How 4 hours per week can improve your life
4-hour workweek summary and takeaways from the book.
Climbing the corporate ladder, building a hugely successful business. Investing and getting returns like Warren Buffet.
Why do we actually do it?
Answer! money more money. But let's take a step back, What does money create?
It creates time, mobility and options
The new rich are a group of people who have realized that living like a millionaire doesn't require that one is a millionaire
They have also realized that you can live like a millionaire life without working your ass off until age 65 building a fortune 500 company or consuming millions of annual reports
In the 4-hour workweek book which is written by the entrepreneur Tim Ferriss, we shall learn how the new rich managed to do this at the end of this post. You'll be able to fill in these blanks
Take away number 1:
The step-by-step process of joining the new rich
Create time mobility and options without having an abundance of money. That sounds like a great deal. Am I right? That's why the strategy to get there is abbreviated as DEAL
Life is negotiable: Just because everyone else follows the nine-to-five Dogma doesn't mean that you have to do it too. I hate it the but what if everyone else does so two-argument? Don't worry. Everyone won't be willing to do this, but hopefully, you will
Follow this and you'll be ready to join the new rich in no time
D stands for definition
First and foremost we must redefine the goal of the game that we've been fooled to play for so long Money in itself is not the end goal, relative income trumps absolute income once certain essentials are met more on this in takeaway number 2
E is for elimination
Being busy 24/7 is trumpeted as ambitious but Tim Ferriss disagrees with being busy. All the time is lazy. lazy thinking. To become truly productive which is essential to have a 4-hour workweek. You must eliminate unimportant activities which we'll discuss in takeaway number three
A is for automation
outsource outsource.No more wasting your time with repetitive tasks. If you estimate your hourly to be say 20 dollars. It probably makes a lot of sense to have someone else do it for seven dollars an hour. Morn this intake way number four
L is for liberation
Skiing is better in Italy, Surfing is better in Costa Rica, diving is better in Australia. Why tie yourself down to a single location? In takeaway number five, I'll discuss some of the tips that Tim Ferriss gives for the final piece of the puzzle mobility
Takeaway number 2: Relative income trumps absolute income
Ok, so D is for definition and it's all about redefining how we think about money
Who is richer in your opinion?
The investment banker with an annual salary of $500,000 who works 80 hours a week
or
Be the e-commerce entrepreneur with his whole business on autopilot. Who earns?
$40,000 per year with a 4-hour workweek Tim Ferriss talks about something he calls a freedom multiplier consisting of four variables.
Depending on how many of them that you can control the practical value of your money multiply. They are:
What you do when you do it?
where you do it and
whom you do it with
An investment banker is typically very restricted in these regards, which is why the e-commerce entrepreneur may be richer when we consider what money can do for this person. And here we shall introduce a very important concept. Relative income Trumps absolute income once you have a cash flow that's enough to support your desired lifestyle.
Sure, the investment banker beats the e-commerce entrepreneur in absolute income, He earns four hundred and sixty thousand dollars more per year.
But is this a bit excessive?
the e-commerce entrepreneur beats the investment banker once the time is introduced to the equation as his relative income is $200 per hour versus hundred and twenty dollars for the banker. The investment banker may be able to stack up that five hundred thousand dollar salary for early retirement, But he should question himself on why he wants to do so so that he can move to a nice and warm Paradise Island and just go surfing all day.
Well, the e-commerce entrepreneur can live that lifestyle already he doesn't have to wait until retirement to do so and there's every reason not to save it all till the end
Take away number 3: How to be more productive
What's the difference between being effective and being efficient. Being effective is about doing the right things. Being efficient is about doing things, right? To join the new rich and reach a four-hour workweek. We must focus on the former, remember this
Doing something unimportant. Well does not make it important, It's time to eliminate the activities that are not getting us where we want, There are two great principles to keep in mind here Pareto's law and Parkinson's Law, Pareto's law states that 80% of the effects come from 20% of the causes 80% of company profits come from 20% of the customers, 80% of results come from 20% of effort and time, 80% of consequences stem from 20% of the problems etc.
Our mental energy must focus on this 20%
For example, keep the top 20% of customers happy and put the remaining 80% on autopilot
fire their asses if they complain, In general, keep updating priorities and focus each day on one to two big tasks. Small bad things will happen when you start to ignore certain tasks, but this is necessary to get the big things done.
Parkinson’s Law states that a task will grow in observed importance and complexity. Proportion to how much time is allowed for its completion.
Please I've got to become better at this myself, I've had days when I built the whole website in one day, But I've also had days when I search for flight tickets for a whole day without would even booking one, It's all about deadlines to become as productive as possible.
Cultivate the habit of selling short ones both for yourself and for others,24 to 72 hours is preferred. And if the task seems too big for that chunk it down, This is closely related to the student’s syndrome.
Takeaway number 4: Become the ghost in the machine
What's the greatest obstacle towards management free money
Answer yourself, No matter if you're an employee or an entrepreneur to join the new rich, you must learn how to define and delegate tasks, Replace and multiply yourself, Outsource tasks either to machines and software or to people to have them automated from your perspective
Elimination precedes automation because just like doing something unimportant well does not make it important. Outsourcing something unimportant does not make it important either. But they also go somewhat hand-in-hand. By paying someone else to do an activity for you. You can quickly determine if it's something that should be done or not
Would you pay someone seven dollars an hour to manage customers that you only profit five dollars an hour from? Of course not and It's even crazier for you to handle these customers yourself as you probably value your own time much more than seven dollars an hour. These customers should be eliminated. Not outsourced. Tim Ferriss talks about Geographic arbitraging. It's all about earning in dollars living on pesos and compensating in rupees.
Get a virtual assistant from for instance Fiverr or Upwork for time-consuming and repetitive tasks and remember the following.
Focus on cost per task completed and not cost per hour.
Test you don't know how well you will work with anyone before you try it.
Set short deadlines.
One task at a time.
Apply it try it and hopefully you can multiply yourself down the line making you the ghost in the machinery.
Take away number 5: create unrestricted mobility. Yes, even as an employee
For the entrepreneur, unrestricted mobility follows from eliminating and automating if you start with the right business
An example of such a business is an internet-based one and I’ll have to tout my own horn again.
You can't just tell the boss that from now on you'll be working from the beaches in Rio de Janeiro. No, Instead, you should follow these five steps to gradually allow yourself to pull a disappearing act from the office.
Step 1: Increase investment
Look for courses and additional training available for employees. You want the company to invest as much as possible in you because no one understands sunk costs.
Step 2: Show increased output
Call in sick and do work off-site for a day or two make this period ultra-productive
Step 3: Quantify company benefits
Showcase just how productive you've been during these days to your boss emphasize the company benefits that this has
Step 4: Suggest a revocable trial
Ask the boss for a revocable trial of working remotely for two weeks two days per week. Your fallback plan is one day per week if this request is denied. Again, make these days the most productive ever.
Step 5: Expand the time spent remotely
After success for trial. Gradually increased time spent outside the office in additional trial periods until you don't have to be in the office at all, Swee!t. And that's it for Tim Ferriss 4-hour workweek.
Let's repeat the key takeaways again.
Joining the new rich is a four-step process with the abbreviation DEAL. Relative income beats absolute income once you have enough cash flow to support your dreams. Be more productive by prioritizing tasks and setting short deadlines. Remember Pareto's and Parkinson's Law. Outsource tasks to multiply yourself and become the ghost in the machine. Create unrestricted mobility for yourself so that you can experience everything that the world has to offer.
Are you able to fill in the blanks! please comment.
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Click here to buy the book on amazon.
Happy reading Buddy! Thank you
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