I’ve been playing this game called Path of Exile recently. Actually, let me correct myself. It’s more like I’ve been “living” the video game lately because I played for so many hours already. I found out that this behavior is pretty common. In fact, spending hours and hours on a game is so common for so many people that there’s actually a term for it. They call it “no-lifing” (pronounced no life-ing) a game because you spend so much time of your day in the game that there’s no life left to do anything else in your life.
My wife can’t understand why I’m so obsessed with this game. And I agree with her that there’s no reason to spend so many hours trying to get an item in the game that’s pretty meaningless at the end. But look under the hood more closely and you can see why people become so addicted. In the game, you slay monsters, and eventually, you get enough in-game currency to obtain a better item. This in turn makes your in-game character more powerful and thus lets you enjoy your life a bit more in the game as you slay monsters more efficiently to gain more in-game wealth.
Here’s where it dawned on me that this is just like our pursuit of financial wealth. You make money (and save it). Eventually, you amass enough to be able to use that money to make money. Then you can use the money to enjoy life a little bit more and be more efficient at making more money.
That’s all interesting, but can we translate this understanding into us being able to gather more wealth? Luckily, it turns out that we CAN use this information to further our path to financial independence. Can you imagine how much more money I can amass if I spend just a fraction of the time I spend on these games on activities that result in more wealth?
I could serially refinance any loans I have as long as it’s no cost and the interest rate is lower. I could start a few broker transfers and take advantage of the signup bonuses that different companies offer, then keep track of how long I need to keep funds in the new accounts before I switch them yet again to another brokerage firm for another bonus. I could play the credit card game and earn a ton of sign up bonuses and reward points. Those are easily doable by anyone as long as you put your mind to it.
I could also start a part-time job. One area I could make a few extra bucks with is through writing. It’s not like I have people banging on my door asking me to write for them, but I’m sure I can eventually find one, probably more companies that are looking for people to write about money topics.
There’s only one issue with this whole thing. I’m not obsessed with making money right now. How do I, or you if you are interested, become more motivated?
Thinking back, there’s been a few times in my life I’ve been “no-lifing” something. I remember working as a sales manager, where I’ve basically been no-lifing the job in order to make money. Then there was the time when MoneyNing.com was first starting. I was thinking about the site so much that I distinctly remember being really upset in Hawaii while we were supposedly vacationing because people were driving too slow. No, I wasn’t upset because I wanted to get to the destination faster. I was mad because they were in the way of me going back to the hotel room so I could work!
Talk about obsessive behavior!
Why was I, or why am I so happy to no-lifing something? The answer was obvious. Other than the fact that everything was new and fresh so it’s more interesting to me, I was seeing constant and rapid improvement. In any addictive game, you are constantly leveling up and getting new and more powerful items. At the sales job, I was signing up customers often enough that I was making really decent progress and making more money. And the early days of MoneyNing.com saw explosive growth. The site was making record highs in traffic numbers daily, if not weekly.
When you see progress, you feel good. And when an activity makes you feel good, you don’t mind spending more time on it.
Progress, it seems, is key. Part of the problem of asking people to work on their finances is because it takes months, if not years, and sometimes even decades to see results.
Paying off debt is extremely beneficial, but progress happens at a snail’s pace as any payments you make at the beginning of a debt’s service life go towards the interests charged.
Investing is worst because volatility can erase years, and sometimes even a decade’s worth of progress. That’s why we aren’t kidding when we tell you that investing is for the LONG TERM because you are essentially gambling with your money if you are buying in and out based on performance in weeks and months, even quarters, and sometimes even years.
Unfortunately, there’s really no way to truly speed some of these things up to increase our motivation. We can, however, make building wealth more fun for us by showing ourselves the progress we’ve made more often. We just need to spend a bit of time keeping track of our progress.
Want to get started? Here are a few ideas of what you can track so you can feel good about how far you’ve come.
Have a budget, and keep grinding expenses lower. Many people talk about cutting expenses because that’s easier for some to do than trying to make more money. The problem with always thinking about cutting is that it’s extremely hard to cut when all you can think of is the sacrifices you are making. When you have a budget, you aren’t just logging down what you are spending but you can also look at how much you were spending before. Being able to see how much you used to spend and the progress you are making is huge.
Being able to track progress is the single best benefit of having a budget. Don’t let this opportunity pass you by.
You should also start tracking your net worth, and chart how much you’re worth financially over time. I’ve had a spreadsheet that shows the financial assets I’ve amassed for about 10 years. It’s fun to see the numbers grow over time, so I look at it from time to time to give myself a smile on my face. I also go back to it whenever volatility in the market strikes because while my emotions are telling me that I’ve just lost a significant portion of my wealth, the data often tells me that I’ve only gone back to the wealth level of a year and maybe two at the most.
Whenever I see the hard data that confirms that things aren’t as bad as they seem, I feel less emotional, which helps me stay calm during market volatility.
Concentrate on how much interests and dividends your portfolio is making, and see it grow. I also track the dividends and interests that my portfolio throws off. While market value can go up and down pretty drastically on a daily basis, the income that an investment portfolio throws off is much more stable.
Over time, income from your portfolio will grow in two ways. You will own more shares with your contributions, and that will increase your income. Companies also tend to raise their dividends over the long run, helping that income grow as well.
Start tracking for a few years and you can see that number creep up steadily. Then tell me it’s not addicting to try to increase it.
Once you get going, just make sure you don’t start chasing higher dividends, favoring stocks that pay high income because that could be a ticket to bad returns.
Finally, your progress to pay off all your debt can definitely be tracked. List out everything you owe now. Then, track the balances over time. Cross them off one by one, and periodically go back to that spreadsheet and look at how you’ve done.
While I haven’t played the game today, it’s hard to imagine that I will all of a sudden stop playing entirely and devote my time solely to make money any time soon.
Still, you and I can really give our wealth building activities a boost if we are more motivated to increase our financial standing.
The way to do that is with tracking and seeing progress.
Start to keep a log now and reap the rewards soon. I wish I could show you the smirk on my face now that I can tell my wife how my video game addiction have a financial benefit. I hope this benefits you too 🙂