Findependence Day: How to achieve Financial Independence — while you’re still young enough to enjoy it
Findependence Day is a financial primer that uses classic fiction structure to impart core financial concepts to young people just embarking on the working world and raising a family.
Findependence is a contraction of Financial Independence, so Findependence Day is the moment far off in the future when your income from all sources exceeds the income you could get from a single employer. Henceforth, you work because you want to work, not because you have to.
The financial concepts roll out in the order of a normal human “life cycle,” proceeding from saving for college, graduating, landing a first job, enrolling in an employer pension plan, getting married, buying a first home, saving for retirement, raising children. Then the cycle resumes as you save money for the education of your children, and they need to learn the same concepts as they graduate and confront the working world.
The thrust of the novel is to impart enough major concepts that if all of the suggestions were implemented, you would achieve financial independence while you’re still young enough to enjoy it. Thus, in the book, a young couple named Jamie and Sheena want to reach their Findependence Day at the relatively young age of 50.
This is not a get-rich-quick book but is about getting rich slowly, whether through financial assets, pensions, real estate or — ideally — a combination of all of these. It takes 20 or 30 years to achieve financial independence and the book follows the couple over 22 years: hence the “financial Pilgrim’s Progress” description of one reviewer.
The book begins when Jamie & Sheena are 28 and featured guests on a financial reality TV show. Humiliated by their credit card debt before a nationwide TV audience, Jamie vows his Findependence Day will be the day he turns 50. But Sheena won’t buy into the “guerrilla frugality” habit needed to save money.
Jamie prefers stocks and financial assets and wants to be an entrepreneur. Sheena on the other hand has a comfortable teaching job and expects a generous Defined Benefit pension plan when she retires. She feels uncomfortable with Jamie’s punts on the stock market, urging him to invest instead in something more tangible, like the bricks and mortar of real estate.
Their disagreements over money escalate, as Jamie stakes everything on the big score when his hobby website attracts a big social networking site. Betrayed by his business partner, his world falls apart, threatening his dream of early financial independence.
All-American edition now available, including as e-book
In April 2013, Trafford.com published the new revised all-U.S. edition under the same title, in both hardcover and soft cover, plus most major e-book formats (just $3.99 for e-books). The plot and characters are almost the same, but the setting is entirely in the United States (chiefly Chicago, Boston, Maine and Florida). The financial content is all-American and current as of early 2013, so it’s all about IRAs, Social Security, Roth plans, 529 plans etc., with no Canadian content whatsoever. The manuscript was vetted by several American financial planners, including Garrett Planning Network founder Sheryl Garrett, who also penned the new foreword. Also new is a glossary and end-of-chapter summaries of the new financial concepts Jamie and Sheena learned in the preceding action.
Click here to purchase directly from Amazon.com, Barnes & Noble or Trafford.
Click here to order your copy of the Canadian edition of Findependence Day
The basic financial literacy lessons underlying Findependence Day
While Findependence Day is at one level a “novel,” complete with a multi-layered plot, characters, setting etc., it’s a hybrid creation that also attempts to weave the basic lessons of financial literacy into the story.
As indicated last post, the new US edition, including the e-books, includes a feature not present in the original North American (i.e. Canadian) edition: end-of-chapter lessons of the basic concepts learned.
In retrospect, I should have done this from the get-go since the book is first and foremost a financial literacy primer.
As I create a backgrounder for the press, I’ve gone through the exercise of extracting the 18 end-of-chapter summaries (“What Jamie & Sheena learned this chapter”) into a single document. It reinforces that if you toss out the story, there’s plenty of useful material there, so much so that I sincerely believe that if anyone took every lesson to heart, they would indeed “achieve financial independence while they’re still young enough to enjoy it.”
Those who have only the Canadian edition can view the new foreword and an example of the end-of-chapter summaries by previewing the free Amazon Kindle version here. And you can get the e-book version for $3.99 or less in most tablet and e-reader formats by clicking through the Trafford link here.
But for those who would rather not, I’ve decided I’m going to roll out the 18 summaries in this blog perhaps on a weekly basis. We’ll start with chapter 1, even though that’s already available in the sneak preview:
Chapter 1 Summary: Take it to the Limit
Topic: Credit cards and other forms of bad debt
• You can’t start building wealth until you’ve eliminated debt.
• To save, you must stop spending.
• To stop spending, you must embrace “guerrilla frugality” and be willing to make small sacrifices.
• The foundation of Financial Independence is a paid-for home.
• Findependence Day is simply a contraction of Financial Independence Day.
• The key to manifesting your Findependence Day is to pick an actual date in the future and visualize it happening.
• To reinforce the idea that saving is more important than spending, take to heart the motto “Freedom, Not Stuff!”
What the e-book has that the original edition lacks
If you already happen to own the original print edition of Findependence Day (now called the Canadian edition), is there any reason to also buy the new e-book edition of the just-published US edition? Perhaps there is, considering that at $3.99 or less for all but the Kindle edition, the e-books are only a quarter of the price of print editions.
The two main features in the e-book that are new are the glossary at the end, and the end-of-chapter summaries of what Jamie and Sheena learned. The latter may be useful for those who have already read the story and now just want to be reminded of the basic principles of financial literacy covered.
End-of-chapter summaries
For example, you can view the summary after Chapter 1 by clicking the sneak preview of the Amazon Kindle version here. (Amazon charges US$7.63 for it). For convenience, I’ve reposted that page below. Most of the bullet points apply to either edition, although some are focused on US-specific financial content like IRAs or Roth plans. This isn’t the case for the excerpt below, though. At some point, I will likely do an all-Canadian ebook edition but until then, readers of the original book may still find the US ebook useful.
There are also some subtle differences most wouldn’t notice unless you compared the editions side by each. The original was finished just as the financial crisis was hitting, while the new edition benefits from the insights investors have gained since 2008. There are minor changes in the technology devices: in the original, Jamie has a cell phone, in the new one, it’s an iPhone and there are more references to social media in the subplot about Jamie’s troubles with his business partner. Some names and places have been changed but the story itself and the financial lessons imparted remain pretty much the same.
Kindle, Nook, iPad & other formats
If you want the Kindle version, access the Amazon.com link shown under the Buy American edition button. For the Nook e-book, access the Barnes & Noble link under the same button or click here. For most other e-book formats, go to the Trafford.com site here, select the e-book edition and you’ll get a list of formats from which to choose.
What Jamie & Sheena learned this chapter (Chapter 1):
• You can’t start building wealth until you’ve eliminated debt.
• To save, you must stop spending.
• To stop spending, you must embrace “guerrilla frugality” and be willing to make small sacrifices.
• The foundation of Financial Independence is a paid-for home.
• Findependence Day is simply a contraction of Financial Independence Day.
• The key to manifesting your Findependence Day is to pick an actual date in the future and visualize it happening.
• To reinforce the idea that saving is more important than spending, take to heart the motto “Freedom, Not Stuff!”
News release on new edition: review copies available on request
The official news release announcing the new US edition of Findependence Day has just gone up on PR Web. Click here to view. Since the publisher does not as a matter of course send out review copies to the media, any member of the press interested in reviewing the book needs to contact the publisher to formally request a copy.
The contact for this is at the top right hand of the release linked above: Marketing Services, Trafford Publishing, 888-232-4444. There’s also an email request form there. If you tried and found the process unwieldy, drop me an email at jonathan@findependenceday.com and I’ll try to expedite the request.
Review: Findependence Day = Financial Independence Day
For some reason — perhaps because I was finalizing the new American edition of the book — I missed this The Canadian Wallet review of the Canadian edition that ran in January of this year. For those who missed it (apart from myself!), here it is.
I was intrigued by the reviewer’s suggestion for several sequels that might focus on single people or other markets. The original and the US edition are of course both oriented to couples embarking on family formation.
Anyone up for a sequel?
Of course, as soon as I completed the original Canadian edition in 2008, I had an idea for a sequel, possibly following the Michaela character (Jamie & Sheena’s daughter) forward as she enters adulthood — somewhat like my own daughter Helen, who has just graduated from university.
If there are any readers out there who think any of these sequel ideas might be promising, leave a comment here or email me at jonathan@findependenceday.com.
For now, I have my hands full with MoneySense and the US edition.
Speaking of reviews, over the past week, a handful of 4-star and 5-star reviews have appeared on Amazon.com in conjunction with the new American edition. One of them describes the book as a “bargain: where else can you get a financial plan for under $30?”
Where indeed!
Gold & Findependence
Since the price of gold crashed a few weeks ago, I’ve twice blogged on the topic over at MoneySense.ca, as you can read here. I’ve also done a bit of radio and TV commentary on the topic. As noted at MoneySense, personally I’m somewhere between the 5% “gold as insurance” camp and the “gold bug” camp that allocates upwards of 15 to 25% of a total portfolio to the yellow metal as a permanent strategic allocation in a well balanced portfolio.
My second MoneySense blog looks at Nick Barisheff’s just-released book, $10,000 Gold, a prediction which if it came true would mean a seven-bagger from the most recent post-correction price of $1460 or so. Of course, gold has started to recover from the shocking drop that grabbed the media’s attention earlier this month.
So how does gold fit in with the concept of financial independence? Historically, it has held its own in providing a degree of capital preservation. Anyone who experienced the hyperinflation of Weimar Germany or more recently Zimbabwe can attest to the value of “real money” when contrasted with mere pieces of paper that once promised to pay the underlying metal “to the bearer on demand,” but today are no more real than digits in a computer somewhere.
Bricks & Mortar are another tangible investment I like
So the question isn’t so much whether gold could possibly rise seven fold or ten fold from here, although that’s roughly what it DID accomplish over the past decade. The question is whether paper money backed only by governments with unlimited access to printing presses can continue to be perceived as having value. Just as real estate investors see value in bricks and mortar and the assured streams of income known as “rent,” so too do some investors feel comfortable having at least some of their wealth in tangible precious metals or comparable financial derivatives they hope will retain value if mere paper money falls in value (i.e. ETFs like GLD or SLV). As readers of Findependence Day know, a major subplot of the book is the conflict between Sheena’s desire for tangible bricks and mortar and Jamie’s preference for paper/electronic assets like stocks and bonds.
I’m a Capital Preservation Asset Allocation Bug
Does all this make me a gold bug? No, it makes me a capital preservation asset allocation bug: SOME gold, some cash, some bonds, some stocks and some real estate. And of course, that’s just the investment part of the equation. To this we should add employer pensions and Government pensions like Social Security or the Canada Pension Plan. If someone came to me saying they believed ONLY in their employer pension plan or ONLY in their Social Security or CPP pensions, I’d be just as worried on their behalf as I would be if they told me they had only paper money or — for that matter — only gold coins.
Together, this is my recipe for financial independence.
The vinyl records subplot in Findependence Day
As noted on Twitter, there have been a fair number of stories in the press lately about the resurgence of vinyl records: as recently as Friday morning on BBC World News.
When I tell people vinyl actually plays a big role in the subplot of Findependence Day, I usually get some blank stares. So I’ll summarize it here. The Jamie character is 28 years old when the action begins, which makes him an echo boomer or member of Generation Y. He carries an iPhone everywhere he goes and, like most of his generation, listens to music mostly via MP3s, although he also frequents traditional music stores to buy physical CDs and DVDs.
After he meets a financial planner (Theo) on the financial reality TV show, Jamie “gets religion” about guerrilla frugality, and starts brown-bagging it and visiting a vinyl record store in Boston. Ostensibly this is to save money but also because the proprietor is a fee-only financial planner on the side, and recommended highly by Theo.
Will cloud-based music eventually vanish?
Jamie returns frequently for vinyl bargains and financial advice and ends up creating a hobby web site and selling vinyl through the site around the world. He starts blogging about the future of digital music, taking a bit of a “retro” approach as he champions the superior audio quality of the Boomers’ old vinyl records. He starts to fret that all the music held on the cloud and in mobile devices will eventually vanish. When a blog he writes entitled “The day the music died,” goes viral, his web site starts attracting interest from big social media sites, which spins the plot in another direction.
The other recurring theme in Findependence Day is real estate. This ties in to the vinyl subplot when Jamie decides to venture into commercial real estate, living in an apartment above a commercial unit that eventually becomes a vinyl-themed Internet cafe. When it too attracts attention for its franchising potential, the plot again advances. On top of all this, there are romantic complications, as Jamie’s marriage with Sheena encounters turbulence triggered — as is so often the case with modern couples — over disagreements about money.
You can read the first two chapters free at Amazon.com, which includes the very beginning of the vinyl subplot midway through chapter two, when Theo suggests Jamie should visit his friend Bobby at the Vinyl Cave.
Findependence Day USA now available on the Nook
In addition to the various e-book formats found at Trafford.com (see previous post), Barnes & Noble is now making the new US edition of Findependence Day available on the Nook, and at a slight discount to the regular e-book price of $3.99. Details here. Note that you can also peek at the first two chapters, table of contents and new foreword by Sheryl Garrett without having to commit to purchase.
P.S. I sometimes refer to the new American edition as Findependence Day USA to distinguish it from the original Canadian edition. However, the actual title in both versions is simply Findependence Day.
Findependence Day now available on iPad, iPhone, Kobo, Sony, iBooks, PCs
The new U.S. edition of Findependence Day is now available in e-book format for $3.99 in the major tablet formats:
Sony e-reader, Kobo, iBooks, iPad, iPhone, Stanza, Bluefire (OS & Android), Kindle and in PDF format for various Personal Computers. Go to Trafford.com here to order. Kindle version is from Amazon.com here.
Amazon Kindle reviews
Wanted to share a nice review on the Amazon Kindle site today about the new US edition of Findependence Day.
Here’s what Rob has to say:
A unique and well-written book that is doing something important….. it is teaching you more about becoming financially independent than anything else out there. The narrative story is easy to follow for those who would never read a financial book and a nice format change for those who would. Well worth it – enjoy.
The day after Findependence Day
Some may wonder why if I celebrated my Findependence Day and 60th birthday party over the weekend (see previous blog), then why on earth am I still going to work to engage in the stressful job of putting out a worldclass personal finance magazine.
My answer ran today on my sister blog housed at MoneySense.ca, which we call the Financial Independence blog.
Here it is in its entirety.
