Chapter 1
Becoming Brave
January
This Month
- Warren Buffett and Value Investing
- Rule #1 Investing
- Inflation
- My Investing Practice
IT HAD BEEN ONE OF THOSE EXTREMELY LONG WEEKS, AND ONE FRIDAY nightâs sleep had only smoothed out the rough edges of how tired I was. I wasnât sure how many months it had been since I had really looked up from my desk, and that morning, I finally had a moment to remember that there was a world outside my office.
I was a low-level lawyer in the Boulder, Colorado, office of an international law firm, and as many other law firm associates have, I thought going to college, grad school, and law school and working hard at a law firm were the âsmartâ decisions for my financial future. After graduating from New York University School of Law, I had intentionally ignored the workhouse law firms of New York and gone back home to the Rocky Mountains and the âlifestyle orientedâ law firms of Colorado. I had gotten my dream job doing venture capital and startup law in the deeply innovative Boulder entrepreneurial community, but still wanting to work at a sophisticated legal practice, I had ended up at a large firm with New York work hours anyway. I learned a great deal, and paying my dues with the stress from eighty-hour workweeks had been an acceptable trade-off.
However, as I observed the lifestyles of the people ahead of me in their careers, it slowly dawned on me that the only reward awaiting me was working more hours, internalizing more stress, and continuing to be salary dependent with no end in sight. I thought I had invested in myself, but really, I had invested in a lifelong treadmill.
The money was just not worth it. Yes, I could make enough money as an attorney to live well, but I had no time to actually live well. I wanted to feel passionate about my life. I wanted to wake up and be excited about the day. I thought of the partners in my firm, who were still on that treadmill despite years of experience, and realized: I donât want this life.
Striving for happiness through my law career wasnât working, but I knew that pursuing happiness without any regard for money was unrealistic. The truth is, there is a special kind of happiness money can buy. It can buy liberation from a lawyerâs 6:00 a.m.-to-midnight grind. It can buy a house in a good school district. It can buy a permanent end to waking up at night anxious about medical bills, student loans, or a mortgage. And it can literally buy time and experiences and choices in life, like, say, a Porsche 911 and time to race it. The ability to do what you want feels like more than just happinessâit feels like joy. It feels like pure freedom.
Looking out the cold window that morning, I did not feel joy. As much as I adored the people around me and my legal practice, there is a tipping point at which the pain caused by overwork makes the experience and salary of a job not worth it.
I was ill. I hadnât been able to properly digest food for about two years and I had begun vomiting randomly. I would get a high, twenty-four-hour fever out of the blue, or leave the office with a dizzy feeling like I had been hit in the head. I got tonsillitis, then got it again, and again, and again. I hid my symptoms from my coworkers as well as I could, which wasnât very well. When I went on medication to control the vomiting, my doctor gently suggested that my illness was caused by stress. âI donât feel stressed, I feel normal,â I promised her, and I meant it. I didnât get that my ânormalâ was skewed.
I should have seen that my bodyâs reaction was a warning from the universe that I had slipped away from doing what I was meant to do in my lifeâwhat ancient Indian texts call âliving in dharma.â Being in your dharma should feel as smooth as floating in the current in a calm river. The river always flows in a straight line until it is forced to turn, which means you often are pointing in a different direction than your ultimate destination. And like that, zigging and zagging to try to find the current, we all make our way through life.
I wasnât zigging or zagging, though. I was toiling in the choppy waves, being slammed against the riverbank by the water, struggling to breathe and stay afloat, and I couldnât remember that there was a smooth current right next to me if only I would zag.
I had been down so long, it looked like up. My lack of workâlife balance was particularly bad, but most of my friends, also in their mid-thirties, had the same types of jobs and similar stress. One lawyer friend had a mini-stroke on an airplane when flying overseas for work after months of almost no sleep. Another âburnt outâ after months of intense work hours when he started seeing spots in front of his eyes and was unable to remember how to get home. Another had stress-related stomach problems so severe she was hospitalized twice. I knew at least three people who depended on weekly acupuncture appointments to function at work. It wasnât only my generation. A friendâs father, a high-level manager at a well-known technology company, was the only person at his level to make it until his stock options vestedâevery other manager left for health reasons or passed away. When my friend told me about it, she said he was âthe only one who lived.â
Of course, work isnât the only part of life that causes life-altering stress. One couple I knew were juggling kids and jobs and were so sleep deprived that they barely spoke to each other anymore, to avoid starting an inevitable argument. Another friendâs fiancĂ© broke up with her, and she lost her love, her future, and her home in one day and had to scramble to find a place she could afford on her own and move in quickly. Money alone canât solve these problems, but it certainly can buy some literal helpâchildcare, movers, security depositsâand create peace of mind.
We are all exhausted and think itâs normal to feel that way because itâs so common. âLeaning inâ to our work is considered the virtueâeven though Sheryl Sandberg herself recently said she had not really understood how hard it is to succeed at work when you are overwhelmed at home.* We keep running on the treadmill because the challenge feeds our ambition, and if we stop, there sometimes arenât any other treadmills to get on that will pay student loans.
Still, I had been certain I could push through. It wasnât all bad. Supporting my innovative clients was my favorite part of the job, and working with my whip-smart, pragmatic, and kind colleagues was a pleasure. However, when my family started to suffer too, that became more than I could bear.
I had canceled plans with my dad, mom, and sisterâand worked through Christmasâso many times that they stopped expecting me to show up; eventually, they stopped making plans with me because there was no pointâwe all knew I wouldnât make it. Hard work and ambition are prized in my family, and they understood, but there was a tone of concern that had been growing strongly, and lately they had started making pointed comments about how this wasnât going to work in the long term, and no job was worth the damage to my health. That January morning, thinking it over, I realized I needed to protect them, not hurt them.
But I couldnât get off the treadmill because I had student loans and a mortgage, and I loved a great deal about my work.
I called one of my best friends from college, Kamala. âI donât know what to do anymore, Kam. I donât know how much longer I can keep this up.â
She sighed. âMe too. I write every morning before work, but I hate what I write.â Kamala is an extraordinary writer and novelist who was getting up at 5:00 a.m. each day to write her second book, while working a day job in marketing. Her potential was being slowly buried by New York City rents. âI feel too tired all the time, and not creative. When I look ahead at the next few years I just think, Is this it? Am I going to keep struggling? Is this how it is?â
âNo,â I decided. âNo. Youâre too good of a writer to get stuck in a dead-end job. Thereâs no way that can be the end of your story.â
âWell, it canât be yours either. I think itâs clear. You have to leave that place. You just have to figure out how to financially afford it.â
âItâs hard, though,â I prevaricated. âThere is so much I love about my work. But honestly, I donât see any way to do this job without working as much as I am.â
âWeâve got to make this the year that we make real changes,â Kam decided. âWe canât keep living like this. Itâs too . . . pointless.â
âFoin,â I reluctantly agreed. Kamala coined the term âfoinâ when we were in college to mean âfine, I agree, but reluctantly and begrudgingly.â âI have no idea how anything can change, but Iâll put the intention out there.â
âMe too,â she declared. âMaybe the universe will kick up some dust and shake things up a bit.â
I knew Kamala and I werenât the only ones who felt torn. My friends and I, all working in very different fields and having grown up in families of varying economic status, talked regularly about our similar dreams of having financial flexibility well before the time of official gold-watch-and-golf-course-style retirement to do whatever we want (if such a thing even exists anymore). âFinancial freedomâ could mean having just enough in the bank to add flexibility to our livesâto stay at a low-paying job we love and be able to easily support loved ones, to work part-time, to have reliable childcare, to quit a salaried job and start a nonprofit, to move to a safer neighborhood, to travel, to simply have a financial cushion in the bank for the apocalypse. To live the life each of us was born to live, whatever that might be. Then there is the ultimate goal: to be truly financially comfortable at the time that we want to fully retire or, even better, to be able to forget the money and just do what we love forever. Thatâs financial freedom.
âFinancial freedomâ means something different to each of us. To me, financial freedom meant balance in my life: quitting my law firm job, getting healthy, and working with startup companies and entrepreneurs without the pressure of having to work ten hours per day. I wanted flexibility and a financial cushion that was large enough that I wouldnât have to worry about the bills. I wanted to be debt-free.
In my financial life, I realized that I lived with two selves: current self and future self, both of whom wanted to enjoy life and feel secure. Often, though, Present Danielle and Future Danielle were necessarily in conflict. All that New Age-y advice to live in the moment and not worry about the future was great for Present Danielle to abandon it all and tour the wineries of Tuscany, but not so great for Future Danielle to have food or shelter. Putting my nose to the corporate grindstone now was great for Future Danielle, but not for Present Danielle or my family. Living in the antagonistic relationship of my two financial selves felt constantly unstable. Present and Future Danielle needed to have a symbiotic relationship. I had to bring my financial selves into balance.
I had to create that freedom. But I had no idea how.
I started feeling some internal pressure. To figure. This. Out. The jitters started in my stomach. Maybe there was an easy fix? Or maybe there wasnât. The jitters got worse, and I started getting antsy with anxiety. What on earth was I going to do? I needed to physically move. I got up from my big armchair, made some tea, and plomped back into my chair again.
I called my dad. He knows a few things.
âDad, Iâm thinking seriously about my career plan. What can I do to get some financial freedom so I can leave this job if I need to? What I want is to not be depending on this jobâor any job, for that matter. I want to be able to do the work I want to do without worrying about financial issues. I want freedom money.â
My dad replied, âHoney, that eighty-hour-a-week job at the law firm has clearly run its course for you. I think nature is telling your body that quite loudly. Now you have to figure out how to get some balance in your life and still somehow get the money youâll need for the lifestyle you want, right?â
âRight. I love so many parts of being a startup lawyer, but I want a life too.â
âOkay, you love what you do and youâre really good at it. So, if you want this career, then the answer is obvious, right?â
It is?
âYou have to start investing. Then youâll have the money to have the choice. Right now, you have no choice.â
Oh. Of course thatâs what he was going to say. My mind drifted to all the times he had told me that already.
My father, Phil Town, already has a life of financial freedom: he loves his job and he has the money to do whatever he wants to do. He knows how to create money starting from almost zero because he did it himself.
After dropping out of college and getting dirty for a living as a young lieutenant in the U.S. Armyâs elite Green Beret unit in Latin America and a platoon leader in Vietnam, while working as a river guide in the Grand Canyon,* my dad had a chance meeting with an investor who ended up teaching him how to use the value-based strategy of renowned investors Benjamin Graham and Warren Buffett. Value investing is an investment strategy to buy stocks based on financial fundamentals at prices below their value. It was first defined in 1934 by Benjamin Graham and David Dodd in their book, Security Analysis.