I want you to picture an endurance race. It’s between two 21-year-olds working on Wall Street. One only invests their personal money in real estate. The gritty fixer-upper kind with shitty tenants, leaky septic tanks and non-stop cash-out refis. The other taps a button and buys a single index fund. 20 years go by. Who comes out ahead? ## Does complexity lead to better payoffs? I’m [the index fund buyer](). And I lost. After twenty years we did a rough comparison of financial returns (i.e. IRRs). The _Real Estate Guy_ was 2% higher. Per year. (He was at 12% and me at 10%, pre-tax.) And a 2% difference compounded over 20 years is a big deal. ![Blog post image](/images/blog/image-1-1024x293.png) But there’s a catch. The _Real Estate Guy_ averaged 10 hours a week tending to his properties. He fought with tenants during weddings. Pestered property managers while watching his kids play soccer. He stayed up until 2 in the morning aggregating financial documents for bank underwriters. If you’re doing the math, that’s __10,400 hours__ of life energy _flushed down the toilet._ ## Introducing “Return on Hassle” Astute investors will typically look at _Return on Investments (ROI)_. It’s calculated as: > ___ROI =_ Money Earned / Capital invested__ But _Return on Hassle (ROH)_ looks like: > __ROH = Money Earned / (Capital + Time + Brain Damage + Stress)__ (Props to [Mitchell Baldridge]() and [Nick Maggiulli]() for coming up with the ROH concept.) The way I think of _Return on Hassle_ is with a simple life value that drives countless decisions for our family. __We value simplicity over complexity… even if it means leaving money on the table.__ Here are some examples from my own life: I value [the simplicity of renting over owning]() (even though the latter has better ROI). I value the simplicity of one credit card (2% Citi Cash Back) over [optimizing for points and miles](). And we value the simplicity of 2 kids versus 3 🤣. [Mitchell Baldridge]() adds a few of his own examples: > __Series I savings bonds:__ > > Individuals can invest up to 15k a year in bonds that are tied to inflation. It’s a massive opportunity as inflation rises today (7%+ coupon today.) No meat on the bone – you’ll maybe make $1000 annually on 15k. Also you lock up your $$ for 1-5 years. > __Trying to perfect your withholding to not ‘give the government an interest free loan:’__ > > I pay extra for peace of mind. I have clients who constantly owe the IRS because the interest rate is relatively low. Make a choice. For us Internet Nerds, these examples remind me of [the MidTwit Meme](). It’s a mildly disparaging term used to “describe someone of average intelligence who mistakenly believes they are among the intellectual elite.” ![Blog post image](/images/blog/image-2.png) Said differently, it’s when you overcomplicate a problem (and shit on the simpler solution). And it’s also a sign that your _Return on Hassle_ has gotten out of whack. ## Here’s how we can help you * [The Life Operating System](): Your home base for personal productivity. It combines tasks, notes, project management and a CRM in one place. * [Supercharge your Productivity](): Learn how our $10K Work method can help you improve your mind, career and relationships. * [Apply for our Group Coaching:]() Are you an executive or founder undergoing a career change? We’ll give you frameworks and accountability for this transition. * [Train Your Team on $10K Work](): Is your team busy, but without much to show for it? Teach your colleagues how to prioritize and identify leverage in your organization. * [Download the Rad Friends podcast:]() Every week we ponder one of life’s thorniest questions. * [The RadReads Newsletter](): Sign up for 5 actionable insights each Saturday for a life well-lived.