He Tried 30+ Side Hustles Before 3 Actually Paid Off, with Cody Berman

Summary

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Podcast Summary: Afford Anything | Get Smarter With Money

Episode: He Tried 30+ Side Hustles Before 3 Actually Paid Off, with Cody Berman
Host: Paula Pant
Guest: Cody Berman (Author, Retire By 30)
Date: July 24, 2026
Main Theme:
What does it actually take to reach financial independence (FI) at an early age—especially through relentless experimentation with side hustles? In this episode, Cody Berman details how he reached FI at 25 after testing over 30 side hustles, living intentionally below his means, and distinguishing between two organizing philosophies of financial independence: “nest egg FI” and “cash flow FI.”

Overview

Paula Pant interviews Cody Berman, who became financially independent at just 25 after years of “whole hog” hustling. Cody shares how trying out more than 30 side hustles—many of which ended up in his "side hustle graveyard"—taught him the value of scalability, diversified income streams, and persistent optimism. The conversation revolves around frameworks for building wealth, habits for maximizing the gap between income and expenses, and actionable takeaways for anyone looking to fast track their own journey to FI.

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Key Discussion Points & Insights

1. The Two Types of Financial Independence Frameworks

[04:47]

• Nest Egg FI ("Net Worth Approach"):
  • Classic strategy: save 25x your annual expenses (the “4% rule”).
  • “You’re spending $60,000 a year... you need $1.5 million invested to then ride out to the sunset.” – Cody (03:27)
  • Relies on drawing down principal from investments.
• Cash Flow FI:
  • Requires generating enough monthly, mostly passive income to cover all expenses.
  • “Now they just need to figure out how to get $5,000 per month or $60,000 per year in cash flow... from real estate, small business, digital products, whatever they want.” – Cody (03:27)
  • Often more psychologically comfortable because “you’re not actually drawing down principal.”
• Inflation Hedge:
  • Cash flowing assets (like real estate) often rise with inflation, protecting buying power.
  • “If you’re owning assets that are inflating with inflation… it’s a better hedge against your financial independence plan going awry.” – Cody (05:08)

2. Cody’s Path to FI: Relentless Side Hustling

[08:13]

• Early FI Milestone:
  • By his mid-20s, Cody had $500k in the stock market, 13 rental properties ($3,700/month net cash flow), and a digital products business ($10k+/month passive).
• Insatiable Hustle:
  • Used a brutal 3-4 hour commute to build side hustles: “If his eyes were open, he was either at his day job, or building a side hustle.” – Paula (00:00)
  • “That time on the train… was a forcing function.” – Paula (09:37)
• Living Aggressively Below Means:
  • Deliberately kept personal expenses extremely low, double-downed on investments, particularly in income-producing assets and businesses.

3. The Four Side Hustle Frameworks

[14:56]
Cody buckets side hustles into four types:

1. Type 1: Trade Time for Money – Freelancing, gig economy, manual labor, etc.
2. Type 2: Scalable Side Hustles – Upfront work for long-term, passive-ish payouts (e.g., digital products, rental real estate, YouTube).
3. Type 3: Sharing Economy – Earning through assets you already own (Airbnb, Turo, renting tools, etc.).
4. Type 4: Hybrid/Agency Model – “Agency-fication” of skills; building a business that employs others for scalability.

“Those are the four types of side hustle frameworks that I like.” – Cody (17:02)

4. The Side Hustle Graveyard & Learning Through Failure

[37:15]

• Over 30 Side Hustles Tried:
  • From freelance writing, video editing, buffing boats, house hacking, Disc Golf manufacturing, to Uber Eats bicycling in Australia.
  • “I have a very filled side hustle graveyard, if you will. But they all taught me something.” – Cody (36:33)
• All Failure is Learning:
  • Each ‘failed’ attempt honed a new marketable skill later used to earn or diversify income.
  • “If that first side hustle never happened, I don’t think I would be doing that next side hustle.” – Cody (37:15)

5. How to Know When to Quit or Pivot

[62:24]

• Side Hustle Timelines:
  • Recognize the difference between time-for-money gigs (easy to drop) and scalable businesses (require patience and consistent investment of time/money).
  • “Way too many people give up way too early… I didn’t make a sale for months.” – Cody (62:24)
• The Marshmallow Test:
  • Highlights the role of delayed gratification and patience—cornerstones of the FIRE movement.

6. Building the Gap: Income vs Expenses

[52:26] [54:45]

• Maximize the Gap:
  • “The gap is the most important metric on your journey to financial freedom, bar none. Especially at the beginning.” – Cody (52:26)
• Cody’s Personal Numbers:
  • Year 1: $96,000 income, $24k expenses
  • Year 2: $198,000 income, $24k expenses
  • Year 3: $403,000 income, $24k expenses
  • “All of that was possible because I had this massive gap between what I was making and what I was spending.” – Cody (54:40)
• Short, Intense Sprints:
  • A few “crazy years” of high gap can create enough runway for life.
  • “You only need a couple crazy years… Three crazy years for me to hit fi.” – Cody (55:12)
• Strategies:
  • House hacking, frugal car use, intentional grocery spending, travel hacking.
  • Paula: “Expenses of two grand a month… for three years?”
  • Cody: “Combined [with spouse]." – (69:42)

7. Skills Stack & The Timeless Value of Learning

[44:41]

• Skills as Future Currency:
  • “They can never take your skills, they can never steal your skills from you.” – Cody (45:39)
  • Stay ahead by learning what wealthy individuals/companies don’t know how to do.
  • “Identify what the big players, what the rich folk, what big companies are doing… and then figure out how you can learn that.” – Cody (50:09)
• AI & Skill Acceleration:
  • AI won’t eliminate skilled work; it enhances productivity for those who learn it.

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Notable Quotes & Memorable Moments

• On Asset Ownership:
  • “Your money can work harder than you can. It’s like a necessary premise for this whole thing.” – Paula (21:10)
• On Perseverance:
  • “If you don’t give up, you can’t fail. You just keep pivoting until it works.” – Cody (36:09)
• On Opportunity Cost:
  • “Doing the right things consistently over a long period of time is what makes results happen.” – Cody (68:10)
• On the Power of Community:
  • “You don’t have to hang out with [role models] every Tuesday. They could be in your earbuds… while you’re driving to work.” – Cody (22:48)

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Timestamps for Enriched Listening

• 02:42 – Cody introduced; reflects on discovering FI and his hustle to early independence.
• 03:27 – The two financial independence frameworks: Nest Egg FI vs. Cash Flow FI.
• 08:13 – Cody’s actual “FI calculation” and assets at the point of financial freedom.
• 14:56 – The 4-bucket framework for classifying side hustles.
• 37:15 – The value of trying and “failing” at more than 30 side hustles.
• 52:26 – Maximizing the gap: the engine of early wealth accumulation.
• 62:24 – When to quit or double-down on a side hustle.
• 69:42 – “Extreme” frugality specifics: household costs, health insurance, and house hacking.

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Key Takeaways

1. Frameworks Drive FI—Choose Your Path
   • Understand and choose between Nest Egg FI (classic 25x expenses) vs. Cash Flow FI (income from assets covers expenses). The psychological freedom and practical flexibility of cash-flowing assets can’t be overstated.
2. Maximize—and Sustain—The Gap
   • Serious wealth-building hinges on the size of the gap between your income and spending. For most people, a few relentless years can do most of the heavy lifting.
3. Embrace the Long Game of Scalable Side Hustles
   • Most scalable hustles don’t pay off for months (or more), but if you don’t quit too soon, their compounding long-term returns can be life-changing.

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Further Learning & Connect with Cody

• Book: Retire By 30 – retireby30book.com
• Podcast: The Financial Independence Show
• Social: @codydberman
• Afford Anything Free PDF: affordanything.com/FIRE (with two I’s, for the five pillars)

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This summary encapsulates Cody Berman’s journey, the value of frameworks, the reality behind his rapid FI, and real-world advice for side hustlers and aspiring FI’ers. If you’re hungry for more than surface-level personal finance, this is a must-listen (or at least, a must-digest) conversation.

Transcript

[A]

Cody Berman was 19 when he first learned about passive income and 25 when he reached financial independence. He is a regular guy, just like any of us who hustled really, really hard. Cody is a dude who hustled super hard and lived below his means and reached financial independence at an aggressively early age. 25 years old, he. He tried everything under the sun. I mean, you name it. All of the Internet tactics that are out there, he's tried every single one. And you're gonna hear about that in our upcoming conversation. He is now the author of a book called retire by 30 and it's all about how you can fast track your approach to reaching financial independence. He also talks about two different ways that you can reach financial independence. There's the saving 25 times your income or, or there's also what he calls cash flow fi, which is a different form of financial independence. We're going to unpack all of that in this upcoming conversation. Welcome to the Afford Anything podcast, the show that knows you can afford anything, but not everything. This show covers five pillars. Financial psychology, increasing your income, investing, real estate and entrepreneurship, acronym Double I Fire. I'm your host, Paula Pant. I trained in economic reporting at Columbia and. And today we are joined by someone who learned about financial independence at a young age. He was again 19 when he first learned about all of this. Decided he was gonna go full force, whole hog. First job out of college, he was commuting on the train, on public transit, working his side hustle during his commute to and from work, working pretty. If his eyes were open, he was either at his day job or building a side hustle. Again, he tried everything under the sun. He'll tell you the story in this upcoming conversation. Tried digital products, bought real estate. I did it all. And through a lot of hustle and a lot of trial and error and living very, very, very aggressively below his means, reached financial independence as early as possible. So you're going to hear him talk about that experience and you're going to hear reflections now that he's a bit older and he's got some time to think back on what that experience was like and he's got the benefit of hindsight. Would he do it again? Would he recommend it to people who are just starting Today? We're going to cover all of that and more in this conversation with the author of retire by 30, Kody Berman. Hi, Kody.

[B]

Hey, Paula. What's up?

[A]

Thanks for joining.

[B]

I'm ecstatic. I've been listening for a long, long time. Afford Anything was One of those podcasts that I started listening to when I first started my financial independence journey. And now being on the other side. It's so cool to be here.

[A]

Oh, my. I'm so honored. I'm flattered that we could have made that kind of an impact.

[B]

How long have you been doing the podcast for?

[A]

10 years. Started January 2016.

[B]

Okay. So, yeah, I was probably late 2017 listener. So I've been listening since the beginning.

[A]

Wow. Amazing. You have a really great framework of how to think about two different types of fi. I don't want to steal it from you, so I'll let you describe it, but it's a really good organizing principle around how to think about net worth in general.

[B]

So there's two main ways to hit fi. There's the net worth approach, or the nest egg approach, I should say, and the cash flow approach. So with the nest egg, this is your typical save 25x your expenses, the 4% rule, if you will. It's like all the OG Fire content is about that, right? Okay. You're spending $60,000 a year, 60 times 25. You need $1.5 million invested to then ride out to the sunset, and you never have to work again. There's this other way to hit fi called cash flow fi, and some real estate folks like yourself are probably more familiar with that route. But with cash flow fi, it's saying you just need to generate enough passive or mostly passive cash flow each month from your assets, from your business, from whatever it could be real estate, could be digital products. It could be a small business that that covers your bills and more. I know a lot of folks that I've talked to that I've interviewed, they've gone this, like, cash flow by approach. And this was new to me back when I started listening to the podcast, like, it was all just 25x4% rule. But then I met people who had done it via real estate in, like, two years or in five years, and I'm like, what the heck? How are these people getting to financial independence so fast? It doesn't make sense. And it was because of this cash flow fi idea. So that same scenario where they're spending $60,000 a year, they no longer have to accumulate $1.5 million in assets and use that to fund their lifestyle. Now they just need to figure out how to get $5,000 per month or $60,000 per year in cash flow from real estate, small business, digital products, whatever they want, right?

[A]

And so breaking it up into those two categories, Nest Egg 5 versus Cash Flow 5. It sounds intuitive in hindsight, but I've been talking about this for 10 years, and I've never thought to use that as an organizing framework.

[B]

And the cool thing about that, I know you talk a lot about inflation. I've heard a lot of people have concerns about inflation in your Q and A's especially.

[A]

Yeah.

[B]

And if you go the cash flow route, like, if you're owning assets that are inflating with inflation, like, it's a better hedge against any downturns, or it's a better hedge against your financial independence plan going awry versus, like, you know, just the 4% rule. Even if you don't want to do just cash flow Fi, having some kind of diversification. So having a couple rental properties or having some small business that you own, part equity stake in, like something on the side that can kind of hedge and can kind of buffer if there is a big market downturn.

[A]

Right. And the other piece of cash flow fi, is that your quote, unquote, your drawdown, so to speak, is just the income that it's generating. You're not actually drawing down principal, whereas with nest Egg fi, you are making withdrawals. Yeah. It's psychologically a lot harder to. To make withdrawals, especially if you are in the mindset of being an accumulator. Yeah.

[B]

And I've heard this from a lot of people from folks who have hit FI and folks who have had big exits. Like, I have friends who have sold their companies for seven, eight, even some even nine figures, and they felt richer when the cash flow was coming in from that company versus when they sold it and they had that big amount in their bank account. Because it's scary. Like, when you're sitting on a big pile, it is scary to spend that down. That's why I'm so drawn to cash flow fi, is because I'd much rather live off my cash flow than sell away my investments to me. I don't know, maybe it's because I have a scarcity mindset, but psychologically, it's a lot easier to cope with.

[A]

Right. You reached FI through starting a bunch of businesses, which I want to dedicate a lot of this episode to that because you have probably tried more side hustles than anyone I know. You were delivering Uber Eats in Australia. I was, yeah.

[B]

On a bicycle.

[A]

On a bicycle, yeah. You have clearly some adventures from that that I want to discuss. But also, you. You have 11 rentals.

[B]

Yeah, 11 rental units actually. Just sold in recently. So now we're down to eight we can get into all of that.

[A]

Thank you.

[B]

Yeah, I do have a lot of real estate exposure via syndication now. We can get into that whole can of worms. But when I first started out to go back to your question, you're asking how I hit 5. Basically, yeah. So when I officially claimed 5, I had about 500k in the stock market. So per the 4% rule, I can pull out like $20,000 per year or like $1700 per month or what is it, $1600 $67 per month using the 4% rule. And then I had 13 rental properties at that time that were bringing in about $3,700 a month in cash flow. So this is not just the income minus mortgage. Like I'm actually bundling all the expenses in on like some real estate influencers do online. I've heard you talk about that as well. Like some people like, oh yeah, I'm charging 2000 for rent. My mortgage is 1700, so my cash flow is 300. No, no, yeah, but my cash flow after all was said and done after capex, after reserves, after mortgage, PITI, after everything, about 3700 dol. And then I had a digital products business that was making me a little over $10,000 a month passively. So this was just before my 26th birthday. My like 5 sprint was from 22 to 25. And so yeah, right before 26 I had 500k stock market, about $3,700 from real estate and about 10k from digital products. And it was at that point I'm like, I don't think I have to work for money anymore.

[A]

And you had like a rough commute. You were commuting three hours per day, an hour and a half each way. It was on a train going, going in and out of Boston.

[B]

Yeah. So the train itself was about an hour 20. I had walking in between each of those. So I had to drive to the train station, you know, get on the train, ride the train for hour 20, then walk 20 minutes to Boston. The commute on each end was two hours, just four hours commuting, four hours. But it allowed me to side hustle my butt off. So during all that time I'm just working on my whole slew of side hustles. I know you mentioned at 30 plus. I don't know if I'm the most side hustled guest you've had on before, but maybe I'm up there.

[A]

I, I think you are, I think. Well, I guess with the exception of maybe Nick Lope.

[B]

May. Nick Loper, Yeah.

[A]

Yeah, I think you are in a tie with Nick Loper for most side hustled guests.

[B]

So that time on the train and that time just spent commuting, I was able to, well, absorb a lot of knowledge. That's when I was listening to Afford Anything and some other podcasts in the space and I was building up my own businesses. So by the time I left corporate, and I'm jumping forward to my story a bit, but I had like 12 to 15 hundred dollars a month coming in from my side hustles, which gave me a lot of security and safety when I jumped ship. It wasn't like I was just quitting my job because I felt like it and I want to stick it to the man. Like I had a plan in place. I was already making close to what I was spending at the time. Because I was a 22 year old kid, I hadn't inflated my lifestyle at all. So being able to use that time on that commute to side hustle was probably a pretty important piece of this whole journey.

[A]

Right? And what's interesting about that is that with that commute, the commute almost makes dedicated side hustle time. It's like a forcing function. You have to go into the office. It doesn't matter how you feel, it doesn't matter what your mood is. There is a forcing function that says you must be on a train during these hours. And then you just build the the habit stack of like if on train, then work on side hustle.

[B]

Yeah, it was perfect. I mean it was a forcing function when you put it that way. I never thought about it like that, but I was working my side hustles every single day for probably four plus hours outside of my day job between like not just the train, but when I got home from work, I'd work on my side hustles too. I was just so inspired because I knew that this whole world existed and that people had quote unquote retired or hit financial independence or whatever, whatever name you want to put to it in their 20s, 30s. I'm like, what the heck am I doing? Like, I don't want to be my boss. I don't want to be my boss's boss. They were both miserable and like most of my co workers are miserable. There was just a Gallup study that came out that said 72% of people don't like what they're doing on a day to day basis. And I just saw that so much in my job. Not like I don't want this life. And so I was just like, doing everything I could to get out of there.

[A]

You know, it's interesting that you say that you were looking at your boss's job and then your boss's boss's job, and you could see that those jobs look like they suck.

[B]

Yeah.

[A]

We actually just interviewed Jack Raines. He wrote a book called Young Money. So it's also about money in your 20s. And he said exactly the same thing, that he was talking to his boss, and she was complaining about her workload, and she was complaining about the job. They were, like, a few beers deep, and he was, like, just looking at that job and saying, I don't want that job. And when he realized that he didn't want his boss's job, that was when he knew he needed to make a change.

[B]

Yeah, because for me, it was like, if I stay on this path and do well, the best case scenario is I take my boss's job.

[A]

Right.

[B]

And my boss was complaining. He was making a ton of money. He was complaining about his, you know, his third vacation home had issues, and he had marital issues. And it was just like, your life sounds awful. I really don't emulate. I don't want to emulate it. And this is the path that I'm barreling towards if I keep applying myself as much as I can to this job. So that's when I was like, I need to escape. And we can talk about how that all happened, but it was the best decision I ever made.

[A]

Let's talk about all of your side hustles. You've had, what, over 30 side hustles?

[B]

Over 30 confirmed side hustles? Yes, confirmed. Oh, my God. I don't know if I'm leaving any out.

[A]

Do you remember the first one?

[B]

The very first one? I mean, I don't know if you count this as a side hustle. I was 10 years old when I started making my first dollar. I've always been, like, an entrepreneur of sorts, but I started working at my uncle's disc golf course in the lost and found and snack shop. It's making $5 an hour. So that's my first side hustle, if you will. It was just being in the snack shop. 10 years old.

[A]

How about on that train? What did you start doing on the train?

[B]

Okay. Yeah. This is probably a better question in terms of what I'm doing now. I think when I first started side hustling for real was my sophomore year of college. I actually started. So this circles back to the answer to that question that I mentioned before. I started a disc golf Manufacturing company when I was a sophomore in college. And so I had tried a couple other businesses. I had tried to start a tutoring business. I tried to start a specialty, like clothing company. Both of those failed for various reasons. But I did start to have some success with this disc golf manufacturing company. It's called Arsenal Discs. I don't run that company to this day. It wasn't like I. This wasn't the story that, oh, he made a million dollars in this business and then exited. And no, I learned so much from running that business. For those who don't know, disc golf is basically like, think of ball golf, but instead of hitting a ball into a hole, you're throwing a plastic disc into what's called a pin, like a metal fixture. And so we were manufacturing the discs that people would throw into those pins, and we were shipped, like, shipping globally. We were selling in over 40 countries. It was a whole big operation.

[A]

Wow.

[B]

So even though, like I said, that company didn't make me a millionaire and I didn't have a big exit or anything, I learned so much about entrepreneurship. I learned how to market. I learned how to talk to people. I learned sales. I learned networking. I learned how to build a website. I learned all of these different skills that have now come to fruition today, like, in the businesses that I'm running now. But I don't think any of that would have been possible if I didn't start that first side hustle. Like, I was so scared. I thought it was going to fail. You know, we just kept pushing and pushing until things started working. And that was the first, like, real business, first real side hustle that I started.

[A]

Wow. And you say we. You had employees.

[B]

I had a business partner. We had fake employees, actually, which is hilarious at the time. We would, like, make email addresses with different names in front of them. And, like, when manufacturers would communicate with us, be like, yeah, we'll send that to Rick in marketing or whatever. Like, we had all these fake people. It was just me and my friend Jim. He was an engineer. I was like the finance and marketing guy. So he, like, would literally design the disks and run them through all these airflow CAD programs and stuff to make sure that they would fly.

[A]

Right.

[B]

But no, it was just satsu.

[A]

Wow. We started this conversation by talking about frameworks, and you've got this organizing framework for Nest Egg Phi versus Cash Flow Fi. You also have an organizing framework for side hustles. And actually, before we dive into this story of all your side hustles, let's talk through The. The organizing framework that you use. Cause I think that's going to be a helpful Linnaean classification system.

[B]

Yes, yes. Because we can definitely talk about the side hustles that I was doing on that train versus what I do now. Very, very different. So I like to bucket side hustles in four groups. So group number one is just trade your time for money side hustles, this could be trading your time for money online. So in the form of freelance writing or freelance podcast editing or video editing or building websites, these are all things I've done before. That's why I'm thinking of these at the top of my head. So trading your time for money, it could be also like landscaping, buffing boats, could be bailing Christmas trees. These are all, again, side hustles that I've done before. These are all trading your time for money. You're getting paid a certain dollar per hour. However many hours you work, that's how many dollars you receive. The second type is scalable side hustles. So this is you're putting your time, your energy, your money into something once, and then that thing is going to pay you, hopefully in perpetuity, or at least for years or decades to come. So this could be you're buying a rental property. Like, this would be a scalable side hustle. You buy it once, that thing pays you in perpetuity, assuming it's a rental, you build a digital product once that you're selling on Etsy or Shopify or whatever platform, that thing could sell for years to come. You put out a podcast episode, a YouTube video. These things live on and continue to pay you in perpetuity. So that's kind of like the scalable side hustles. Number three is the sharing economy. This is one that a lot of people sleep on. So the sharing economy. A lot of people know there's like Airbnb for your home, there's Turo some people are familiar with for your car. But there's so many other sharing economy platforms out there. Like, people can rent out their pools, their power tools, their photography equipment. Like, there's all these different marketplaces now where if you own an asset, you can rent that out to other people who want that asset without wanting to buy it themselves. So there's like a huge economy out there for that. And then the last one is what I like to call hybrid hustle. So this is taking a type one side hustle. So I trade your time for money, and then it's kind of scaling that into a business. So let's say you start freelance writing. Eventually you get really good at freelance writing. You hire some freelance writing writers under you, you have this whole framework. You build sops, boom, you've scaled yourself out of the business and now you have your quote unquote, trade time for money side hustle that's then been transformed into a slightly more passive business.

[A]

Right. So essentially you've created a content agency.

[B]

Exactly right. Yeah. Basically just the agency vacation, if that's a word of any of these businesses. So those are like the four types of side hustle frameworks that I like

[A]

to think in the agency model essentially would be bucket number four.

[B]

Exactly. So in my early years on the train, it was mostly type 1, so trade time for money. So I was doing a lot of freelance work at the time, and I don't know if you remember, I launched a freelancing course back in 2019 with my friend Julie, and I interviewed you for a segment on that because you used to talk about freelance writing a lot back then.

[A]

Wow.

[B]

I know you got kind of your start in freelance writing, talking about personal finance. I had a lot of success with just various freelance jobs. I was doing freelance writing, I was writing newsletters for people. I was doing affiliate marketing freelance. I was building websites. I was just doing a whole bunch of stuff, just whatever I could get my hands on. I was just like, so hungry at the time. I was like, I'll spend every hour of the day to make some extra dollars toward my financial independence goals. I was doing a little bit of the type 2 side hustles where I was building my own. What was a blog. Now it's kind of just like a personal brand website, because blogging isn't as popular as it once was back in 2018 when I started, I was starting my podcast in 2018 as well, and I was starting to build some digital products to sell on Etsy and Shopify. So I was doing a little bit of, like, bucket too, but those weren't making a ton of money at the time, as you know. Like, a lot of these things take a long time to scale.

[A]

Yeah.

[B]

People will be like, oh, I just started a podcast last month, or I just started a YouTube channel or just started making digital products. What am I going to start making thousands per month? It's like, it takes time. You just got to let it simmer. It's like compound interest. Like anything. You just got to continue to put in the work and then it pays you. So most of that side hustle income I mentioned, like, I was making 12 to 15 hundred dollars a month was from the type one trade. My time for money side hustles in the form of freelancing.

[A]

Well, and what's nice about those is guaranteed payment. You're trading time for money, but you're not investing capital. There's no risk of loss. It's essentially having a job, but with a little bit of additional freedom attached.

[B]

Yeah.

[A]

So you don't get the upside, but you also. But you also don't get the downside.

[B]

Yeah, you can work as much as you want. That's the issue with the typ. One side hustles. And we could talk about my pivot to pretty much exclusively type 2 side hustles was I realized I'm like, I don't have 100 hours in the day. Like, there's only 24 finite hours in the day. If I'm just constantly trading my time for money, I'm going to run out of time to trade.

[A]

Right.

[B]

So I was running out of time and I'm like, I'm working 16 to 18 hours a day. I was sleeping like six hours a night, literally working every waking minute. And I was like, this is not sustainable. I need to figure out how to scale my income, build things that'll pay me whether or not I'm working on them.

[A]

Right. Okay, so then let's talk about the, the pivot to type two, the scalable businesses.

[B]

And just to double click on this for a second, because I think this realization was such a groundbreaking moment for me. Like, when I first read the Four Hour Workweek, this was actually the book that, like completely broke all of my frames in my sophomore year of college. And that was shortly after that, I started that disc golf company. He had this notion that the richest people in the world did not trade their time for money. So before growing up, like, we all hear, oh, doctors, lawyers, they make 200, $500 an hour. But someone like Warren Buffett can literally sit on his hands for a year and make billions of dollars. Like, he's not trading his time for money.

[A]

Right.

[B]

So the richest people own assets that pay them regardless of whether or not they're working. And that light bulb moment for me was like, like, it just completely shattered everything that I'd ever learned about money. I always thought that to be rich, you had to earn as much dollars per hour as you possibly could. But once I realized that it was actually the things that you own, the assets that you own, that's what's going to make you richer in the future. Like a Warren Buffett it just changed everything for me.

[A]

I forget how big of a realization it is for people who are not. Who have never heard. Yeah. People who have never heard that concept before. Like, and that is one of the things that I love about the notion of pursuing fire. One thing that everyone has to understand in order to be part of that space or part of that journey is the fundamental idea that your assets and your capital can produce more assets than capital.

[B]

Yeah.

[A]

That cornerstone of, like, your money can work harder than you can. It's like a necessary premise for this whole thing.

[B]

Yeah. Yeah. And once you really internalize that and it becomes real.

[A]

Yeah.

[B]

I know you've talked a lot about the power of in person and meeting people face to face.

[A]

Yeah.

[B]

For me, even though I'd been listening to all the podcasts, watching all the YouTube videos, reading all the books, when I went to campfire in 2018, January, campfire 2018, I was just like, okay, this. It just felt so real. Like, meeting these people face to face who had hit financial independence in their 20s, 30s, 40s. It was something I'd never heard before, like, in my regular life by IRL folks, my parents weren't talking about this. School wasn't talking about this. I'd never known anyone who could have stopped working in their 20s or 30s. It was so crazy. But here's this room full of 70 people, and, like, half of them were five. And it was such a groundbreaking moment for me. Just like getting outside of my comfort zone and meeting new people that were doing what was seemingly impossible to me a year ago.

[A]

Right. The Jim Rohn. You're the average of the five people that you spend the most time around.

[B]

Yeah.

[A]

And even if you can't spend all of your time around somebody, spending any time is better than spending no time.

[B]

What I like to say about that quote now in the technological age is like, you don't have to be physically with that person. You could be one of the five. For someone like, you were one of my five. When I was going through my journey, it was like, afford anything. Bigger pockets, money, choose five. Or like, the big three podcasts that I listen to. Even if I wasn't hanging out with you, you didn't even know who I was. Having you in my sphere of influence helped guide my decisions.

[A]

Wow.

[B]

So, like, I'm hoping to now be that beacon of light, hopefully for some young 20s folks or even folks who are just getting started in their financial freedom journey out there. Like, the five people don't have to be in your town. You don't have to hang out with them every Tuesday. They could be in your earbuds while you're walking on the treadmill or driving to work or whatever. So it is cool. The access that we have now in this technological world where you can be connected to people that a couple decades ago wasn't even possible.

[A]

Right, exactly. It is a case for optimism.

[B]

Yeah.

[A]

And it's not all bad. Yeah.

[B]

Technology isn't taken over yet.

[A]

Yeah, exactly. And you do need optimism to make money, frankly. You make money by solving problems and you make money by improving the future. And all of that kind of hinges another fundamental premise. Underpinning this whole thing is like, the belief that the future can be better than the present.

[B]

Yeah.

[A]

And the belief that things can and are improving.

[B]

It's funny because I'll have some people say, like, well, what if the whole world gets in a world war and the US stock market tanks by 90%? I'm like, we have way bigger things to worry about than money in that scenario.

[A]

Yeah, yeah.

[B]

It's. You need some kind of a general optimism. If you think there's going to be an apocalypse next year, then maybe investing isn't for you. But please know that, like, the stock market has just continued to trend up and to the right through many world wars, through pandemics, through so many global events. So, I mean, the best we can do is just assume that it's going to continue on the same course. Yes, there'll be ups and downs. Yes, there'll be 30% corrections, but they'll also be 30% up years.

[A]

Right.

[B]

You don't want to miss out on those just because you're scared of something bad happening.

[A]

Right. Okay. We're trading all of your time for money, and you were running out of time to trade.

[B]

Yeah.

[A]

You hit the point where you just had no further waking hours and needed to do something. How did you begin to make the switch into building side hustles that were scalable?

[B]

I think the simple one word answer to this question is time. So I was still working on some of those class two Type two side hustles. Like, I was starting my blog, I was starting a podcast, I was starting to create some digital products. They just didn't have legs yet. In the time that it took me to quit that corporate job, I was in corporate for seven months. Those side hustles, the type 2, started to get some legs, and I started to make some money from my blog and started to make some money from podcasting, and my Etsy shop started to take off. So because those things that I had spent months and months and months building started to actually make money. I was able to scale down the type one side hustles. And as that started to happen, I'm like, oh, these type two side hustles, like, these things are going to pay me for years to come. It's not like the freelance writing gig that I just got paid $150 for and now I'm never going to get a dollar from that again until I pick up another gig.

[A]

Right.

[B]

So I was like, I'm going to start focusing a lot more of my time and energy in the second bucket of side hustles where I can spend my time, my energy, my focus on this thing that could potentially pay me for decades to come in the short term.

[A]

Did you see your income drop when you were going from the thing that pays you immediately to the thing that pays residuals over time but doesn't necessarily pay right away?

[B]

That's a good question. I wouldn't say it was like a precipitous drop. I was weaning off of the type one side hustles. It wasn't like I was just completely stopped cold turkey. And this is the same advice I give people when they're like, I hate my job. I want out. If you don't have any side hustle or any sorts of income outside of that day job and you're not at five, like, please don't quit your job. Try to get legs with some side income, some income source outside of your day job. And then once you quit, then you can scale that up and it won't be as scary as just like jumping off a cliff with no parachute.

[A]

Right.

[B]

So that's kind of what I did is like not a day job exactly, but like my type one to type two side hustles. I like, started weaning off versus, like, just shutting off all my freelancing one day, going all in on the scalable stuff. It was like, as the scalable stuff started to ramp up, I would just take on less and less freelance jobs.

[A]

Right, right.

[B]

That makes sense.

[A]

Yeah. Yeah, that totally makes sense. And that's what I did. I had a content agency for a while, and when I decided to go full time with afford anything, I slowly. It was a gradual taper.

[B]

Yeah.

[A]

One by one, I began just dropping clients. Took about 18 months in total, but over the span of 18 months, I dropped clients until eventually I had dropped them all down to zero.

[B]

Perfect.

[A]

You know?

[B]

Yeah, It's a perfect glide path. I like that.

[A]

Yeah.

[B]

Exactly. Yeah. That's what I recommend for folks. Don't just quit cold turkey. It works for some people, but I think for the vast majority it's just a lot easier psychologically.

[A]

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[B]

I think back then I wanted it so bad that I was just unwilling to quit, which might not be the best answer for folks out there, but I was just willing to Give it my all. I'm like, I saw other people that I was idolizing. I'm like, this person has a successful blog, this person has a successful podcast. This person is crushing with digital products, Kind of just following in others footsteps. And I know before we hit go here, I was talking about that with my own FI journey, there's no way I would have hit FI at 25, just flying blind, figuring out by myself, the only reason I was able to do what I did was because there was podcasts and YouTube videos and books out there of people who had done it before me. So kind of the same thing on the side hustle front. I feel like I just emulated what other folks were doing. And, I mean, I started to see some results. So I was like, okay, if I'm making even a hundred dollars a month from podcasting or from blogging, that means I can't. I can make 200 or 400 or a thousand. Like, there is the possibility, since I've already started to make some money from it, I just need to, you know, get more listeners or I need to reach more people with this stuff. And so I think because I'd made a dollar, that was enough proof in the pudding. And I think for a lot of people making that first side hustle dollar outside of a corporate job, it's so much more than just the finances of it. It's the psychology. Like, once you realize that you can earn money outside of a day job without your boss handing you a paycheck, it just unlocks this whole new world. I know that's what it was for me. Even if it's selling something on eBay for 10 bucks.

[A]

Yeah, it is a huge unlock. I remember going to conferences. This is back when I was a print newspaper reporter, journalism conferences, and they were broken out by track. There's a track for newspapers, track for radio, track for magazine. And then there was this track called freelance. And I was like, what? What's that? You know, I never heard of it. And I just bopped into a couple of sessions just out of sheer curiosity and discovered the concept. This is like another unlock. Discovered the concept that you could make money outside of a W2. And that was a brand new concept for me. And that was life changing.

[B]

Yeah, I remember when I interviewed you about the freelance writing, because you would scale that up to a pretty sizable business, right when you're freelancing. And then you kind of went to type 4. You built the hybrid model. Then you had like a agency.

[A]

The agency, yeah. Yeah. So I did I did. I went from type one to type four.

[B]

Yeah, you were trading all your time for money, and then you probably were like, this is not sustainable. I'm burning myself into the ground. And then you're like, how can I scale this? And then if it comes to type four, where kind of you're running a business.

[A]

Right, Exactly. So it became a type 4, and then eventually I tapered off that type 4 in order to go full time into type 2.

[B]

I know it's so confusing for the folks listening, but it helps me think of side hustles and bucket them appropriately.

[A]

All right, so just to review one more time, so type one is trading time for money. Type two is scalable type. What is type three?

[B]

Type three is sharing economy.

[A]

Type three, sharing economy. And then type four is the agency model.

[B]

Yes, exactly.

[A]

Okay, so you're building out type 2. You're building out scalable businesses. I actually like your answer that you're too determined to not quit. Because I think with people who pursue type two, the biggest challenge that I see, a lot of them, you know, a lot of them just quit too early. Like, because sometimes it is a long, long, long Runway before you actually start making money. And you have to invest a lot of time. A lot of time and a lot of money, you know, And. And if whichever one you lack, you invest more of the other one, you're investing either time or money or some combination of the two to make it work.

[B]

Yeah, I couldn't agree more. It's funny because as you were saying that, I was thinking of this. This hater comment I was doing an IG Live with. Do you know Jeremy Schneider from personal finance book?

[A]

Oh, yeah, yeah.

[B]

So we were chatting, he was interviewing me, and we had this, you know, hater pop on, and they're like, oh, so the answer is just work hard. Yeah, yeah, yeah, that's it. Like, literally, if you work hard, like, if you don't give up, you can't fail. If you never stop trying, like, you literally can't fail. You just keep pivoting until it works. Yeah, so I. It was like a hater comment, but I'm like, this is so much deeper than this person realizes. Like, yes, that's actually it. If you work hard, you. You can't fail.

[A]

Nailed it.

[B]

Yeah, you got it. That's so funny. But, yeah, once when you have a lot of energy, you have a lot of time, you give a lot of energy, you have a lot of time.

[A]

Right.

[B]

Once you hit five, once you have a high net worth, then you have Less time and less energy and then you start to put money towards stuff. So it's just, it's all a balance.

[A]

Yeah, there's that quote I haven't failed. I've just discovered 10,000 ways that don't work.

[B]

Yeah, that's like my 30 side hustles. I don't do 30 side hustles to this day.

[A]

Right.

[B]

I have a very filled side hustle graveyard, if you will. But they all taught me something. Like, it's. I don't like to think of them like, oh, that side hustle failed. Because people ask me that question on podcasts. What's your know which side hustles failed? I'm like, I don't know. I don't like to think of side hustles that way. I like to think of them as learning lessons. Like, because I did this side hustle, I'm now poised to do this next business better. Like, if that first side hustle never happened, I don't think I would be doing that next side hustle. It's like when people will, you know, sometimes people be like, oh, like Dave Ramsey, for example, they'll be like, oh, his personal finance stuff is too basic. Or, you know, just when they're talking about the basics, they're like, well, I don't need that. Well, it's like if you never learn the basics, then you can never get to the advanced stuff. You can never get to the afford anythings.

[A]

Right.

[B]

So, like, if you never learn basic math, you can never do calculus. So I think a lot of people don't give like the, the basics enough credit and they just want to jump to the advanced stuff. But you need the basics in order to get to that advanced stuff. This is a crazy, roundabout way of explaining my side hustles, but I don't think that I could do what I'm doing today without those 25 plus side hustles in the graveyard.

[A]

Let's talk about some of the ones in the graveyard. Like, how did you end up Bicycle. Bicycle delivering for Uber Eats in Australia.

[B]

So this predates my train journey. So I graduated college semester early. My then girlfriend, now wife Lauren was studying abroad and I was like, I'll come with you. So this is actually when I started my blog, started my podcast. I was also doing type one where I was trading my time for money. I tried to get hired at like 20 different places in Australia and they just didn't want to hire expats at like norm quote unquote normal places, like a burger joint, like a fast food Chain, whatever. So I was like, I'll just do Ubereats. So I went on the equivalent to Craigslist. It's called Gumtree.

[A]

Gumtree. Yeah, Gumtree. I know Gumtree.

[B]

I bought a $25 bicycle that only worked in one gear. It was pink. And I was just like, all right, fired up the Uber Eats app. After I got approved or whatever, I just send in my passport, make sure I was a legit person, and I started biking around. And what's funny though is I was in a super hilly suburb. It was called Too Long. It's like a suburb of Brisbane. It was hot there. I mean, Australia is hot for most of the year. So I got a couple of one star reviews because I was sweating on people's food. So, yes, I have done many Assad hustles. That was definitely not one of the more glamorous ones, but it was like, immediate money. Like, if I needed 30 bucks, I just go out and bike for two hours and make 30 bucks. It was like such an easy way to make money. But I can only bike around for so long delivering people's food. It was just unsustainable. One, fatigue. And two, just, you know, gets dark and there's not enough hours in the day.

[A]

Right, right. The advantage to gig economy stuff is, like, immediate money. So if your back's against a wall and you're like, I need $100 right now. You know it's an emergency. Yeah, like, cool. Get it.

[B]

There you go. Drive for Uber. Whatever you got to do.

[A]

Yeah, exactly. So, yeah, there's definitely a ceiling on your earnings, but the immediacy is there, which is nice.

[B]

I think people will hear me talk about, like, type one, and it's almost like I'm saying, oh, type one side hustle suck. But there's a time and a place for them.

[A]

Like, right.

[B]

There's definitely a time and a place for freelancing or for driving for Uber or Instacart. Whatever you got to do to make money. Like, if you're living paycheck to paycheck and you just need to create any kind of a gap between your income and your expenses, leaning on type one is a great way to do that.

[A]

Yeah.

[B]

Because it's going to take a while for type two. Like, if you're going to start any kind of a business that's scalable, like, you usually don't make money on day one, unfortunately. But if you keep with that thing for six months or a year or multiple years, that's when the income starts to explode. The same thing as compound interest.

[A]

Right, right. And what I hope people hear is like, both you and I started Type one.

[B]

Yeah. Nothing wrong with it.

[A]

Yeah. That's where a lot of people get their start. Tell me about some of the other side hustles that are now in the graveyard.

[B]

Okay, so in the Type one bucket. Yeah. Freelance writing. I mentioned podcast editing, video editing, building websites, writing white papers, writing email newsletters, managing affiliate programs. I was like a blog post editor for a little bit, working on like blog post compilations. A lot of these were in the blogosphere because that's where I got started. So I just asked people if I could work for them and do whatever. Then I was doing like landscaping. I was buffing boats. I was working at my uncle's Christmas tree farm. I had a vegetable stand in the past. I. When I was. This is like way before, but I was like, had a hot chocolate stand when I was a kid working at the disc golf shop. Those are all the type ones that come to mind. I think I'm at like 12 or 13 right now. Then on the type two. So I've done. I started blogging, podcasting, building digital products for Etsy. I had like a whole separate digital product store that was building for Shopify. Ended up creating a template library. Started doing like a YouTube channel. I have multiple courses, multiple communities. I guess I could include real estate stuff here as well. I've done long term rentals, short term rentals, syndications. I guess is a kind of a stretch bucketing in here. But yeah, I'm just trying to think off the top of my head. Type 3. I have done Airbnb sharing economy, type

[A]

the type 3, sharing economy, sharing economy.

[B]

And I guess type 4. In a couple different ways. I've tried to, like, I don't even know the verb for this. Agentify businesses. Like, I tried to do that with a tutoring business in the past that I mentioned that failed. I tried to agentify my podcast and build like a podcast network that just kind of fizzled to the wayside. Some other ones I don't even know how to bucket. Like, I managed a book tour for our mutual friend Grant Sabatier. I was his book tour manager. I wasn't even trading time for money because I was doing it for free. It was just a cool networking opportunity, I guess. I had planned a summit, the Financial Freedom Summit that got shut down by Covid in 2020.

[A]

With that. Yeah, yeah, man.

[B]

What else have I done? I mean, as people can see, I've done a lot of them. I'm just blanking off the top of my head live on a podcast, but I think I named at least 20 yeah off the Dome, which isn't bad.

[A]

There are several things that you've named that require knowledge and skill. Affiliate management requires a decent amount of knowledge. You know, uniquely. You have to know all of the players. You have to know how it all works. You have to, you know, there's a lot of. Of learning that comes with knowing how to do that particular thing. YouTube is another example. YouTube has a lot of knowledge associated with it that is extremely specific to only YouTube and, like, not transferable to any other video medium. How long did it take? Because this is all on the job learning how long did it take? How many unknown unknowns were there? Like, talk to us about the process of building the airplane while you're flying it.

[B]

So it might sound like I was building the plane while I was flying it, but a lot of these lessons came from blogging and podcasting myself. So a lot of these lessons I had learned and failed in my own business. A lot of those things that I just mentioned were related to me blogging, like freelance writing. I knew how to write. I knew how to, like, add a captivating headline and just how to structure paragraphs and stuff. I knew how affiliate systems worked because I was trying to do it my own blog. I knew how to edit a podcast and edit video and do all this other sorts of freelance stuff, build a website because I'd done it in the past with my own businesses. So when I got to the point where I felt comfortable freelancing, it wasn't like I was jumping in blind, like, hey, can I write an article for you? I've never done one before, but give me a try. It was, I've already written dozens of articles on my own site, or I've already edited dozens of podcasts. I've already edited dozens of videos, or I've already built 30 plus affiliate relationships. I know how to do it for you because I tried it in my own business. Even if it didn't end up being a big thing for me personally, I wasn't able to use that skill in the future to make money.

[A]

So essentially, you yourself were your own guinea pig. Guinea pig, yeah. Yeah, that's a great model because essentially you are your own. Almost like a workshop of one or a class of one where you yourself are. You've got your own little laboratory. You're trying, you're testing, you're. You're figuring it out on your own before you then Go out and sell that skill.

[B]

Yeah.

[A]

And so then when you sell it, it's a fully developed skill.

[B]

Yeah. And people can actually trust that you know what you're talking about and know what you're doing. And this is bringing up a quote I just mentioned that book tour with Grant Sabatier. He has this quote that skills are future currency. And I love that. And I don't know if you've seen the show Undercover Billionaire. Uh, one.

[A]

No.

[B]

So basically, they just like take a billionaire, strip them of all their titles, they take away their cell phone, they just drop them in like a random town, and they see how long it takes them to build a million dollar per year business.

[A]

Wow.

[B]

And these people do it in like two or three months. And some people might be like, oh, that stage, that's fake. But it's like these billionaires have accumulated skills that whatever else you take away from them, their money, their network, whatever, they're never going to lose those skills. So as long as they have those skills, you can put them in any city, any part of the world with no connections, and they can probably build a pretty successful business because they've built those skills. So I've always found that so interesting. And I love that quote by Grant, that skills are future currency, because those are something that there's a market downturn if something horrible happens. Like, nobody can take your skills away from you.

[A]

Right.

[B]

People, you know, governments can seize assets. Like, I know there's some countries that they seize real estate and they've taken money out of bank accounts and they can never take your skills, they can never steal your skills from you. So building up a skill stack is just going to make you that much more valuable of a player in the future.

[A]

What would you say to somebody who's listening to this and thinking, well, what about skills that depreciate? So, for example, a lot of people thought that the skill of coding was going to be incredibly valuable, and now with AI it's less so. Even the skill of writing is. I mean, at this stage, AI is. You can tell when something is written by AI. So writing is still valuable, but mediocre writing is no longer valuable. You know, specialized writing is just as valuable, if not more so. But the stuff that traded on volume is no longer valuable.

[B]

I think I can answer two questions at once here because I get asked a lot like, oh, if AI is going to replace jobs and how scared of AI.

[A]

Mm.

[B]

I think that the doers are only going to get better because of AI. So if you already have a Background in freelance writing, if you already have a background in video editing, if you already have a background in whatever. And now you add AI to yourself, now you're just going to become 10 times more prolific.

[A]

Right.

[B]

It's like having that base knowledge. If you were a coder before and you're like, oh, now there's replit, now there's cloud code, now obviously it's like, no, now you can become a 100x producer than you were before with that base knowledge that an average person, a layperson like you or I might not have, trying to code something ourselves with an AI tool.

[A]

Right.

[B]

So, like, I think that the doers, the people who are willing to learn and adopt a new technology are going to just, the gap is going to widen between the people who, like, accept AI and who don't accept AI. So I don't think, like, people like, oh, AI is going to take my job. It's like, how can I leverage AI to become a super producer and become so invaluable that like, my job can't? Let me go

[A]

right to your point. Skills don't depreciate, they actually accelerate.

[B]

Yeah, I think so. I mean, of course some skills are going to become replaceable in some form or fashion, but having that base knowledge to know that when you know you have cloud code spitting out all these different website scripts or whatever your job might be, that you can actually look at it and understand it, whereas a regular person couldn't. So, like, you could make. If there's like some technical error, AI does make errors, then you can actually correct it because you have that base knowledge. Yeah, skills don't erode in the sense that the actual knowledge base deteriorates. Maybe the robots can do the job faster than you, but like, knowing those base things is still going to help you in the future, if that makes sense.

[A]

Right, right. The more you partner with AI, the faster as a team you can run 100%.

[B]

Yeah.

[A]

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[A]

You mentioned that developing a skill stack is one of the most powerful things a person can do. What specific skills do you think should be in a person's skill stack today? If a person were starting from scratch?

[B]

So instead of me trying to rifle off a million things like I just failed miserably trying to name all my side hustles? Yeah, I think the best framework for thinking about this is think of people or companies that have a lot of money. What things don't they know how to do that they'll pay a lot of money for other people to do. So like a decade ago, if you became really good at social media, all these old titan companies with billions, trillions of dollars, they didn't know how to do social media. If you were someone who could understand social media, boom. You're so valuable. If you could understand how to do run Facebook ads, Google Ads, boom. So valuable because these companies that were already doing extremely well, this is like a knowledge gap for them. So they're willing to pay a lot of money for a knowledge gap because they have so much money to start with. So like that's why I like to identify. And it makes the answer more timeless too. If someone's watching this interview in 2040, you might it might be a very different answer than what I'm giving in 2026. Identify what the big players, what the rich folk, what big companies are doing or what big companies don't know and then figure out how you can learn that. So right now it might be building AI agents before, it might have been running social media before it might have been figuring out how ads work. And so it's always going to change. But if you can stay ahead of the curve and see where are the big companies lacking. Whereas maybe smaller creators or entrepreneurs are like they're really getting this, but big companies are not getting this. That can usually be a really valuable skill that you can monetize.

[A]

Right. Identify the knowledge gaps.

[B]

Yeah.

[A]

Develop a skill stack around those knowledge gaps.

[B]

Yeah. I like to think in frameworks. It just makes it easier than me just rifling off a bunch of, off the top of my head stuff. Frameworks are better because the frameworks are timeless.

[A]

Exactly.

[B]

And so whether someone's watching this now or in 15 years, it's the answer will stand.

[A]

What I love about frameworks. Frameworks aren't prescriptive. Frameworks are teaching a man to fish

[B]

rather than giving him fish for dinner.

[A]

Yeah, yeah, exactly. Yeah. It's. We don't hand you the answer. We hand you a way to think about the answer. You mentioned earlier that part of the reason that you were so enthusiastic about type 1 is because you wanted to grow that gap between what you were spending and what you were earning. And so that was what was fueling your, your Type one heyday. Yeah. Tell me more about the importance of that gap and how that has persisted throughout your life.

[B]

The gap is the most important metric on your journey to financial freedom, bar none. Especially at the beginning. I think a lot of people hyper focus on what they should be investing in. Whereas if you just focus on increasing your gap, the difference between making 8% or 12% even doesn't really matter once you start messing with bigger numbers. Millions, billions. Yes, those percentage points matter a lot. But at the beginning of your journey, if you have less than a hundred thousand dollars net worth, just maximizing the gap is. Should be your main focus. So that was my main focus. I need as much money as possible to invest in things like the stock market, into real estate so that I can have assets that are going to continue to pay me in perpetuity. So yeah, starting out building that gap when I was working in that corporate job I was making. So I, I got the corporate job, I was paying $80,000 a year, which was a lot of money. I only worked in it for seven months though. What I was doing was I was banking literally every single paycheck from that job. So I was just living on my side hustle money. I was spending like 12 to 15 hundred dollars a month. I was making like 12 to 15 hundred dollars A month. So I was literally banking everything I was making in corporate. So by the time I quit, I had like 35000 saved up.

[A]

Were you living at home?

[B]

I was living at home during that time for seven months. And then I went on the book tour. And then I. Yeah, we could talk about the housing after, because then I started house hacking, which was huge. Yeah, huge for my gap. So after that year, 2019 was my first full year in entrepreneurship, and I was like, I'm going to keep my expenses as low as possible. And my income started to rise via the various type 2 side hustles I was doing. So that first year in entrepreneurship, I made $96,000, and my expenses were $2,000 a month, $24,000 a year. Pretty decent gap. It was like 76% savings rate if I'm doing math right at the top of my head. If I remember from my book, the next year, my income doubled and I made 198,000. I kept my expenses the exact same. So my gap increased by, like 100K. The third year, this is the end of this year, is when I hit 5. I made 403,000, and my expenses were still $24,000 for that year. So I had a $379,000 gap. That's why the numbers I was spouting off at the beginning of this podcast, like, the 500k in the stock market, the multiple rental properties, like, all of that was possible because I had this massive gap between what I was making and what I was spending.

[A]

Right.

[B]

Like, none of this would have been possible without that massive gap. That gap was everything.

[A]

Right. To have a $300,000 gap in one year is like, you only need that for just a few years. Even if that doesn't last. It's such an accelerant.

[B]

Yeah.

[A]

And I'm sure for the people who are listening to this, that sounds insane.

[B]

It sounds unrelatable, but I'd like to be transparent with the numbers because it's just like, you only need a couple crazy years. Yeah, three crazy years for me to hit fi.

[A]

Yeah, exactly. I have also had years where I've had a $300,000 plus Gap. And. And those years, by the way, have not lasted. My income has dropped since then. But having had a gap that big and investing it. Holy moly. What? I mean, jeez, what an accelerant.

[B]

You know, it's crazy.

[A]

Yeah, yeah. It's life changing. And the beauty of not spending that money is that the income doesn't have to last because, like, you had the gap, you invested the gap, and now. Now that that income has dropped. Cool. I. I'm buffered.

[B]

Yeah.

[A]

You know, like, I like to think

[B]

of it as an analogy because I've heard you talk about CoastFi, Coast Fire on the podcast before, and it's like, imagine you just have a bucket sitting at the bottom of your shower. And most people are just, you know, you have the shower on low and it's like filling up over time. But imagine you just freaking crank that thing for like three years in my case, and the bucket just fills up. You never have to contribute again because you just like went crazy with the nozzle in a three year sprint, right? Like, if your goal is to fill up the bucket, like right now it might just be a drizzle in there and like, it might take a couple decades, but like, if you just go hard for a couple years, just cut your expenses to the bone side hustle as much as you possibly can, maximize that gap. You don't have to sacrifice forever. Like, you don't have to, quote, unquote, live like a college kid like I did forever. Now my expenses are way higher than they were, but because I sacrificed during those early years and had that massive gap and invested that massive gap into assets that pay me, like the stock market and real estate, now I don't have to work anymore.

[A]

In your highest earning year, a lot of that came from your digital products business.

[B]

Yep.

[A]

What kind of digital products were you selling?

[B]

All sorts of kinds. So I started. It's going to sound so silly. I started selling digital products on Etsy in like the seasonal space. So I was creating like love coupons and like notes that you give to your significant other and like these things where you drag and drop your. You and your spouse or you and your partner's face over like a heart. It was all these like silly Valentine's Day printables. I remember you were just talking about Nick Loper, actually.

[A]

Yeah.

[B]

We were at this event called Ski Con. So fincon did this little like.

[A]

Oh, yeah, I went to that. Yeah, you did? Yeah, yeah, I think it was in Tahoe. It was. No, I was not at the one in Tahoe. I was at the one in Colorado.

[B]

Okay. So this was at the Tahoe one.

[A]

Wow.

[B]

And I just remember because this is like burned into my memory because it was the first time where I had like, truly, quote, unquote, made money while I slept and while I snowboarded. So I'd created all these Valentine's Day digital products on Etsy, like, just created them in Canva, listed them on my Etsy shop. And up to that point I was making like, I don't know, maybe $50 a month from my Etsy shop. Like it wasn't doing anything crazy. But I heard someone on a podcast who had success. And as a chronic dabbler, as you've so heard. Yeah, I was just like, I'll try this. And so started making products. But I remember it was like, February 9th or something. My shop just started going crazy, and I was expecting a call from a reporter, actually. So I had my phone on loud or.

[A]

Yeah, the ring or do not disturb,

[B]

whatever that word is. And I kept hearing all these cha ching. And I was on the ski lift with Nick Loper, actually, and he's like, what's that cha ching sound? I was like, I don't really know. I never really made sales like that before. But by lunchtime that day, I'd made over $100 for my digital products. And by the end of that week, I made over $700 for my digital products. And you better bet after that week, I'm like, okay, I'm going all in. So it started as just, like, literally, silly little Valentine's Day printables. And now I have all sorts of stuff. I mean, it's become a whole company in and of itself, with courses and communities and a template library of thousands of different printables and digital products. But the very first seed of that was these silly little Valentine's Day products.

[A]

Interesting. Well, and you had those products for a few months in advance of February.

[B]

Yeah.

[A]

So you were well positioned. You know, it wasn't like you were scrambling to put something up on February 1st.

[B]

That's a good point.

[A]

You were well positioned for Valentine's Day starting from what, October? November?

[B]

I think I started in December. But this is like the power of type 2, right. It's like I grinded throughout all of December and January for this Valentine's Day sprint, because I was doing, like, the keyword research. I saw the trends. I'm like, valentine's Day goes crazy on Etsy. So I'd spent so much of my time building those assets, which is kind of going back to the theme I've been talking about with these type two side hustles. But now those assets pay me in perpetuity. Like, I have stuff that I created, Paula, in 2018, 2019, that still sells on Etsy to this day, on Shopify, to this day, on my website to this day. It's like, now it's 20, 26, seven years later. It's crazy.

[A]

As time has gone on and more and more of these have accumulated, has it been onerous or difficult to go back and make updates and, you know, not let things get stale? Like, keep things that's A good question.

[B]

Well, I've hired help in my main shop, so that makes it a lot easier to keep things current when someone else is doing it. But I actually, a year and a half ago, I guess I'm fueled by haters because I was talking about the hater on that video I did with Jeremy. I had someone comment on one of my Instagram reels and it was like, well, you started in 2018. Like, of course you got your Etsy shop blew up. You could never redo that today. Like, okay, bet. So I started a brand new Etsy shop in a silo just to see how fast I could get to. My goal was a thousand dollars per month in revenue.

[A]

Uhhuh.

[B]

Like you can look on Etsy. It's like last 30 days. I wanted the last 30 days screenshot with a thousand dollars or more and I was able to hit that in 116 days actually.

[A]

Wow.

[B]

Again, skills stack. Like, I learned those skills over the past six plus years. So like coming in fresh with a brand new shop, like I was able to do it way faster than I was the first time. So to answer your question, is it easy to keep things fresh? I think doing fun challenges like that allows me to jump back in without it being boring for me. So I love game gamification. Like if I can gamify something or make a. Or just, you know, stick it to a hater, it makes it a lot more fun for me to like really get back in, dive back into the keyword research, start creating again. Whereas maybe if I was just chugging along it, I wouldn't be as motivated.

[A]

Yeah, that makes sense. With communities that you have, sometimes those go cold or get, you know, do you revive them or do you scrap and start over?

[B]

Of the communities that I've taken off, I don't think any of them have really gone cold. What I will say is we launched three courses at once in 2019. So basically what we did was I partnered with Julie. She was in a part of the fire movement. She had a podcast back in the day called Fire Drill with Gwen. With Gwen.

[A]

Oh yeah, yeah.

[B]

We're like, okay, what are we good at? How we made money. So this was like mid-2019. I'm like, I made money with freelancing, I've made money with blogging, I've made some money with digital products. So what do we do? We launched a course on freelancing, blogging and digital products. We have since shut down the blogging and freelancing course. So to answer your question, I guess when something doesn't work for a while, like, it was just kind of waning, and we're like, it's time to shut this down. So we shut down the freelancing course, shut down the blogging course, and then we just went all in on the digital product stuff. So I don't really have a scenario where something was going cold and then I, like, revived it, but I have shut down things that weren't working. I mean, hence the side hustle graveyard, right?

[A]

Yeah, right, right. Do you have any frameworks for knowing when to shut something down?

[B]

Yeah, when you're thinking about shutting something down, I think there's multiple different angles to take. It's like, okay, what is the thing that you're doing that you want to shut down? If it's, oh, I really want to stop delivering Instacart, okay, you can shut that off tomorrow. And it's always there. It's always available. But if it's shutting off something that is a type 2 that you haven't given it proper time to run, like a YouTube or a blog or digital products, like, if you've been doing it for one month, you're like, why am I, you know, why am I not making a thousand dollars a month yet? It's like, because you have not given it enough time. So I would say for. Especially for side two or Type two side hustles, you need to give it some time. I don't have a finite amount. Like, it has to be six months or three months. I think that's going to depend on the side hustle and depend on you. But I see way too many people give up way too early. Like, we have people in our community who are like, I haven't made a sale yet. I'm two weeks in. It's like, hold your horses. Like, I didn't make a sale for months. But then things started to pick up. I had that huge week during Valentine's week, and now I'm making, you know, thousands per month with digital products. So things do take time. I think it just depends on what the thing is that you're doing. Again, if it's a trade, your time for money side hustle, and you want to quit that because you hate it, so be it. Like, that's fine. But if It's a type 2 one and you're like, kind of like it, but it's just not making enough money for you to want to continue doing it. Like, I remember, I think I have a blog post. I was like, I've made dollars per Hour. Like, I've made a $88 or something per hour on this blog. I've been working on it for two years. It was something like that because, like, you make. You spend so much time. You're like optimizing everything on the website. You're like trying to build all these pillarstone pieces of content and set up affiliate marketing and all this stuff. And you don't. You don't see a dollar for like months. And even like a year in, you might not be making tons of money, but like, all those initial hours that you did at the beginning, they do pay dividends later on. It just might take some time.

[A]

Yeah. I think that's why so few people build type 2 things. It's because it's a lot of upfront work for zero money or negative money because it's a lot of upfront work and cost. So you're like, great, take all my time. Take all my money. And now, now I've just lowered my net worth, you know? Yeah. Like now I have reduced my net worth in order to work more.

[B]

You know, it's the marshmallow test.

[A]

Yeah.

[B]

So many people not in the FI community so much, but in the gen pop, so many people lack delayed gratification or just understanding the power of delayed gratification. I think that's such a cornerstone piece of the whole FI movement.

[A]

Right.

[B]

Is delayed gratification. Like, you can't have everything right now. You can have anything, but not everything. So delayed gratification is so, so important.

[A]

Yeah, absolutely. We've come upon a bunch of cornerstone pieces of the five movement. So optimism is a cornerstone piece. Delayed gratification. There was a third. What was the third?

[B]

I think owning assets is one. If that's.

[A]

Yeah.

[B]

I don't know if we specifically said that.

[A]

Yeah, no. And understanding that your assets, that your money can work harder than you can the capital. So, yeah, capital yields capital.

[B]

Yeah.

[A]

Yeah.

[B]

Okay. We got three. I don't know how many there are, but we're uncovering them.

[A]

Yeah, all three of those are cool cornerstones. I want to go back to something that we talked about earlier. We were talking about the gap, the gap between what you make and what you spend. And of course, the. The beauty when you spend adequate time Investing in type 2, eventually type 2 pays off. Your income gets really high, and that gap becomes huge. But the other thing I noticed is your expenses were low consistently for three years. 24,000 a year. So two grand a month. How did you keep your expenses that low for that long? Because I realized I phrased it as, were you living at home? Which probably sounds funny. So you were living with your parents? Yeah, yeah, for seven months. We all live at home. You were living with your parents for seven months, but your expenses were two grand a month for three years after that. After that.

[B]

So housing, transportation and food, that makes up like two thirds of the average American spending, which is crazy. So I'll tackle each one of those in sequential order. Housing front. I was house hacking. So me and my then girlfriend, now wife Lauren, we bought a 3 family. We lived in the 11 basement unit and we rented out the split level duplex above us. While we had friends who were living in Boston paying like 2,000 plus dollars per month to live in Seaport, we were actually making money from our living situation. So our housing was actually a positive, not a negative. So just that one thing, like if we didn't do anything else, that's a multi thousand dollar swing per month that we now had that money to invest in things like real estate and the stock market. So that was one that was huge. And I think for folks who ask like, what's the number one thing I can do? It's house hacking on the expense front bar none. House hacking is the biggest lever that you can pull.

[A]

Yes.

[B]

I mean, you can sell the car, you can do all the other stuff, but like house hacking, especially if you can flip a positive and you can actually make more money than the expenses are on that house, it's just revolutionary.

[A]

Yeah.

[B]

So doing that, I did not upgrade my car. Like even when I was making that $403,000 year, that was when I was like 25 years old. Everyone's like, dude, why don't you upgrade? Like, even if you're saving 50% of your income, you'd still be spending 200k. I'm like, because I have my eye on the prize, I know the goal. I know what compound interest can do. If I just like keep working at it for this year, I can hit FI at 25. So I didn't upgrade the car. Despite a lot of pressure from family and friends. I just kept driving the Same paid off 2015 Nissan Frontier. Then on the food front, we were super intentional about groceries. We would go out with friends and stuff and like, you know, I'm 22 years old. Like we had friends going out to the bars and we had friends going out to wherever, but we would just like get an entree and an app and split them. Whereas other people might get like an app, entree and dessert and not finish it all. So like even just that one tiny thing, it might sound like nothing, but like that over 50 weekends is thousands of dollars.

[A]

Right?

[B]

Or like and our friends would be spending a bunch of money out at the bar. We just wouldn't buy as many drinks at the bar. Like it's these tiny little tweaks. Like people think that it's, you know, winning the lottery, it's these huge swings or it's selling a company. Doing the right things consistently over a long period of time is what makes results happen. So that's what we did for those three years. It was just like we optimized housing, transportation and food. And once those were all in check, I mean we didn't really have too much other discretionary spending. Like we would travel. We were doing travel hacking. We were doing the whole credit card game and I had a spreadsheet with like a bunch of credit cards doing the points thing. But yeah, we really just weren't spending too much money. It didn't feel like we were depriving ourselves. I think it's the most important piece here. Like we were living in a nice one one. Like it was modern, it was updated, it was just we happened to own it and we happened to have two other units that were attached to us that were paying us money versus our friends who were renting a 1:1 in Seaport in Boston. Expensive neighborhood. Spending $2,500 a month. Again, just that one decision is like a $3,000 swing. Or like we could have easily upgraded the cars, but we just kept the same paid off cars. They got us from point A to point B. They were safe. It wasn't like they were rusting out with the muffler dragging on the ground. And on the food front, we weren't eating rice and beans like I've always been like into health and fitness, making sure like I'm hitting my protein goals, all that stuff.

[A]

Right.

[B]

It's not like I'm, you know, getting the dollar microwavable meals, nothing like that. It's just like being slightly more intentional with some of our choices allowed our gap to be that wide during those three sprint years.

[A]

Expenses of two grand a month. Was that just you or was it you and your neighbor Lauren combined?

[B]

Combined.

[A]

Wow.

[B]

Yeah.

[A]

Did that include health insurance?

[B]

Yeah, health insurance for me. So Lauren was still on her parents health insurance till 26. I have my own health insurance, but it was $274 a month.

[A]

Wow.

[B]

Through the Massachusetts Exchange.

[A]

Wow.

[B]

And I know this differs depending on where you are and your situation. All that stuff pre existing conditions. But for me, I was healthy guy, my early to mid-20s and I just went on like MA Health or whatever it's called, like healthcare.gov.

[A]

yeah.

[B]

And yeah, it was $274 a month. So that did include health insurance.

[A]

Wow. Wow. Incredible. I guess goes to show how much it varies state by state.

[B]

Yeah, it depends where you live. So don't take that. Be like, oh, mine could be 274 too, but it also could be. So like do your own research.

[A]

Yeah.

[B]

Check out healthcare.gov. i think that's the website.

[A]

Yeah, yeah, that's the national website. And then depending on what state you live in, it may or may not route you to a state site.

[B]

Yeah.

[A]

So in the state of New York, it routes you to the New York state site.

[B]

Perfect. Yeah.

[A]

What's next?

[B]

I think one of the most freeing things about financial freedom is not knowing what's next. I kind of like not having an answer to what am I going to be doing in five years or what am I going to be doing in 10 years? Am I still going to prioritize health and fitness and travel and time with friends and family? Of course. But like on a day to day, what I'm doing in my businesses, I don't really know. I don't know exactly what I'm going to do, going to be doing. I don't know exactly what I'm working on. But I think that there's so much freedom in that. I think that's the fun part of fi is you just never know what's around the corner. Like if you asked me five years ago what I would be doing today, I would have never told you all the things that I'm doing now, but they just happened because I just like kind of let life happen and you know, I leaned into the things that I liked and I steered away from the things I didn't like. And I feel like at this point I've kind of built out my ideal life and I feel like every day I'm like excited to wake up and work on what I'm working on.

[A]

Wow, that's wonderful.

[B]

Thank you.

[A]

Well, thank you for spending this time with us. Where can people find you if they'd like to learn more?

[B]

So you can check out my book that just came out, retire by 30, that's @retireby30book.com if you like listening to podcasts. I have a podcast called the Financial Independence Show. Paula has been on a couple of times and then I'm everywhere. Odyd Berman on Social media.

[A]

Thank you. Cody. What are three key takeaways that we got from this conversation? Key takeaway number one, There are two ways that you can reach financial independence. There's nest egg fi, which is that classic approach. That's where you save 25 times your expenses and you live off the 4% withdrawal rate. And that's a method of drawing down a big portfolio over time. But there's a different method. It's called cash flow fi, where you build enough monthly income from your assets, your real estate, from a small business, from digital products, from any income producing asset that you hold. You build enough monthly income that you can live off of that income and never touch the principal. Nest egg Phi, Cash flow Fi. Those are the two camps. The surprising piece of this is the psychology of it. Because even people who build nest egg fi and who sell companies for eight figures or nine figures, they often really struggle with the psychology of drawing down from a lump sum. Because spending down a big pile of cash is scary.

[B]

Yeah. And I've heard this from a lot of people, from folks who have hit fi and folks who have had big exits. Like, I have friends who have sold their companies for seven, eight, even some even nine figures. And they felt richer when the cash flow was coming in from that company versus when they sold it and they had that big amount in their bank account. Because it's scary. Like when you're sitting on a big pile, it is scary to spend that down.

[A]

So that is the first key takeaway. Key takeaway number two, the gap between what you earn and what you spend. That gap is the whole game. Cody's numbers are incredible. His first year in business, he made $96,000. Awesome. His second year in business, he made double that. He made 198,000. Fantastic. For a solopreneur. His third year in business, he made $403,000. Incredible. So he doubled and then doubled again. Doubled every year. Throughout all of that, he kept his expenses flat at $24,000 per year. He held to that flat expense line the entire time. So in that third year, the gap between what he earned and what he spent was $379,000. And so his point is that when, especially when you're early in your journey, the size of that gap matters way more than whether you earn 8% versus 9% on your investments. And the thing is, you don't have to grind forever. Because if you just have a couple of really intense sprint years, those few really intense years can do the bulk of the heavy lifting.

[B]

Imagine you just Have a bucket sitting at the bottom of your shower. And most people are just, you know, you have the shower on low and it's like filling up over time. But imagine you just freaking crank that thing for like three years in my case, and the bucket just fills up. You never have to contribute again because you just like went crazy with the nozzle. In a three year sprint, that is

[A]

the second key takeaway. Finally, key takeaway number three. Scalable side hustles pay you for years, but only if you don't quit too early. Cody sorts side hustles into buckets. And his favorite is the scalable kind. The things that you built once and they keep paying you for years. And so his flagship example are these goofy Valentine's Day printables that he lists on Etsy. The catch is that these take time to pay off. Most people get impatient and bail before it really starts to pay off. He sees people quit just a couple of weeks in because they have these inflated expectations and, and they're like, I've been working at this for a few weeks and I'm not making big, big money yet. And the whole model of scalable side hustles, the model runs on patience. So have patience, trust the process, keep at it, keep on keeping on. And if you do, you can build assets that create a scalable source of income.

[B]

I grinded throughout all of December and January for this Valentine's Day sprint because I was doing like the keyword research. I saw the trends. I'm like, valentine's Day goes crazy on Etsy. So I'd spent so much of my time building those assets, which is kind of going back to the theme I've been talking about with these type two side hustles. But now those assets pay me in perpetuity. Like, I have stuff that I created Paula, in 2018, 2019 that still sells on Etsy to this day, on Shopify, to this day, on my website to this day, it's like, now it's 20, 26, seven years later. It's crazy.

[A]

Those are three key takeaways from this conversation with Cody Berman. Thank you so much for being part of the afforder community. If you enjoyed today's episode, we have a free fill outable downloadable workbook that helps you figure out how you relate to Double I Fire F I R E Financial psychology, increasing your income, investing, real estate, entrepreneurship. So it's a PDF. You can download it, you can fill in the blank. You can either print it out or fill it out on your computer. It's completely free. You can find [e-mail] fire with two eyes double I fire so afford anything.com/fiire grab the workbook. You can fill it out on your desktop or you can print it if you prefer. Whichever you like. It's an interactive way for you to think through how to take these lessons and apply it to your own life. Because what matters is that you take action. So use this to help you take action. Again, that's afford anything.coms II R E thank you so much for being part of the Afforder community. If you enjoyed today's episode, please share this with the people in your life. Share it with anyone who is interested in reaching financial independence, anyone who wants to build a side hustle to create some scalable income, anybody who you think would benefit from learning about the distinction between Nest Egg Phi and Cash Flow Fi. Share this with all of those people and more. Because that is the single most important way that you spread the message to of thinking critically about your finances and about the type of life that you want to live. Also, please don't forget to open up whatever app you're using to listen to this podcast. If you're on YouTube, please hit the Follow button and hit the notification bell so that you don't miss any of our amazing upcoming episodes. And if you're on Apple podcasts or Spotify or Pandora or any of our audio playing apps, please hit the Follow button. And then while you're there, please leave us up to a five star review. Thanks again for being part of the Afforder community. This is the Afford Anything podcast. I'm Paula Pant and I'll meet you in the next episode.