Now that’s what I call Financial Independence! 28

Opinion is divided on the Now That’s What I Call FI! series.

Some say it became shit as time went on and The Escape Artist increasingly looked to have exhausted his musical repetoire.

Others disagree, saying that it was always shit.

But those same people would probably have criticised Michelangelo’s paintwork on the ceiling of the Sistine Chapel. So what do they know?

Yes, that’s right…The Escape Artist is back to review more classic songs about financial independence in the guise of a music critic from the NME…armed with earnest prose, psycho-babble and increasingly tenuous metaphors.

Rich Girl (Hall & Oates)

In The Millionaire Next Door, chapter 5 is entitled “Economic Outpatient Care”. This is all about what the parents of successful people do (and don’t do) to teach their children about money. If you are a parent that hasn’t read this book, then go read it.

It turns out that the fastest way to spoil your teenage / adult children and ensure they never grow up and take responsibility for their own spending patterns and earning their own money is to keep funding them and bailing them out.

If you protect people from the consequences of their own decisions, they never learn. The great irony is that those parents who attempt to smooth all the corners off their child’s world, are probably setting them up for failure.

Streetlife (Randy Crawford)

It’s ironic but people who grow up with a taste of of poverty may be more likely to end up rich. They are strongly motivated to get out of debt and build an emergency fund in an attempt to get the feeling of security they crave.

In 1981 interest rates went to 17% and my parents were leveraged AF. Rightly or wrongly, I grew up with a terror of being homeless. If you can channel fear in a productive direction, it’s a hell of a motivator. I paid off my mortgage within 6 years (lower house prices definitely helped).

But at some point you have to let go of the fear and think bigger.

Pull Up To The Bumper Baby (Grace Jones)

Cars are money incineration units. Sitting idle in traffic jams (where you are literally burning money) is a losers strategy. Note the contrast between the fantasy open roads of car adverts and the reality of sitting in traffic jams. It’s a scam.

Cars are not inherently evil…but how did we end up at the point where everything got designed around the car? Town planning since the 1960’s has mostly been a disaster.

How is Drive-Thru MacDonuts even a thing? Sedentary lifestyles are making people fat, weak and broke.

2020 was a wake up call. Will the last year prove to be a turning point? I don’t know but the good news is that bike sales are booming.

The Gloves Are Coming Off (7Kingz)

Here 7Kingz hammer home the importance of never being a forced seller of risk assets during a market crash.

You can be a trader or an investor but it’s fatal to muddle up these two very different strategies. Most people are not cut out to be traders because they have no edge.

So let’s stick to investing. If you invest in any form of risk asset (whether equities, property or crypto) you need to avoid being shaken out of your position by price volatility. As a long term investor, the ideal holding period is forever.

Here’s the thing about unrealised losses: they only become actual losses if you sell. If your investment thesis still holds, then so should you. Panic selling in a market crash will leave you rekt and bleeding by the side of the road.

Diamonds (Sam Smith)

Pop videos are bad enough when the pouting, twerking and booty-wiggling is being done by an attractive woman. But when it’s some geezer with a Dad-bod in a wet T shirt, well, quite frankly, it’s embarrassing.

That having been said, Sam Smith may be onto something here. In Are Diamonds Really A Girls Best Friend? we examined the strange social convention of spending large amounts of money on diamond engagement rings.   This is basically a scam. You can’t buy love…although that doesn’t stop people trying.

And Sam is not wrong when he warns nice guys that, if you split up with your “soulmate”, well, good luck getting that diamond ring back.

Disco Inferno (The Tramps)

Last week Ethereum successfully completed the EIP-1559 upgrade. Transaction base fees now get burnt: this means that units of ETH get cancelled and the monetary inflation rate of ETH is lowered.

And in 2022 Ethereum is due to move from proof of work (where miners use lots of electricity and computer equipment to mint new coins) to proof of stake (where validators put up ETH as collateral and get new coins for checking transactions). This will mark the start of a more eco-friendly network, a big reduction in electricity consumption, in miner selling pressure and ETH issuance.

What happens when reduced supply meets increased demand? They say that ETH is on course to become a form of ultrasound money.

Got Me Thinking (Maduk)

One of the things that I’ve learned from 7 years of blogging is that trying to lay down a simple “paint by numbers” guide to financial independence that applies to everyone is tricky. All good advice is contextual.

It’s good to talk and the beauty of financial coaching is that you can take into account an individual’s unique circumstances.

Maybe it’s better to listen, introduce new ideas to intelligent people, get them thinking and let them reach their own conclusions?

Suddenly I See (KT Tunstall)

I almost became a teacher in an earlier life. Somehow I don’t think the state education system would have been a good fit for me but I do think of myself as a teacher when it comes to personal finance.

One of the best things about doing financial coaching is that you get to help people create those lightbulb moments where they suddenly understand and see how the pieces fit together.

Get Drunk And Be Somebody (Toby Keith)

Here Toby Keith articulates my policy re alcohol during my years working in corporate finance.

If I was being generous, I’d say that I used alcohol as a way to wind down from a stressful job, to celebrate wins with clients and my team, to celebrate surviving another week of crazy deadlines and general corporate nonsense.

They say that every good country song contains a profound truth. It turns out that Toby Keith is quite the philosopher…I commend his work to you.

The new content is on my email list

I’m writing new content for my (free) email list. I’m aiming to write about 3 or 4 emails for each new blogpost. If you’re not on the email list, you’ll miss out on new content.

The beauty of having an email list is that you can always reach your core audience…those interested enough to sign up to an email list. As a side benefit, the email format also feels more personal and I get quality feedback by email.

So if in future you are wondering why my blogpost production has slowed down or even stopped, the answer is that it hasn’t, it’s moved onto my email list (it’s free and you can sign up below 👇).

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