Tag: grant sabatier

Why Financial Independence Is Like Self-Publishing

As of this morning’s freelance paycheck, I have $100,203.85 in assets and $825.44 on two credit cards that will both get paid off tomorrow, giving me a total net worth of $99,378.41.

I mean, I’m more excited about the “$100K in assets” figure, since I’ve been working towards that goal for a while (even though I know I probably won’t hit a for-real six-figure net worth until I get my next freelance paycheck).

After this, I guess the next big goal is a total investment portfolio value of $750,000, which — at the recommended 4% annual withdrawal rate and the level of frugality I’ve managed to maintain since college — should render me financially independent. 

In other words, I’ll be able to live exclusively off my investments if I choose.

The various online calculators suggest this will happen in the next 10-12 years. I am smart enough to understand that other things may happen in the next 10-12 years to shift that goal, but optimistic and/or dedicated enough to decide it’s a goal worth working towards regardless.

Being able to live half off my investments and half off my freelance writing and teaching and self-publishing income, for example, would also be good.

There are a lot of potential success scenarios here.

There are also a lot of potential success scenarios for a self-published book — like, it’s literally the first lesson I teach in my online Finances of Self-Publishing course (which you can take next month, sign up here).

You could write a runaway bestseller; you could write and publish a book a year and sell it to your 1,000 True Fans; you could write a book to preserve a piece of family history and use tools like Reedsy and IngramSpark to create a beautiful hardback copy that’ll last for generations.

Self-publishing can also get you many of the aspects of “the author’s life” that a lot of us dream about: a book launch party with cake and sparkling beverages, the opportunity to do readings and signings at bookstores and libraries, the professional expertise required to teach classes or speak on panels at conventions. A quiet home office with plants in it. The ability to say “I will block off X amount of time, every day, just for writing my next book.”

(Current NEXT BOOK draft: 12,253 words.)

Of course, you can get the plants and commit to a writing schedule before you finish that first draft — and if you want to learn more about how to do that, you should sign up for my online course How to Develop a Writing Practice, which runs end-of-April through end-of-May. (It’s a self-paced group course, so you’ll take it as a group but won’t have to be at your desk at any specific time for mandatory webinars or anything like that. You’ll be free to do the readings, chat in the group discussion forum, etc. whenever you have time available.)

Just like I’m already thinking about myself as having committed to financial independence — and behaving and budgeting like a financially independent person might behave* — 10–12 years before I’ll actually get there.

But I thought, during my early-morning yoga practice where I usually get my best thoughts, that the whole financial independence thing was strikingly similar to the self-publishing thing. A nearly identical mindset.

Self-publishers take on both the author role and the publisher role. They develop various “success scenarios” for their books — maybe they want to crowdfund their “advance,” the way I did for The Biographies of Ordinary People; maybe they want to sell more than 500 Kindle copies in the first three months**; maybe they want to to go on book tour or get their book reviewed by Kirkus or submit their novel for various awards.

There’s a lot that a self-published author can’t control, such as who wins those awards or how much money Amazon pours into its Kindle Unlimited Fund or whether the market for their particular genre changes, but there’s a lot they can control through research and careful budgeting.

The biggest factor under their control is whether they spend more on their self-published book than they plan to earn (THIS IS THE NUMBER ONE MOST IMPORTANT THING I WILL TEACH IN MY CLASS, BTW).

That’s also one of the biggest factors that will determine whether they’ll self-publish another book and slowly build up a career as a self-published author.

Likewise, the person going after financial independence takes on both the worker role and the employer role, even if they already have another employer. This person is setting aside money for to pay their future salary the same way an employer sets aside money for payroll, and deciding how much they might want to earn in the future the same way an employer decides how much to pay employees.

There’s a lot that this person won’t be able to control, such as whether they get laid off (or lose their biggest freelance client) and have to cut back on their savings goals (or spend money they’ve already saved) until they find another source of income. They won’t be able to control market changes or recessions.

The biggest factor under their control is — you guessed it — whether they spend more than they earn.

Now, I know what you’re thinking, because several years ago I got myself into $14K of credit card debt during a period of underemployment. There are 100% for-sure times when you cannot spend less than you earn because you are simply not earning enough. I have been there. Lots of people are currently there.

If that’s where you are, and you’d like to not be there, I’d recommend reading Vicki Robin and Joe Dominguez’s Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence. This book should be available at your local library (get the 2018 edition if possible; if not, the older editions should be just as good though slightly less relevant to today’s economy) and it absolutely changed my life when I read it while working as a part-time telemarketer.

If you like cats and glitter, I also recommend Lillian Karabaic’s Get Your Money Together: An Illustrated Purrsonal Finance Workbook to Help You Budget Your Money, Save for Retirement, and Smash Debt. This book might not be available at your local library, but it’s exceptionally useful if — well, to quote Lillian Karabaic:

I only started teaching personal finance only because I was frustrated with the lack of queer-friendly, feminist, and, most of all, fun personal finance education out there — especially stuff that deals with actual real-life money issues and doesn’t assume you have one full-time job with benefits, 2.5 kids, and a white picket fence.

I’d also suggest reading Grant Sabatier’s Financial Freedom: A Proven Path to All the Money You Will Ever Need, because Grant devotes the first half of the book to “how to earn more money” and the second half to “how to become financially independent,” so if you’re interested in that, go check it out. Literally.

And if you’re interested in the finances of self-publishing, well… you could always take my class. ❤️

*Contrary to popular belief, “financial independence” doesn’t mean “having more money than you could ever spend.” It’s more like you’re paying yourself an annual salary based on your investment returns. Which means you’ll still need to stick to a budget, and in some ways you’ll need to be more careful about your budgeting and spending than a person who isn’t “financially independent.” After all, you want that pool of investment money to last for the rest of your life.

**The average self-published book sells fewer than 500 Kindle copies, so hitting this benchmark is an early sign of success.
Posted on by Nicole Dieker 1

THE WORK, THE LIFE, and THE MONEY

Yesterday I asked whether “does it make money” should be a factor in determining a creative work’s success.

This, by the way, is one of the oldest questions in the book, we were debating it back in grad school, but in grad school we were also all on food stamps because that was literally part of the orientation process.*

Since then, I have had varying levels of income — specifically, two periods of earning at or above the median income in the United States, separated by a few years during which I earned significantly below the median income — and I’ve become less interested in the philosophical question of whether creative work should make money then the practical question of how to earn money from your creative work.

Here’s what I have come to believe:

  1. The big creative work you want to do with your life — aka THE WORK — should include a money-making component.
  2. THE WORK might not earn enough money to be your sole source of income. (If it is, congratulations!)
  3. You will probably need to do additional types of work to fund THE LIFE you want to live. If possible, choose work that complements and/or supports both THE LIFE you want and THE WORK you want to do.
  4. A successful piece of WORK should, at minimum, earn back the cost of producing the WORK. This cost may or may not include your time.

None of these foundational beliefs address the question of how to earn money from your creative work — we’ll get to that, probably next week — but, at least for me, they set up a framework through which I can structure THE WORK, THE LIFE, and THE MONEY while simultaneously evaluating the success of all of the above.

This brings me to Grant Sabatier’s new book Financial Freedom: A Proven Path to All the Money You Will Ever Need.

Sabatier wrote this book as a sort of unofficial sequel to my very favorite personal-finance book ever, Vicki Robin and Joe Dominguez’s Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence. (Vicki Robin wrote the foreword to Financial Freedom, making it an official unofficial sequel?)

Your Money or Your Life teaches you how to interact with money; how to calculate your true hourly wage and identify jobs that give you the most value for your time, how to avoid blowing your cash on impulse buys and poorly-thought-out purchases, and how to save and invest for the future.

Financial Freedom teaches you how to earn more.

Financial Freedom also provides an updated guide to the whole saving-and-investing thing. The original edition of Your Money or Your Life was all about savings account interest and U.S. Treasury Bonds (both of which are no longer performing at a rate that can lead a person towards long-term financial security), and Financial Freedom focuses on newer strategies such as index funds and Roth IRA conversions.

If that’s not where you are in your financial journey, you can skip that part.

But I would argue that every creative person should read both Your Money and Your Life and Financial Freedom, if only because these books will cement the connection between THE WORK, THE LIFE, and THE MONEY.

If your job is not giving you enough time and/or money to live THE LIFE and do THE WORK, these books will help you find and/or create a better job, preferably one with a higher true hourly wage.**

If THE LIFE you want to live does not match the life you are currently living, and especially if you are spending extra money because you are dissatisfied with your life, these books will show you how to shift your habits and your spending to get you closer to THE LIFE you want.***

If you want to go all Marie Kondo on your everyday expenses and ask yourself “do I really want to spend $780 every year maintaining my pixie cut or do I want to invest that money and turn it into three months of financial freedom,” well… guess what, I started growing my hair out.

(Financial freedom, by the way, translates to “the amount of time you can live comfortably without earning another dollar.” You can stack up your months of financial freedom to provide security for the future, or cash them in for a big purchase such as a house or a sabbatical or an indie-published book.)

Most importantly, if you want to figure out how to turn THE WORK into THE MONEY-MAKING WORK, Financial Freedom has several excellent suggestions.

That’s all for today. Next week we’ll continue discussing how to make money on your creative work, so… see y’all on Monday. ❤️

*The orientation, which was student-led, consisted of two components: don’t sleep with the undergrads and here’s how to get on food stamps.

**I know jobs don’t grow on job trees and getting a new job is not always easy. But if you are going to do the work of job-hunting, it’s worth knowing what kind of job you’re hunting for.

***I can hear you saying “I don’t earn enough money to change any of my spending habits,” which, believe me, I’ve been there. I first read Your Money or Your Life in 2004, when I was making $9 an hour working as a telemarketer. (That’s the equivalent of $12 an hour today, if you were curious.) I could make very few changes to my spending, but I started doing things like making peanut-butter-and-raisin sandwiches because a tub of raisins was cheaper than a thing of jam, and taking the bus during off-peak hours because it was less expensive, and finding a job that paid $13 an hour, and within nine months I had saved $500, which was NOT A LOT, but also proved that the system worked.

Posted on by Nicole Dieker 0

On Play, Performance, and Profit

I told you some of these would be about money, since I’ve been writing about personal finance for the past seven years — and, arguably, I wouldn’t be making the money I do on my creative work without the personal finance background. (Or, at least, not as much money.)

About a month ago, I got an advance reader’s copy of Grant Sabatier’s Financial Freedom: A Proven Path to All the Money You Will Ever Need, which released to the public this Tuesday. I reviewed it on The Billfold this week from a personal finance perspective; I’m going to review it on this-here blog tomorrow from a creative perspective.

Because I have been thinking about this book a lot.

But before we get into that, I want to ask a question about the link between play, performance, and profit.

I have not yet written the promised blog post on why I believe there is a difference between play and performance, or how I came up with this particular theory, but I have given you my personal definition of play vs. performance, so let’s recap:

Play is a gift you give yourself.

Performance is a gift you give an audience.

I have been to many performances that were, in fact, play — the people onstage were doing it to satisfy the internal urge to create but not the external urge to connect.*

Sometimes the people onstage charged money for us to watch them play, and in some cases I was a little disgruntled once I realized what I was watching.

Sometimes it was a situation where the audience wanted to pay money to watch great artists play — to see the creative process in process. I’ve gladly purchased those kinds of tickets.

I’ve also purchased tickets, bought books, paid to visit galleries, etc. to see performances, by which I mean completed work designed to guide an audience through an experience that engenders an emotional response. (Yes, I’m counting books and other forms of static art as performances.)

Sometimes these performances were given away for free.

More often, money changed hands. Willingly. Eagerly. Not out of obligation (like the $45 the dance studio makes you pay to attend your kid’s ballet recital) or even out of friendship. The audience paid money because they wanted the experience.

Which leads me to the question: is a performance effective if people are not willing to pay for it?

On the one hand, of course not. We don’t need to give people money in exchange for experiences; we’ve just agreed, culturally, that it’s the thing you do.

On the other hand: since it is a cultural thing, if people are not willing to give you money to experience your thing, then…

ON THE THIRD HAND THERE ARE A LOT OF PERFORMANCES IN THE WORLD RIGHT NOW, INCLUDING MANY EXCELLENT ONES, AND NOT ALL OF THEM ARE MARKETED EFFECTIVELY.

On the fourth hand I wrote “profit” in the title because of the alliteration, and there’s a huge difference between making money and making a profit, and I’m going to address that when I review Financial Freedom tomorrow, but let’s just keep in mind that good art can make money but still not be profitable because it cost more to make the art than the audience paid to experience it.

We’ll stop here, mostly because I’m out of time.

More tomorrow. ❤️

*This is one of the reasons there’s that perennial joke about nobody wanting to watch their friends do improv. (BUT WE DO IT ANYWAY BECAUSE WE LOVE YOU. Also because improv is six-sevenths of the way towards improve.)

Posted on by Nicole Dieker 2