1:26

Hello and welcome back to Catchy Up to FI. I'm Bill Yount and I'm here with my co host Jackie Kosky.

1:32

How are you today Jackie? Hey, Bill, I'm doing good.

1:34

I'm so excited about our interview today.

1:36

And I am honored that you invited me to join to speak with our guests today.

1:41

I'm excited. All right you know your discovery of JL Collins was on

1:46

his website back originally. how'd you find him?

1:48

Oh, my gosh. It was back in the day.

1:51

And I'm having the same issue as he is in terms of trying to teach my daughter about

1:55

money and personal finance and investing.

1:58

And when I saw his letters on the website, and he was Talking about the fact that he

2:04

was writing them to his daughter because he wanted to teach her these things.

2:08

And so he put them in little letters. And as you know, I had a book that I wrote 10 years ago.

2:13

And it's called Money Letters to My Daughter. So I'm like, oh my god, we have a very similar line of thought.

2:19

We want to teach our kids about money. So ever since then it had my heart.

2:22

He's talking to his daughter. I felt every single word he was saying and how genuine it was to say, Hey, these

2:31

are the things I'm telling my daughter. So we were like four years watching him and listening to him share all of this.

2:37

And I just loved it. So ever since then, everything JL Collins, I was all about.

2:42

So simple path to wealth and now Pathfinders, I'm just thrilled.

2:46

And it's just so great to be able to chat with him today.

2:50

Well, how are you doing JL? I'm doing great and and I feel even better with all those nice warm words.

2:56

Thank you for having me back on the show and Jackie, I'm glad that

2:59

you're going to be part of this. Without spoiling the fun, we'll just send you back to listen to those shows

3:04

after you've fully enjoyed this one. Now, in case you don't know who he is, JL is known in the Phi

3:12

community as the Godfather of Phi.

3:15

First and foremost, a husband to Jane and a father to Jessica.

3:19

Were it not for this family, we would not have the simple path to

3:22

wealth, your roadmap to financial independence and a rich life.

3:26

As any JL tried gently beating Jess over the head with his vast and practical

3:32

financial knowledge from infancy on up.

3:35

And college Jess countered with. Quote, I know money is important.

3:39

I just don't want to spend my life thinking about it.

3:41

End quote. Frustrated but not thwarted, J.

3:44

L. wrote loving money letters to his daughter that became his blog, J.

3:48

L. Collins N. H. And ultimately became the book, the Bible of Phi.

3:53

Once you read it, you cannot unsee the simple path.

3:58

But JL at Base is really a simple storyteller or guide in a monk's

4:02

humble robes and sunglasses.

4:05

As our mutual friend, host of the Choose a Fight podcast says,

4:09

stories make the world go round. Well, JL has been collecting stories of those on the path all over the world

4:15

since he published his first book.

4:17

And this past fall came out with his third book titled Pathfinders Extraordinary

4:22

Stories of People Like You on the Quest for Financial Independence.

4:26

So it's time to curl up on your favorite chair with your favorite beverage and

4:30

once again, listen to JL tell us a story.

4:34

Now, so welcome back to Catching Up to 5, JL.

4:36

It's a pleasure to have you back. It's a pleasure to be back, and I'm curious as to what story you want to hear.

4:42

Oh, well, there's plenty of stories in the book.

4:45

I think there's about a hundred and we'll go over a few of them, but first, before

4:49

we jump into the book, I have a burning question that I realized I'm not sure I've

4:53

ever heard the answer to on a podcast. What does JL stand for?

4:59

It stands for James Linton, Linton being

5:03

interesting. Okay.

5:05

All right. Have you ever revealed it on the podcast? That's interesting.

5:11

I don't know that you've ever revealed that on a podcast before,

5:13

so maybe we're getting a real scoop. don't know that anybody's ever asked before.

5:19

Well, JL is a much easier way to go with that.

5:22

So we'll stick to JL, James Linden, but let's jump into the book.

5:27

And Jackie, I think you had a first A few questions for him about the origins of

5:33

pathfinders and the simple path to wealth.

5:36

Yeah. So obviously we are all enamored with Simple Path to Wealth and

5:42

that's a hard act to follow. So I'm very curious at what point after that book was published,

5:50

in the public domain, you've got over half a million readers.

5:54

You've got a ton of super fans. At what point after that book coming out, did you start thinking about, Oh,

6:02

there's people actually following this advice and they're having success with it.

6:06

I think I want to put it in a book. Like, how did that transformation happen?

6:11

Where. Pathfinders was born.

6:15

Yeah, so that wasn't really an idea that I had to come up with I

6:21

want to say simple path to wealth, which came out in 2016 in June.

6:26

So probably by the end of that year, the beginning of 2017, I started hearing from

6:32

people who had read the book and were telling me about how they had taken the

6:39

principles and lessons in it and applied it to their own unique circumstances.

6:45

And that was fascinating because. I wrote this book for my daughter.

6:49

I mean, I was once asked, why is the advice so specific?

6:53

And it's the answer to that as well, because this is exactly what

6:56

I'm telling my daughter to do, which of course is very specific.

7:00

And she was in college when I was writing it.

7:04

So at the beginning of her journey, she's an American.

7:07

So it's very us centric book.

7:10

And yet I started hearing all these stories from people who were in their 30s,

7:14

40s, 50s, 60s, well on their journey.

7:18

Maybe they had lifestyles that they regretted and they had to unwind

7:23

to free up some money to invest.

7:25

Maybe they'd made investments that, in retrospect, weren't optimal and

7:30

they wanted to pursue the simple path.

7:33

And then I was hearing from people in other parts of the world, places that

7:38

didn't have 401ks or IRAs that I'd talk about in the simple path to, well, they

7:44

might have something that was equivalent, but it was fascinating to me how these

7:48

people would say, Oh, maybe I don't have an IRA, but that sure sounds like

7:52

this, that we do have, or, okay, we don't have anything like that, but.

7:58

I'm going to apply the other lessons in the book.

8:01

And so that's what first got me thinking about it.

8:05

And then over the years, there were just more of these stories.

8:09

And I took some of them and created case studies that are on the blog.

8:16

I want to say they're pretty good. 15 of them.

8:19

And that was my original idea actually for the book was to bring

8:24

these 13, 15, 16, whatever it was, case studies into a book form.

8:30

But when Harriman house, my publisher reached out and that was, what I was

8:36

telling them in our conversations, it kind of morphed into, well,

8:40

why don't we seek more stories? and have more and they're sure, because case studies were pretty

8:46

long and have more shorter stories.

8:49

So now, as Bill alluded to, there's about 100 and pathfinders.

8:54

They range from a few paragraphs long to a few pages.

8:58

And they cover a much wider spectrum than if I'd done the case studies alone.

9:04

And by the way, there are a couple of. Vignettes from people who had their case studies on the blog.

9:11

Yeah, that is actually one of my favorite was one that was written on the blog.

9:16

I didn't realize it was on the blog, but that's fascinating.

9:19

So really people reached out to you and said, here's my story.

9:26

And they sort of gave you your marching orders that we think that there's a lot of

9:30

people that has benefited from your path.

9:34

So when you started getting people writing their own stories, did

9:38

you find people any other way than just them sending in your stories?

9:44

Well, so first of all, when my editor, Chris at Harriman house, and I came

9:49

up with the idea that we wanted to have more stories in a shorter format.

9:54

At that point, I reached out to my audience and actively

9:58

sought out the stories. Until that point, I had been hearing them.

10:02

They'd been coming to me, but I hadn't been collecting them.

10:05

I hadn't been saving them, other than the ones that were case studies.

10:09

So, we reached out, or I reached out on Twitter and Facebook

10:13

and on the blog and asked. and we didn't know if.

10:17

What kind of response we'd get if there would be enough for a book.

10:21

Well, it turns out there was more than enough for a book.

10:24

The challenge became, how do we choose from all these great stories?

10:28

And so the book is a manageable size and so, but that was the labor of love.

10:33

That was a lot of fun. If you ask for that, I'm thinking you've got a lot of responses because

10:38

there's a lot of people reading and benefiting from your book.

10:41

So then you have the task of sifting through them.

10:43

That's awesome. Yeah, we didn't know we were nervous.

10:48

Are we going to get like 12 but no, we more than enough.

10:52

And, and so, yeah, it was, it was

10:55

they were also from all over the world, and that's one of the interesting things

10:59

to me about this book, is that it's not U.

11:02

S. centric at all, if anything, there may even be almost a majority of, countries

11:07

all over the world that are represented and we'll get into some of those

11:10

stories here, I just want to let the audience know that the book is divided

11:14

into nine sections, and the sections include freedom, Debt, saving, lifestyle

11:21

inflation, investing, FU money, of course, staying the course, family, and endgame.

11:28

There's some sections in here that are unique to these stories, and

11:32

you break things up into these with the stories that are very punchy

11:36

and bring your message across.

11:40

Very strongly in the story fashion, so it must have been very gratifying for you to

11:46

see that your impact all over the world.

11:50

So one of the things that was, was gratifying.

11:56

And there are stories from all over the world, because we got

11:59

stories from all over the world. In fact, we have stories from every continent except Antarctica.

12:06

And I made that comment in an interview, and I promptly got an email from somebody

12:10

who said, for the last, I think it was six years, I've, I've been living in

12:14

Antarctica doing research, and if only I'd known, I would have sent you my story.

12:19

So even, we didn't get a story from Antarctica, but evidently https: otter.

12:26

ai

12:28

How many copies has your book sold now?

12:31

Last time we talked, it was over 600, 000, and I'm sure that's becoming exponential

12:36

with your message reaching so far. How many copies are you up to now?

12:40

The last time I checked, it was, I want to say 670, 000 copies.

12:46

Now that includes the print Kindle, audible, and to a much lesser extent the

12:53

books that have been published around the world and other languages, you

12:57

Wow. That is mind blowing, JL.

13:00

Mind blowing. Look at how many

13:02

lives you have touched with that book.

13:05

It is stunning to me as well. I mean, when I wrote this book, I never, I never dreamed.

13:11

I, in fact, I remember when I was getting ready to publish it and I,

13:15

it took me three years to write it. And so I had a lot of blood, sweat, and tears into this thing.

13:20

And I began to wonder, what does success look like?

13:24

And so I started asking people in the business and, I heard

13:27

things like, well, most books. Don't sell anything.

13:32

I mean, if you get to a thousand copies, that's kind of a success.

13:36

If you, if you get to fourth or 5, 000 copies, that's really good.

13:41

If you get to 10, 000 copies, well, then you've hit it out of the ballpark.

13:46

And I remember thinking, I can probably get to 10, 000 copies just based

13:51

on the size of my blog readership.

13:54

But I never dreamed that, it would get into, and it didn't

13:58

happen the first year or two.

14:00

It started pretty slowly and then it just has kept growing.

14:06

And so yeah, that's really gratifying too.

14:08

It's selling well in 2021 during COVID was the high for annual sales.

14:15

But since then, this year and last, which are about equivalent

14:19

or are short of, of that high watermark year, our record years.

14:25

So, seems like it's going to have some legs.

14:27

Silence.

14:35

Path to Wealth that was written for one person in particular, your daughter, but,

14:40

it went viral to all these other people and now we get to see and get a peek

14:45

into, the impacts this has had on folks.

14:48

Now we start your book with freedom.

14:51

Which is an interesting concept to start with, because you had

14:53

focused on pretty much investing and how do you do this in mechanics?

14:58

This is sort of the soft science of the simple path to wealth.

15:02

And there's a couple of great quotes you have to start this chapter off.

15:05

And one from Groucho Marx says, money frees you from doing things you dislike.

15:10

Since I dislike doing nearly everything, money is very handy.

15:14

I love that quote. And then the quote from you here too which really resonates with me is

15:23

unlike you, once your money starts working, it never grows tired, never

15:27

gets bored, never sleeps, never stops.

15:31

It keeps working 24, 7, 365.

15:35

You can deploy it across many tasks so that even, as some

15:38

may fail, others prosper. It will keep working for you as long as you live.

15:43

And after you die, it will keep right on working for whomever

15:46

or whatever you have told to it.

15:49

So freedom is not just during our lifetimes.

15:52

Give us your concept of how the Simple Path and Pathfinders personifies freedom.

16:01

Yeah. So freedom for me is kind of why bother doing this, right?

16:05

I mean, why not just go out and squander every dime that comes your way.

16:11

And the answer to that in my mind is that of all the things that money

16:16

can buy, the single thing that was most valuable to me anyway, was.

16:21

My financial freedom. And it's hard for me to conceive of.

16:27

Anybody else making a different choice, if they understood that that is a

16:32

choice available to them, I don't think most people even consider or aware

16:38

that one of the things they can spend their money on is buying their freedom.

16:43

And of course that means as Groucho Marx said, freedom from doing things

16:46

you don't necessarily want to do, freedom from having to rely on it.

16:51

Your own ability to, to earn money in order to, to take care of yourself

16:56

because, that ability might go away.

16:59

I saw it go away. As my father's health deteriorated from his cigarette smoking.

17:04

So yeah, I mean, and then, when you have that financial freedom, there's

17:10

so many more options available to you in the world with how you live

17:14

your life and what you choose to do.

17:17

That I've spent every dime that's ever come into my possession.

17:21

The difference is that I've spent half of those dimes on buying my freedom.

17:27

And of course you buy your freedom by buying financial assets.

17:30

That is that quote you came up with.

17:33

Never stop working for you once you put them to work.

17:36

Silence.

17:44

eloquently than jail Collins. But for, for me, it is being able to do what you want.

17:51

I always see money as like an obstacle.

17:53

When I was growing up, it was always the reason why we couldn't do

17:57

something or couldn't have something. So now that I'm older, I've gained, a certain level of financial success.

18:04

I no longer have to worry about money being that obstacle that's keeping me

18:09

from doing the things that I want to do.

18:12

So that's how I see. It's just freedom to do what I want to do and not having to

18:17

have that money issue in the way.

18:21

What about you, Bill? What's, what's your thoughts about freedom?

18:25

Oh, interesting. I don't disagree with either of you.

18:28

I mean, freedom for me is to not be locked into the chair where my butt's

18:35

in the seat in order to earn money. And that's kind of how my profession works.

18:41

Unless I'm at work. I'm not earning that active income and to have the so called passive income

18:48

that takes care of you so that you don't have to work and you can work

18:52

for fun and you can do things that you wouldn't normally do when you're

18:56

focused on supporting a family and, So to get out of the day job and into the

19:05

life job would be the way I look at it,

19:08

but the way your audience looked at it is kind of interesting too.

19:11

I have a few stories from the book.

19:14

And Paul M. from Cologne, USA.

19:17

And this is a guy I've actually met and will be on the show.

19:21

He's a friend of yours, and he wrote the story, the freedom to choose.

19:27

And his story goes that I was 44 years old, and this speaks

19:31

to our late starter audience. Debt free, other than a mortgage that would be soon underwater, but

19:36

also investment and savings free.

19:39

I had been in the workforce for 25 years and was starting over.

19:43

Fewer than 15 years from having to start over in life.

19:46

When I have to make a decision between money and time, I now

19:49

have the freedom to choose time.

19:52

You remember this story, JL? I do.

19:54

Yeah, it's coming back to me.

19:56

And I certainly remember Paul. I'm still in touch with him.

20:00

Well, he's writing a book that will be coming out.

20:03

And we're gonna talk to him about that.

20:05

I can't reveal much more than that. But I think he met you at a Camp Phi, and he's come up with a very unique idea that

20:13

I think will do very well in the space.

20:16

I've actually read his first draft. So, and I agree.

20:21

I think it's a very cool idea.

20:23

Silence.

20:28

to share with our audience, too, and one is from Tiffany S.

20:31

in Vermont, USA, and she titles hers The Two Kinds of Wealth, and she says, I grew

20:37

up thinking that if someone had a flushing toilet in their house, they were well off.

20:43

If they had two toilets, they were rich.

20:45

This is a really interesting concept of wealth, don't you think, guys?

20:50

I love that particular take.

20:52

I'd forgotten that it came from Tiffany, but I talk about the, the toilets.

20:57

And then another, another 1 that I like is there's a.

21:01

One of the stories is from a guy who grew up as an immigrant farm

21:04

worker, migrant farm worker. And, when he was a kid, he was picking asparagus in the field.

21:10

And the reason I love those stories is because when I first started the blog and,

21:16

and started writing in this FI community.

21:20

I noticed that there was a lot of pushback from naysayers who along the

21:24

lines of, well, this is all fine and good if you're a college educated software

21:30

engineer making the six figures, but it doesn't apply to the rest of us.

21:35

And, as I got to know people in the FI community through the Chautauqua

21:41

events that I started and going to camp FI, that's not what I saw.

21:46

I didn't see that. The people doing this were this exclusive, rarefied group.

21:53

I mean, they came from all walks of life and some from

21:57

very, very humble beginnings. And so I love those stories because it shows that this idea that you

22:05

have to be making a certain amount of money or have a certain background in

22:10

order to do this is simply not true.

22:13

What I enjoyed about the book so much, it was the variety.

22:17

I didn't know exactly what to expect, but I think, when I started in the

22:21

early days of FIRE there didn't seem to be a whole lot of variety.

22:25

So The collection of stories that you pulled together and kudos to whoever

22:29

decided to choose, which ones made it in the book, but it was so cool to have

22:34

these people from all these different countries, which I absolutely love

22:38

the ones from Russia and Ukraine that just, sent chills through my spine.

22:42

But, whoever reads the book, they are going to get such a great

22:47

variety of stories and there's going to be at least a few that

22:53

will completely resonate with you.

22:55

So that's the thing I appreciated. The most about the book and I did the audio book.

23:00

So I loved, just not knowing what was coming up and, I didn't preview

23:04

the table of contents or anything. So it was so fun to see what was coming up next.

23:08

I didn't know how long they were going to be. I didn't know where the story was going to go for each person.

23:12

And it was, it was just very cool. And I, I appreciate it kind of getting all these different perspectives.

23:18

Yeah, well, thank you. And when the stories came in, we were kind of blown away at the range of

23:24

perspectives that they represented. Because we didn't really know what was going to come our way, but I,

23:30

think the amazing thing to me about pathfinders and the thing that I like

23:35

the most about it is you can't read pathfinders and then honestly look in

23:42

the mirror and say, this can't be done.

23:46

Which I think too many people when they first hear about this idea of

23:49

pursuing the simple path to wealth and becoming financially independent

23:53

say, Oh yeah, no, That can't be done.

23:55

that's smoke and mirrors. You can't read pathfinders and honestly, save yourself from that point forward.

24:01

It can't be done. You can still say I choose not to do it, but from that moment on, if you're honest

24:09

with yourself, you will know that this is a path that is available to you because

24:14

it's available to virtually anybody.

24:17

And certainly it's available to anybody.

24:20

Who is able to listen to our conversation, who's able to listen to this podcast.

24:25

I think I can pretty safely say that nobody who hears

24:29

this is, is this path beyond,

24:32

Yeah, that and you can't unsee it. it's you can't see

24:35

It's, it's hard not to choose the path after you've seen it

24:39

when you realize the power of it. I mean, there's a story in this chapter also from out of the

24:44

box traveler in Canada called minimum wage, but maximum freedom.

24:49

Another one of my favorites. And, this person says people without college degrees might be interested

24:55

to know that three months of work in the winter is often enough to

24:58

fund my entire year's expenses.

25:01

But that's not a lifestyle that everybody leads. And every lifestyle in this book is unique and you can find elements of

25:10

your challenges and your opportunities In almost every one of these stories,

25:16

and one or two of them probably will resonate with you profoundly, there

25:19

are late starter stories in this book.

25:22

And I would encourage our late starter audience to read it and

25:25

find them and realize that their story could be in this book too.

25:30

Yeah, absolutely. And the other thing about the Canadian guy you were just talking about is, not only

25:37

is he covering all of his expenses, But he's also building his wealth, so he's

25:43

also saving a portion of that three month income and he's doing it when you read

25:48

the story and not to be a spoiler, I guess, but he's figured out how to arrange

25:54

his lifestyle in a very inexpensive way that allows him to do the things that

25:59

he's passionate about with his time.

26:02

And it's brilliant and he doesn't have to wait.

26:05

to live that life until he's fully financially independent.

26:09

He's living it right now while he's building his wealth.

26:12

And this seems avant garde to the majority of society, right?

26:17

I mean, who could imagine working three months and taking

26:21

nine months to live life? I mean, that's some kind of balance that most people wouldn't

26:25

even dream of or think of, right? Well, and that's the thing.

26:29

I think that's again, the reason I love Pathfinder so much and

26:33

the stories in it is, I think it really will open people's eyes.

26:38

As to what is possible. And, if you think outside the box and with a little bit of creativity and hopefully

26:44

with some of the inspiration that you, you find in pathfinders, I've actually, by

26:49

the way, come to think that for somebody who's not read any of my stuff pathfinders

26:56

is probably the book to start with.

26:59

It's probably actually a better introduction.

27:02

Then the simple path to wealth is now, I couldn't have written it until I

27:07

wrote the simple path to wealth, but the reason I say that is you're going to read

27:12

these stories from all these different perspectives, all these different starting

27:16

points, all these different lifestyles that people have that are following this,

27:21

this path, that's bringing them not only financially, freedom, but great joy.

27:26

And then when you set that book down, hopefully you will know.

27:31

That this is an option. I mean, this is one of the things that you too can be spending your money on

27:37

and if that resonates with you, then the simple path to wealth is kind of the

27:44

manual as to how to actually do that.

27:50

each chapter where you talk about your thoughts on that section and in the

27:55

investing section, for example, in a matter of a few pages, you go through

27:59

the entire simple path to wealth and you outline, 10 things you got to do

28:04

and you boil it down towards, I mean, you could read this book and come

28:08

away with it with all the knowledge you need to get started on the path.

28:12

It that was one of my goals is that if this is the only thing you read

28:18

that you can understand why it's something to consider and then

28:23

you can get started if you choose. makes it so accessible.

28:28

and JL, I kind of thought of it that way too, like with the Pathfinders

28:31

versus Simple Path to Wealth. Pathfinders, it taps into your emotional side and your psychology.

28:38

And these stories are fleshed out from real everyday people.

28:41

they're not content creators. They're not bloggers, podcasters, whatever.

28:45

These are everyday people and this is their life. And they were willing to share their lives.

28:48

And so that tapped into my emotional side and got me thinking and

28:54

we'll get most people thinking. So probably one of their conclusions would be.

28:59

Well, I think I can do it too. So what do I do now?

29:01

And then that's when they would hit the simple path to wealth, where, like you

29:06

said, it's more of the funny instruction manual that will get them there.

29:10

So so yeah, I think, I think it could go either way, but some people

29:14

are just more drawn to, a story.

29:18

Seeing someone else actually accomplishing it and tapping into

29:21

like how they think about it. And that kind of gets them more motivated to where now

29:26

they're ready to do something. And again, it's not something just for some remote group of

29:36

people that I can't relate to.

29:39

Right. Yeah, absolutely.

29:42

Let's move on to the next section because this is where we want to have freedom.

29:47

But this is where kind of you see the journey starting and you have

29:51

very strong opinions on debt.

29:54

and, You start this chapter with Will Rogers famous quote, too many people

29:58

spend money that they haven't earned to buy things that they don't want.

30:01

To impress people that they don't like, and you refer to debt as danger.

30:06

Can you give us some of your thoughts on debt? The good, the bad, and the ugly.

30:11

well, there's no good . It's all bad and ugly in my opinion.

30:17

that's a little harsh. I mean. certainly if you want to own a house and I think you should think

30:23

along carefully before you make that decision, you shouldn't just buy one

30:29

automatically because the larger world tells you that's the right thing to do.

30:34

But then clearly taking on a mortgage can, can make some sense.

30:38

If you're running a business at a certain point, you taking on

30:41

some debt might make some sense. But personal debt.

30:46

Is insane. It's and, and I'm appalled at how accepted it's become in the American culture that,

30:55

well, of course you're carrying debt.

30:57

I mean, how else would you maintain the consumer lifestyle that you must maintain?

31:03

And there's some truth to that because the, the lifestyle that we're kind of.

31:08

With all the marketing that's, that's crammed down our throat that

31:11

we need to maintain, well, most people don't actually have the income

31:16

to do that, but hey, no worries.

31:18

We have this easy payment plan, but when you take on debt to buy something,

31:23

essentially, you're saying, if it's a car, as an example, like, but I don't

31:28

want to pay 30, 000 for that car.

31:31

I want to pay a whole lot more than that. And I want to keep paying it until I die.

31:35

I mean, it's insane. It's like being covered with bloodsucking leeches , and thinking that's normal

31:42

a way with words. I mean, it's not normal.

31:46

It's not okay. And if you're covered with bloodsucking leeches, you take your sharpest

31:50

knife out and you start scraping the little bloodsuckers off.

31:54

And that's exactly what you should do with your debt.

31:56

You should take your sharpest financial knife out and pick the biggest, the

32:02

meanest, the ugliest, the nastiest, the highest interest rate debt, and start

32:07

scraping at that sucker until it's gone.

32:11

And that's a great way to organize your life, to free up the money to do that.

32:17

You get a great return when you pay off high interest rate debt,

32:21

because essentially it's getting whatever that interest rate is.

32:26

That's the guaranteed return you're getting by paying it down.

32:30

And then when you've blown that debt out, not only are you free from

32:35

debt, but you have the discipline to begin building your wealth.

32:38

So all that money that went to paying down your debt.

32:41

You can now channel into buying assets into buying your freedom and it will

32:46

feel at that point normal to you. If you have debt, that's the silver lining is that once you go through the

32:53

candidly, extraordinarily difficult process of getting rid of it, you've

32:58

created a wonderful discipline that will serve you well in building your wealth.

33:04

Yeah. I definitely think that's the bright light for people paying off debt.

33:07

It doesn't mean you can't still, be on the path to fire, whatever.

33:10

But like you said, you created that habit. By paying off your debt regularly.

33:14

So now all of that money that was going towards your debt every month, now

33:18

you get to reroute that to investing.

33:20

Like how great does that feel? Maybe even more so than someone that didn't have debt

33:25

because that marginal gain. But I mean, I've heard you make that point before and I'm like, that, that is so.

33:32

True. And that might be the extra little motivation to say, Hey, if I can

33:36

pay off these debts every month and be consistent, then I can do the

33:39

same thing with investing and I've already, created the funds to do that.

33:43

So I love that. Yeah. I would hope anybody who's listening to this, who's carrying this kind

33:48

of debt and is under the impression that it's okay or that it's normal.

33:54

I hope this conversation inspires them to rethink that.

33:59

My friend, Mr. Money Mustache likes to say, if you have debt that your hair's

34:03

on fire, this is an emergency.

34:05

This is not normal. You need to act right away and you need to move heaven and earth

34:10

to, to get out from under it. You will never be free if you're dragging that ball and chain around.

34:16

JL's got some great one liners.

34:18

I just want to throw this in there. I don't know if this was in the book, but JL, you were Maybe it was a podcast or

34:24

something, but you just said, don't spend all your money on trash and trinkets.

34:28

You know what i'm saying? It's like those are t shirts.

34:30

You need to start a t shirt business because you've got so many great one liner

34:35

yeah, I and I think that's actually in the simple path to wealth because I've

34:40

kind of gotten away from that line. I've forgotten it a little bit, but, but yeah, I mean, it's trinkets and

34:45

trash, and you can buy your freedom or you can keep buying trinkets and trash.

34:51

mean, you have a couple of other great one liners in this book where, you say

34:54

having debt makes money your master and, rather than master your money, you're,

34:59

you're turning your life over to debt. And then

35:02

Oh, absolutely And then money spent servicing debt is not working for you.

35:07

It's not those little soldiers out there and all the companies that

35:10

you can buy with investing that work for you tirelessly while you sleep,

35:15

uh, debt works tirelessly against you and helps you lose sleep, probably,

35:21

And then you also refer to debt as a dumpster fire.

35:24

There is no financial freedom until you put it out.

35:27

Don't overthink this. Start today. So a lot of, a lot of great one liners.

35:32

that's the, that last one, don't overthink it.

35:34

I think it's critically important because there's also a whole industry

35:40

around ostensibly helping people get out of debt by selling These

35:46

programs and that's also insane.

35:48

Don't buy stuff to try to get out of debt.

35:51

It's not easy, but it's not complex.

35:55

It's don't overthink it. You just have to pay it down.

35:59

And again, my advice is start with the highest interest rate

36:02

because debt and pay that down. Cause that's your biggest immediate return.

36:07

That's what financially works best. But. It's not easy, but it's not complex.

36:12

It's very simple. You just have to stop spending money.

36:18

Organize your life so you're freeing up money to put towards that debt and

36:23

then just keep pounding away at it.

36:27

Jennifer C. from Chicago, Illinois in the story When Debt Rules Your Life in your

36:31

book she says something profound too.

36:35

I used to think that budgeting meant that you were poor.

36:38

And I realized that if you wanted to achieve true happiness in

36:41

life, debt was going to inhibit me much more than a budget.

36:45

So for people that are, reticent to starting a budget, I mean, that

36:49

seems to be a critical move to make in order to pay off your debt, right?

36:53

Yeah, absolutely. Yeah, Absolutely. I mean, it's a tool towards freedom.

36:57

you need to know where your money is going before you can figure out

37:01

how to organize your life to free some of it up to work for you.

37:04

Um,

37:18

And you quote Benjamin Franklin and say, if you would be wealthy,

37:22

think of saving as well as getting, there, there's all these great

37:27

things that people can summarize in one line that should motivate us.

37:32

To go down this path, saving follows debt because it's the key mechanism

37:37

by which we only escape debt.

37:39

If we have been unlucky enough to fall into it, but build wealth,

37:43

it makes everything else possible. Saving is what powers the journey.

37:48

Right? That's it. I mean, savings and I've come to think of that a little bit differently,

37:55

it's a way of spending, right?

37:57

So when you say saving, what you're really saying is, well,

38:00

you're investing in assets, you're spending your money to buy assets.

38:05

Because that's how you buy your freedom. So that's what savings is.

38:09

It's a form of spending to buy your freedom.

38:14

There's another great t shirt Yeah, I think that I think

38:20

Maybe Jackie, we have a little side hustle here.

38:23

We should start, Yeah, we'll, we'll chat after the recording.

38:25

Yeah. I mean, I think this is true.

38:28

We got X and chill. That's definitely out there.

38:32

But there's a lot more things that could be T shirts for the fire world.

38:37

I don't know who came up with that VTX and chill line.

38:40

I wish I could claim it, but it's, it's not mine, but it's a great line.

38:44

Yeah. And then what you say to encourage our late starters in your book is that, young

38:49

or old, and a lot of us feel old when we start our journey here in our community.

38:55

If you make achieving financial freedom a major goal, you're looking at about

38:59

a 10 to 15 year journey, and that's your 50 percent savings rate, right?

39:03

It's shorter if you already have some assets and longer

39:07

if you have debt to unload. But it's all within reach in 10 to 15 years.

39:12

And that's the message we try and keep pounding, , into our audience is there

39:17

don't lose hope the sooner you wake up the better, but if you get your act

39:22

together, you're only 10 to 15 years away because the journey is the same for a

39:26

30 year old as it is for a 50 year old,

39:29

Exactly. you're going to have to buckle down. But it's entirely possible with a shift.

39:35

Well, the other thing that I would emphasize is that it's

39:38

not an on off switch, right? It's not like you start from ground zero and then, when you

39:44

become financially independent, you flip the switch and you're there.

39:48

It's a journey, right?

39:50

I mean, that's why it's called pathfinders in the simple path.

39:53

It's a journey. And each step you take along that journey.

39:56

You're a little bit stronger so Let's suppose you don't even have the 10

40:02

or 15 years But if you do five years of it, you won't be fully financially

40:07

independent But you'll have a lot more of what I call a FU money.

40:11

You'll be a lot more fiscally strong.

40:14

You'll have a lot more options one of my all time favorite quotes is

40:18

from guy named Leo Burnett, who was a big advertising agency guy

40:23

in the, in the fifties and sixties. And the quote is, if you reach for a star, you might not get one, but you won't

40:30

come up with a handful of mud either. So if you're reaching for financial independence, you

40:36

might not ever get there. You might not have the time or whatever.

40:42

But you want to end up with a handful of mud.

40:44

You'll be significantly better off than if you'd never started the journey.

40:51

That's a great point. Well I know the savings is like a big deal.

40:56

One of my earliest savings things, I saved these 2 bills, which is

40:59

what's in the background there. So there's a lot of really good stories about that.

41:04

And like Bill said, being a part of catching up to five,

41:07

we feel like we're behind. And the first step is just to, start to save and get that going.

41:12

So So, yeah, I love Bill. Was there something, some stories in that section that you liked in

41:17

Oh yeah, absolutely. And they're funny too.

41:20

There's one by C. L. Robinson in North Carolina called Saving Like Chuck Berry.

41:25

And this gentleman said, I happened to read a magazine interview with

41:29

the famous musician Chuck Berry. He said that he saved 80 percent of his earnings And had done so

41:36

throughout his entire life, even when he worked as a carpenter before he

41:40

became famous, what a mindset, right?

41:43

You see a lot of celebrities and athletes going bankrupt because of, they're a quick

41:48

degree of wealth, but if you, Just make the decision to save 30, 40, 50 percent

41:57

and do that, whether or not you become famous or your business explodes, you

42:01

can afford the lifestyle inflation that comes your way as your income progresses,

42:06

it will happen and you can enjoy a better life and still save 50 percent.

42:11

Yeah, almost no matter what you make, no matter what your income is, if you save

42:17

a portion of it, a strong portion of it, you will become financially independent.

42:23

The same is not true about your income. It's very possible to have an extraordinarily high income

42:29

and wind up with nothing. And there are examples, ,too numerous to mention in, especially it, it

42:39

tends to be with people who, who come into money quickly and early.

42:44

So I'm thinking people in the entertainment industry, in sports stars,

42:49

even Lawyers and, and doctors and, who tend to spend a lot more and in school

42:56

and then suddenly they're making a lot of money they don't necessarily

43:00

become financially independent. A lot of them become broke Mike Tyson, who I pick on in my

43:07

book, the simple path to wealth.

43:09

And I realize I'm a little insane to be picking on Mike Tyson of all people.

43:13

And by the way, I, if Mr. Tyson's listening, I have profound respect for his athletic prowess and his boxing.

43:21

But this is a guy that made, I think, 400 million in his career

43:27

and wound up broke for two reasons.

43:31

I think one is that nobody ever taught him that money could do things

43:36

other than buy trinkets and trash. And he bought very expensive trinkets, make no mistake.

43:42

But also, those kinds of people, and this doesn't just apply to athletes, but it

43:47

applies equally to doctors and lawyers, and there's lots of sharks circling

43:51

them, wanting a piece of that income.

43:54

And if they're not very careful and very astute, then those sharks are

43:59

going to get a lot of that income. I think that's what happened to Mr.

44:02

Tyson. I've seen it happen to doctors and lawyers, and there's lots of other,

44:08

athletes and actors and, musicians where, where, they tragically wind up broke.

44:15

That's a good segue into the next section of your book, which I

44:19

think is a really important one. You talked about doctors.

44:21

I'm one of those and I succumbed to lifestyle inflation.

44:26

And you talk about that and you give us a few rules of the

44:28

road for lifestyle inflation. Can you elaborate a little bit on what you think are the rules of the road for

44:33

what happens when you succumb to this? Well, my memory's not nearly good enough.

44:37

You have to prompt me. Okay, well, you say people may notice if you don't live like them, that's okay.

44:46

That's critical. That was my own experience when I went out in my corporate career and I was saving

44:51

50 percent of my income back in the day.

44:53

And I was living a very comfortable life.

44:57

I didn't want for anything. But I was not living the same life that my peers who were spending

45:04

all their money were living. And that gap was noticeable at times.

45:11

But I didn't care because I was spending my money on the single

45:16

thing that was most important to me. But I didn't know anybody else.

45:19

This is long before the internet and even computers.

45:23

I didn't know anybody else who was making that choice.

45:26

There was no way to connect with people who were doing this

45:30

because we're absolute unicorns.

45:33

I think we still are, but now we have podcasts like yours and the internet

45:37

that allows these random unicorns.

45:41

Who are alone in, in their immediate environment with their friends and family

45:46

and the way they think, but then they can come here and say, oh, yeah, I'm but

45:50

I'm not alone in thinking this way, it's just a more rarefied way of thinking.

45:57

yeah, I actually had a favorite letter in that section.

45:59

It was called the happiness quest. It was like, he was in the military and then he became a cop after he

46:05

got out and he was going up and down in terms of his lifestyle inflation.

46:11

And there was a point where he actually felt happier when

46:15

he had lifestyle deflation.

46:18

And in the end, he just basically said, to me, like, this was like a full

46:23

spectrum of the hedonic adaptation where he would get the happiness level out.

46:31

And then that's the norm. And then even when he went back down, it was the same thing.

46:35

So for me listening to that, I felt the highs and lows that he was having.

46:40

So it was just, just kind of cool to, again, I did the audio book.

46:44

So just listening to how his happiness, no, it wasn't necessarily dependent

46:49

on the, the, the how much money he was making or the inflation, in his

46:54

lifestyle because he would always sort of get used to that level.

46:58

And I think that's how most of us are as human beings.

47:01

So that was 1 of my favorite ones in that section.

47:04

Bill, did you have a good 1 in that in that section?

47:07

before we move on to Bill, if, if I may, that that's the story where

47:11

he talks about his burrito, right? Yes.

47:14

He talks about his burrito yeah, so I, I love that because

47:19

he talks about when he is a patrolman he's limited to in a very specific area

47:25

of the city where he works as as a cop.

47:28

And of course while he's on patrol, he can't leave that area.

47:31

But his favorite burrito place is outside of his patrol area.

47:35

So he only gets to go to his favorite burrito place once a week when he's

47:39

off duty, when he gets promoted and becomes a detective and he can go

47:43

anywhere in the city, he suddenly can eat at his burrito place a lot

47:48

more frequently and it diminishes his enjoyment of, of the burrito.

47:54

And that's the other thing that lifestyle inflation does.

47:57

It, it Ironically diminishes our enjoyment of the thing that we're trying to have

48:03

more of when, we in fact have more of it.

48:06

You're right. And the chocolate cake is just another example.

48:09

we can't eat chocolate cake every day. We love it.

48:11

And it's also funny that each story as, as you, I, and Bill are talking

48:18

how each person extracts certain pieces of Of each story, and we take have

48:24

different takeaways, so that was kind of cool to just so for anyone else

48:29

that's like going to get the book and read the stories, you may pull some

48:33

things out that you never hear us talk about because of how it kind of hits in

48:38

whatever your frame of mind is there. So, so when you mentioned the burrito, yes, I remember the

48:43

burrito, but I was just thinking about the ups and downs that he had.

48:47

Yeah. Yeah. So. Yeah. Yeah.

48:49

Yeah. There's a couple other stories there's so much pithy stuff that

48:53

comes in very short snippets. And Lisa Shader from California titled her story, Life Changing Advice.

49:01

And she talks about how her husband, and she became millionaires because

49:04

of a college professor gave them one life changing piece of advice.

49:09

For the first 10 years out of college, don't upgrade your lifestyle.

49:13

Continue living like broke college students and invest instead.

49:16

but because of compound interest, the opportunity cost

49:19

of upgrading your lifestyle when you're young is astronomical.

49:23

I mean, Warren Buffett talks about his wife wanting to buy a couch and

49:27

she says, the couch costs 2, 000.

49:30

He said, no, it doesn't. The couch costs 2, 000 plus 20, 30, 40 years of compounding and all

49:37

the opportunity costs that, these are costs that I never thought of.

49:41

It was just the price of the item, not the price that you paid for

49:46

freedom and using your life energy to buy that couch, as opposed to buying

49:50

investments, that money works against you.

49:53

It's gone. It's never coming back when you

49:57

buy the right. That's right.

49:59

Yeah, absolutely. I use in the simple path to wealth.

50:02

I, I illustrate that talking about buying a car.

50:05

That's right. And, just how expensive that car is when you start taking into account

50:12

that, not only are you losing the money immediately that you pay for it,

50:19

but you're losing all the money that money could have made over the years.

50:23

And then suddenly you're 20 or 30, 000 car.

50:28

Becomes a whole lot more expensive than that.

50:31

And that's assuming, that's not even taking on car payments.

50:35

Then it really gets ugly. That'll compound against you.

50:40

And then another funny one. I mean, these are all funny.

50:43

These people take humor into their lessons and Christina

50:47

Conley from Anoka, Knoxville.

50:49

Now this is actually a local, I'm trying to meet up with this person.

50:53

I've reached out to her. I haven't heard back, but a Knoxvillean here.

50:56

So I did find somebody that's in my realm, in my community, her story

51:00

is titled Lifestyle Inflation. Sometimes it's real murder, and so their story was very interesting because they

51:07

had frugal down with regards to their house and they lived in a very sketchy

51:12

neighborhood and she says. That was how we learned that a cost of living increase is not necessarily a

51:17

question of being tempted by a luxury car or a private school tuition.

51:22

Sometimes it can look like a dead body in your neighbor's front yard.

51:27

We tried turning a blind eye to the drug drops and yelling matches around

51:32

us until one morning we awoke to see yellow tape flanking our mailbox.

51:37

And they had a child. And then safety became an issue and they upgraded their lifestyle

51:43

because they needed to get away from dead bodies and yellow tape.

51:48

Well, it's important to remember that because we are kind of emphasizing,

51:53

saving and investing money to buy your freedom, but it's important to remember

51:56

that you do that to make your life better.

52:00

And if you're waking up in the morning and looking out your window

52:03

at dead bodies, you might want to take some of that money you've been

52:07

investing and divert it to moving. Right.

52:10

So. No, absolutely. And the final one for this section that I want to, tell, and I'm sorry

52:16

for telling too many stories and taking away from you, JL, but these

52:20

at all. I'm loving it. stories really resonate with me.

52:23

And this guy, David Behan in San Jose, his story was told, I was

52:28

a cheap ass and I'm not proud.

52:31

he's talks about life was not all good news.

52:34

I struggle with spending money in certain situations.

52:37

I even hesitated to take my girlfriend at the time out to movies, even when

52:41

I knew that we would both enjoy it because as the fire joke grows or says,

52:47

I could retire 52 seconds earlier, and if I had saved the money instead, if

52:52

you're thinking I was being a cheap ass, I was, and I'm not proud of it.

52:56

I have come to realize that I should be optimizing for long term

53:00

happiness, and not to retirement.

53:03

The simple path to wealth doesn't require sacrificing your happiness for wealth.

53:07

That's something I came up with all my own.

53:09

In fact, I believe happiness is one of the many reasons to walk the path.

53:15

Yeah, I mean, I agree with that and I, you alluded a little bit

53:20

ago, I think we were talking about the advice from the professor to

53:24

live like a student for 10 years. And I didn't do that myself, but when I came out of college and I got my first

53:31

professional job, I very arbitrarily decided I was going to save and invest

53:38

half of my money, 50 percent of my income.

53:41

And, again, there was no internet.

53:43

I didn't know anybody else who thought this way.

53:46

I just kind of pulled that number out of a hat because.

53:50

Buying my freedom was just so important to me that spending half my money on it

53:55

seemed like a reasonable thing to do.

53:57

And by the way, in retrospect, it's still what I would recommend if

54:00

anybody asked, but I've had people say, well, how on earth do you possibly

54:06

live on 50 percent of your income? And there are two things.

54:09

One, I looked around, I was making 10, 000 a year in that first job.

54:14

And I could see people living on 5, 000.

54:16

So that was. Was kind of a no brainer that, there are people who live on 5, 000.

54:22

There's no reason I can't do that. But even more importantly, $5,000 a year was far more than

54:29

I've been living on in college. So even on half of my income, it was a major step up in my lifestyle.

54:38

So, it just all depends on, I think, controlling.

54:42

The lifestyle inflation is not that you can't have some of it.

54:45

It's just, you don't want to let it get away from you.

54:47

And so when I was making 20, 000 a year, I had twice as much money to buy my

54:53

freedom with, but I also had twice as much money to, to live my life day to day.