All posts by Jonathan Chevreau

My road to Findependence: Guest Blog by Sheryl Smolkin

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sherylholdingrufus.
Sheryl Smolkin and Rufus

By Sheryl Smolkin

Special to The Financial Independence Hub 

Almost 10 years ago, at age 54, I took early retirement from my job as a pension lawyer and Canadian research director of an international benefits consulting company. I locked the door of my downtown office for the last time on a Friday; on the following Monday I started my new career as editor-in-chief of an industry magazine.

My new job paid only about one third of what I earned before, but I left with a defined benefit pension (albeit reduced by about 30%) and retiree health benefits so I was prepared to take the risk in order to try something new.

With the benefit of hindsight, I can say it was a totally audacious move. I knew how to write peer-reviewed, factual client publications but didn’t have a clue about the economics of running a trade magazine or how to turn a bunch of disparate articles into a cohesive product.

Hard work but fun, and I learned fast Continue Reading…

Tony Robbins on how to invest like a billionaire

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tonyrobbins
TonyRobbins.com

Via Fred Kirby’s Permanent Alert comes this morning’s piece on Marketwatch written by Tony Robbins (yes, the financial guru with the cameo spot on the movie, Shallow Hal) on how to invest like a billionaire. Fred, by the way, is one of the true fee-for-service advisers listed in our “Getting Help” section.

But back to the Robbins piece. He starts with the premise that the key to gaining financial freedom (aka Findependence?) is to control your money mistakes. The money masters share four traits:

1.) Don’t lose. (remember Warren Buffett’s two rules, the second of which is “Don’t forget Rule 1: Don’t lose money.”)

2.) Risk a little to make a lot.

3.) Anticipate and diversify.

4.) You’re Never Done.

P.S. After this was posted, a few financial advisors griped about whether we should be helping to publicize Robbins’ new book, his first in a long while. But check out this article about ten things one influential writer learned from Robbins.

A decade of stagnation scarier than rising rates?

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McGugan
Ian McGugan/Twitter.com/

Good piece in the Globe by Ian McGugan posted Monday night. When I tweeted it out this morning, it was retweeted by some prominent Tweeters. McGugan — back to writing after years of being an editor at MoneySense and the Globe — suggests a major threat for investors is “the possibility that nothing happens … nothing as in a stagnant market, not just for a year or two, but for a decade or more to come.”

Citing the work of Boston-based Ben Inker (of GMO), McGugan says that if interest rates and bond yields remain stubbornly low, it may be hard for institutional investors (pension funds) to generate a return of inflation plus 5%. Stock investors need to be more cautious because the expected reward for taking on risk is getting muted. Long-term returns from both stocks and bonds may disappoint and investors may be lucky to get a 3.5% real return: net of inflation but before taxes and fees.

Scary indeed! But Inker doesn’t suggest parking in cash, seeing some value in the less obvious emerging markets, European value stocks and high-quality American companies.

Happy Money vs. Findependence

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text happy moneyWhile more and more financial pundits seem more inclined to retire the term Retirement, it’s by no means clear what the preferred term should be. Obviously I’m biased since I’ve invested six years in the term “Findependence,” culminating in this web site, the Financial Independence Hub. Over the weekend, we linked to Roger Wohlner’s site and his reposting of a one-year-old posting by me arguing the case for Financial Independence over Retirement. And last week, we posted financial planner Jenya Rose’s piece making the case for Happy Money over Findependence.
I then responded to that piece here at the Hub and now Jenya has reposted that piece over at her own site. She announced this on Twitter on Monday, with this gracious tweet:
responds nimbly to my post that argued is moot if you have Happy Income Touché! :)
Love that use of the hashtag in front of #Findependence!

Guerrilla Frugality & Froogers

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LunchEarlier this fall, I gave a short interview to robo-adviser/light advice firm NestWealth.com about financial independence, ETFs and the term I often use in Findependence Day: guerrilla frugality. You can find it here.

I first used the term “guerrilla frugality” in a personal finance column in the Financial Post. The idea was that early retirement (or findependence) requires a sort of super-frugality.

Guerrilla warfare and guerrilla marketing are both phrases already in the public lexicon. I reasoned that as consumers, we’re constantly besieged by the “guerrilla marketing” efforts of well-heeled advertisers and stealth marketers. So in order to spend less than you earn consistently, in order to save and invest the difference, you need to become super-frugal and practice “guerrilla frugality.”  (Note, it’s not “gorilla,” which some readers have mistakenly used in their correspondence with me. Gorilla is the ape!)

In the book, we talk (in war terms) of donning the battle fatigues of the “Frugality Guerrilla,” which we shortened to “Frooger.”

I’ve used the photo of a brown-bag lunch to illustrate this blog, since the character in the novel starts to brown bag it once he decides he wants to be “findependent” by age 50. In his guest post here at the Hub last week, millennial Sean Cooper also describes how he “brown bagged” it (among many other frugal endeavours) to accelerate his mortgage pay down campaign.

Formal definitions in the Glossary of the new ebooks

In the glossary to two new e-books published earlier this month, we offer these two definitions:

Guerrilla Frugality: A term invented by the author to describe the “warlike” mentality of being super-frugal in order to resist the strong consumption messages of America’s markets and advertisers.

Frooger (Frugality Guerrilla): An invented term in this book describing anyone highly committed to being frugal and saving money.

US fee-only financial planner Sheryl Garrett used the term “frooger” in both her foreword to the US edition of Findependence Day, published in 2013, as well as the new US ebook. Because it appears near the front, you can read Sheryl’s foreword free by clicking on the “Look Inside” feature on either the full book or the abbreviated e-book edition.