Category Archives: planning

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Celebrating my fiscal year end; planning how to improve

When I incorporated my business last February 19, I chose September 30 as my fiscal year end. I’d read a number of forum posts that recommended avoiding December 31 as the fiscal year end because accountants are swamped with personal and sole-proprietor tax returns. Picking September 30 meant that I’d have no problems finding an accountant for return preparation, and they might even have time to sit down and chat with me about tax planning.

I’m a bit of a personal finance geek, so I was glad to dig into the numbers for my own business. When I started the business, I talked to several accountants in the city. I think most expected me to turn up at year-end with a shoebox of crumpled receipts. Since I couldn’t stand the thought of waiting that long to find out what was going on with business, I purchased Quickbooks, scanned copies of all of my business receipts, typed in transactions, and hired a virtual bookkeeper/accountant who could answer my questions as I got things going. I liked working with her, so now I’ve asked her to take on more of the bookkeeping and to help me prepare the tax return. I think it’s made a huge difference in terms of my potential stress level around the fiscal year end. =)

We’ve been working on closing the files. My accountant was surprised at how low my expenses were. She’s been sending me questions like: Where are the rest of your bank fees? I only see $1.80. You should have entries for every month. What about TTC transit passes? I told her that since I was using RBC’s eBusiness bank account, I really did only have $1.80 in bank fees (deposited paper cheques), and that I’d been biking to work, so no transit passes either. (Except for the one in March, which I’ll probably claim as a personal tax credit.) She said that she thought she was frugal.

When I made the decision to leave the comfort of a large company for my own adventure, I expected to spend a few years building sweat equity – investing time into learning the things I need to learn while drawing on my savings. Clients talked me into consulting immediately. It’s been a thrill to be able to help both really big and really small organizations using a combination of different skills: from technical work such as Rails, Javascript, HTML, and CSS to soft skills such as enterprise social software adoption, and even newly-developed skills in illustration and animation.

I’ve far exceeded my initial financial projections, but I know it’s because I’ve been staying close to what’s familiar. My experience at IBM prepared me for consulting, and advice from mentors and friends helped me transition into independent practice; but there are other lessons I’m looking forward to learning as well. It just means that my 5-year-experiment is probably going to be a 7- or 10-year experiment!

So, the things I need to keep somewhere on my radar: taxes due by November 30, HST by December 31. I’ve set aside money to cover those expenses, so it’s all good. Actually, I haven’t taken any money out of the corporation yet, since I figured it was simplest to get things off the ground first and then introduce payroll or dividends in the following fiscal year. One step at a time!

In the meantime, I’m making myself spend more (and spend more wisely), learning how to substitute money for time through connection, tools/automation, training,  and delegation.

For example, I want to connect with other entrepreneurs and help them make things happen. I can wait for the Brownian motion of bumping into each other at tech events to gradually help me build that network. Or I can speed it up through lunches and coffees and follow-ups, especially if I take things beyond a perfunctory e-mail conversation and invest real time and energy (maybe even other people’s time and energy!) into helping people.

I want to try new tools to see which ones will support my workflow well. Sometimes that means paying for tools that turn out to be less than what I want, but the things I’ll gain from the tools that work out will more than pay for those.

I want to learn more about drawing, sales, business, and other skills that can help me make even more of a difference. I don’t want to just sign up for courses or coaching. I want to have a clear, action-oriented plan for implementing what I’m learning.

I want to learn how to delegate and to share the opportunities that come my way. That means that I’m going to slowly transition my processes over to other people, even if I think I can do it better or it doesn’t take me that much time to do it. I can always take those tasks back if I need to trim my budget, but if I can document my processes and learn how to take advantage of other people’s talents, I think I’ll be able to grow a lot more. Many entrepreneurs struggle with going beyond what they can do with their own time or talents. Knowing how to share the load – and better yet, building a network of people I can trust – is more than worth the investment. Besides, if I get better and better at delegation, and if I use that time productively, I can grow the business even more.

What can the 2012-2013 fiscal year for my business look like? I have four more months of consulting planned at three days a week (although I’m taking December off, so technically, that’s just three months of consulting). I have a professional speaking engagement in November. I’ve got the beginning of a possible business idea around sketchnotes, and I want to practise validating it. For that, I’m going to want to set up more lunches and start more e-mail conversations. And I’m going to follow up on that budget, seeing if I can invest money in growing.

Both business idea validation and investing in people/tools/processes involve risk. At the end of the next fiscal year, there’s a chance that my balance sheet will be slimmer – but also a good chance that I’ll have learned a lot along the way, and possibly at a rate cheaper than an MBA. Besides, who knows? I might turn those experiments into earnings too!

So that’s where I am and where I want to go. Thank you for being part of the adventure!

Planning for retirement when you don’t know where you’ll be

I have several friends who’ve also moved to Canada from other places. One of them asked me how she could figure out how much money she’d need in retirement if she doesn’t know where she’s going to live and what the costs will be. Even at 29, I’ve spent some time planning for retirement, and here’s how I approach planning for retirement when I don’t know what’ll happen.

The most important thing to realize is that there isn’t just One Number. There are different possibilities depending on how much you save. I remember reading a personal finance book that suggested coming up with three numbers: how much you need for a bare-bones retirement, what you need for a comfortable retirement, and what you need for an awesome retirement. If you take the same idea and extend it to possibilities in different places, you can get a sense of what you might need.

It’s also good to know that those numbers will change. You’ll make different decisions. You might need more, you might need less. If you’re automatically saving 10%, maybe 20%, maybe even more, then you’ll most likely be in decent shape.

Still, numbers can be good for motivation! So, how do you get those numbers? I like starting with current dollars instead of inflation-adjusted numbers. It’s easy to find articles suggesting what you need to retire in different places. For example, this 2010 article says $800-1200/month is comfortable for expats, which probably means that number’s way over the top. =) I can probably get away with something like the amount I earned while teaching there, with something extra put aside for medical issues.

In Canada, I can estimate the minimum I need by looking at my expenses and finding out what else I might need to spend for, like medicines. I’m not counting on Old Age Security, the Canada Pension Plan, or other government programs – they’ll be a nice bonus if I get them, but I shouldn’t rely on them. That gives me a number for a basic retirement, and then I can come up with other numbers for more comfortable retirements.

When you look at retirement planning as a range of numbers instead of a single number that you have to make, it becomes easier to cheer yourself on. Then you have all these numbers, and you can estimate how much you need in today’s dollars when accounting for inflation and growth. You can see what possibilities are probably already available, and how far you are to your next threshold. You can think of it as getting to different levels in a game, or unlocking different achievements. As you save and invest, you open up more possibilities – and it’s great to know that your backup plan is well-covered.

Me, I’m inching towards my “very basic Canadian expenses covered” goal, knowing that I can likely retire to the Philippines if I want to. It’s pretty cool knowing this at 29, and it motivates me to save up more so that I could have a totally awesome retirement either in the Philippines or in Canada!

I’m not a financial advisor and this isn’t financial advice. I’d love to hear what you think, though!

Thinking about what wild success at 29 looks like

One of the brainstorming exercises I picked up from our workshops at IBM was the idea of a “wild success story” – imagining a great future and backtracking from there to the present. It’s useful in personal life, too. For example, this is what I blogged in 2009:

I wake up at 5:00 AM to opera, light, colors, cats, kisses, or whatever gives me a great start to my day. I exercise a little to get my blood flowing, and I have a healthy breakfast of steel-cut oats or fresh fruit. Then I gear up for a morning of creative work, settling into a comfy chair or setting up on the kitchen table for a four-hour session of brainstorming, writing code, and preparing articles and presentations. I snack on fruit and nuts along the way. I have a light lunch or head out to lunch with friends. Then I tackle more routine tasks: responding to mail, following up, editing and formatting documents, testing code, taking care of chores, reviewing delegated work, and other things. I make dinner and enjoy it with people I love, and spend the rest of the evening reading or enjoying people’s company. After tidying up and taking care of other things, I go to bed, happy with the work I did that day.

I’m close to that, but I’m not quite there yet. My Fridays are shaping up that way, though, and we’ll see how things go in September.

On a larger scale, what would a wildly successful 29th year look like? Looking back on the eve of my 30th birthday in 2013, I’d like to be able to say:

  • I have even more wonderful relationships with family and friends.
  • I regularly stay in touch, and have good notes on what people are interested in and are up to.
  • I survived my first business tax return, yay! I’m now investing in building skills while giving back to the community, eventually turning that into income from mobile apps, illustration/animation, and other ways to create value.
  • I’ve got lots of sketchnotes of meetups, books, and product reviews. I’ve organized them into a blog and an e-book. My sketchnotes have colour and depth and interesting layouts. =) I help people find out about useful stuff and good get-togethers.
  • I’ve updated my Stories from my Twenties e-book with what I’ve learned from my 29th year, and I’ve shared the updates with the people who bought the book and sent me their receipts.
  • I’ve gone through Lingua Latina Per Se Illustrata, and I understand it. =) I’m also picking up Cantonese.
  • I’ve been having fun gardening. We’re growing more greens and have actually gotten into the habit of eating them. (I know!)
  • My finances are on track for my 5-year experiment; this might even be extended at least a few more years.
  • I’m ready to rock my thirties!

Thinking about the next mini-experiment

The consulting engagement I’m working on is great. It takes advantage of a hard-to-find combination of different skills and experiences, and I’m having lots of fun. I’m glad I can help make a difference.

What do I want to do when it wraps up in around three months? I’m leaning towards experimenting with concentrating on some projects, which means not committing to any large, regular chunks of outside work. The Quantified Self conference in September will give me lots of reasons to work on Quantified Awesome. I’ll probably harvest enough ideas from it to be busy for quite a while afterwards.

I keep thinking about writing a book, too. If I clear the space for it, dedicate the time to it, then I’ll have some clear answers. Either I’ll emerge with a book (the first book is often the hardest, they say; after that, you know you can write), or I’ll know that I’m not yet in the right space for writing a book, and maybe I’ll have an idea of what I need to work on before I am.

I haven’t had such a large chunk of time to myself in a while, structured and directed mostly by me. The closest I can think of was the time after I returned from my technical internship in Japan and before I left for my master’s degree in Canada. Fortunately, I blogged back then too, so I can try to remember what I did and what it felt like.

March 2005: Spoke at a conference, worked on open source, practised poi April: Worked on open source, spent lots of time with family May: Worked on open source, wrote flash fiction, wrote about hipster PDAs (index cards) June: Took driving lessons, worked on open source, wrote flash fiction, moved to Canada

Right! Open source, that was what I was focusing on – that, and spending time with family, and exploring productivity tips. I’ve been working on far less open source than I thought I would be, but that’s because I’ve been focusing on non-programming things like writing and drawing. It was fun working on open source. I was maintaining Planner Mode (another organizer for Emacs) at the time, and I had a lot of fun working with the community. Time to re-subscribe to mailing lists and see if I can stay sharp by helping out.

That should be a good balance, eh? Writing and drawing to exercise creativity and share what I know, Quantified Awesome and open source software so that I can make better tools. Should be fun. For the business side of things, I might explore e-books and icon design as a way to use the writing and drawing skills I’ll be developing. Quantified Awesome and open source software might be more of a stretch for business, but let’s see where that takes me.

By that point, I’ll have been consulting for six months. I’ll probably give this self-directed learning and working a try for six months as well, and we’ll see how other factors influence our scheduling.

Looking forward to it!

Planning my life

I often think about what I want in life. What do I want to learn? What do I want to be able to share? What do I want to try? What do I want to do?

I think about life a lot because:

  • I want to make better decisions: Planning my life allows me to deliberately try things instead of being limited to chance or what other people want
  • Looking back makes it easier to go forward: Reviewing my life helps me decide what I want to continue doing, what I want to stop doing, and what I want to start doing
  • Planning ahead helps: You can’t plan for everything, but a little foresight can make things a lot easier

Gaps are great for thinking about these things: biking to work, waiting in line, getting ready for bed, relaxing during a long weekend. I review my key priorities and brainstorm ideas for the next steps. I make lists in my notebook, tap ideas into my phone, type thoughts into my laptop, or think out loud (good for bike rides!).

Most of my notes are in scattered places, and that’s okay. I don’t need a perfect record of everything. I don’t need a well-organized outline. I don’t mind covering the same ground again. Every time I make a list, I learn from what I add, change, forget, or remove.

I revisit my plans regularly. Every week, I review the things I’ve accomplished, plan what I want to do the next week, and check how I feel about how I’m doing. Once in a while, I flip through my old mindmaps and notes, crossing out things I’m no longer interested in and adding new ideas.

Every so often, I sit down and flesh out the plans further, sharing them on my blog or adding them to my private notes. I think about what I want to learn, and I plan my curriculum for getting there. I think about the experiments I want to try, and I take the first step. I think about what I want, and I dig deeper to find out if I really want it or it’s something I think that I want. These plans change, and that’s good. The changes tell me more about myself.

I don’t have a firm plan for my life. I don’t have goals like “I want to be ____ by ____” or “I want to _____ by ______.” Many people have these bucket lists – things they want to do before they die. It’s easy to get carried away by these goals, though. Many people plan themselves into unhappiness by saying, “I’ll be happy when I…”. I try to not give in to the temptation to think that happiness is something external, something caused by events or reached when you get to a threshold.

I like to think that I plan out of curiosity. I’m curious about certain things, and I can make certain decisions that get me closer to understanding. For example, I’m curious about entrepreneurship and parenting. With a little planning, we can give ourselves as good a foundation as any. I can’t dictate the cards that are dealt, but I can stack the deck.

How would I like to get better at planning my life?

I’d love to learn more from other people’s lives. I read voraciously to learn about other people’s patterns, and I also ask people about their lives and their decisions. The more I learn about the different paths people have taken, the more I can explore and prepare for possible futures, and the more ideas I can pick up and play with.

I’m working on getting better at documenting and reviewing my decisions. I read a lot about decision science and decision management. I like the way that the practice of thinking through my decisions helps me understand future ones. I’m looking forward to writing about more decisions.

I’m looking forward to testing more of these plans. Many things take time. The wait is fun because I can periodically tweak my plans to try new ideas, understand things better, and get closer to what I want. Besides, there’s always the chance I’ll be surprised, and that helps me learn to think on my feet. (Many of these surprises are awesome!) Life is good.

Thanks to Soha for the nudge to write about this!

Learning more about what I want to learn

It’s hard to get better without knowing what better is.

I want to draw better. What does better mean? For me, “better” means having a wider visual vocabulary for both individual concepts (icons? shapes?) as well as layout (graphic organizers? metaphors?). “Better” means cleaner lettering and more font or design choices. “Better” means being able to draw more things more recognizably, and to design pages so that they’re visually appealing as well as informative. “Better” means becoming more comfortable with colour and shade, and using them to emphasize what’s important. Someday, “better” might even include working with animation.

How can I learn how to draw better? Practice is a big part of it, of course. I can revise my previous sketches, and I can make new ones. I can also look at sites like Sketchnote Army for inspiration. I can collect graphic organizers and visual metaphors. For deliberate practice, I can draw lines, circles, and other shapes, and I can work on lettering.

I want to write better. “Better” means adding more vividness to my writing: picking just the right verb, noticing little details and fleshing them out, adding more specifics and more data. “Better” means pushing beyond clichés. “Better” means writing so that other people can learn more effectively – digging deeper to find things people might be curious about, organizing my notes so that other people can learn more from them.

How can I learn how to write better? Again, practice and inspiration. I can revise my posts and organize them into a coherent e-book or blog series. I can challenge myself to research and share a topic I’m curious about. I can read other people’s work and play around with their styles.

I want to connect better. “Better” means knowing more about people’s lives – it’s easy to know about mine, but I think it would be interesting to know more about people too. It boggles my mind wonderfully that I now have old friends here in Canada (by golly!). I’d like to cultivate more friends and build deeper friendships both in person and online.

What does your “better” look like?