2017 was the year I learned about the FI community. As a result, I started this blog. With 2018 nearly upon us, today’s post is dedicated to my favourite reads of 2017:
Mr Money Mustache’s blog was my first introduction to the FI/FIRE community. I’ve learned so many things from this blog that it’s hard to summarise in a single paragraph. Here are the top 3:
- Importance of savings rate - The savings rate is key to achieving FI and has a double effect. A high savings rate enables your net worth to grow quickly. A high savings rate also means you have a lower monthly expenditure which means you require a smaller net worth to sustain you in retirement.
- In sourcing to reduce costs and learn skills - Rather than outsourcing jobs like cleaning, plastering and plumbing. Try doing these jobs yourself. Not only will this save money, it allows you to learn skills that have the potential to earn money in the future.
- Enjoying the simple life - Previously I was of the mindset that I should work hard at my Software Engineering job and outsource everything else. As I earned more, I could outsource more, spending my time doing things I enjoy. However, MMM has taught me to enjoy the small tasks of every day life, like cooking or mowing the lawn.
This is a book about retiring extremely early, in as little as 5 years. I’ve read a number of personal finance books but none as extreme as this. The author, Jacob, completely reframes the problem of personal finance. Instead of aiming for a 15% savings rate, like mainstream personal finance writers suggest, Jacob suggests aiming for 75% or higher. In the book, Jacob explains his philosophy for savings such a large percentage of his income and how he was able to retire in 5 years.
Many readers will not be willing to be as frugal as Jacob. However, that is not the point of the book. The book helps readers to grasp the mindset of self-sufficiency, renaissance thinking & anti-consumerism.
The Early Retirement Extreme blog is also the work of Jacob, the author of Early Retirement Extreme. The book is a philosophy on life. The blog is more like Jacob’s diary. One of my favourite parts of the blog is the 21 day makeover, which is a great introduction to ERE. Or, if you’re up to the task, you can start from the beginning and read every post.
The author is no longer writing new content for ERE. The homepage just cycles between old content. However, it is a huge body of work and a must read for any aspiring FI-ers.
I found the Wealthy Accountant’s blog via MMM. The Wealthy Account is MMM’s personal accountant and he brings a very different voice to the FI community. He is someone who reached FI at a young age but continued to work as a business owner. The author is not as extreme on topics like insourcing but has more knowledge on tax and investment management. A perfect companion to MMM and ERE.
WA is updated regularly, the author updates multiple times per week and often discusses current affairs.
I read this book at the start of the year and it’s not directly related to FI. The book is about being generous (being a ‘giver’). As a natural saver, generosity does not come naturally to me. Although this is not true of everyone in the FI community I would bet that many could benefit from reading this book. Other than helping me to be more generous, I have received financial benefit from reading this book. Here are two stories to illustrate:
- Earlier in the year I interviewed for a job but decided that it was not for me. The interviewer then contacted me saying that he was struggling to find anyone to fill the position. Previously I would have ignored this kind of email but I decided to try and help so I reached out to my network and found a recruiter that could help. I expected nothing in return but a month later the company reached out and told me that they would like to pay £2000 for the help I gave them! I was shocked.
- A company contacted me about some freelance work. They were looking for someone full-time but I was not able to commit that amount of time so I passed the job on to a friend of mine. Not only did my friend get some work, the company were able to give me some hours over Christmas which fit perfectly into my schedule.