Be your own AI

School's out but class is just beginning

Being a software developer in my day job I see the rise and use of AI (artificial intelligence) in my daily life. However, the term AI might be simulatneously the best and worst name for what we typically call AI. Why the worst? Well intelligence is the ability to discern something and be able to only have the information for A and B but be able to get to C. That certainly fits some versions of what we would call AI. But the reality is that the AI most of us are exposed to is not so much intelligence as memorized and trained large language models. Let me explain.

If you have a large set of data. Let's say the sales figures for three different stores for the first quarter of 2024. And then you have a set of instructional questions about that data. And you run those questions in a test. Then you gauge how accurate those responses are and give that feedback to the program. You continue to run the tests over and over and give feedback. That program gets better and better at giving the correct information about the question you ask it given the data it has access to. But this isn't really thinking, you see computers are better at many tasks than we are but the ability to interpret data over and over and over isn't really intelligence. It's just getting better responses per revolution.

Now let me give an example in real life. I like doing lots of little experiments in earning money, and I like growing those examples into a repeatable and tangible principle for others. So I like starting with things Im familiar with and using new tools to get better. You'll see me use the example of aluminum cans quite a bit. This is because I know it very well and because it couldn't be simpler. You gather them, take them in, and get cash for them. It's dead nuts simple and works for anyone. I like using it as a basis for other things because it ALWAYS gives you a starting point from nothing. You can always get cash by recycling cans. Maybe not a lot, but always something. I hear the phrase you have to have money to make money. This is largely false. You need drive, but there is a lot of ways to create cash from effort instead of cash.

Anyway, I decided a while back that I would show people how I created a consistent income and eventually totally passive income stream from absolutely nothing. So im starting with cans. And to be fair, this takes a while. But im going to show you the ways I take nothing and turn it into something incredible. So the reason I started talking about AI is because despite it not being actual intelligence as much as memorization over large data sets. It's certainly helpful. So I use the tools available to me.

I think the AI you're probably familiar with is chatgpt. It was kind of the first on scene and it's very popular. Being a developer I've tried a great many of them to find what works best for my industry. Spoiler....none of them are magic bullets, but I have found grok to be the closest to useful. All of them are slanted heavily to left wing ideas and responses. But it doesn't make them totally worthless. It just means you often get very predictable answers. Now I take considerable time to craft my questions to be as pointed as they can be. This is very much a software skill, having to google the correct thing or set of things. But anyone can get better at the the things they ask.

So the thing that I did after turning in my two bags of cans for $4.20 ( I swear that's just the amount it was. ) was to start using AI to see what would they lead me to in maximizing my $4.20 if that was all that I had and I needed to keep growing that money. Kinda tough with that amount. But i've actually done this with a single penny. (i'll publish that story some day, it was interesting). Anyway, what can you do with that little? Lot of factors come into play, but I basically painted the perfect picture of where I lived, what the population and market was like and which stores were available, etc. Eventually I got a pretty useful answer. Dollar tree frequently has undervalued products for sale but none as valuable as makeup and cosmetics. Although not an immense selection, there is certainly undervalued products. Even in my rural small town there were 3 products that I could have purchased and reasonably tripled my initial investment. That's very true. But im not sure how long it would have taken. You see I simply don't know the makeup scene. I don't know how to market it though. My wife was very skeptical having seen this tried many many times.

And yet still, that's not a bad haul, But here's where AI really really falls short. This is where the "intelligence" is really kind of questionable, because it's giving the best answers that it has data to support. But it couldn't actually think of even better solutions that existed that required some sweat equity on my part. Everything was a turn and burn solution. And I respect that it came up with the single best idea given the information it had. But even after I gave it additional information trying to steer it into the intelligent response I was hoping it might find. It didn't.

So here was the additional information. Every year we have the single greatest opportunist day of the year in my home town. Its a small town with a community college, but it still fills up with tons of people from all around the state and many others out of state too. Right after graduation (last night) the students have to leave for the summer cleanings and college maintenance. So every year there is this mad dash of completely unprepared and borderline retarded hoard of students cleaning out their dorms and getting rid of things so they can go home. Yes they do have a lot of junk to toss. But they have even more incredibly valuable things that they get rid of. The amount of things that people throw away is eye popping. I make several runs near the dumpsters every year to interecept people and often do them a solid by taking stuff before it gets there. (no dumpster diving required). This year on my first haul I found a brand new Castle Arts colored pencil set that regularly retails for $60 - $80 bucks. It's really great, almost like new. I can sell this for $55 dollars all day long. I also got an apple watch se 40mm. The person forgot their password and couldn't use it (there's a factory reset option that I did in about 2 minutes) $150 new but I can get $100 for this with little effort (tech can be tricky, even really expensive items don't always sell because it's easier to upgrade in many situations, so I find you take a steeper discount to move things quickly). But still $100 for essentially nothing? I found quite a few items, but the last one I'll mention is a set of barely past new lady converse black high tops in size 7.5

These truly were almost new. But my point is to move money and not hatch it. New are $60-$80 range and used are $10-$50's. I try to match the actual value. First I professionally clean them just because... I mean people's shoes? Whether they really need it or not, im kind of a germaphobe so they get professionally cleaned. Now here is where AI couldn't make the connection. I'm taking my $4.20 and buying new laces. I'm still using the old ones because they're super solid, but brand spanking new laces really sells the shoe, and I will list these at $40. If all I get is $20 I've still done 5 times my initial investment. But what about the professional cleaning? I have family who do this and I was owed multiple favors. So yeah, I called this one in. But if I had to do it, ok, i've got a little more time and sweat equity. Still worth it.

Now as the shoe's aren't sold yet, I will follow up when they are. But let's say I sell them for the full 40 instead of 20, That's just shy of 10x the investment. That is not always possible, if you can 2x your investment consistently you are killing it. But early on, bigger jumps are easier than later on with bigger items. My personal best for something is about 500x my investment when I sold some equipment that was given to me. I simply cleaned it, listed and sold it. Not something I aim to do all the time. Shortly after that I wasted inordinant amounts of time trying to replicate that cinderella moment and I never could. So take the wins when they come, but MOVE THAT $ and keep it flowing to grow it.

I still have a few items left to sell and I finally sold the dog house mentioned in a previous post for $165. Not exactly what I asked for ($175), but close enough, especially for a free item. Now i've mentioned several different items, and occurrences where i've made money, but because I want to really emphasis the point of turning a few old soda cans into a full fledged lifetime passive income source, i'm going to stick with that example and it will happen almost in real time. I've done this with other things but im excited to take this idea in one year or less as a lesson that anyone can replicate. Right now you might not be able to replicate the lady converse find or even the soda cans. But as we get closer to turning it into a passive income source, I will be picking something that virtually everyone can replicate and is found nearly everywhere.

Take the good and leave the bad. You should be thinking that with everyone you meet and every story you hear. Real freedom, the kind that you never have to return from is a very big process and even though I have a few passive income streams flowing, I decided that I wanted to document the process as it happened. Most financial gurus you read about are backdating their stories quite a bit, and honestly I get that, I really do. There is some wisdom in writing about the things that already have a tack record. But so often I dig into these people only to discover that they leave something incredibly huge out, like a lawsuit that went their way, or something they sold that would probably not pass the smell test today or inheritence, book deals about the very content they are writing about, you name it. I want freebyfifty to be the pure unadulterated journey from rat race to freedom as it happens.

Every stage of making money has pros and cons. In the beginning, hustling is easy and readily recoverable from failure. But as it grows it becomes more cruicial to be careful and do more measuring and less cutting. But it also creates bigger income streams and more stability the larger it gets. This is a marathon and not a sprint. But it's more like a marathon where you occasionally sprint. Now im going to lay out a bit of a road map with some possibilites, but largely let the good ideas work themselves out in real time along with failures. What should I do next with the money? Remember I don't spend this on anything else except growing it. That's the biggest issue people have. DO NOT SPEND IT ON YOURSELF. Force yourself to grow that money, but do not spend it. It's easy not to spend $40, but it's a lot harder to not use a little bit of the money when you've turned it into $4k. But don't do it.

Now how much do I need to turn "flips" into a passive income source? That's a pretty loaded question but here's what I recommend and why. I recommend you flip your way to about $10k. You can certainly do it before then, but there is two reasons I recommend the 10K. Number one, it forces you to repeat the process of flipping and growing incrementally well past what you actually need, which is really about $5k. And number two is that it build a cushion for failure so that you can recover. Flipping is easy but it always requires your input. Remember we're trying to create a "plug and pay" system that will require almost nothing from you in time but produce a constant passive source of income forever. Think about it. Even if it took you 10K and it only produced $100 / month. But it never really failed and always produced that much. Would it be worth it? I say yes because I plan on living longer than 8 more years. But to be clear and fair. That level of return is still somewhat of a failure, and yet it's in the acceptable failure range (yes that's a thing). We do in fact have acceptable failures in life, just don't make them goals.

Speaking of goals, lets go back to my $4 that Im confident I can turn into $40, although $20 would work great too. But im optimistic. What can I do with $40? How much do I want to reasonably turn it into? This sparks some questions because we're not far away from being able to "split" our returns up so that we can do multiple things instead of relying on one thing. Keeping your money moving is fairly helpful when you split it up. It not only minimizes the risk but also keeps you busy in "minning your own business" (that's not a typo, i meant what is written). So be thinking about all of that, but for now $40 alone is still not great to split. So how much is still reasonable to make? Is it probable that we have another 10x investment or even 2x? Well experience tells me there is a time / value that works like this. The more committed you are to 2x - 10x ing your cash, the longer your cash will stay dormant. So learn the balance of growth with movement before sizeable returns. I say this because passive income is where you get real returns anyway.

Flipping your way to 10k from nothing should be a 5-10 month excersize, but sooner if you can do it. And longer if life happens. But beyond a year, you need a different strategy. So let's have a more reasoned goal for the next jump and if we get 2x or higher...then awesome. I can assure you we will eventually hit a wall in flips. So lets take the good and leave the bad. I say we strive to turn our $40 into $60 within a week of getting the $40, then $100 in the next week, and $200 by the third week. At that point we can split into groups of $50's so that we can double up on our solid ventures and try some riskier ventures to super charge our earnings.

High value items are quite a bit more satisfying than low value but high volume items, but they take longer for sure. And yet I want to focus on that a little more because it steers you in the right direction. You see, value is intially harder to sell and harder to keep a sales pipeline. But you don't have to change your model. The problem with high volume products is that you really can't win in that space. There's always a race to the bottom, and you just can't out compete big box stores forever. You wind up working more and more and more for less and less return and value. 20% of customers are 80% of your problem. With high value items you might deal with one bad customer a year or a just a few. But with high volume you can get a terrible customer fairly often.

The other reason is that you want to start dealing with more quality people and getting used to high value items and deals so you can produce that for your own life. When you finally get to make that passive income switch, you want something that is producing as much value as possible with as little physical input as possible.

I hope this all excites you, maybe you're only reading about it, but I hope you're following along and succeeding. I want you to be free as well. That first time around is the hardest but you can replicate the idea over an over. The goal is to have passive earning streams completely replace your income. THEN YOU'RE FREE !!!

May 10th, 2025