Mr. Money Mustache vs. Tim Ferriss

“Who is this Tim Ferriss guy?”

If you find yourself asking that question, then congratulations, you get five extra Mustache Points for not tuning into US mainstream media for the last several years. In fact, I myself was blissfully unaware of his existence until I started this blog last year and noticed everyone either worshiping or criticizing him.

For those just tuning in, Tim Ferriss is the dude on the left. In a fit of Photoshop brilliance, I put on a similar shirt, photographed myself doing a fake punching move, and added myself on the right, just so you will think that I am in the same dynamic and exciting league as Tim. He’s an interesting man indeed, because despite being a bit younger than me, he has already started a few cash-spraying companies, popularized the “Lifestyle Design” movement, published two bestselling self-help books, and met many of the world’s famous people* – not to mention winning various competitions in unusual disciplines like Tango and Chinese Kickboxing.

Because of all of this success, he has spawned competing armies of copycat followers and sarcastic mockers. The twentysomething followers start their own lifestyle design blogs and tell the world to “Be Awesome! Live life your own way instead of taking it from The Man!”. And the slightly older mockers point out the flaws in the philosophy and complain about the annoying self-entitled confidence of both Tim and his followers.

I have watched both sides of this argument with a slight nervousness. Without even knowing the field existed, I may have accidentally started a Lifestyle Design blog myself. In fact, I once saw a Twitter comment that a stranger posted linking to one of these MMM articles that said something like, “Awesome stuff – Tim Ferriss and this guy should have a baby together!”

But which side of the argument is right? Is the concept of “The Four Hour Work Week” compatible with Mustachianism? To find out, I took time out of my busy schedule to carefully read Tim’s seminal work, The Four Hour Workweek.

In a word, I’d describe the book as “Surprising!”.  I have never read a book with so many unusual and counterintuitive ideas, presented with such confidence. I mean, I thought I was slightly odd for describing the fact that over 50% of the rich world’s consumption and work is irrational, stupid, and should be stopped immediately so we can all start having some real fun with our lives. But in many ways this book out-stranges me. And many of those ways are quite good.

Let’s start with the basics: Tim went to a good university and got a good job after graduation. But he’s a hacker, so he wasn’t satisfied with the ratio of reward to effort. He started his own company on the side selling sports nutrition supplements, which did well. But he found it was sucking up growing amounts of his time each week. At 80 hours, he snapped and decided something had to change.

Then he figured out how to empower other people to run the business for him and get the whole thing to go mostly on autopilot. At this point, he found he was making something like $40,000 per month, yet only working four hours per week. Hence, the idea of the Four Hour Workweek was born.

Using his newfound freedom, he toured the world and learned lots of interesting new skills. And eventually, he wrote the book itself, using some very clever tricks to go from novice author to #1 New York Times bestseller in just a few months.

That’s a drastically different and more exciting path than my own, yet we both ended up financially free at about the same age. There’s an obvious difference in that his financial freedom is based on a very high level of income and spending, while mine is is way down near the US average. But the interesting part is that we both realized the same things once this freedom was reached: life is not so much about money or possessions,  it’s about freedom of time and mobility to go wherever you like. And it’s not about not working, it’s more about not being tied down to any particular job.

There are several more concepts and quotes I liked in this book:

• “Most people work decades in a job they hate, with the vague promise of retirement as their motivation. How would your choice of work/life balance change if retirement was not an option?”
• Most people focus on being busy rather than being productive at work. By walling yourself off from distractions, meetings, and even spurious emails at your (office) job, you can usually double your hourly productivity. Then leverage this into a work-from-home arrangement where you continue to do the same job, in only half the hours.
• To someone who becomes good at making deals with other people, reality is negotiable.
• Cancel your TV, your magazines, your casual websurfing, and your newspaper subscriptions. Put yourself on a low information diet where you only take in things that are relevant to your goals.
• The old way of work (fixed hours and work days in a fixed location) does not work well with the natural human cycle. We have waves of creative energy and inspiration, interrupted by periods of downtime.
• Setting ridiculous goals and disregarding common objections to them often works surprisingly well. Getting in touch with company CEOs or other famous people and asking them to help you, getting a job near the top of a company, or creating massive publicity for your own products. All of these things are easier and less competitive than expected, because most people are afraid to even try them.
• Expand your comfort sphere by doing uncomfortable things. Getting phone numbers from attractive strangers. Negotiating for prices everywhere you go. Asking your boss for a raise. Lying down on your back in the middle of a crowded pub.

That’s all exciting advice. Although you’ll find it in many business and self-help books, it means more to me coming from a very young entrepreneur than it would mean to hear the same things from a crusty old fortune 500 CEO. But eventually the book goes off into a new direction: outsourcing your entire life. Ferriss describes his experience with hiring Indian subcontractors as “Virtual Assistants” – people to book his meetings and travel, do his online research for him, even organize social events and help his business with special projects. The idea is that for under $10 per hour, you can hire really clever people to do a good chunk of your work for you, so you can do your even more important work.

It all started sounding very practical and clever until I realized that I don’t need assistants, because I have taken the opposite approach and designed simplicity right into my life. I have plenty of time to take care of anything that needs doing by myself, with plenty of time left over. Sure, I still automate away some of the busywork using computers and other gadgets (automatic income deposits, bill pay, bank account transfers, financial tracking, online calendaring and documents, etc.), but with those bases covered I find there is not much else that needs doing.

And that’s where we find the biggest contrast between The Four Hour Workweek and Mustachian Early Retirement. Tim goes into great detail on how to start an online business that sells products to people. That is supposed to generate passive income so you can live the life of your dreams. Then he encourages you to add up all the costs in the life of your dreams. “It costs less than you think!”, he says. One example he gives is that you can lease a Lamborghini Gallardo for only $2800 per month. Wow! No problem!

The idea of earning financial independence by actually amassing some of your own capital is quickly dismissed. To paraphrase,

“To retire on money alone, you’d need like a million dollars, which not many people can accomplish. And even if you did get that million dollars, inflation would be eating away 2-4% of it each year, destroying your purchasing power. Finally, if you WERE hardworking enough to save a million dollars while you are still young, retirement is going to be about as fun as poking bicycle spokes in your eyes. You’ll want to start a business. So why wait for retirement?”

I’ll have to call a timeout here. First of all, the perspective on inflation is naive. Investors like you and I always take inflation into account when designing our portfolio – as long as you earn more than inflation, your purchasing power increases rather than decreasing.

More importantly, by failing to start their journey by first learning to live happily on a low level of spending, 4 Hour Workweek followers may be setting themselves up for a lifetime of chasing expensive thrills. To focus on earning more rather than spending less is to neglect the fact that we are already living lives of drastic overconsumption. We are already spending plenty of money to achieve happiness – all of us. Let’s figure out first how to totally decouple spending level from happiness, and shed the inconvenient burden of insatiability.

Then you can still go out and earn a shitload of money. The difference is that you’ll tend to save it and invest it in social change for the better, rather than spending it on yourself.

Or you can keep your existing job, save well, and still end up financially independent and free while you’re still young. You don’t have to start an online business or do anything particularly crazy.

The original target audience of this blog was the well-paid office workers of the world. I felt that for people earning over $60,000 per person per year, financial independence was already so easily attainable, that it would be an unnecessary distraction to spend years building a second business to increase income still further.

But Tim Ferriss definitely sells the idea well. His book should be viewed as a supplementary course in Badassity, and will be especially valuable to younger people who are near the beginnings of their careers, and also to anyone who is on the lower end of the income scale who is willing to fight to move to a higher level.

Going back to the Twitter comment about MMM and Ferriss – I would agree that we could have a baby someday. The baby would be some kind of hybrid between our ideas. We’d take all of his energy and fearlessness and complete lack of fear of failure. But we’d strip out a bit of the hype and selling, because we wouldn’t be out to make money for ourselves – we already have plenty. We wouldn’t be creating products to sell. Instead our product would be a globe-spanning breed of supermotivated and ultraproductive Badass People that would be out to save the world.

* Compounding the celebrity intrigue, Tim Ferriss is apparently friends with another one of my much more famous frugality arch-rivals, Ramit Sethi.