A little while back I did a juvenile post called the Financial Independence RPG, I enjoyed it.
It seems, since that post, I have levelled up. Happy days, I am now at level 2, A Finance Barbarian.
“Getting to grips with this whole personal finance thing. Your tools might be a bit basic and approach heavy handed, but my my you are smashing your way forwards as best you can. All gusto and no finesse.”
I think something like this happened when I crossed the threshold;
I’m surprised I didn’t notice or would have thought a couple of people might have commented. If I actually got to select a new skill, I would have upped my frugality skills or maybe my dark magic (after all, smiting a fool with a fireball would be helpful every now and then).
Way back in the day, when there was only one PC in the house weekends became a game, between me and my brother, of who could get up earliest to settle into the gaming chair for the day. The loser had to head out and actually hang out with their mates.
I used to love playing RPG‘s, the immense size of them, the multitude of options and of course the levelling up. There was no way round it, to level up you needed dedication and time. Sure different strategies might get you there slightly quicker, but ultimately it was all about sticking to your plan and putting in the time.
It is interesting how huge RPG’s can grab a persons attention for weeks or months on end. They can spend hours doing some mundane task to level up some bizarre skill, which doesn’t actually mean anything.
Yet, this single minded focus rarely transfers into real life, say into their job or into their finances. Someone might rattle off three hours mindlessly playing a game and yet find it so fucking difficult to spend 10 minutes setting up an ISA or an instant making the decision to buy something they don’t need.
For all the chat around investing, actually just setting aside something each month is the easiest and yet the hardest thing. The actual work has already been done, it’s just a decision to save some and not spend it on crack cocaine or butter that’s been hand made by pandas. Where to invest it is another question, for another time, my brain chomping friends.
But maybe, just maybe approaching Financial Independence as if it were an RPG wouldn’t be such a bad idea.
Some Financial Independent Skillsets
The early stages of an RPG were normally a grind, you were weak, puny and skill-less, consigned to slaying rats and completing menial tasks, like finding someone’s dog or getting a banana for a monkey. I like to think of those times as training camp for the early days of attempting to become Financially Independent.
As you levelled up, you started to gain momentum, and things generally got easier and easier. Tasks that were once impossible become doable, perhaps even laughably easy.
I am in the grind at the moment, still fine tuning my expenses and my own individual approach to investing, and slowly growing my pot of gold that will be used to provide perpetual freedom. I suspect, I’m hoping, that momentum will gather as I continue to fine tune and grow my pot of gold so that the last few years are just that, laughably easy.
Saving a substantial amount is a huge task, not a light caper that invites laughter and mirth but a logical approach. Big goals broken down into smaller goals and tasks to make it more manageable. To attack it as one giant goal would be the path to insanity and failure.
So what skills do we need to focus our attention on, hone, training at and generally be badass at to prosper in the world of Financial Independence or saving money in general. To complete the FI RPG…
Learning to live off less might be the single strongest pillar of Financial Independence.
Putting in some effort here early doors is pretty crucial, spending less means there is more to save. It can be a painful exercise cutting out the things you think you need, Sky Sports, lunches at cafes, evening meals at restaurants, that fucking money-sucking vampiritic BMW. You’ll have withdrawal symptoms.
But ignore the spooky babies on the ceiling for the first couple of weeks, the trips into alternative realities will slow and soon cease, then spending less will feel normal (even liberating).
Just got to work through those first couple of levels quickly.
As you level up even further you’ll move away from just simply cutting back your expenses. You will gain super cool DIY skills and grow a beard. You will learn to cook amazingly tasty and healthy food from scratch, and cooking will become fun rather than a chore. Gardening skills will be honed and you’ll be able to provide, at least some, food for yourself.
You need to get your basics down. Put in some time reading around investing, books or blogs, what ever floats your boat. Find out what works for you. Active or passive. Equity or real estate or both. Be honest with yourself and find your own risk appetite and investing time horizon.
Before you know it you will have moved on from cash and be constructing your own notional portfolios to value hedging strategies (just out of interest, as simplicity is key).
The ‘Not giving a shit’ skill
A thick skin or some frugality armour will be needed. As a warrior on the path to Financial Independence you will be in the minority. Marketing and advertising will constantly try to separate you from your hard earned cash. Friends and colleagues won’t even try to understand what you are doing, your actions will be assumed to be wrong and perhaps you will lose some of your more spendy friends.
You will be an outcast and people will throw rocks and eggs at you when you walk to work in the mornings. Not really (they’ll throw gravel and manure). But you will be up against a relentless wall of resistance, as it’s not an easy or obvious choice to make and you’ll need to upskill in pig-headedness and apply some ointment to thicken your skin.
Endurance to be used in walking and cycling
It’s far cheaper and much more healthy to walk or cycle where we can.
At level 1, our soft, office conditioned, trotters will form blisters, our legs will ache and lungs will burn with the most minimal of exertion.
Levelling up will result in a decreasing waste line, more energy, better sleep and rippling legs that drive the opposite sex, and the same sex regardless, into a frenzy. You’ll need to learn some form of hand to hand combat to fend them off.
Hand to hand combat
To fend off the inevitable aggressive advances, due to your bulging thighs and sculpted calves.
|A calf sculpture|
As we progress through the levels towards Financial Independence a cool calm will descend, perhaps with a slight undertone of smugness, and confidence and charisma will pour from our pores.
This will increase exponentially as we near completion, resulting in employment offers and business venture opportunities for obscene amounts of money. But that will only delay completion.
You will level up very quickly here at the start of the journey, as you create endless projections to facilitate your imagination.
Developing your own method of tracking your networth, reassessing your progress and setting challenging goals will all be enhanced by spending a few hours learning to use the wonderful tool that is Excel.
As any good RPG player knows, tasks and levelling up a far easier with a few friends along the way.
But a group charging off in different directions is far worse than the solo traveller. Not getting your significant other onside will make it very difficult to escape the first couple of levels. Forming a party and aligning goals with your other half is going to see you steaming along at a cracking pace. We all need a little help and refocussing sometimes and a chat with your partner in FI crime will provide just what you need.
While a battle axe might be helpful in battling the hordes of the undead it’s not a great tax efficient savings vehicle. You’d be better off;
– Using an ISA to take advantage of some tax free goodness
– Maximise the employer match on a workplace pension
– Protect cash from omnipresent inflation with the best savings rates on offer
– Find the cheapest broker for your situation
– Get a laptop (excel skills aren’t much use on the bike)
Time to start working towards Level 3, who’s with me, let’s do this.
Spend Less, Save More & Escape the Horde (& complete the game)