The Question That Changed How I Work

Photo by Bethan.

Right now, on my computer screen, I have a little digital sticky note with two questions on it. The font is big; you can’t miss it.

Since I put that note up on my screen I have worked better, more efficiently, and more consistently. Really.

The questions are deceptively simple. Their importance might not be readily apparent. So let’s take a moment to explore why we need these two questions in the first place…

Fear May Be The Mind-Killer, But Distraction Is Pretty Shitty, Too

We live in an age of distraction. Right now, as I type this, there are icons on my computer desktop occupying my peripheral vision, my cell phone has buzzed twice to let me know someone wants to play chess, an alert just appeared notifying me that Evernote has finished syncing, and I got an email.

That’s in the last 30 Seconds.

We’ve all been conditioned to respond to these intrusions into our consciousness. Every time we receive an alert, open it up, and get some new piece of information we receive a little jolt of happiness. This conditions us to feel a powerful urge to check when that alert goes off (“There’s some new information available! About ME!”). 

Meanwhile, those little badges, beeps, and pop-up notifications ensure that, even with the sound off or while away from the device, there’s still a way for it to reach us, to tempt us.

What this means is that it becomes increasingly difficult to engage in full, unbroken focus on anything. We’re scattered, our focus diffused, partially effective on a lot of things but fully focused on nothing.

This doesn’t even count the ever-alluring call of simple time-wasting, mind-numbing internet browsing. One moment of weakness leads to an hour on Reddit, chin in hand, staring blankly at Lol-cats and Karma-whoring stabs at meme humor.

The Worst Part

But you know what the worst part is? The worst part of all these things that break into our consciousness and rob of us focus?

They’re not even fun.

Think about it: can you even really remember the last time you zoned out and just surfed the web? Did you really enjoy it? Maybe you got a few quick hits of happiness when you watched some dude fall off a horse on YouTube, but did you really have fun for more than a few seconds at a time?

If you could zoom out on yourself at that moment, what would you look like? Here’s my guess: slumped over, chin in hand, too close to the screen, eyes glossed over. Is this what fun looks like?

If we’re not getting something done – something we care about, something that gets us closer to what want to do with our lives – and we’re not having fun, then what are we doing? And why are we doing it?

The Question

Back to my computer, and the sticky note.

I fall prey to this stuff just as much as anyone, if not more. I’m pretty plugged in, what with Facebook, Twitter, Last.FM, 5 (Yes, 5) email accounts open at all times, blogs, Formspring, you name it. If I don’t find a way to control it, I’ll spend all day talking about doing things, rather than doing things.

I don’t want to comment on life. I want to live life.

This is why I look up at that sticky note, every single day, and consciously ask myself:

Am I having fun right now?

Is this what I set out to do?

That’s it.

If an action satisfies both criteria, we’re golden. I’m being effective, and I’m enjoying myself. This is the goal, the perfect state to be in – the perfect marriage of action and purpose.

If something isn’t fun, but it’s what I set out to do, we’re good. Not everything in life is pretty. Some days you’ve got to get up and milk the cow. Taking care of your responsibilities, to yourself and to others, is part of what makes a person Good.

If it’s fun, but it’s not what I set out to do – and I mean really fun, as in, enjoyable for more than a few seconds – that’s fine too. Life is meant to be enjoyed. You can’t work all the time, and we live in the Golden Age of Video Games and Television. You’re excused if you take a break.

But if something isn’t fun, and it isn’t what I set out to do – why am I doing it?

Ask yourself the question. Be honest.

It’ll take you a long way towards cutting the bullshit out of your life, and leaving more time for the things you actually care about.

How To Take Total Control of Your Life

This is it. Photo by Parowan496.

This post is a little more personal than normal for this blog, but what better way to kick off Eternal Suffering Society for 2012?

Each New Year, I observe two rituals: an Annual Review (analyzing and evaluating the previous year) and the Setting of Yearly Goals (choosing my direction for the next).

These two rituals, together, are probably the single most important new habit I have ever started.

It isn’t an exaggeration to say that doing these two simple exercises was the difference between feeling unmotivated and helpless and finally taking control of my life.

In this article, we’re going to talk briefly about why goal-setting works, and how to do it yourself. Then you’ll see all my actual goals for this year.

Let’s do it.

A Ship With No Captain

How much of your life do you think you are conscious of?

Think about your environment right now. You’re definitely aware of these words, if you’re reading this. What about all the other sensory input around you – are you aware of the things in your peripheral vision, maybe the things on your desk? What about the quality of the light? The feel of the chair or couch against your body? Are you really feeling the ambient temperature in the room? Are you becoming aware, at this moment, of how your tongue feels in your mouth?

Have you ever walked into your house and completely missed something huge and obvious – a large package in the corner, or someone standing off to the side? The truth is, we’re unaware of most of our surroundings, most of the time. We don’t have the available mental resources to constantly pay attention to everything, so we just assume most things are as usual and pay attention to what’s going on in our own heads.

The same goes for the decisions we make in our lives. We don’t have time to debate the benefits and drawbacks of every tiny decision we make – cream in my coffee? go out or stay in? beer or wine? stay at this job, or look for another one? – so we spend most of our life on autopilot. We react to the immediate thing, the thing that’s happening right now, in front of us, and ignore the rest.

The problem is that this approach is really great at saving energy, but often leads us into situations we wouldn’t have purposefully chosen. We’re like ships with able crews but no captains: great at keeping the boat afloat, horrible at choosing where to go.

This is why setting purposeful, yearly goals – especially at a time when people feel they are “starting over,” such as the New Year – can radically change the way you live your life. You are no longer just moving forward, focusing on the here-and-now. You have a mission, a purpose, something you can compare your actions to and say “Am I doing well, or poorly? How can I improve?”

Setting Yearly Goals

Contrary to my daily/monthly goal-setting process (I discuss practical goal setting in depth in my email course), my yearly process is ambitious and pretty loose. Here’s what I do:

1. Brainstorm things I would like to do, achieve, or get this upcoming year. Be ambitious, but keep within what you think is doable in one year (Making a million dollars if you’re currently making 100 might be too much, but you could definitely double your income). These can be big or small goals. Difficulty doesn’t matter, only whether or not you want to achieve it.

2. Whittle the list to around 10 things. That’s a big list. If you’ve got really big goals, make your list smaller (perhaps 5). If you’ve got smaller goals, 10 is good. I usually have a mix.

3. Convert the goals you keep into concrete, measurable things. “Lose weight,” for example, can be turned into “Lose 15 pounds.” “Be more creative” can be turned into “Record every Saturday” and “Release two albums this year.”

Once you have your list, do the following:

– Save a copy somewhere. Computer, online, in your phone, wherever; just somewhere safe, where you can access it if you need it.
– Take another copy and post somewhere you will see it often. By your desk is a good place.
– Every once and a while, review your goals. Once a month is good. Once a week works, but you’ll probably find that you’ll remember them enough that you won’t need that, especially if your goals are prominent posted.

And that’s it.

It doesn’t look like much. But everything you do, now, has a purpose, a destination. Your actions either take you away from, or towards, these goals. These were the things you chose for yourself; don’t you owe it to yourself to pursue them, rather than whatever the randomness of life chooses for you?

My Own, Actual Goals

I publish my own goals every year, because I like to be open about what I’m doing, and also because public accountability can help you follow through. Also, it’s hard to lose something I posted on the blog, and I lose everything. So.

My Goals For 2012

1. Double my self-employed income. This was by far my best year for making money outside the bounds of my regular job. In fact, it was really the first year I made any significant amount of money on my own. I want to take that progress and build off of it, doubling my income from web design and hosting. To that end I invested a fair amount of the money I made into business training and resources. I’m going for it; this is the year, do or die.

2. Weigh 180 pounds by July. I started last year about 15 pounds lighter than I am now, and that’s a bum out to me. There are reasons – I got injured and stopped exercising, more stress at the job, etc. There are no excuses, however. This is something I have to address, and this is a much more realistic goal than I set for myself last year.

3. Exercise regularly, twice a week. Part of achieving #2. I always try this, and always fail. To beat myself into submission I actually hired a personal trainer to make me go, as well as to help rehabilitate my back (the injury I mentioned earlier). So far, it’s working.

4. Release two records. I went through a long period, after releasing my last record, of not recording or writing at all. That sucks, and so I’m observing a strict recording schedule, good or bad. Two records is certainly doable, but it’s a bit of a reach, considering my usual pace.

5. Get married. I’m getting married in October. It’s more work than I thought it’d be. It also requires a pretty rigorous savings schedule, which I’m observing now.

6. Produce a podcast. This is something I’ve always wanted to do, though I’m not sure why. I’m going to give it a shot.

7. Record label reboot. I’m redoing my record label’s website, online store, and a few business-y things (printing a mailorder catalog, etc). I spent most of 2011 gathering data on what works for us and what doesn’t, and this is the year I streamline much of the process to max out what works and reduce what’s wasteful.

That’s it for 2012. A bit shorter than normal for me, but I’ve got some really major things in there.

Go, today, and do your own. Really. It’s important.

If you liked this post, consider signing up for my free email course. It’s got a ton of really in-depth stuff in there on goal setting and motivation that I think you’d really like. You can sign up over here.

What Gets Measured, Gets Managed: How To Measure Anything and Get Better At Everything

That’s an actual graph of my productivity this week.

That’s an actual graph of my mood. Notice anything?

Lately I’ve become obsessed with metrics. “Metrics” is a fancy way of saying “something you can measure.” Metrics, data, analytics; anything that takes my life and puts it in graph form, I love.

Why the sudden interest in measuring things? As it turns out, measuring your life is the key to improving it. In this post, I’ll introduce the newest movement in self-improvement and show you how you can use it to start improving your own life today.

Self-Management: Why Measurement Works

The latest obsession with metrics and measurement comes from what I’d call the “self-experimentation movement.” This is the self-improvement style most commonly attributed to Tim Ferriss (of 4-Hour Workweek and 4-Hour Body fame).

(A quick caveat before we continue: I realize that many people despise Tim Ferris. I happen to like him. His blog is required reading if you’re interested in where modern self-improvement is headed, good or bad.)

Ferris has done a lot to popularize the measurement-based approach, but there’s more going on here than just one author’s interests. I think a good deal of the recent interest in measuring ourselves comes from an increasingly-scientific view of what makes us behave the way we do. We’ve all become much more comfortable with the idea that our behavior isn’t entirely self-directed – that outside forces and factors influence what we do.

The main reason I’d suggest incorporating some measurement into your life is that it’s an extremely effective tool for achieving goals and improving performance. Simply measuring an outcome has been shown in multiplie studies to have a positive effect on that outcome: weighing yourself and keeping track of your weight each day, for example, has been shown to lead to weight-loss even without any deliberate modification of diet, exercise, etc.

Peter Drucker, perhaps the most influential management and productivity author of all time, coined the phrase “What gets measured, gets managed.” He was talking about business, but the principle applies just a strongly to our personal lives.

Frankly, we all think we know more about what we do each day than we actually do. Humans have been shown to fundamentally misunderstand all sorts of things about their own behavior: how much they drink on average, how many calories they take in each week, how intelligent they are. We are extremely skilled at rationalization: we explain away our mistakes and keep our successes front and center in our minds. We gloss over all sorts of little things, ignoring the cumulative effects of small behavioral changes. We focus on the now, forgetting even basic facts about our past behavior (what did you have for dinner a week ago?).

We’re a mystery to ourselves.

Measurement helps to eliminate this uncertainty, giving us an accurate picture of our present: just how many calories do you take in, on average? How many drinks do you actually have each week?

Measurement has other benefits, however, especially when we’re considering habit-creation (something I’ve been talking a lot about in the email course I’m currently running.) A record of your successes has a powerful motivating effect: a feeling of accomplishment and a reluctance to “break the streak” can help you stay the course when willpower is low.

All this means that, if you’re trying to change a behavior, build a new habit, or just get better at something, measuring your successes and failures is one of the most important things you can do.

Luckily, it’s never been easier.

Useful Websites For Self-Measurement

There are a lot of websites out there for creating, tracking, and analyzing data. I’ll show you the ones I use, and some suggested applications of these powerful tools.

General Data Tracking – Pachube.com

Pachube.com is an API meant to take data from real-world sources. It can be used for everything from tracking geiger-counter readings in Japan to measuring volcanic activity.

Thankfully, it can also be used to measure more mundane things – for example, the number of drinks I have each night.

Yup. That’s how many drinks I had this week (That graph will update each week, by the way.)

Pachube is a complicated application, and it can have a bit of a learning curve. It’s extremely powerful, however, and adaptable to almost any use you can think of. It allows you to create graphs of data in almost any variation you can think up, and observe connections between datasets you might never have expected (you may notice a connection between my mood and the number of drinks I had, for example).

Pachube “feeds” (collections of data) have the added benefit of being editable online or through a handy iPhone app, making data collection simple. The api is also public, meaning that if you’re smarter than I am you could program your scale to update your feed automatically, and so on.

You can check out my public feeds to get an idea of how it all works and see what a mess I’ve become.

Weight Tracking – Hacker’s Diet Online

Screen shot of my Hacker's Diet trends

The Hacker’s Diet is both an online diet guide and a simple web application. The guide is all right, but the web application is pure gold if you’re interested in tracking your weight.

Designed by MIT students, the site is very bare bones – no extraneous graphics, no ad banners. Instead, you’re given very simple tools: pop your weight into the chart that day, add an optional note, and you’re done.

The application takes that data and does a number of useful things with it: it shows you not only a graph showing your weight over time, but provides a “floating average” that helps to take into account things like water weight and daily weight fluctuations. It estimates your daily caloric excess or deficit, and can show you general trends in your weight patterns (as in the chart shown above). You can view customizable graphs that will show you your weight change over specific periods of time, good for isolating periods when you tried new diets or exercise regimes, etc.

I love Hacker’s Diet for tracking weight because it’s minimalist, easy to use, and powerful. There’s even a mobile version of the site; just bookmark the homepage on your smart phone and you’re good to go.

Charting and Visualization – Daytum

Screen shot of part of my Daytum.com page

If you’d like to keep a running tally of something, and don’t need to dig too deeply into the data, Daytum.com is a fun and easy way to track daily activities.

Daytum allows you to create categories and category items that are easily updatable via web or iPhone app. You can then select a display type, and have those datasets displayed dynamically on your Daytum homepage (check out my Daytum page to see an example of how this works).

In effect, this creates a little dashboard for your life. I use Daytum to keep track of more abstract things, things that don’t require a whole lot of analysis: how I felt that day, what I’m stressed about, how many times each week I perform a new behavior I’m trying to turn into a habit.

Tracking Habits – Habit Forge

Screen shot of my HabitForge.com page

You may have heard of the “21 Day Rule” for habit creation – “21 days of consecutive successes before a habit become fully ingrained.”

That’s a nice rule of thumb, though it doesn’t apply to all situations. It’s a good way to measure your progress on a goal – how long have you gone without breaking your streak?

HabitForge is a simple way to track this. Each morning, HabitForge will send you an email, asking if you were successful in observing your habit. Click “yes,” or “no,” and you’re done. HabitForge will track your successes, and start your 21-day timer over if you fail. It also tells you your success percentages, good for boosting confidence when you mess up.

HabitForge is pretty bare bones, and they’d like you to upgrade to get more functionality (the free version tracks only one habit). The simple features of the free version, however, are more than enough, and great for keeping track of the one big habit you’re working on.

You can check out my HabitForge goal to get an idea of what the site looks like.

How Do I Eat? – The Eatery

Screen shot of the Eatery iphone app

This iPhone app is simply the best way I’ve found to track what I eat each day.

The problem with food tracking has always been difficulty – I never know how many calories are in what I eat, I never want to weigh or measure my food, and the existing calorie-counting apps are too complicated and slow to make me really want to pull out my phone at the dinner table.

The Eatery is a great way around all these problems: simply pull out your phone, snap an image of what you ate, and you’re done. The app allows other users who eat like you do to anonymously rate your food on a sliding scale of “healthy” to “unhealthy.” No complicated measurements, no quibbling about calories – just eyeball it.

The average of all these ratings is usually fairly accurate, and The Eatery uses this information to provide a general picture of how you eat – how healthy were you this week? How does that compare to last week, or to the average user? It shows your healthiest and unhealthiest meals, and even pulls together insights like your healthiest and unhealthiest times of day, and where you tend to eat your best.

This is a great solution for those of us who want an idea of how we’re eating, but don’t care enough to spend hours each week counting calories and weighing carrots. Use the data in the app to optimize your existing diet (just eat more of your best meal each week) and gain insights into your own behavior (I, for example, eat the worst when I skip breakfast and drive by fast food on the way to work).

Making Measuring Part Of Your Day

If you’re interested in measuring your own life, you’ll need to remember to actually input the data (not as easy as it seems).

There are two important things to keep in mind when trying to work this powerful habit into your life: regularity and simplicity.

You’re going to need regular points in your day when you input data if you want to be consistent. My two points are in the morning (when I answer my HabitForge email, and when I weigh myself while waiting for the coffee to be done) and in the evening (after dinner each day, when I input data into my Daytum and Pachube accounts).

I find this time enjoyable: I get to sit back and really think about how the day went. I might feel fine right now, but I felt crappy this morning; how does that average out? I can also look back on past data and see how I’m doing. Was today better or worse than average? How am I doing overall?

Your input methods also need to be simple and fast. If it takes too long to get your data down, the likelihood of you skipping it altogether increases. We want our data to be as complete as possible, so try to find a method of measurement that fits into your life as painlessly as possible.

For me, that means almost all of my data goes into my phone. I always have it, and it’s fast and easy. Even pen and paper can be simple: set it up beforehand, have the pen right there on the pad, and put the pad somewhere you can’t miss it.

Measuring your life leads to managing your life, and managing your life leads to improved performance, better habits, and less of what holds you back. If nothing else, it provides insight into your own behavior.

It isn’t always easy to hold the mirror up to ourselves, but it’s always worthwhile.

Giving Up On Discipline: Why Hiring A Coach May Be The Best Way To Achieve Your Goals

Pvt. Stephen Colbert outsources his willpower. From the US Army Flickr feed.

Recently, I made a decision: I need to give up on discipline.

Let me explain.

I’m a pretty motivated guy. This has not always been the case. Many of the posts on this blog detail the many, many ways I attempt to get control of myself, to make myself do the things I know I need to do to move towards what I want in life.

That process is a lot harder than it might seem. I’m sure, if you’re reading this, that you’ve experienced something similar: you want something, you know you need to work to get there, but you don’t. You watch TV, or go out, or do whatever fun and easy thing you want to do instead.

I’ve always believed that this was a part of being human, and that there were any number of ways we could motivate and discipline ourselves to succeed in life. I still believe that.

However, I no longer believe that using willpower and discipline is the best way to achieve everything.

To understand this, we need to talk about the well.

The Well

Imagine you are standing at a well.

The well is quite deep. You can see, by peering down, that it’s filled just about halfway to the top with clear, clean water.

There is a bucket and rope at the top, and you are welcome to draw from this well all you want. In fact, it’s the only source of water for the entire neighborhood, so you’ll need to draw from it quite often.

Throughout the day, you draw from the well. You draw from it for drinking water, to wash dishes and take showers, to water lawns and do laundry. By the end of the day the water level is quite low; it gets harder and harder to reach the water with the bucket and rope.

In the morning, you return to the well to find it replenished. Overnight, ground water has seeped back into the well, returning it to its original state. Once again, you may draw all you wish – but only to a point.

Will Power As A Psychic Commodity

We’ve talked about this before, but one of the single most effective things you can do start understanding and affecting your own behavior is understand that will power is a finite resource.

Much like the water in the well, you use will power throughout the day for all kinds of things: to stop at just two cups of coffee, to not hit your boss right in his stupid face, to smile at the girl you dislike. You also use your willpower for the big stuff: to stick to your diet, to wake up at 5 to run, etc.

Sooner or later, the water runs out. Your will power gets low, and it becomes increasingly more difficult to resist temptations and do difficult tasks. Eventually the time will come when you can’t draw on willpower at all. Thankfully, the well will be refilled in the morning, and your willpower will return.

This leads us to an unavoidable conclusion: you can’t do everything you want.

Kill Your Darlings

In life, we acquire all sorts of ambitions. We want to be an amazing musician, an inspiring painter, have a six-pack, raise a loving family, live in a big house and be rich and travel to Peru.

All of those are awesome goals, and worthy. But each of them has a separate path to success (practice for 4 hours a day; find a studio to show your work; change your diet and workout every morning; spend more time at home; get a second job and start saving; call the travel agent), all of which require willpower.

What will happen if, during the course of our already-stressful and demanding lives, we attempt to achieve all of these goals at once?

Nothing.

Willpower is finite. Trying to do everything – committing our energy everywhere at once – will leave us with nothing. No success, no progress.

William Faulkner once said “In writing, you must kill your darlings.” He meant that all your favorite sentences, characters, and bits of language – all the writery things you are really proud of – need to be cut. It isn’t about you, after all; it’s about the story.

The same applies to goals. We need to make sure that if a goal is important enough to spend time, energy, and willpower on, it’s important enough to spend enough time, energy, and willpower on. That means dedicating a lot of our precious psychic resources to that goal.

We can’t do everything. We have to choose. We have to decide what really matters to us, what fulfills us and profoundly reflects who we are, and then we have to get rid of everything else. We have to kill our darlings.

How I Gave Up On Willpower

Let’s take a moment to talk about my own life, and how I’ve applied this line of thinking.

As I noted earlier, I’m pretty motivated. I’m a goal-driven, disciplined guy; I wake up several hours before work each day to write and answer emails. I have set-aside times each week to write music, to manage the record label I run, to try to make more money. I do these things because they’re important to me, and to my stability in the long-term.

But there are other parts of my life, like my health, that I just cannot seem to get under control. I’m not that unhealthy, or particularly overweight, or anything like that. I just don’t exercise or eat particularly well. I’ve got about ten extra pounds I wish I didn’t have. My father died of a heart attack, and it weighs on my mind. I want to make sure that doesn’t happen to me.

I know that I could die if I don’t exercise regularly. I know it will make me look and feel better if I do so. It’s hard to think of a stronger motivation to take a relatively simple action: go out and run a few times a week, go to the gym and lift weights.

And yet I just can’t seem to do it. I start and stop after a few weeks. I can’t muster any strong feeling about it one way or the other. I know I should, but I don’t, and that’s been the case for a long, long time.

Why is that? There are probably several reasons – human beings are notoriously awful at predicting how we’ll feel in the future, and how much we’ll regret not doing the things we should – but I suspect that a large part of it has to do with willpower.

I spend so much willpower on other parts of my life, always with multiple projects going at once, several things which require my attention and time, that I’m left without enough willpower to get an exercise habit started. If I could just get started, get going with a regular routine and start building an exercise habit, the willpower requirement would go down (habits require very little willpower to maintain, and often require willpower to break). But getting started is the hard part.

So, if using willpower to get started is a losing battle for me, how do I get started? I don’t want to just give up on being healthy.

So, I hired a personal trainer.

That’s right. I said it. I hired a personal trainer.

Even Tiger Woods Has A Coach

When faced with a situation in which you can’t muster the willpower to work on an important goal, you need to look for ways to circumvent the need for willpower.

I’ve talked about this a bit in my on-going email course, and about ways to manipulate your physical environment to decrease the need for willpower and change ingrained behaviors. One thing I haven’t talked about, however, is how to outsource your willpower by hiring a coach.

Who is a coach, in this context? A coach is anyone who has the responsibility of monitoring your behavior, advising you on how to move forward, and holding you accountable for your slip-ups. A coach could be a teacher, a friend, a personal trainer, or even an actual, paid, licensed coach.

There are a few reasons why hiring a coach can be very effective in this kind of situation:

1. Accountability.

Accountability – having other people know what you are supposed to do, and aware if you do it or not – has been shown to be a very powerful motivator. No one wants to look like a jerk to their peers.

I never, ever want to exercise after work; now that I have a trainer waiting for me, however, I’m very unlikely to skip a session. I know that I’d be putting him out, inconveniencing him and taking a step backward on my goal of starting an exercise habit. That’s a powerful incentive to go.

 2. Commitment.

The fact that I am spending money on these lessons is a strong motivation to go. I want to get my money’s worth; I’m already committed, financially, to the decision to start an exercise routine. I don’t have a lot of money, which makes each dollar I spend very important.

Being committed in this way makes it very difficult to pull out or stop. I’ve already lost the money, I might as well get something out of it.

3. No guess work.

Often, when we have trouble moving forward on a goal, the problem is not so much motivation as certainty. We’re often not sure exactly how to proceed, and that uncertainty can make it difficult to get started.

I’ve read dozens of books on exercise and diet, and I have a growing list of possible regimes to try sitting in my Evernote. Which is best? If I choose one, how do I know I’m performing the exercises correctly? What if I hurt myself, or aggravate an old injury? How do I know if I’m making progress?

Having a coach solves this problem. A coach can tell you what to do, and when. They can evaluate your performance and correct mistakes. Having a coach removes uncertainty – you don’t need to do the research, weigh your options, or worry about if you’re doing everything correctly. Just show up.

You’ll also benefit from your coach’s competitive advantage in their field. No matter how much I read about exercise, I’ll never know as much as the guy who went to school for exercise science, has worked out for his entire adult life, has trained hundreds of people and keeps up with all the latest literature in the field. Exercise is what he does. The depth of his knowledge far surpasses mine, which means that I can benefit from all the work he’s done without having to do it myself.

All these factors mean that the willpower requirement for starting a new exercise routine is far, far lower than it would be if I tried to go it alone. Essentially, I have outsourced my willpower to someone else. I no longer need to rely solely on my own willpower to work towards my goal: I just need to concentrate on getting to the gym. Everything else is out of my hands.

If there’s an area of your life in which you’re having trouble making progress, consider finding a coach. Maybe find a friend who’s working on similar goals, and be coaches for one another, holding each other accountable and sharing knowledge. If you can spare the money, look around for people you can pay to hold you accountable (Craigslist is a great place to start for personal trainers and coaches).

Giving up on discipline and investing in a coach can have powerful results.

By the way, I’ve coached some people before. If that sounds like something you’d be interested in, drop me an email. I’d love to hear about what you’re working on.

 

Things Rich People Do: How To Trade Stock Options

Things Rich People Do: How to trade stock options, at www.eternalsufferingsociety.com

This is the first part of a series called Things Rich People Do, in which we obsess about money. Have suggestions for the series? Leave a comment and let me know.

First off, let me get this out of the way: I worry about money. A lot.

I think it’s pretty common, amongst “creative types,” that in our youths we tend not to care about money. Money is for suckers, we think. Go ahead, trade your life away. I’m going to be true to myself, and pursue my art!

That’s awesome. Really. I mean, I did that. However, at a certain point in your life, it occurs to you that if you don’t make some money, a little bit, at least, you’re going to have to work literally forever. And then maybe you fall in love, and get married (how bourgeois, young you scoffs while rolling his or her eyes), and maybe you want kids or even a house to call your own so that you can retreat from the world and paint, or make music, or whatever it is. Or maybe you just want to travel.

As my dad used to say, “money is freedom.” You don’t have to care about money, and more power to you if you don’t. But if you do, it can be profoundly stressful as a “creative person.” Most of us still aren’t willing to just up and join the corporate world; even if we were, that isn’t exactly so secure anymore, either. So what do we do?

That’s what this series is going to be about: what are some ways we can make money and leave time for our creative pursuits? How do we make a living without ruining our lives?

On with the show.

INVEST ALL OF YOUR MONEY IN GREEK BONDS RIGHT NOW

Not really.

I wanted to address something quickly before we get into this topic, which is: why would you want to learn about stock options in the first place?

I initially wanted to learn about the stock market as an intellectual exercise. I am not mathematically inclined. I’m not even particularly logical in my thought processes. Learning this kind of skill set seemed like something that was both within reach (unlike, say, astrophysics) and something that would expand me as a person. Also, Wall Street is a hot topic lately, and understanding how it all works seemed like a prerequisite to understanding the news.

I’m also not going to lie: I’d like to be able to make money on the stock market. Despite the doom and gloom on Wall Street lately, you can still make money in the market, especially if you’re focusing on options (which can make a profit when stocks go up or down, as you’ll see). You could also lose money. A lot of it.

Options, as we’re going to discuss them here, are not a long-term investment strategy. This is not where you put your kid’s college fund: this is an edge of your seat, smoking cigars, scream “BUY!!!!! SELLLLLL!!!!!” into one of those Bobby Brown headset things kind of deal.

I’m learning about stock options specifically because I want to gamble a bit with my money in an effort to make more of it. If that’s not for you, no problem.

Stock Options, Part 1: What are they, and why should I care?

So. What are stock options, anyway?

Let’s start with stocks.

Stocks, as most people know, are shares of a company. When you buy a piece of stock for 10$ in, say, Enemies List, you are buying an actual part of that company. As a publicly traded company, Enemies List would have to listen to the people that owned our stock, and the more stock you owned, the more influence you’d have.

This is important, because if Enemies List does poorly and loses value, your stock will be worth less. If you then wanted to sell your stock, you might only be able to find someone willing to buy it for 5$ a share, meaning you lost 50% of your initial investment. Likewise, if Enemies List did awesome, it’s price might rise to 20$ a share, and you could sell your stock and make some money.

Stock options aren’t actually stock at all. Instead, stock options are a promise – a contract – between two people. That contract states that one person is willing to buy, or sell, stock to the other person at a specific price, at a specific time.

Let’s look at an example (the numbers and such are simplified here).

Let’s say you think Enemies List is going to do really well next month. We’ve been growing steadily, and the trend of our stock price is upwards. Seems like a good investment!

However, you only have 10$ to invest, and Enemies List stock costs 100$ a share.You don’t have enough money to actually buy stock in EL. Bummer.

Instead of buying stock, however, you could buy a stock option. You look online and find one stock option that reads like this (when translated into plain english): “Whoever buys this contract agrees to buy one share of Enemies List at the price of 101$ a share one month from now. The cost to buy this contract is 10$.”

Due to your analysis, you’re pretty sure that Enemies List stock will be worth at least 200$ a share next month. That means that, if you had this contract when the price went up you could buy one share for 101$ (your contracted price) and turn around and immediately sell it for 200$ (the market price), making a tidy 89$ profit (the 99$ you make from the sale, minus the original 10$ for the stock option). You’ve spent 111$ on the contract and the stock, and made 200$, a 180% return on your investment.

What’s more, if you didn’t have the money to actually buy the stock for 101$ when your contract came up, you could sell the contract itself. If the price really goes up to 200$, people will want to buy your 101$ contract. They might pay you 80$ for it, meaning you would make a tidy 70$ profit (80$, minus your original 10$ for the option). You’ve spent 10$, and made 80$, an 800% return on investment.

Stock options thus give you two ways to make money: by buying and selling the stock as stated in the contract, and by selling the contract itself.

An option to buy stock at a certain price is called a call option. When you buy this kind of contract you’re essentially betting the stock price will go up within a certain amount of time. Call options give you the right, but not the obligation, to buy stock at a certain price on or before a certain date.

You can also buy a kind of option, called a put option, that bets the price of the stock will go down. Put options give you the right, but not the obligation, to sell shares of a stock at a certain price on or before a certain date.

What are the benefits of trading stock options?

Stock options have a few benefits that make them attractive to someone like me, with not a lot of money to invest.

1. There’s potential for a lot of profit. Stock options tend to be volatile, meaning that there’s potential for a very high return on investment (anywhere from 10 to 900%, in some cases).

2. Your risk is clear. Essentially, you know what you’re risking with stock options: the cost of the contract. If you spend 10$ to buy the contract, and the stock doesn’t do what you expected, the contract expires. You’re out the 10$, and that’s more or less it.

3. You don’t need a lot of money to start. Options allow you to profit from the rise or fall in the value of stock without actually owning that stock, and at a fraction of the price. Since making a lot of money in stock usually takes time and a high number of stock, stock options can be attractive to those without a lot of money who aren’t necessarily looking for a stable, long-term investment, but are instead looking to learn the market and make money in the short-term.

If this all seems pretty simple, it is…at least, at a basic level. Of course, there are complicating factors which make figuring out the actual worth of stock options more difficult.

Complicating Factors – and/or, Stock Lingo Makes Me Want To Put A Bullet in My Brain

Now, some caveats to the simple picture laid out above:

For one, stock options are also called derivatives. So. There you go.

Stock options give you control over 100 shares of stock. That means that if you used a stock option for buying stock at $7.10, you’re not going to spend $7.10, you’re going to spend $710 (the price of the option x 100 shares).

Not all stocks have stock options. There are various factors which determine whether a company can or should have options, but just know that you can’t buy stock options for every stock that exists.

The price you are contracted to buy or sell a stock at is called the strike price. For example, in the example above we bought a stock option on Enemies List for a strike price of 200$.

Stock options have time limits. Figuring out the impact of time on your option is one of the most complicated factors of the whole business. Remember: a stock option is a contract to buy or sell at a certain price on or before a certain date. Once that date passes, your stock option ceases to exist, just like your membership with Netflix might expire. This means that the value of stock options can change pretty rapidly once you get closer to their expiration date.

Stock options expire on the 3rd Friday of whatever month they expire in. For example, if you purchase a December call option, it expires on the 3rd Friday in December.

Those are the basics of stock options. Next time: how to read stock option reports and how to actually trade them

Did you like this post? Do you want to see more like it? Hate it? Let me know in the comments.

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