As an answer to someone who asked me why I do not go back to work on IT in order to have two sources of income I replied something like the following …
It comes down to this: time is a limited asset.
I think that in practical terms it’s extremely difficult to work in a fixed job and invest well simultaneously. To have good results investing on long periods of time you need to be fully focused on it. When I worked my results were very mediocre or worse than that because I had no time to learn and practice investing. Investing takes too much time to do it well. It’s a huge advantage to dedicate, whenever you like, 60 hours a week to it.
A benefit of working is when you have small amounts of money saved. Then working gives a lot of income in proportion to your savings. For example if you have 50K saved and have a 50K per year job then you make a lot with your work in relation to your savings.
But if you live with low costs or have one million saved then making 10% average a year on the stock market beats most works. So it all depends on how much money you have and how much you need to maintain yourself.
My problem with working is mainly that:
1) I mostly disliked working for clients or bosses. Even as an independent or with my own company.
2) Working took time away to find out what I really liked.
3) Once I had an idea of what I liked working took most of the time I had to concentrate on learning and getting better at it.
As I see it very few people with jobs do well investing on stocks. They basically lose their hard earned money on the market. Others save their whole life and when they start investing they are old and unprepared risking their life savings due to that.
I was not one of the few lucky ones that knew soon what he liked. If you are fortunate to know it, whatever it is, then it’s a sin not to be doing it already. And working for money on something you do not like takes a toll on you, if you value yourself and your time you should really ask yourself if it’s worth it. Think about what Warren Buffett said:
If you gave me the choice of being CEO of General Electric or IBM or General Motors, you name it, or delivering papers, I would deliver papers. I would. I enjoyed doing that. I can think about what I want to think. I don’t have to do anything I don’t want to do.
The ideal with investing or any job you really like is to start as soon as possible, seriously, full time and most importantly: really loving it. It’s hard to compete with someone who does what he loves. Keeping pace with someone passionate about his job is tough. Loving your professions will make you advance fast and do it the best you can. Chances are high that you become an expert at it. The sooner you start what you like the better for your well being, health, and happiness.