if they were paying you $500,000/year? That would be hard to do. Wouldn’t it be better to earn that for 5 years, and then retire?
Hey Sam,
For under 2 years and it really wasn’t my cup of tea ;) Five years I would definitely do it! What I was trying to say was that I wouldn’t do it forever regardless of what price tag they put on me. I wasn’t making $500K but I wasn’t too far from it either. The problem was I would have to stay at it for at least another 5 years to reach a nice salary and the opportunity cost was too high for me.
What I really wanted to do was have the down time to research real estate income property and make some purchases. Although I was making good money, it wasn’t going to allow me to make the investments I wanted. I also really don’t like working for anyone or reporting to work (I swear I’m not lazy, just self-motivated). So my switch to 3 days/week was exactly what I needed. I really feel had I stayed in the industry, I wouldn’t be where I’m at today.
I guess what I should state is that I know at least 10 other real estate investors and the majority retired prior to 40 and none took longer than the age of 45! Pretty inspirational! One of my friends makes an unbelievable $80K/month in net income! I will say that he had the help of his parents who were real estate tycoons, but regardless they showed him the way and he was kind enough to give me some insight.
Gotcha.
Ahhh, it’s always helpful to have real estate tycoons as parents to get rich!
Yes it sure is! To a question you asked me on my site…the most elite local agency of course!….LAPD baby! :)
The time with the family thing is what really did it for me. The demands on my time should rarely interfere with my family time. When they do, it becomes a problem. Now, if I miss something it’s because there was something that was beyond important enough to make me miss it. Not just something that came up at work.
At the time I made the career switch, real estate investmenst were my top priority. I also knew someday I was going to get married and start my own little family. I didn’t want my kids to grow in daycare. I’m not knocking it, just grew up old school and I believe the most important investment we can make is in our kids. I’ve seen all too well what happens to those whose parents really didn’t care.
I realize some may feel they have no choice. I disagree. I think you can change anything if you really want to. Where there’s a will there’s a way? In either case, my driving factor now is my family. I love my son more than words can describe and I’m willing to exhaust myself now to reap the benefits in a few years :)
Great job living the dream man! I am glad I have a job (teaching) where I only feel like I am trading time for money once in awhile. Today I had a student rush up to me full of joy because she had won a big scholarship (75K) that I put her up for. Stuff like that allows me to endure the garbage parts of my job. All the same, I hope to be mostly retired, or working many less hours a week by the time I hit 40. Too many things to do and see in life to spend trading my labour for most of it.
I think that teaching is one of those vocations where there is such a high potential to use your position to better the world, and I can see it being a high reward job sometimes.
Your post sounded more like a work/life balance. As a teacher, I normally do not have much leverage, however I am using my past CFO experience to increase my value. I am heading the budget committee. This and other things increases my value to the organization. This is what everyone should do to increase leverage.
Absolutely, take advantage of whatever ways you can to leverage yourself at your work. The problem is that when, instead of gaining leverage by doing those things, you are taken advantage of.
I’m so happy I took the leap to blog part-time. I was scared about a lot of things which made me hesitant to get started, but boy am I glad I got over my fear. My life is so much more rewarding and I’m learning so much. I’m not making that much extra money yet but I’m sure if I keep it up things will start to pick up.
I’m very happy that I took the leap too. May we both realize our full potential!
BB – I’m pumped for your new adventure! Do keep us regularly posted on how it goes. I’d love to know more about your mood and happiness levels 6 months and 1 year in. I hear from everybody who’s gone solo that it’s all cookies, and that it’s impossible to ever go back into the corporate world.
Best, Sam
I second this. I’m curious to know more down the road, and also have heard only good things from others, good with the bad but good overall. :)
I’m pumped too, Sam. I’ll be doing rather regular updates. So far, I’m liking it quite a bit, but haven’t yet had a cookie! ;) I wouldn’t say that it will be impossible to go back to corporate, if I should decide I need to, but I think the difference is that once you’ve gotten out, you realize that the corporate world isn’t the only world there is, despite what we’re all brought up to think in school.
I am always try to improve my life and my situation. I work really hard with everything I do. In fact I have been called an over achiever more than once. I guess I am just worried that I won’t do enough with my life before it is over. Life is short and I want to max it out. I think trying to find balance in all the things you enjoy as well as work hard at the things you want to accomplish is a good way to live. Bottom line is that your life needs to be fulfilling and rewarding or it will just be one big regret later on.
Absolutely, Miss T. For some, the corporate environment and the “fancy job” gives them that fulfillment. I just realized that it wasn’t for me. Or, at least, it wasn’t the only road that I could travel.
This really got me thinking. I studied physics and mechanics in college, and while I’ve applied it to a lot of things, I don’t think I’ve ever applied it directly to my skills or time. Since I’m having such a suckfest in the time management department, I think I’m going to sit down and write a flow-chart of my own, adding in all of my skills and resources to better accomplish my goals…hopefully keeping my sanity.
Yes. Do that! I think we all spend so much time applying our learned skills to our “work” that we forget to apply them to ourselves and our time as well.
I really like this post. I think it’s important to be honest with ourselves, and come to terms what makes us happy, what gets us excited – as well as what our strengths/weakness are, etc. Then we can be in a position to determine how to use leverage.
Using leverage is smart. It can apply to different situations as you allude to. You got me thinking about how I can leverage my own skills a bit differently.
Absolutely, Squirrelers! I think, also, it’s about not being content with the same ol’, same ol’, and trying to improve ourselves at all times.
I’m spending my time to build up my blog and make it as great as I can, improve our finances and better myself. Great post, it was very inspiring. :-)
Thank you.
I think the concept of leverage really boils down to making the logical decision rather than one based on emotions. Of course, it’s easier said than done though.
Great post, BB. Having lunch with your son at school is one of those things that can’t be bought.
I’m leveraging my life experiences in my blogging. I’m leveraging my education and work experiences in my job everyday. I’m leveraging my emergency fund in the bank to bring me peace of mind and lowered anxiety. I’m also leveraging my passion to do something great someday by getting into the blogging community, joining the Yakezie challenge and networking with all of you great people. What a great post. Thanks a lot!
It would be ideal to be able to make a living through an online business, however we don’t all have the luxury. I first need to build up my site before I can start making any money off it. But how will I know when I’m ready?
totally love the analogy. Leverage is a great term. But, I think the necessary effort to build a sustainable income online requires an overabundance of time!!! Or the brilliance to fill an unsusual niche.