I’ve read several outstanding educational books this year about financial independence, and if I saved this post for December then it’d be four times as long. I’ll write this one now and follow up with another post later this year.
As many of you know, I read a lot. No, seriously, A. Lot. I go through over a hundred books a year (print and eBooks) and maybe another 500 hours a year online. (Blogs and other research.) About a third of my reading is fiction, but the rest is non-fiction or self-improvement.
You know how Amazon enables you to compile tons of reports on your spending habits? Yeah, all except for how much you’ve spent on eBooks. That’s the most-requested customer report, but there must be some reason Amazon hasn’t quite gotten around to it yet.
Meanwhile, if hackers really wanted to exploit my credit card, they’d just charge me small random amounts about six times a month for cryptic descriptions like:
AMZN Digital*MW20Q98240 888-802-3080 WA $4.99.
Well, last month racked up 11 charges, but some of those eBooks were pre-orders. I’m almost positive they were all charged by me.
No worries: I used to have a book addiction problem, but now I have enough money to afford it. Besides, I’m still one of our public library’s best customers and a long-time Netgalley member. I can quit anytime I want.
Fortunately for me, when you’re an author and a blogger, people occasionally send you free books and ask you to write about them.
Fortunately for you, I’m only going to tell you about the best of my reading pile.
You can scan the title headers below and read the paragraphs if one piques your interest. Before you buy, ask your library to order the hardcopy or the eBook for you… and then you can decide whether you want a personal copy for frequent reference.
“Playing With FIRE”
Scott Rieckens and Travis Shakespeare spent the last two years interviewing and filming and writing and recording for the documentary… and the book… and the audiobook.
[Disclosure: I was interviewed and filmed with Scott during their family’s visit to Kauai. There was surfing. I didn’t make the cut for the documentary, but I think we’ll see the surfing in the blooper reel.]
The book describes their emotional journey from dawning awareness (through Mr. Money Mustache) to the first awkward spouse discussions (Taylor was skeptical) to making the tough lifestyle choices. I won’t spoil the documentary’s stunning conclusion but I’ll mention that they interviewed over a dozen other FIRE luminaries(!) about their journey and their lifestyles.
My favorite parts of the book were Scott’s struggles to share his FIRE ideas with Taylor, and later to convince themselves that they really were making the right choices. (Two chapters are titled “I spend How Much On Coffee?!” and “BMWs And Boat Clubs”.) They both had several painful moments when they felt like they’d reverted to poor college students (living with their parents) or made a horrible mistake leaving Coronado.
One interesting story describes the documentary’s effect on the crew. The filming and editing process changed the lives of those who were involved, from comments like “I just paid off my student loans!” to “Man, I have got to get my sh… stuff together.” The crew saw and heard everything that our FIRE community has to say about the paths to FI, the obstacles, the successes, and the failures… and they still jumped on board. The director of photography said that he always looked forward to the next shoot for the film and was going to miss the experience.
Did I mention that Scott grew up with the military? Yeah, he’s a #milfam #milkid too. I really appreciated meeting his family.
I thoroughly enjoyed the book, and the documentary (released to Kickstarter backers) is wonderful too. Even if you’ve seen the documentary, you want to read the book for its additional perspectives.
Real Estate Investing Books
I read about real estate just to keep up with the tech, the tax deductions, and the investment opportunities. I’ve learned that I don’t want to invest in more real estate, although my spouse and I are optimizing our two decades of landlording of our one rental property.
I get dozens of questions from military families about investing in real estate. Many of them are unable to live in base housing or to find a place to rent. They eventually end up buying a home for what seemed like the best of reasons at the time. A few are heavily influenced by realtors, lenders, and the slick marketing fantasies of making $100K in two years from an Ewa Beach townhouse.
Unhappily, at the end of their tour, the family frequently learns that their great home is a lousy investment property. Even worse, when they try to sell it they find that it hasn’t even appreciated enough to cover the sales expenses.
Thousands of books promise to make you rich from real estate. Here are two which will actually show you how to do that without magical thinking and without buying their $5000 training program.
“Buy, Rehab, Rent, Refinance, Repeat” by David Greene
[Disclosure: BiggerPockets sent me an advance review paperback, and I’m going to pass it along to a local real estate investor’s group. ]
I’ve actually met David Greene in person. A couple of years ago he visited Brandon Turner during his Hawaii vacation and we hung out on White Plains Beach for a few hours. (There was surfing.) I didn’t realize it at the time, but David was putting the finishing touches on his financial independence, one investment property at a time. We were too busy talking surfing and Hawaii to really dig into BRRRR, but happily, he’s written the book about it.
Brandon Turner (the very prolific BiggerPockets author) actually coined the term for compounding your real estate investments. This is NOT a “zero money down” fantasy or a “100% VA financing” pitch. BRRRR is straightforward but it takes dedication, research, math, analysis, and sustained effort. Luckily you can do it at your own pace, and you only have to chase the deals which make sense.
The book is a brick of a trade paperback at 338 pages. David has years of experience with investment properties and he works with one of the country’s top real estate firms. He’s reached FI from BRRRR techniques without you buying his book, but it also helps him connect with even more deals. BiggerPockets is selling it because they have the free forums and the tools for you to succeed with what you’ve learned.
David starts by decrypting the acronym and shows how you can reach FI by buying and paying off one investment property at a time. Then he goes through the compounding acceleration of refinancing into the next property.
Again, this is not “get rich quick with no money down”. (Although you can get rich.) You start by buying at a discount (ideally with cash that you’ve saved) and then you dive into a rehab. (Not you personally– you’ll use a contractor.) You’re not doing a quick flip but rather adding value for a long-term cash-flow holding. Once you’ve added value to the property and put in a good rent-paying tenant, you’re ready to borrow on the equity and start analyzing the next deal.
Straightforward, but not easy.
Each chapter dives into incredible detail, beginning with patiently finding the right place at the right price. (Hint: he describes several search techniques and lots of networking.) The rehab is usually a significant effort, too– if it was easy then someone else would have already done it. You’re going to research and network (again) for a contractor who understands investors and will make good use of both your time and their labor. David then goes into great detail on finding good tenants (the first time) and finding good lenders for the refi.
The book’s highest value is in the last 50 pages, where he shows you how to put the systems and processes in place to scale your efforts. You won’t be answering 3AM phone calls from angry tenants, and you won’t be painting walls. Instead, you’ll learn how to find deals across the nation, how to build a team around each investment, and how to network that team to find more deals for them to work on.
Happily, the book is built for skimming. The table of contents is very detailed (13 chapters, six pages) but there’s no index. As a Baby Boomer, this might be a sign that indexes are dying from eBook search. You can work with the book’s table of contents without an index, but perhaps you’ll want to search with the eBook version.
When you’re on active duty, please do not BRRRR a home at every duty station. Personally, I think you shouldn’t even do it with your first home after active duty… at least not right away.
Instead, rent or live on base and then follow David’s advice on how to invest the right way, in the right places, and at the right times.
Chad Carson’s “Retire Early With Real Estate”
Chad’s subtitle is “How Smart Investing Can Help You Escape the 9-5 Grind and Do More of What Matters”.
I actually paid real money for the eBook version, and I got more value than I paid. Yet again, here’s another author who is not depending on book sales to reach financial independence. He’s already FI, and he’s even spent the last 17 months exploring Ecuador with his family. The book was published late last year, so they must have enjoyed an inspiring life experience.
You’ll learn about all types of real-estate investing here, including a BRRRR chapter.
Other tactics include house hacking, live-in-then-rent, and live-in flips. Financial plans include rental debt snowballs, all-cash rental investing, long-term buy-and-holds, and trading up.
The book’s real value comes from figuring out why you’re investing in real estate, and which methods will work best for your risk tolerance. Chad includes profiles of 20 investors (including many bloggers)– both their successes and their failures. Felisa Savage’s story in Chapter 21 is as heartbreaking as it is educational. She’s back on track but the scars are still healing.
Read Chad’s financial and lifestyle advice while you’re waiting for David Greene’s release to ship. The two books fit well together.
The Next Millionaire Next Door
The original “Millionaire Next Door” helped my spouse and I realize that we would reach financial independence. Better still, it debunked all the urban legends about how millionaires look and act. We went on to enjoy all of the books in his MND series. “Millionaire Women Next Door” even influenced our teen daughter.
20 years later, Tom Stanley and his daughter Sarah Fallaw were updating the original with new research. Did MND’s advice still work, or was it an anomaly of the economy and a strong stock market? As they finished their analysis and began writing the new book, Dr. Stanley was killed in a car accident.
I’d followed their research for years on their blog, and I was concerned that the project would quietly stumble to a halt. Thankfully their latest book is now a memorial to his life’s work as well as a growing database of even more inspirational facts. Sarah Fallaw finished the book with their research and included her father’s voice by adding some of the material from his blog posts.
Much of the analysis compares the changes over the last 20 years, but it shows that real millionaires still have a high savings rate and don’t act rich. This sequel’s data is not as novel as the original MND, but– even better– it verifies that the methods are repeatable.
I wish I’d read the book while I was in high school, and I’m unsurprised to learn that many people bought the original MND for their teens and young adult children. You can do the same with this one for your family! Talk about it while they’re young.
Cameron Huddleston’s “Mom And Dad, We Need To Talk”
I’m not going to review the chapters of this book because I haven’t read a copy yet. When it’s published, I’m buying two copies: one for my spouse and me, and another for our daughter and son-in-law. We’ve already had many family financial conversations, and this guide will help keep our discussion going.
Cameron is a prolific author, journalist, and GOBankingRates columnist. I met her several years ago at FinCon when she asked about my father’s Alzheimer’s Disease and how I was handling his finances. By this point, she was caring for her mother (who was also dealing with Alzheimer’s) and had handled Mom’s finances for several years.
We talked for over 90 minutes. It’s the typical unspoken conversation among members of the Sandwich Generation. Nobody brings up their multi-generational challenges because they feel like they’re the only one dealing with it, and yet most of the people in the room are struggling with the same issues.
“Everyday Bucket List” by Karen Cordaway
“10 Steps to Bring More Exciting Experiences to Everyday Life”
Karen plans to publish in June, and she’s working on the book cover and a sales page.
I’m not going to review this book, either, because I helped with the copy-editing of an early draft. I’ll just point out that Karen sure can write, and she has extensive freelancer experience in major publications.
Rather than the book version of the movie, Karen shows you how to turn your bucket list into a plan. Instead of a huge fantasy trip requiring a logistics team and thousands of dollars, she applies her personal-finance experience. She shows you how to break down your goals into smaller steps, figure out your timeline, and save the money to pay for the parts you really want.
She’s writing for young adults and working parents who want to have exciting, fun family experiences on a budget. They want to make it happen during weekends or vacations, and without spending exorbitant amounts of money. They want their great ideas to happen with a plan instead of “someday when we have the cash”.
Financial independence is not deprivation and deferred gratification and merely saving tons of money. It’s a lifestyle which lets you focus your expenses on your priorities. It’s making spending choices on what’s important to you, and this book shows how to make it happen. You’ll reach FI, and you’ll enjoy a higher quality of life along the way.
NewRetirement.com (well, not actually a book)
Now that I’ve dangled all these reading resources in front of you, I feel obligated to share a tool.
Steve Chen has worked on the NewRetirement planning calculator for years now, and it’s more robust every month. (I helped check the parts of the site that deal with military benefits.) It’s gaining traction on search engines (see what I did with the link in that first sentence?) and it’s headed for the first page of results.
Last year the team brought in a paid version of the calculator and did more testing of the direct-to-customer model. They’ve already had over 1.2M visitors and created over 60,000 “Planner” accounts reflecting $60B in retirement savings. Steve’s NewRetirement podcast has already brought in over 250,000 downloads of episodes with rockstar financial authors, analysts, advisors, and… professional poker players.
Bonus tools (for a value price)
These next two items are not free, yet they offer tremendous value. I’ve personally benefited from using them, and these are not affiliate links.
First, Billy & Akaisha Kaderli just published the 4th edition of their “Adventurer’s Guide To Early Retirement”. They’ve been financially-independent and world travelers for nearly 30 years! They started with a leanFI portfolio and an expat perpetual-traveler lifestyle. Three decades later they’ve demonstrated that the 4% Safe Withdrawal Rate works, and their life is better than ever. They set the world’s best example of how frugal habits lead to abundance in a fulfilling lifestyle that you’ll love.
I bought my earlier edition over a decade ago, and the update is even better. The new edition adds 15 chapters and a FI lifestyle experience that you won’t find in any other FIRE book. (I’ll reach their experience level in another 11 years…) It’s particularly helpful if you’re curious about combining perpetual (slow) travel with home ownership.
Second, a new online course tackles a problem that I confronted over 25 years ago: building your spreadsheet for financial independence.
ActuaryOnFIRE uses 18 short videos to walk you through the process of creating your FI spreadsheet. You’ll start with a copy of his template and then learn how to modify it for your own situation. All of the formulas are explained (so that you can edit them if necessary) and he explains how to forecast everything in current dollars.
In addition to his actuarial perspective on making your money last longer than you do, he includes several case studies. You’ll follow along as he tweaks various lifestyle changes to show how the red flags will pop up and get handled. (I wish I’d seen this in the 1990s!) My spreadsheet skills are up to the material he covers in his course, but he’ll reassure you that you’ve considered everything without overlooking a horrible omission. If you’re a total noob at spreadsheets then you’ll learn how to build your own and gain the confidence to tweak the scenarios. Even if you’re a spreadsheet wizard, you’ll see how to graph out the various situations and turn problems into successes.
I know that people have certain perceptions about the actuary stereotype, but AoF keeps things entertaining with animated characters and blues guitar riffs.
Your Call To Action!
Run the NewRetirement calculator and build your version of ActuaryOnFIRE’s spreadsheet to see where you are on your path to FI, and read the books. I hope you don’t need to start an awkward conversation with your spouse or your parents, but these books have you covered for real estate and millionaire stealth wealth. Let us know which ones work for you!
The Military Guide to Financial Independence and Retirement Price: By Doug Nordman: This book provides servicemembers, veterans, and their families with a critical roadmap for becoming financially independent.
The 5 Best Personal Finance Books I’ve Read All Year (2016 edition)
A Retired Sailor Recommends 50 of the Best Personal Finance Books Ever Written
Over two dozen other book reviews from the blog archives