Financial Independence

Reach Financial Independence Using The Three Solutions Rule

Three Solutions Rule

I’ve been with my current employer for nearly five years now.  Throughout that time I’ve held a few different positions, worked on various teams, and had a handful of different managers, but something I learned during my very first week on the job has stuck with me the entire time.  I call it the ‘3 Solutions’ rule and I believe it can help all of us reach financial independence.

Find Solutions, Not Excuses

Prior to starting the job I’ve got today I’d been unemployed for the previous 14 months, and that was a dark time for me.  But after getting back the saddle I was eager to knock off the rust and prove to my manger that he’d made a good decision by hiring me.

I was still in the on-boarding phase at work when I was given my first assignment.  It didn’t take long for me to start poking holes in the project.

I approached my manager one afternoon to show him the flaws that I’d discovered and why this particular project wasn’t really a great idea.  Anticipating a solid pat on the back along with an ‘atta boy!’ I was somewhat taken aback at his response:

“Anybody can point out problems, Ty.  That’s not what I hired you for.  What I need you to do is find solutions to those problems. That’s how we get the job done.”

Anyone Can Spot A Problem

Five years later and I still remember that moment perfectly. My manager went on to explain that he was happy to help whenever I needed it, but he expected me to find no fewer than three solutions to each problem we faced. “Identify the problem, find three solutions for solving it, choose the best one, and then implement it.  That’s how you make progress.”

Although this was a workplace lesson for me (which I still use on a daily basis in my job), it can very easily be applied to the world of personal finance as well.  And when the 3 Solutions Rule is applied correctly, it will help you reach your financial independence.

I know that not all problems are created equal. Some are incredibly complex and don’t have easy answers, but there are always options.  Doing nothing is an option.  Not a great one, but an option nonetheless. Complaining about your problem isn’t an option.  The harsh reality is that nobody gives a damn about your problems.  Most people are too preoccupied with their own issues to listen to you complain about yours.

So stuff the whining and the excuses in a sack.  Suck it up and get to work on solving the problem.  Here’s how you do it.

Identify the Problem

This is the easy part.  The first step in the 3 Solutions Rule is to identify your problem, or opportunity.  What’s the problem you’re trying to solve, or the opportunity you’re trying to exploit?

  • Do you have extra cash and aren’t sure what to do with it?
  • Did you lose your job and need income to pay your bills?
  • Are you buried in debt, unable to get ahead financially?

Whatever your problem/opportunity is, you need to identify it.  But don’t stop there.  For example, many people know they’ve got a debt problem, but what are they doing about it?  Just identifying the problem isn’t enough.

“Even if you’re on the right track, you’ll get run over if you just sit there”

Find Three Solutions

Once you’ve identified the problem/opportunity you need to know what your next step is.  What you do to solve the problem, or exploit the opportunity, is your strategy.  But before you settle on your next move, give yourself at least three options.  Sticking with the “too much debt” example, here are three options:

  1. Do nothing; maintain the status quo
  2. Earn more money to pay for the debts
  3. Cut current expenses and use that money to pay off a debt

This list could go on and on because there are a several ways to attack your debt, but let’s go with these three options for now.

Analyze Your Options

Next, you need to pick the option that works best for you.  Option #1 (do nothing) isn’t a great option, but you can still choose it. If you truly want to get out of debt, you’ll move along to options 2 and 3.

These options are better than doing nothing, but you still need more details before you can make your decision.  If you choose to earn more money, how will you do that?  Are you going to ask for a raise? Get a second job?  Sell some of your assets and possessions?

And what if you decide to cut expenses?  What will be cut?  Are the cuts going to be temporary or permanent?

Figure out those detailsule, select the option that’s best for you, implement your decision, and then keep your eyes open for that next problem or opportunity.

Wash, rinse, repeat and reach financial independence the retire early if that’s your goal. That’s it. Using the 3 Solutions Rule has helped me improve my own personal finances, and it can help you improve yours as well. 

Anyone can point out problems, but only those that find solutions will get ahead in life. Use the Three Solutions Rule to overcome the financial (and personal) obstacles you face.

Chime in!

What do you think about the 3 Solutions Rule?  Do you already use it in your personal or professional life?  Do you agree that ‘doing nothing’ is an option?

By Ty Roberts

Ty Roberts is the founder of Camp FIRE Finance, and a husband and father of four living in the Seattle area. He's a fan of the 4% rule, 80s movies and music, dad jokes and cast iron cooking.

24 replies on “Reach Financial Independence Using The Three Solutions Rule”

Thanks for this post Ty. At work, I’m actually a pretty good problem solver, but I really should apply these principals to my finances! When solving problems, its rare that there’s a perfect solution. If there were, it would be obvious and not need solving… The way I tackle problems is by assessing the pros and cons of each, and generally the one with the lesser of the evils gets picked. The best part of this article is the reminder that no one cares about your problems. Whining is a choice we can make but it doesn’t get us very far, so what’s the point?

What a great rule, I hadn’t ever heard of that before but I like it. Kudos to your boss for pointing you in the right direction and the valuable career advice right off the bat. I think that’s a good way to go about addressing problems with your boss and a great way to get noticed positively in your group. I’ll have to remember this rule myself, thanks Ty.

Seems like a reasonable approach to problem solving. I do think that “do nothing” is an approach, but I prefer to call it “keep doing what your doing” Same idea, but it sounds better!

The best part of this, for me, is that you’re narrowing down your options to 3. Too many options leads to paralisys for many. We get stuck looking for perfect and do nothing.

I like it! It’s the solution focused mindset that’s necessary to move forward. I tend to get stuck in Barry Schwarz’s “paradox of choice” and look at the plethora of possible solutions, ultimately getting overwhelmed by all of the options. So limiting it to 3 makes a ton of sense to me. And, yes, I agree, doing nothing is a choice. It may not always be the best one, but sometimes we may need to just sit on a problem for a while.

I really like this approach. Others have noted the benefits of limited yourself to three options, but I feel like there is also benefit in going into it knowing that you will come up with more than one option, which frees you up to brainstorm more freely knowing that your first option doesn’t need to be the perfect solution.

Great post. We live in a time where it seems almost too-natural to point out what’s wrong/why things aren’t working. It’s very pessimistic. Yet, if more people were living how you explained in your “3 Solutions Rule” we could be a better society. There are problems every where. Any one can point them out. It takes true brain power to think of realistic solutions though.

Although doing nothing sounds like the easiest solution, it is certainly the most detrimental! I personally love having rules like this in place because it can take something that is so overwhelming and break it down into simple, manageable tasks. Thank you for the post!

I love this. My boss gave me the same advice early on but I never thought about it in terms of finding three solutions. This is brilliant and something I will definitely need to adapt and share at work. Thanks for the tip.

Doing nothing is probably one of the most overlooked and under-valued options in any decision. Sometimes the first decision-making mistake somebody makes is that they “decide to decide” and take action on something…even if things aren’t yet “ripe.”

A problem with making a premature choice is that decisions can lead to lock-in costs that are expensive to undo if things have to get walked back later. Yeah, different sorts of scenarios imply different emphases on speed and “decisive action,” but “doing nothing” is a pretty good option sometimes…and probably vastly underused.

Nice work!

Yes! Decisions don’t need to be permanent, so deciding to ‘do nothing’ can very often the smart short time option to choose. Most of the time we have the time to think things through and make the right choice. Better to get it right, than to get it fast.

Smart boss. In the advocacy world, the effective people are not the ones who point to the problems. They’ve come up with solutions and work towards them. Even then, sometimes the solution is wait to see what future legislation brings.

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