If you’re aiming for a life of wealth, happiness, and freedom, it’s crucial to nurture your unique edge, or what we’ll call your "X-Factor". This could be a side hustle that brings in extra cash, or a talent in sports, music, or art that brings you immense joy. Without an X-Factor, life might feel a bit lackluster. Here’s why everyone, even those with the best jobs, should develop an X-Factor. After all, a life spent only working can lead to regret.
In my experience interviewing hundreds of college graduates for finance roles, I noticed a common thread: they were all eager to work long hours to achieve financial independence faster. It’s like an entrepreneur working double the usual work week to avoid a lifetime of 9-5. Initially, making big money requires big work hours. But remember, your 20s are for learning, and your 30s and beyond are for earning!
However, after about a decade in the workforce, enthusiasm often wanes. The daily grind becomes monotonous, and the more money you’ve saved, the less you’re willing to tolerate office politics. Complaints increase, and many start seeking advice on how to negotiate a severance package. Without an X-Factor or sufficient savings, they’re stuck in jobs they despise.
But as we emerge from the pandemic, many of us are eager to move forward. The "YOLO Economy" is ready to be embraced.
I remember my early days on Wall Street, where I doubted I could survive the grueling work hours for more than three years. I saved as much as I could to ensure I had a safety net if I was laid off. I lived frugally, eating free cafeteria food and saving about 40% of my $40,000 annual income after taxes in 1999. My goal was simple: each year I worked and saved 50% of my after-tax income equaled one year of living expenses. My mini-X-Factor was to build enough passive income to buy me time to figure out what’s next.
However, the financial crisis of 2008-2009 derailed my plans, wiping out 35%-40% of my net worth in months. This setback spurred me to act on an idea my father had suggested in 2006: start a website and potentially earn a living as a writer. I finally launched Financial Samurai in July 2009, which became my new X-Factor.
My X-Factor freed me from a career I no longer enjoyed. But it took a financial crisis to get me focused. I hope the global pandemic has inspired many to cultivate their own X-Factors.
If you’re young and considering a career change or trying something new, your X-Factor will give you the courage to make the leap. Here are some tips to help you build your X-Factor:
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Take time to think. Set aside 15 minutes a week to brainstorm ideas. You’ll be surprised at what you come up with.
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Invest in getting started. Don’t let a lack of knowledge stop you. Hire someone with expertise to help you get started.
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Moonlight until you gain momentum. Work on your ideas for a few hours each week until you gain traction. Once you have momentum, you can better calculate when it’s time to leave your day job.
Remember, life is never static. I thought I’d work in finance until I was 40, but by 34, I was burned out. Luckily, I had my X-Factor, Financial Samurai, which has brought me joy and a creative outlet.
Don’t wait until you’re unhappy with your job to start working on your X-Factor. Give yourself an option for when you decide to leave your job. It might take years of cultivation, but having a choice is priceless.
If you still enjoy your job after many years, that’s great! Work on an X-Factor that brings you joy and meaning outside of work. Last year, I focused on becoming the best softball player I could be. This year, I hope to finish a unique and useful book.
In the end, having an X-Factor is about creating purpose and abundance in our lives. Financial independence is great, but it’s not enough for fulfillment and happiness. We all need something meaningful to do every day. So, don’t wait until you’re miserable to cultivate your X-Factor. Start today.
