Finance Wanted.

By Terry Sprouse

The 4-Hour Work Week by Timothy Ferriss does what only the best books can do. It strikes a cord deep within us, confirming thoughts that we have always vaguely felt were true, and pointing us down a path that offers fresh hope for the future. Some of the outstanding points the author covers are:

1. Retirement as a goal is flawed. Doing the same thing for 8 hours a day until you breakdown or permanently stop is the wrong way to live. Ferriss says that alternating periods of activity and rest are necessary to survive, let alone thrive. He advocates distributing "mini-retirements" throughout life instead of hoarding the recovery and enjoyment for the retirement years.

2. The question one should ask oneself is not "What do I want in life?," or "What are my goals?" but the real question should be "What would excite me?". To focus in more, you should ask yourself, "What would I do if there were no way I could fail, or, if I were 10 times smarter than the rest of the world?"

3. Getting fired, despite coming as a surprise and leaving you scrambling for recover, is often a godsend. Someone else made the decision for you and it's impossible for you to sit in the wrong job for the rest of your life. Most people aren't lucky enough to get fired and die a slow spiritual death over 30-40 years of tolerating the mediocre.

The author describes several insightful ways to free up time for mini-retirements.

1. Start your own business, then turn the reins over to someone else who runs the operation for you. You become a ghost owner. As Ferriss quotes the Guardian of the Emerald City Gates in the Wizard of Oz, "Orders are nobody can see the Great Oz! Not nobody, not no how!"

2. Outsource your work to foreign and domestic virtual companies that specialize in outsourcing.

3. Negotiate with your present boss to work at home instead of working at the office. This allows you to focus your efforts on the important aspects of your job and doing them more quickly and efficiently.

While I think these are all reasonable options, this is where I part company with the author, in terms of how I approach passive income streams.

What works for me is to buy fixer-upper houses, repair them and rent them out. The work is front loaded with the initial purchase and repair of the property. After that initial push, like the 4 Hour Workweek, it requires minimal input and can allow time for mini-retirements.

For me, the advantage of real estate is that it provides both long-term and short term profits. Long-term from the average 5% increase in equity, and short-term from monthly rental payments and tax deductions. If you turn your rental properties over to a management company, you are free travel.

This is not to take anything away from The 4-Hour Workweek. On the contrary, the book is worth reading because it is eminently thought-provoking and written in a style that is wildly entertaining. (His hilarious Mad Lib fill-in-the-blank job resignation letter is a work of mad genius.) Yet, as I mentioned, the book goes way beyond this by examining deeper themes of life and work that are seldom addressed in such a enthralling manner.

Another excellent book that also takes a meaningful look at issues of work and money is "Your Money or Your Life: Transforming Your Relationship with Money and Achieving Financial Independence," by Joe Dominguez and Vicki Robin.

Terry Sprouse is author of the book "Fix 'em Up, Rent 'em Out: How to Start Your Own House Fix-Up and Rental Business in Your Spare Time."

Terry's blogs:
http://www.fixemup.org
http://www.squidoo.com/fixerupper