The 4-Hour Work Week: Escape 9-5, Live Anywhere, and Join the New Rich Hardcover - 2007

Summary

Excerpt

Cautions and Comparisons

How to Burn $1,000,000 a night

These individuals have riches just as we say that we “have a fever,” when really the fever has us.

—seneca (4 b.c.–a.d. 65)

I also have in mind that seemingly wealthy, but most terribly impoverished class of all, who have accumulated dross, but know not how to use it, or get rid of it, and thus have forged their own golden or silver fetters.

—henry david thoreau (1817–1862)

1:00 a.m. cst, 30,000 feet over las vegas

His friends, drunk to the point of speaking in tongues, were asleep. It was just the two of us now in first-class. He extended his hand to introduce himself, and an enormous—Looney Tunes enormous—diamond ring appeared from the ether as his fingers crossed under my reading light.

Mark was a legitimate magnate. He had, at different times, run practically all the gas stations, convenience stores, and gambling in South Carolina. He confessed with a half smile that, in an average trip to Sin City, he and his fellow weekend warriors might lose an average of $500,000 to $1,000,000—each. Nice.

He sat up in his seat as the conversation drifted to my travels, but I was more interested in his astounding record of printing money.

“So, of all your businesses, which did you like the most?”

The answer took less than a second of thought.

“None of them.”

He explained that he had spent more than 30 years with people he didn’t like to buy things he didn’t need. Life had become a succession of trophy wives—he was on lucky number three—expensive cars, and other empty bragging rights. Mark was one of the living dead.

This is exactly where we don’t want to end up.

Apples and Oranges: A Comparison

So, what makes the difference? What separates the New Rich, characterized by options, from the Deferrers (D), those who save it all for the end only to find that life has passed them by?

It begins at the beginning. The New Rich can be separated from the crowd based on their goals, which reflect very distinct priorities and life philosophies.

Note how subtle differences in wording completely change the necessary actions for fulfilling what at a glance appear to be similar goals. These are not limited to business owners. Even the first, as I will show later, applies to employees.

D:To work for yourself.

NR:To have others work for you.

D:To work when you want to.

NR:To prevent work for work’s sake, and to do the minimum necessary for maximum effect (“minimum effective load”).

D:To retire early or young.

NR:To distribute recovery periods and adventures (mini-retirements) throughout life on a regular basis and recognize that inactivity is not the goal. Doing that which excites you is.

D:To buy all the things you want to have.

NR:To do all the things you want to do, and be all the things you want to be. If this includes some tools and gadgets, so be it, but they are either means to an end or bonuses, not the focus.

D:To be the boss instead of the employee; to be in charge.

NR:To be neither the boss nor the employee, but the owner. To own the trains and have someone else ensure they run on time.

D:To make a ton of money.

NR:To make a ton of money with specific reasons and defined dreams to chase, timelines and steps included. What are you working for?

D:To have more.

NR:To have more quality and less clutter. To have huge financial reserves but recognize that most material wants are justifications for spending time on the things that don’t really matter, including buying things and preparing to buy things. You spent two weeks negotiating your new Infiniti with the dealership and got $10,000 off? That’s great. Does your life have a purpose? Are you contributing anything useful to this world, or just shuffling papers, banging on a keyboard, and coming home to a drunken existence on the weekends?

D:To reach the big pay-off, whether IPO, acquisition, retirement, or other pot of gold.

NR:To think big but ensure payday comes every day: cash flow first, big payday second.

D:To have freedom from doing that which you dislike.

NR:To have freedom from doing that which you dislike, but also the freedom and resolve to pursue your dreams without reverting to work for work’s sake (W4W). After years of repetitive work, you will often need to dig hard to find your passions, redefine your dreams, and revive hobbies that you let atrophy to near extinction. The goal is not to simply eliminate the bad, which does nothing more than leave you with a vacuum, but to pursue and experience the best in the world.

Getting Off the Wrong Train

The first principle is that you must not fool yourself, and you are the easiest person to fool.

—richard p. feynman, Nobel Prize–winning physicist

Enough is enough. Lemmings no more. The blind quest for cash is a fool’s errand.

I’ve chartered private planes over the Andes, enjoyed many of the best wines in the world in between world-class ski runs, and lived like a king, lounging by the infinity pool of a private villa. Here’s the little secret I rarely tell: It all cost less than rent in the United States. If you can free your time and location, your money is automatically worth 3–10 times as much.

This has nothing to do with currency rates. Being financially rich and having the ability to live like a millionaire are fundamentally two very different things.

Money is multiplied in practical value depending on the number of W’s you control in your life: what you do, when you do it, where you do it, and with whom you do it. I call this the “freedom multiplier.”

Using this as our criterion, the 80-hour-per-week, $500,000-per-year investment banker is less “powerful” than the employed NR who works 1?4 the hours for $40,000, but has complete freedom of when, where, and how to live. The former’s $500,000 may be worth less than $40,000 and the latter’s $40,000 worth more than $500,000 when we run the numbers and look at the lifestyle output of their money.

Options—the ability to choose—is real power. This book is all about how to see and create those options with the least ef- fort and cost. It just so happens, paradoxically, that you can make more money—a lot more money—by doing half of what you are doing now.

So, Who Are the NR?

qThe employee who rearranges his schedule and negotiates a remote work agreement to achieve 90% of the results in one-tenth of the time, which frees him to practice cross-country skiing and take road trips with his family two weeks per month.

qThe business owner who eliminates the least profitable customers and projects, outsources all operations entirely, and travels the world collecting rare documents, all while working remotely on a website to showcase her own illustration work.

qThe student who elects to risk it all—which is nothing—to establish an online video rental service that delivers $5,000 per month in income from a small niche of HDTV aficionados, a two-hour-per-week side project that allows him to work full-time as an animal rights lobbyist.

The options are limitless, but each path begins with the same first step: replacing assumptions.

To join the movement, you will need to learn a new lexicon and recalibrate direction using a compass for an unusual world. From inverting responsibility to jettisoning the entire concept of “success,” we need to change the rules.

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New Players for a New Game: Global and Unrestricted

'Turin,'Italy'

Civilization had too many rules for me, so I did my best to rewrite them.—Bill Cosby

As he rotated 360 degrees through the air, the deafening noise turned to silence. Dale Begg-Smith executed the backflip perfectly—skis crossed in an X over his head—and landed in the record books as he slid across the finish.

It was February 16, 2006, and he was now a mogul-skiing gold medalist at the Turin Winter Olympics. Unlike other full-time athletes, he will never have to return to a dead-end job after his moment of glory, nor will he look back at this day as the climax of his only passion. After all, he was only 21 years old and drove a black Lamborghini.

Born a Canadian and something of a late bloomer, Dale found his calling, an Internet-based IT company, at the age of 13. Fortunately, he had a more-experienced mentor and partner to guide him: his 15-year-old brother, Jason. Created to fund their dreams of standing atop the Olympic podium, it would, only two years later, become the third-largest company of its kind in the world.

While Dale’s teammates were hitting the slopes for extra sessions, he was often buying sake for clients in Tokyo. In a world of “work harder, not smarter,” it came to pass that his coaches felt he was spending too much time on his business and not enough time in training, despite his results.

Rather than choose between his business or his dream, Dale chose to move laterally with both, from either/or to both/and. He wasn’t spending too much time on his business; he and his brother were spending too much time with Canucks.

In 2002, they moved to the ski capital of the world, Australia, where the team was smaller, more flexible, and coached by a legend. Three short years later, he received citizenship, went head-to-head against former teammates, and became the third “Aussie” in history to win winter gold.

In the land of wallabies and big surf, Dale has since gone postal. Literally. Right next to the Elvis Presley commemorative edition, you can buy stamps with his face on them.

Fame has its perks, as does looking outside the choices presented to you. There are always lateral options.

'NEW'CALEDONIA,'SOUTH'PACIFIC'OCEAN'

Once you say you’re going to settle for second, that’s what happens to you in life.—John F. Kennedy

Some people remain convinced that just a bit more money will make things right. Their goals are arbitrary moving targets: $300,000 in the bank, $1,000,000 in the portfolio, $100,000 a year instead of $50,000, etc. Julie’s goal made intrinsic sense: come back with the same number of children she had left with.

She reclined in her seat and glanced across the aisle past her sleeping husband, Marc, counting as she had done thousands of times—one, two, three. So far so good. In 12 hours, they would all be back in Paris, safe and sound. That was assuming the plane from New Caledonia held together, of course.

New Caledonia?

Nestled in the tropics of the Coral Sea, New Caledonia was a French territory and where Julie and Marc had just sold the sailboat that took them 15,000 miles around the world. Of course, recouping their initial investment had been part of the plan. All said and done, their 15-month exploration of the globe, from the gondola-rich waterways of Venice to the tribal shores of Polynesia, had cost between $18,000 and $19,000. Less than rent and baguettes in Paris.

Most people would consider this impossible. Then again, most people don’t know that more than 300 families set sail from France each year to do the same.

The trip had been a dream for almost two decades, relegated to the back of the line behind an ever-growing list of responsibilities. Each passing moment brought a new list of reasons for putting it off. One day, Julie realized that if she didn’t do it now, she would never do it. The rationalizations, legitimate or not, would just continue to add up and make it harder to convince herself that escape was possible.

One year of preparation and one 30-day trial run with her husband later, they set sail on the trip of a lifetime. Julie realized almost as soon as the anchor lifted that, far from being a reason not to travel and seek adventure, children are perhaps the best reason of all to do both.

Pre-trip, her three little boys had fought like banshees at the drop of a hat. In the process of learning to coexist in a floating bedroom, they learned patience, as much for themselves as for the sanity of their parents. Pre-trip, books were about as appealing as eating sand. Given the alternative of staring at a wall on the open sea, all three learned to love books. Pulling them out of school for one aca- demic year and exposing them to new environments had proven to be the best investment in their education to date.

Now sitting in the plane, Julie looked out at the clouds as the wing cut past them, already thinking of their next plans: to find a place in the mountains and ski all year long, using income from a sail-rigging workshop to fund the slopes and more travel.

Now that she had done it once, she had the itch.

Media reviews

"It's about time this book was written. It is a long-overdue manifesto for the mobile lifestyle, and Tim Ferriss is the ideal ambassador. This will be huge."
—Jack Canfield, Co-creator of Chicken Soup for the Soul®, 100+ million copies sold

"This is a whole new ball game.  Highly recommended."
—Dr. Stewart D. Friedman, Director of the Work/Life Integration Project, The Wharton School

"Stunning and amazing. From mini-retirements to outsourcing your life,
it's all here. Whether you're a wage slave or a Fortune 500 CEO, this
book will change your life!"
—Phil Town, #1 New York Times Bestselling Author of Rule #1

"The 4-Hour Workweek is a new way of solving a very old problem: just how can we work to live and prevent our lives from being all about work?  A world of infinite options awaits those who would read this book and be inspired by it!"  
—Michael E. Gerber, Founder & Chairman of E-Myth Worldwide and the World's #1 Small Business Guru

“Timothy has packed more lives into his 29 years than Steve Jobs has in his 51.”
—Tom Foremski, Journalist and Publisher of SiliconValleyWatcher.com

“Thanks to Tim Ferriss, I have more time in my life to travel, spend time with family and write book blurbs. This is a dazzling and highly useful
work.”
—A.J. Jacobs, Editor-at-Large, Esquire Magazine, Author of The Know-It-All

"If you want to live life on your own terms, this is your blueprint."
—Mike Maples, Co-founder of Motive Communications (IPO to $260M market cap), Founding Executive of Tivoli (sold to IBM for $750M)

"Tim is Indiana Jones for the digital age. I've already used his advice to go spearfishing on remote islands and ski the best hidden slopes of Argentina. Simply put, do what he says and you can live like a millionaire."
—Albert Pope, Derivatives Trading, UBS World Headquarters

“This engaging book makes you ask the most important question that you will ever face: What exactly is it that you want out of work and life, and why? Tim Ferriss is a master of getting more for less, often with the help of people he doesn't even know, and here he gives away his secrets for fulfilling your dreams.”
—Bo Burlingham, Editor-at-Large, Inc. magazine and author of Small Giants: Companies That Choose To Be Great Instead of Big

"Reading this book is like putting a few zeros on your income.  Tim brings lifestyle to a new level–listen to him!"
—Michael D. Kerlin, McKinsey & Company Consultant to Bush-Clinton Katrina Fund and J. William Fulbright Scholar

"Part scientist and part adventure hunter, Tim Ferriss has created a road map for an entirely new world.  I devoured this book in one sitting–I have seen nothing like it."
—Charles L. Brock, Chairman and CEO, Brock Capital Group; Former CFO, COO, and General Counsel, Scholastic, Inc.; Former President, Harvard Law School Association

"Outsourcing is no longer just for Fortune 500 companies.  Small and mid-sized firms, as well as busy professionals, can outsource their work to increase their productivity and free time for more important commitments. It's time for the world to take advantage of this revolution.”
—Vivek Kulkarni, CEO Brickwork India and former IT Secretary, Bangalore;Credited as the “techno-bureaucrat” who helped make Bangalore an IT destination in India

"Tim is the master! I should know. I followed his rags to riches path and watched him transform himself from competitive fighter to entrepreneur. He tears apart conventional assumptions until he finds a better way."
—Dan Partland, Emmy Award-Winning Producer; American High, Welcome to the Dollhouse

"The 4-Hour Workweek is an absolute necessity for those adventurous souls who want to live life to its fullest.  Buy it and read it before you sacrifice any more!"
—John Lusk, Group Product Manager, Microsoft World Headquarters

"If you want to live your dreams now, and not in 20 or 30 years, buy this book!"
—Laura Roden, Chairman of the Silicon Valley Association of Start-up Entrepreneurs;Lecturer in Corporate Finance, San Jose State University

“With this kind of time management and focus on the important things in life, people should be able to get 15 times as much done in a normal work week.”
—Tim Draper, Founder, Draper Fisher Jurvetson; Financiers to innovators including Hotmail, Skype, and Overture.com

"Tim Ferriss’s book is about gaining the courage to streamline your life… But even more than that, it challenges the reader to seriously consider an essential–yet rarely asked–question:  What do you really want from life?"
—Rolf Potts, Author of Vagabonding and Travel Columnist for Yahoo! News

"Tim has done what most people only dream of doing. I can't believe he is going to let his secrets out of the bag. This book is a must read!"
—Stephen Key, Top Inventor and Team Designer of Teddy Ruxpin, Lazer Tag; Consultant to “American Inventor”