How I got wealthy without working too hard [Extended]
Specialize, Don't live in big cities, Go full-remote
If you are a Software developer, it’s easier than ever to become a millionaire.
What most haven’t figured out yet, is how to become wealthy without working too hard.
Don’t do a startup.
Specialise in something that every company likes a lot. Avoid niche tech, go for huge popular things (eg. AWS, JS, Python, React).
Take a $ 500-1000 / day, full-remote job (If you don’t know how to find them, there’s a chapter about it).
Don’t live in big cities (go for smaller, more liveable towns).
Leave any job that requires too much work or too many meetings. Meetings are the mind-killer. You’ll quickly find another gig because you specialized.
Take 2 months for holidays in-between contracts.
Do this for 7 years while investing most of your salary in a diversified portfolio. Don’t go too crazy with Crypto.
Congratulations. You’re now a millionaire like any other senior programmer that invested, but you’ve worked less, and for fewer years.
Keep reading for the details, I’ll show my investment portfolio later in the article. Consider subscribing to this mailing list, it makes me happy to see the numbers go up and keeps me going:
Preamble: I'm extremely lucky. If we live in a Simulation and life is just a Video Game, mine was started on difficulty level “Very Easy”: I was born in a developed country in the 80s (Italy), with access to fresh water, very good carbohydrates and a decent education system. So what you're going to read is 99% luck and 1% planets alignment. Please, correct success stories for selection bias.
On the 14th December 2010, I joined a protest in Rome, admittedly not understanding very well what was happening. That ended up being one of the most violent protests in recent Italian history, with thousands of peaceful protesters in the midst of riots, cherry bombs, cars on fire, and police vans hurled at crowds of young people.
Such was the political atmosphere after the 2008 financial crisis. At distance, that was just the consequence of 20 years of Italian economic decline and the following reduction in opportunity for the younger generation.
I didn't understand what was happening, but I wanted to escape all of that and, like many southern Europeans I migrated to the north in search of opportunity.
I worked in the UK for a few years as an employee and later as a contractor. Then I burned out and figured I couldn't handle the city anymore, so I quit my job and did some travelling.
At some point, I realised I was running with everyone else: Go to work every day, 3 weeks holiday, mortgage. Even Friday-At-Home didn’t feel like a treat anymore. So, many years before the Covid Pandemic, I started doing remote-only. When the Pandemic came I felt the world caught up with me.
In the beginning, I was riddled with doubts: can I have a Software career only working remotely? Will I find clients? Will people that go to the Office have more opportunities than me? Am I just lazy? In hindsight, I should have just relaxed more.
Most people measure wealth as the sum of all the bank accounts and assets. Hence, maximising wealth becomes just a matter of maximising the total amount of currency you have. This is the "Greedy capitalist formula": max(current value of assets).
We know life is very multidimensional, but to some extent, we all end up using that formula to estimate what's better.
We know it's wrong but we still use it for many choices because it's simple and universal. It's also easy to justify to our peers: I did that because of this gain (or avoided loss). Humans are not very rational, and we need to phrase what we do to others to make sense of our own decisions. Without wording our thinking to someone else, our brains don't really function. This is also why almost all forms of psychology work: because talking to others works.
So, what should we optimise instead?
My personal mantra is: “try to get 80% of the reward with 20% of the work”. I’m not interested in giving 100% to get 100%: that is an overcrowded game.
Making money is procrastinating
Money is the ultimate optionality: it's the right to buy something later. The cost of that option is the inflation rate.
So when we don't know what to do, we focus on making more money, assuming we are going to figure out what to do with it later.
This can be a wise approach, as having savings increases our freedom, but it gets overdone: it becomes a form of procrastination.
When making life decisions, going in the direction of more money can be wise. However, we must keep in mind that when we choose money, we don't choose much. We just decide to decide later.
So instead of "make more money", I look for more free time, more agency, more future freedom. That often means looking for more remunerative opportunities and quitting a Contract to jump on a better paid one. But it also means quitting a job because that company does too many meetings and wants me on the screen for too many hours. I want to be on the screen 2 hours a day and make 80% of the salary I could make.
This philosophy is exemplified in these three points I’ll expand on:
Do not compete
Escape Big Cities and Go Remote
1. Do not compete
The single most important choice you can make in your financial life is to escape the rat race. Use the market, do not compete in it.
If there are many jobless painters in the market, do not make painting your job. If you like to paint, please paint! but do not make it your job.
Do not fight the market. If there is a high demand for UX Designers and you have some design skills, spend some resources to get into UX design.
As Peter Thiel says: in the last 20 years the only engineering fields worth pursuing were Petroleum Engineering and Computer Science. I don't mean you should get into those fields, just that you should figure out how not to compete with everybody else. Find a niche.
You can get better than anybody at something, but not without consuming your life working. Some people are really into what they do, to the point they end up working all the time. That is fine with me, but it's not what most people want. Work always requires some level of sacrifice: do not self improve *ad infinitum*.
There is a whole category of things you learn about only after you learn to read English: *Self-improvement* is one of those things. Some parts of the Anglosphere Global Culture are more evident if you were raised outside of it.
Self-improvement starts from the idea that you can improve by applying discipline. You could be better, healthier, wiser, wealthier if you just applied yourself. This is cool.
But please, do not spend your life self-improving. At some point, we're going to die, self-improved or not. Don't look at unproductive time as wasted time.
A lot of us are going to die of unpredictable diseases, some of us young. Really, don't spend your life getting fitter, healthier, more productive. We are all going to die, and Earth will explode in the Sun in a few billion years: please, enjoy some now.
I'm advocating a sort of Moderate Hedonism. Work and self-actualisation can be rewarding and meaningful, but looking at the sea from a hammock and drinking too much beer with friends three times a week is also a completely respectable way of waiting for the gravitational swallowing of the planet.
2. Escape big cities and Go Remote
I could just say Go Remote. But more importantly: do not live in big cities.
Big cities are the geographical locations of the rat race, it's where you go to compete.
"Yes, but big cities have more opportunities and more connections". True. Probably they are more bearable at a young age, when grappling with the existential urge to mate.
I started doing remote-only contracting in 2014, and I had doubts about its sustainability. Then the pandemic came, and now I only find remote job offers in my inbox. If you think your company is not gonna accept it, change company. Also, they will be forced to change in the next ten years. I think Remote-Only work, like Electric cars, is happening way faster than people think.
Remote-First and Fully-Remote are here to stay, and probably the biggest change in the history of tertiary work.
Compounding is only Third in this list, but it could be first.
We live in the age of Nation-States. Nation-States are political constructs, like Italy, Japan or the United States. This idea of a contiguous big land area with homogeneous culture and administration is pretty recent in historic terms. Nation-States really like to have their own currency, or "money".
Nation-State's money is designed to favour the goals of the Nation-State. It can be printed and used for the goals of the State.
The monetary system is really a Spreadsheet that keeps track of the hours worked by everybody. Now, the important detail here, is that the Nation-State (really the Central Bank) can arbitrarily steal hours from everybody to enact its political goals.
If you invest €100 in some asset that returns 5% per year, after the first year you will have €105. The following year you won't have €110, but €110.25. That tiny difference is the real way to get rich. People don't take that tiny difference seriously enough. In 10 years that tiny difference will make all the difference.
In general, if you have P amount of money, and invest in something that returns r every year, after n years you will have:
That's an exponential function. People that get wealthy take a sit on the exponential function ride, while regular people lose to inflation. You don't need to do much, nor to be clever. Just take a sit on the exponential ride.
Note: If you take the previous formula, and make it continuously compounding, you get what finance books call the Time Value of Money: e^tr . Money is literally defined as exponential so, don't sit on your linear ass.
I’ll include my investment portfolio later in the article.
How to find remote jobs
I’m mostly contacted by Companies at this point, and I have a very explicit Remote-Only contractor profile. But there are many ways of going about this.
There are now plenty of professional networks that focus on Remote-Only contracting. The most important in the US is Toptal. They have a solid interview process, but it’s not the only one anymore.
There are now also Remote-First recruiting companies, like Turing, or Hired, and plenty of boutique remote-only agencies. Signing up with these agencies can help you lend your first contracts, they will give you helpful feedback on how to improve your skillset. Also, most traditional recruiting companies are just pivoting to Full-Remote as they are seeing the tide move.
Probably the most important trick is this: build a public online profile. A website, or a blog where you show at least a couple of side projects (websites, apps, GitHub projects) and previous work experiences. Portfolio matters: in this business companies really don’t care much about your Degrees, as much as your Portfolio. It’s not easy to be considered Senior, but the demand for skilled developers has been rampant since the 90s. So, if you can show something you’ve built and deployed on your own, you’re very well positioned. Decent spoken English matters as well, but I’ve met many remote professionals that built a solid remote career without being Shakespeare.
Once you have a visible public profile, if you find it hard to get into networks like Toptal, you can instead go for Permanent roles at remote-first companies. There is now plenty, and you can find them via websites like remoteok.io or weworkremotely.com.
Submitting your CV / Portfolio directly to the “Careers” page is surprisingly effective. Tweak your portfolio, show what you have done, submit a lot of CVs to many companies over months, try again and again.
My Investment Portfolio
My Investment Portfolio has changed a lot over the years. On average I’ve been more aggressive in the past, but I’ve always used trite and well known ETFs that keep track of US / European stocks and bonds. Nothing fancy! Just regular passive investing. I didn’t get to $1 million with Crypto (unfortunately).
This is what my portfolio looks like now when accounting for various Trading / Bank accounts:
Risk should depend on your age and needs. I try to keep Crypto around 10%, so I tend to rebalance as it grows. I’m pretty conservative now, as I’m not comfortable with the recent overexcited markets, and I don’t really feel like I need my money to grow.
“Developed stocks” is composed of ETFs that track the S&P, FTSE and European stocks. I basically have a Boomer portfolio, but I’m in my 30s.
Note: I didn’t include in the portfolio a house I own, which would be my only Real Estate investment.
If you are not familiar with passive investing and ETFs, please do some reading:
As you’ve probably figured out, I’m a Senior Software professional from Europe, and Amaca is my newsletter. I decided to stay pseudo-anonymous to be able to write without filters, without compromising my professional identity.
Over the last 10 years, I managed to save up and invest a good sum, but I still take contracts every now and then, without the pressure.
I write about Programming, Investing, Contracting, CryptoEconomics and anything that I fancy.
Consider subscribing to this mailing list and following me on Twitter @AmacaCapital. Seeing the numbers go up makes me happy and keeps me going:
Read Peter Levels on the subject: https://levels.io/the-greatest-migration/
The book “Psychology of Money” by Morgan Housel is a great start (or anything by Morgan Housel, he’s great).
Also, the Stock Series by JL Collins is a good read too.
I like your definition of money:
"when we don't know what to do, we focus on making more money, assuming we are going to figure out what to do with it later."
I love this ! Raw, insightful, practical and very honest :) I too have escaped the rat race but unfortunately I didn’t have valuable coding skills your have , so it took a bit longer . Loving living out the city and exploring and hiking through nature - time I would have to spend commuting if I lived in the big city ! Thanks for sharing your insights !