Author: Rob Bennett
Today, Norm Goldman Publisher & Editor of Bookpleasures.com is pleased to have as our guest, Rob Bennett, author of Passion Saving: The Path to Plentiful Free Time and Soul-Satisfying Work.
Good day Rob and thanks for participating in our interview.
Thanks for taking the time out of your day to ask the questions, Norm. There's nothing I enjoy more than seeing what questions people have about this new approach to money management and taking a stab at answering them.
Rob, please tell our readers a little bit about your educational and professional background.
My undergraduate degree is from Temple University, in Philadelphia. I majored in Political Science. I went to law school at The Catholic University of America. I went to law school knowing that I wanted to be a journalist when I graduated.
I worked for seven years at the “Daily Tax Report,” covering the IRS and Capitol Hill beats. It was my job to stand outside the doors of those secret meetings where people like Dan Rostenkowski and Bob Dole and Lloyd Bentsen decided our futures and to try to get a read on what was going on by asking them questions when they came out to go to the john.
Then I went to Tax Note’s magazine, where I wrote a column on “Tax Politics” and managed an electronic database that contained every tax document generated in the Western World (and in some parts of the non-Western World too).
After that, I worked at the Ernst & Young accounting/consulting firm for nine years, engaged in tax lobbying, writing, and management work.
In August 2000, I had saved enough to be able to rely on the earnings from my accumulated capital to cover my essential costs of living. I use earnings from freelance writing work to pay for nice extras, like vacations and new cars and such like. I founded the Financial Freedom Community (a group of internet discussion boards) to facilitate lots of learning experiences about early retirement. My report on “Secrets of Retiring Early” was the #1 best-selling report in the history of the Soapbox.com site.
Most of my time today is spent posting to the community boards, writing my books (I am working on a book on investing entitled “Investing for Humans: How to Get What Works on Paper to Work in Real Life”) and building up my WEB SITE .
What motivated you to write Passion Saving: The Path to Plentiful Free Time and Soul-Satisfying Work? As a follow up, why do you feel that this was an important book for you to write and for all of us to read at this time?
I was not an effective saver in my early life. I lost the Tax Note’s job, which was my dream job, in the recession of the early 1990s. That was a hard blow. I hated the feeling of vulnerability that came from knowing that I had to take whatever job I could get in a short amount of time. I became almost fanatical about learning everything I could about how to win the financial freedom required to be able to call the shots re my own future.
After a few years, I found that I was saving incredible amounts of money, amounts that I had earlier thought no one could ever save. The journalist in me was curious as to what was responsible for the change and whether others could do something similar. I started posting about my strategies at a Motley Fool discussion board, and discovered that there are thousands of people all around the world doing similar sorts of things. I think of these people as The World's Greatest Savers. After I saw the phenomenal reaction generated by some of my posts, I knew that there was a book in this if I could explain the ideas in a way that made saving really make sense for the first time to the typical middle-class worker.
The world of work has changed. There is more opportunity than ever before to do wonderful and enjoyable and important work. There are also greater risks than ever before for those who do not have financial resources to fall back on. My core message is - don't think of saving as something you do just to finance your old-age retirement. Save for what it can do for you in your 20s, 30s. 40s and 50s, as well as for what it can do for you in your 60s, 70s, 80s, and 90s. There's nothing you can buy at the store that will do more to enhance your enjoyment of life than putting a good bit in an investment account to serve as your Freedom Fund. Having accumulated capital opens up all sorts of exciting options.
Why does discussing money and money management seem to be very often a taboo topic among many families and among friends?
It's very personal stuff. It is often painfully personal stuff.
There's a copy of my budget in the book. When my wife read the book, she was worried about having people see this.
It's a bunch of numbers, you know? It's not like I published pictures of us naked in the bedroom.
In a way, it's worse, though. When you tell people what you spend money on, you are telling them what is important to you. You are sharing your dreams and your fears. This is intimate stuff. Done right, a budget is a very personal document.
We must break the taboo of talking frankly about what money means to us. It is by talking with other people that we learn what we ourselves think. You've got to stick your neck out a bit. There are huge rewards to be had down the road for doing so.
There are people on the internet who mock me for my choices. There are others who congratulate me. My choices are an inspiration to some, a challenge to others, and a threat to still others.
You don't expect to see the words “Passion” and “Saving” in the same book title, do you? Saving is supposed to be for boring, responsible people. It's not. What changed me into an effective saver is that I learned that saving is the means by which I become able to do with my life what I want to do with my life. How you think about saving determines how successful you are at trying to pull it off.
We all love freedom, right? We all should love saving because saving is the money choice that buys us freedom.
How would you respond to readers who are skeptical about Passion Saving?
If you talk about the end result, people are skeptical. There are lots of people in our community who retired in their 40s. People find that hard to believe.
I hold off on talking about the numbers until people have bought into the concept. To get people interested in the concept, I tell stories of how saving effectively can change life in the here and now. Saving can free you to start your own business. Saving can free you to see the world. Saving can free you to stay home with your kids when they are young. Saving can free you to retire early. Saving can free you from worry over corporate restructurings and economic downturns. I sell the sizzle. Once you get people into the restaurant to see the sizzle, providing the steak is the easy part.
How is it that people trying to get us to buy stuff pull it off? Television commercials don't list the merits of a product. They tell a story, they reach for the emotions. Get people emotionally involved, and they will figure out logical reasons for buying your product on their own. The emotions are the hard part. The numbers are important but secondary.
The aim of “Passion Saving” is to get people to see saving in a new light, to get them so excited about it that they can't stand the thought of another day passing by without them identifying a new opportunity to save money. There are sections of the book that offer practical step-by-step instructions. But the book is as much a “why to” as it is a “how to.” My experience is that it is not at all hard to save money once you care deeply about doing it.
The problem that most people have saving is that just about nobody cares deeply about saving to finance an old-age retirement. Most of us don't even want to think about getting old! So that saving goal just doesn't do the job. The old money management rules just flat-out do not work.
My mother drilled into me that it is not how much you earn but rather how you manage and spend your money. (Incidentally, I am thankful for her sage advice).
Do you agree with the above and if so, why?
I know people who earn modest incomes who were able to retire early.
I know people who earn six-figure incomes who need to borrow to buy Christmas presents.
Earning lots of money is overrated. It provides an obvious edge. I'm not knocking it. It can be a trap, though. The more you earn, the more you buy. The more you buy, the more you need to struggle to keep up. People who have never earned lots of money sometimes find it hard to feel sympathy for those who do. I can tell you lots of sad stories about people who earn lots of money and who are miserable as a result.
Think of how much you can spend on a house if you really put your mind to it? Or on a car? Or on a vacation?
These things are all by their nature good things. They can be traps for those who have not thought through how they want to put money to use in their lives, however. I don't call my spending plan a “budget.” I call it a “Life Plan.” You need to integrate your life goals and your money goals. Then things begin to make sense and earning more truly becomes a good thing.
Do you ever feel that you are preaching to the converted and that people are not too interested in listening to your theories pertaining to money management? As a follow up, you indicate in your book that many Americans don't give much thought to money management. Would you care to elaborate as to why?
The usual money management advice is boring.
People know that you are not supposed to say that. So they don't say it. But they tune out the advice. Dogs don't eat bad-tasting dog food, and humans don't listen to boring money advice. If you want the dogs to eat the dog food, put some meat in it, for goodness' sake. If you want people to listen to your money advice, put some flesh and blood in it. Make it real.
I'll give you an example of what I'm getting at here. You always hear about compounding returns. Save $1 at age 20 and it will be worth six “kajillion”dollars when you turn 65, right? It's all true. I don't deny it.
But here's the thing. If you SPEND money at age 20, it might provide six “kajillion” dollars of benefits to you over the years too. How much is the dinner worth that you buy when you go on a date with the girl you end up marrying? I spent a lot of money at Blues Alley during my single days. I wanted to marry a Blues Alley kind of girl, you know? I thought of that money as an investment in my future.
Spending is not bad. Spending money often offers an outstanding value proposition.
I don't tell people that spending is bad. I make an argument that there are many circumstances in which saving is even better.
I think you lose people if you put forward clichés or if your advice is patronizing or whatever. I reject out of hand the idea that most people are dumb or lack willpower. That's probably true of some. It's not true of most.
If you start out by telling the people you are trying to persuade that they are dumb or that they lack willpower, you've lost them at the start line. That's not the way to go. It's your job as a money advisor to find out why people are doing things that SEEM dumb. That's the job. Don't blame the dogs if they cannot stand the smell of your dog food, you know? Try some different ingredients.
What has your experience been with self publishing? Do you recommend it over traditional publishers?
For me, it was the right way to go.
The downside is that going with an established publisher gives you instant credibility that you do not get with self-publishing. It's an easier road to go with an established publisher.
The upside to self-publishing is that I call the shots. I don't have someone watering down my message. I don't have someone telling me “you can't say that, you know, you might upset someone.”
I'm trying to create a new genre of personal finance writing. I bill myself as “The World's First Stand-Up Personal Finance Advisor Who Offers Asset Allocation Strategies You Can Dance To.” My writing has a rock and roll edge to it. It's HAPPY rock and roll, for the most part. It's more the Beatles than it is the Rolling Stones. But I'm not one of these people who won't allow himself to be photographed unless he's wearing a tie, okay? There's far too much stuffiness in this field. Most days I write my blog in my pajamas. Sue me.
As there does not seem to be any authoritative standards that exist for money managing authors or publishers, how do you know that a book on money managing is up to par? How do you check out the authorial competence?
The best way to check me out is to visit my web site (www.PassionSaving.com). There are over 100 articles posted there, and they are all free. If you like what's there, you're going to love the book because I worked harder on the book. If you don't like what's at the site, we probably were meant to be just good friends. There's a “Contact Rob” button, so you can ask questions of the guy who pulls the strings. There's a place to leave comments at the blog, so you can connect with other community members.
I don't have a degree in money management or personal finance or asset allocation or whatever. There are people who have those sorts of degrees who have written fine books for those who are looking for that sort of thing.
I'm the guy to turn to when the other stuff lets you down. I learned what worked by trial and error and by running my ideas past The World's Greatest Savers. We don't do things the way you are told to do them in the conventional money guides. Passion Saving is a different approach. I say it's better. They don't teach it in schools, though. If you want to know about what they teach in schools, you should be looking for a different book.
What challenges or obstacles did you encounter while writing your book? How did you overcome these challenges?
Writing the book was the hardest thing I ever did in my life, Norm. There was a time when I really did break down and cry. There was a time when I turned into a genuine mad-person. I wrote about 10,000 versions of the first page of the first chapter. There were days in which I wrote 20 or 30 of them, one after the other. I really wanted that opening to be right!
The words came easy. The hard part was the organization. A book should flow from one thought to another to another. There has to be a strong logic chain. I like to think that I have the ability to keep a five-thousand-word piece of writing focused. I had never done it for a book-length manuscript, however. I'm glad to have the first time doing that behind me.
The other challenge was in answering the question of how bold I should dare to be. Some of the claims I make are a bit out there. I say not to use the financing of your old-age retirement as your primary saving goal. I say that in some circumstances it is easier to save 20 percent of income than 10 percent of income. Things like that.
For a time, I thought that I needed to toe the line. Who am I to say different from what all these experts say? But I studied these claims and the arguments for them and I determined that they held up. I took the bold path. Once I did it, I never looked back. But it was a gut check at the time I made the call.
How have you used the Internet to boost your writing career?
I'm all internet all the time. I need to make an effort to do the other stuff. But the internet is in my blood at this point.
I got started with this by posting to the Motley Fool boards. I love getting feedback from fellow savers. I love bouncing ideas around and changing them and improving them. I live for the back and forth.
The internet discussion board is a communications medium that gets no respect. We all know why. There are lots of idiots who post to discussion boards. It doesn't matter. This is a different sort of communications medium and it needs to be judged by different standards. It is an important communications medium of the future.
There's a guy (John Walter Russell) who started a web site because of research he did in response to a question that I asked on a Motley Fool board back in May 2002. That SITE now has about 300 articles reporting on original investing insights posted to it. Is that cool? This guy is retired and he has been working on this stuff full-time for close to five years now. It's the most exciting web site on Planet Internet. He does this for free! It blows my mind. I'm dedicating my second book to him because he is the outstanding example of what the internet discussion board can be at its best.
Any unique ways you'll be marketing your book that is different from how others authors market their books?
I am focusing on building up the PassionSaving.com web site rather than on selling copies of the book “Passion Saving.” My aim is to make the web site the #1 spot on Planet Internet to learn how to win financial freedom early in life. I want to have a strong sense of community at the site. I have several sections that are set aside for community members to share their ideas re how to save, how to invest, how to advance in one's career, and so on. The community is the engine of the site, and it is the work-product of the community that sells the Passion Saving idea and ultimately the “Passion Saving” book.
The point here is that I do not really see myself as selling a book. I wrote the book largely because we had a lot of newcomers to our boards who were looking for a way to get up to speed with what the rest of us had been learning together since the early days of our movement. The book is something that you can hand to someone looking for an integrated statement of what this new approach to money management is all about.
No one needs to buy the book to learn about this approach. Scores of in-depth articles are provided for free at the site. I don't hold back on articles at the site. I don't say “to learn the full story, read the book.” There are some things discussed at the site that are not discussed in the book. The benefit of the book is that it provides an integrated statement of how Passion Saving works. If you are going to pursue this in a serious way, it makes sense to get the book. But the site provides people with a way to learn enough about this to know whether they want to pursue it or not without having to invest a dime.
What is next for Rob Bennett?
My two big projects today are to build up the web site (I would like it to be double the current size in another two years) and to finish writing my second book (“Investing for Humans: How to Get What Works on Paper to Work in Real Life”).
My investing ideas are controversial. I was one of the best-loved posters in the history of the Motley Fool site during the time when I was writing about how to save effectively. After I began writing about investing, I became one of the most hated posters in the history of that site. Tom Gardner, the owner of the site, wrote one of the blurbs that appears on the back cover of my book, but I am banned from posting at the site today. I never once posted in any way that could be considered abusive (my voice is the strongest voice in our community calling for the reasonable enforcement of posting rules at all of the Retire Early boards). I was banned solely for the content of my posts. I say that stocks are overvalued and that middle-class investors are going to pay a big financial price for the failure of most investing experts to explain the realities of long-term stock investing in a clear and direct and completely honest way.
The focus of the investing book is how owning stocks affects investors' emotions and thus causes them to make decisions that cannot fairly be described as rational. Most investing guides ASSUME that investors are engaged in the rational pursuit of their own self-interest. It doesn't work that way with humans. We do aim to pursue our self-interests, of course. Reason influences our decisions. But reason is not the primary driver. Reason is secondary to emotion. When you appreciate the importance of emotion to investing decisions, it changes your take on all sorts of investing topics.
Is there anything else you wish to add that we have not covered?
The beginning of a new year is a natural time for people to be thinking about where they want their lives to be headed over the next 12 months. Passion Savers are dreamers. We aren't the usual kind of dreamer, however. We are practical dreamers. That makes all the difference. Romance without finance is a nuisance. You want to hold onto your dreams. But you don't want to be just holding a dream. You want to turn the dream into a reality. That's what money is for. Combine the word “Passion” to the word “Saving” and you make a dream come true. A year is enough time to make significant progress. Get started now, and you'll be in a different place come this time next year.
Thanks once again and good luck with Passion Saving: The Path to Plentiful Free Time and Soul-Satisfying Work.
Thanks very much, Norm. I enjoyed talking things over with you.
The above interview was contributed by: NORM GOLDMAN: Retired Title Attorney: Editor & Publisher of Bookpleasures. Here are Norm Goldman's Reviews
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