Every company brags about its culture.  But when you pull back the curtain, does it really walk the walk?  Or is it just a smoke screen?

My Old Company

Company culture was the primary reason I changed jobs in January 2021.  My old job had just laid off many friends, and morale was in the toilet.  I sold all my company stock the day after the layoffs were announced.  (Note: my 401K is very diversified, and the company stock wasn’t a huge percentage of the total.)  When I saw the type of employees who were affected, I lost confidence in the company’s direction.  Within a couple of months, I had left.

I made the right decision.  Company morale cratered, and even more, people were affected by layoffs that were announced this past June.  That round of layoffs affected a lot of loyal, “rock star” type of employees.  I was stunned at the caliber of people that were targeted.  The layoffs seemed incredibly short-sighted.  The internal IT department had been reduced to less than a skeleton crew.  The internal staff had been supplemented with contract employees, but they simply don’t have the years of experience that the departing employees had.

Culture At The New Company

At the new company, things are very different.  It’s a privately owned company and not at the whims of the stock market.  If the company has a rough patch, it doesn’t react by laying off employees – it rides out the storm.

The expectation is a forty-hour work week.  If there is a big project, it might be necessary to work a few more hours – but the hours dip back down once the implementation is complete.  Time off is granted pretty liberally – for doctor’s appointments, kids’ sports events, etc.  The organization is much more results-focused, and nobody worries if you only worked 37 hours last week – they know that you’re a productive employee and will still be on track to meet your deadlines.

Procedures are used as general guidelines, with the understanding that there will occasionally be exceptions.  When there is an exception, it is considered and most often approved.

My specific role is quite different at the new company.  I am an IT Business Architect – very similar to what many companies refer to as an IT Business Analyst.  At my previous employers, I had limited exposure to company leadership.  There was always a project sponsor who approved various aspects of projects, but they were rarely very involved with the actual work.  I very rarely met any of them in person.

At the new company, my role is considered to be leadership-adjacent.  I have frequent contact with company executives.  While the projects get staffed with subject matter experts who know the minutiae of the requirements, the executives pay attention to what’s going on and provide direction to ensure that the work aligns with longer-term strategic goals.  At previous companies, it was common for project team members (including me) to have limited insight into the future direction of the company.  This makes it more difficult to “future-proof” a system – to minimize the need to re-architect a solution in the future.

Recruiting

You can probably tell that I’m a big fan of my current employer.  One area where we sometimes struggle is recruiting top-shelf talent.  There are a few reasons for this:

• The company headquarters is in a small city that has several other large employers.  There’s a lot of competition for limited talent in the local labor pool.
• The nearest metro areas are 45 miles away in either direction.
• The bulk of the company’s business is B2B (business to business), so it doesn’t have as much name recognition for similarly sized companies that are more consumer-facing

I’ve been doing everything I can to help the recruiting efforts.  The layoffs at my previous employer affected two former team members.  I made it my goal to get both of them hired by my employer.  This meant that I had to convince my management to hire them, but I also needed to convince them to work for my employer.

Candidate 1

When I learned that candidate 1 was affected by the layoffs, I started keeping an eye open for potential opportunities.  As luck would have it, my department did a strategic restructuring that created a new position that this guy would be great for.  I reached out to him, gave him some background on the company, and got his resume.  The hiring manager was very interested and lined up an interview.  Due to a backlog with HR (we were hiring many people), the interview was scheduled for a couple of weeks in the future.

In the interim, my friend interviewed with another company and got an offer.  He reached out to the hiring manager to see if there was any way to have the interview sooner.  The hiring manager had been so impressed with my friend that he had the interview panel shuffle their schedule and scheduled the interview for the very next day.

He got a job offer and joined us a couple of months ago.  He jumped in feet first and has already been able to fix a couple of long-standing problems.

Candidate 2

I’ve been working on candidate 2 for even longer.  I worked very closely with him at my previous employer, and I knew that he was really getting beaten down by the daily grind.  He was an expert on many technologies (and always willing to learn a new one) and consequently worked a ton of hours to get everything done.  I’d been trying to find a position for him even prior to the recent layoffs that eliminated his job.

It was a shock when the company announced that he was going to be laid off.  As I write this, the company is getting through its first day without him.  I won’t be surprised if there is a major outage this week.

It was harder to place Candidate 2 because there wasn’t an opening that matched his skill set.  But I kept sharing his resume with various managers in the department, confident that there was a spot for him with the company.  I knew that he would make any team stronger.

Finally, a newly-minted manager reached out to me to ask about “this guy you know”.  He was looking to hire someone, and one of the other managers had mentioned my friend.

My friend’s current skill set wasn’t a complete fit for the role the manager was looking to fill.  However, he believed that my friend could quickly work his way into that role.  He had another manager interview, my friend, for a different role, with the idea of moving him to a higher role in the near future.  They could see that he was top talent and didn’t want to let him walk out the door simply because he wasn’t a 100% fit right now.  The skills required for the job evolve quickly.  Even if a candidate is perfectly aligned with the current needs, they’d have to learn new skills in the future.  To use a hockey analogy, they knew that my friend had the ability to skate to where the puck was going to be, even if he was currently a step or two behind some other skaters (candidates).

Remote work

My company is reluctantly accepting remote work for some roles.  I work from home 60% of the time, while many other roles are completely in the office.

My friends were both going to push for a lot of work from home.  One of them lives 70 miles from the office, and the other one lives 85 miles away.  Neither of these is an acceptable daily commute, especially for candidates with other options.

Both of the hiring managers made exceptions to allow predominantly work from home for both of the new employees.  While the company prefers to have people in the office, they knew that they were going to lose both of these candidates if they weren’t flexible.

Culture is important

What is the company culture at your workplace?  What do you like or dislike about it?

How is July going for everyone? We’ve successfully navigated the first half of 2022. My wife and I just celebrated 15 years of marriage. This is looking like a big month, but first, we need to close out with a look back at June.

June is always notable because the kids get out of school. The kids graduated into third and fourth grade with great report cards even by my tiger-dad standards. That was a month ago, so it already feels like it’s almost back-to-school time.

We started the month on a bit of a sad note. My son’s best friend moved to San Deigo – about as far as you can get from Rhode Island. We went bowling at the military base and had a great time. My son beat me though he had an advantage of guard rails.

We spent most of a week on Block Island as we’ve done for several years in a row now. It’s strange to escape island life for… another island, but we can get there in a couple of hours (one hour is a ferry ride) and it’s so remote that it’s easy to unplug. My last update was from Block Island and I couldn’t upload pictures with the poor internet connection. I found a glass float which is extremely difficult to do. The hunt for glass orbs on Block Island is covered well in this NY Times article.

We got back, had a weekend of a little beach time, and then went to Lake Winnipesaukee in New Hampshire. My family and my wife’s family used to go as little kids. (We didn’t know each other at the time.) The big draw for me was Jack Johnson’s first tour in five years. Zac Brown came out and did a few cover songs (Tom Petty, Steve Miller Band, etc.) with him. I’m not a Zac Brown person, but it was cool to have the extra star power and familiar songs.

While we were up in New Hampshire, we went to the World’s Largest Arcade. It has all the classic games. I put a quarter in Dr. Mario and a long, long, time later had the top score.

High Score! My wife may be pharmacist, but I’m the best two-dimensional pill dispenser in the family.

We also went to Santa’s Village, which is a small theme park that’s been around since 1953. I’m sure my mother has pictures of me there when I was a kid. There’s something awesome about celebrating Christmas in June.

Kids getting ready to go “You Tubing” at Santa’s Village. LOL!

To top off the month, the Newport Gulls, a famous summer league baseball team, called us up and asked if we get the kids to do a last-minute color guard for the national anthem. They had a cancellation, so we stepped up.

Scouts doing their flag thing for the next baseball stars.

In my spare time, I’m working on Kid Wealth. As part of that, I’m discovering new bloggers. If you love the “Lazy” part of my brand, you might enjoy, Don’t Work Another Day. It feels like that’s what I did through June.

That’s enough of the personal stuff… let’s start the Passive Income report. I used to call this the Alternative Income Report because some of this income has an active component to it. However, that idea isn’t catching on and everyone loves “passive income” better. If you are a new reader, you’re going to want to refer to my Alternative Income FAQ as you may have some questions about the math.

The way I calculate these numbers requires that little explanation – it isn’t intuitive. I do things a little differently to show the journey. For example, we don’t have real passive income from our rental properties right now. We still have mortgages to pay off. Instead, I calculate the percentage of equity we have to show where on that journey we are. Each month, you’ll see that the bank owns less and we own more. When we get to owning 100% there will be no mortgages and all that rental income can be used for living expenses. When it comes to calculating the percentage of rental income, I take the rent (minus estimated expenses) and multiply it by the portion of equity we own. Think of it like you and a friend owning a property 50/50. This would be how you’d handle it with each of you splitting the profits at the end 50/50.

Lazy Man’s Passive Income

I categorize our passive income into 3 main sources that are largely represented in my passive income pyramid. For this report, I ignore the bottom section, “career/job” – that’s not passive at all. (I do have some income in that area, but that’s not the focus of this report.) I combine dog-sitting and blogging into one section of my “somewhat active” income. They are a little passive because I can make money even when I’m not immediately tending to them. For example, I’m writing this while boarding 2 dogs right now. I leave real estate and investment income as their separate main sources of very passive income. This way if you want to only count those you can do that.

1. Blogging + Dog Sitting Income

June was a great month for blogging and dog sitting. I know that blogging and dog sitting is stretching the idea of passive-ish income, but June makes an argument that it is more passive than you might think. Despite traveling for nearly two weeks and having little internet connection for part of the time, I did okay.

Jake’s back to the beach on Block Island.

My dog sitting income was the third-best of the year. Summer tourism is always big in Newport, RI. So even with the partial month, we did well. Blogging was our second biggest month. I wish I could say it was something actionable, but it seems like that’s how the advertising Gods worked.

In May, “dogs and blogs” combined for a total of $5,079.36. In June, it was:

Total Blogging + Dog Sitting Income: $4,847.86

That’s 95% of the income with only about 66% of the work. I’ll make that trade any day.

My kids help with the dog sitting. My 9-year-old is extremely good with dogs at this point. He can feed them, let them out, and play with them in the yard. He’s spending more time in front of the clients as a helper at pick-ups and drop-offs. My 8-year-old was a little slower to develop dog skills, but he’s carved out a household niche of catering to the smaller dogs – he just loves them. They are both doing vet camp at the local animal shelter.

Their help means that I can pay them a legitimately earned income (a percentage of the overall dog-sitting income). Because the income is earned they can save money in their kid Roth IRAs and it will be money that they’ll never pay tax on. Learn why you should get started with a kid Roth IRA as soon as possible.

(Note: The blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

2. Rental Property Income

For the first time in a long time, Zillow didn’t estimate our properties were worth more this month. Real estate prices can’t go up forever, especially with high mortgage rates.

We went from 76.53% to 76.84% ownership of the equity in our properties. That modest gain came from simply paying down mortgages. If we owned the rental properties with no mortgages (100% of the equity), we’d make about $4,000 a month after insurance, property taxes, condo fees, and estimated condo maintenance.

The fabled Block Island Glass Float

I like to use an “expected rent” as we’re currently trying to catch up from years of very low rents. We liked our tenants, so we’ve kept them at a discount. However, with housing and rents going up so much, so quickly, there’s a huge gap between what we could reasonably be bringing in and what we are bringing in.

If you multiply our expected net rent of $3,650 by the amount of equity we have, 76.84%, you get $2,805/mo. in estimated passive income. That’s a gain of $12 from last month.

When I started tracking this (January 2017), we only owned 36.4% of the properties and the properties had lower rents. The math worked out to $1,174 back then. So in 5.5 years, we’ve seen that number grow tremendously to $2,803. The forced savings of 15-year mortgages are extremely powerful.

When we get 100% ownership, we should bring in about $45,000 after expenses. Rent is inflation resistant as it’ll rise over time. That means that even though this is $45,000 in today’s dollars, we don’t have to worry about it buying fewer goods and services in the future.

Total Rental Property Income: $2,805

3. Dividend Income

For this section, I assume we will earn a 2.5% dividend yield on our holdings. That could be from a high-dividend ETF. For example, HDV is currently paying about a 3.31% yield, but it has been less in the past.

There’s a chance we could do better than this. There are some income investing ideas here. We can also look at making passive income with Dividend Kings. If we wanted to simply retire on this dividend income, I would get Sure Dividend’s newsletter to try to get a 5% average dividend yield. (That link to the newsletter has a special discount rate and in full disclosure, I make a few dollars if you sign up for it.)

I’m always impressed by my 8-year-old’s art. There’s a lot going on here.

Of course, we may not convert everything over to dividend income at all, the 2.5% dividend is a conservative way to think of our investment portfolio. Many experts would suggest using a standard 3.5% or 4% withdrawal rate. The income would be much more if we did that.

The stock market went to hell again. Well, I’ve seen a lot worse. The drop means that this is going to be worse. We’ll continue to buy in at these low prices and when the market recovers we’ll enjoy new portfolio highs. Since all of this money is in our retirement accounts, we’ll be invested for at least another 15 years.

We continue to get a profit-sharing check since I bought (a lot of) a company. The investment income from this is essentially the same as dividend income. It is taxed differently, but for this report, it makes sense to group all stock ownership in this bucket.

Total Dividend-ish Income: $3,406

Last month, it was $3,548. A loss of $140 is a big move for a month. I don’t think we’ll be back up by end of the year, but the market often surprises me. When I started tracking this number in January of 2017 we were at $1,180/mo. It’s been a great last 5.5 years.

Our money has been working hard to multiply over the years. For a while, we stopped adding to our investments. Instead we had been focusing on saving money in cash for my wife to retire. Except that, now my wife got a new job and isn’t looking to retire. That’s a roller coaster of emotions. Some days she wants to retire and other days, it seems like she wants to work for many more years. Whatever she wants to do is fine with me. At least this new job is much better than the last one. She’s had time to bring the kids to school and do some things like that.

Brother sand burying

Getting back to the monthly update, this monthly $3,406 would be over $40,000. As with the rental income number above, we should be able to live on this by itself. However, because most of our investments are in retirement accounts, we can’t use much of this potential income for now. (We can use the profit-sharing check as it goes straight to our checking account.)

For the 20th month in a row (?), we’re looking into estate planning, but they gave us a lot of paperwork to do before we can move forward. I’m not making any progress on this.

Very Close to Passive Income

Our “very close to passive income” is a combination of rental property income and dividend income. If we had any royalty income from books, movies, or music, I’d include that as well. I’m too tone-deaf to have a rockstar music career, but I may write a book someday. This is important to separate from the dogs and blogs’ income at the beginning. That takes some active work to keep up. Rental property requires a little work, but not nearly as much.

I tried to teach the kids how to skip stones after dinner at the military base. It’s a work in progress.

We have a setback this month because of the stock market. It’s too big for real estate to overcome. I love having both rental property and stock market income working together for us. With the stock market dropping recently, our real estate is saving our net worth from dropping further. For much of the last decade, it was the opposite – real estate didn’t do much while stocks quadrupled. I think everyone interested in FIRE should consider having stock market and real estate income streams. The diversification gives me great confidence that we’ll be better prepared than most FIRE folks in the case of an unfortunate economic event. We’ll still likely get rent checks if the stock market crashes. We’ll still get dividend checks if a tenant is late paying for a while. Of course a bad economy may impact both at the same time, but that’s what an emergency fund is for.

Very Close to Passive Income: $6,211

This would be almost $75,000 a year of passive-ish income. We wouldn’t need to touch the investments themselves. We wouldn’t have to sell stocks or have a “withdrawal rate” – just live off dividends. We wouldn’t have to get a reverse mortgage on our home or the investment properties. Property maintenance and property taxes for rental properties are already factored in. We would still have all the underlying assets (property, stocks, etc.) and be able to pass these on to the kids for them to build on – unless we choose to draw them down for more fun, charity, or other spending.

This $75,000 passive income was my goal when I started this blog. I figured that would be winning the money game as it would be enough to cover all of our needs and many of our wants.

A local sailing group put on a 3D hologram story about saving the ocean from pollution. It was very, very awesome, even though it was only about 10 minutes long.

This $6,211 of “very close to passive income” has grown from $2,354/mo. in January 2017. So in 5.5 years, we’ve added almost $4,000 in monthly passive income. That’s nearly $50,000 – a lot more than the $34,000 I made as a software engineer out of college in 1998. This is one of the reasons why I went with the “Lazy” name, it shows that investing money can do more work (or somehow produce more value) than I did. It’s a crazy system. I’m just doing my best to work within it.

It’s worth noting that, once again, these are fudged numbers that aren’t “real” yet (except for the profit-sharing check), because the money isn’t liquid. We can’t spend those retirement investments or the equity we have in properties. We don’t feel “rich” by any stretch of the word, even though we are relative to many people’s circumstances. We still have some day-to-day struggles with money. These are relatively minor compared to what most people experience I imagine. That’s one reason we are selling a rental property. It will help us feel a little more financial freedom right now. We’ll still have plenty working for the future.

I used to wonder if we can get to $8,000/mo. in passive income by the start of 2025. A year ago, it was a stretch goal… now it feels like we could make it. We’ll have to see where the numbers are when we sell off the rental property.

Final Passive-ish Income

When you add up “dogs and blogs” to the “very close to passive income” you get:

Passive-ish Income: $11,058.86

Last month it was $11,420.36. Considering we were on vacation so much and the stock market took a dive, it’s amazing we didn’t take big drops.

That’s over $130k a year. That (hypothetical) annual income for writing on a blog, taking care of dogs, investing, and landlording is very nice. For the year, we’re averaging around $135k from all these – which is more than for our necessary expenses for the next 45 years. Of course, those necessary expenses aren’t going to cover all our spending, but they are a large percentage of it.

We went to a church fair that had a petting zoo. We did this one for years before COVID. It’s good to get back.

None of the numbers here include my wife’s bread-winning day job as a pharmacist or the freelance work I’ve been doing over the last few years (which isn’t passive at all). When my wife retires we can count her vested military pension as more truly passive income. For now, those jobs (and the dog boarding) are the fuel that drives the passive income engine – it allows us to live well, pay off our mortgage, and invest. My income doesn’t match my wife’s, but the flexibility gives me the time to stretch almost every dollar in much of our spending. It also gives me the flexibility to bring the kids to school and after-school activities.

I love two things about the graph below. First, there’s a solid trend of the numbers staying high for several months now. Second, it doesn’t dip down too far. It seems like it should be at least $8,000, maybe $9,000 going forward.

(Once again, the blue line is the monthly number. The red line is a 3-month average which helps smooth the curve.)

Net Worth Update

My net worth updates aren’t very exciting as I don’t share the exact numbers. That’s why it’s just a footnote here.

I truly believe that net worth is one of the most important numbers in personal finance so it is worth sharing in some way. Showing relative growth can be useful.

We saw our net worth lose -2.52% last month. That’s a big hit for one month, but it’s a lot smaller than what I’ve seen from other bloggers. For the year, our net worth is up 1.74%. With bad markets, inflation, and all the big spending we’re doing I can’t complain.

Recently for something new, I decided to share our liquid cash growth (or loss). I’ve been tracking it for some time, but never thought to share it. Many other bloggers break down their income and expenses in great detail. I’m too “Lazy” for all that, even if my credit card reports can do a lot of it. Looking at our liquid cash is a way to roughly gauge the bottom line, income minus expenses.

This month, we lost around lost $900 in liquid cash. That’s not great, but we went on a couple of vacations and ate out a lot. We’ve been spending a lot this summer, but we’re doing a lot of stuff too. We saved a lot in the past (and we’re still saving now), so losing a little liquid cash isn’t too bad.

It’s important to recognize that everyone is in a different place in their financial journey. I’ve been blogging about personal finance for almost 16 years. FIRE wasn’t a “thing” back in 2006. We naturally are further along in that journey than some younger readers who may be just starting. Some of those readers are saddled with huge student loans that we didn’t have to deal with. If you are one of these readers, I hope you won’t be discouraged by some of the numbers above. I didn’t start many of these graphs until year 10 of blogging and early retirement planning. Please try to use it as motivation for what may be possible (depending on your circumstances and market luck) over 15-20 years.

There’s a big wild card in calculating our net worth. Now that my wife’s military pension is vested, it’s reasonable to ask whether we should include it in our net worth. I decided that it does make sense to include it. She could have earned more in immediate salary if she didn’t work for the government. That would have boosted all the numbers across the board. Calculating pension value is not easy, but here’s the best way to know what a pension is worth. However, like most of the money mentioned in this article, this isn’t money we can spend right now.

How was your month? Let me know in the comments.