Book Club featuring Jonathan Clements

george grombacher 0:02
Well, this is George G. And the time is right. Welcome. Today’s guest strong and powerful. Jonathan Clements. Jonathan, are you ready to do this?

Jonathan Clements 0:08
I am George, it’s great to be with you again.

george grombacher 0:10
I’m excited to have you back on let’s go. Jonathan is a writer he wrote for The Wall Street Journal for over 18 years. He’s the founder and editor of the humble dollar. He’s the author of seven books. And his newest is my money journey, how 30 people found financial freedom. And you can too, Jonathan, tell us about your personal life’s more about your work and why you put pen to paper for this book?

Jonathan Clements 0:35
Well, that’s three questions in one, George. So let me let me start with the book. And then we can back into the other stuff. So the book, as you said, it’s called my money journey. And what it is, is 30, people who write for humbled dollar, often or occasionally contributed essays describing their financial journey, how they reached financial freedom. And it is a, I think, a fascinating look at how everyday Americans handle their money, how, even though we all make mistakes, even though we all have struggles. Even with all that, if we are persistent, we can reach financial freedom. And that’s what the book tells you these 30 stories of how people managed to accumulate enough money so that essentially their time is their own. And one of the things that’s unusual about the book, is that we rarely talk honestly about money. You know, people will talk about the stock market in general, they will talk about careers in general, but will they actually tell you what they make, what their salary is, what the size of their portfolio is, what specific investments they own, and what horrendous mistakes they made? Well, some of the writers who contributed to my money journey do just that.

george grombacher 1:57
It is, it has always been and remains a very, very, very personal thing, and almost uncomfortable. And for a lot of people clearly uncomfortable. Why? Why do you think that the folks, these 30 people, some of them, or all of them were were so open.

Jonathan Clements 2:15
I think it starts with the website, I mean, humble dollar.com, which I launched at the end of 2016. Most the writers who contribute to the site are amateur writers, they that yes, they’re awesome financial planners and financial advisors who write essays for the site, but most of them are just everyday Americans. And what I say to them is, you may not be an expert on the financial world, but you are an expert on your own life. So if you talk about the things that have occurred with your personal finances, you can speak with authority. And so that’s what I encourage the contributors to do to write about their own financial lives. And as they say to them, if you’re not comfortable talking about your own financial life, then this is not the site for you to be writing for. So coming into this book, the contributors were all used to talking about their own finances. So it wasn’t a huge step to go a little bit further and describe their entire financial journey. Ego

george grombacher 3:19
is this this ever present, really important thing to be considered and potentially be overcome, to be lived with? Why humble dollar? Is it speaking to ego?

Jonathan Clements 3:36
Going back to the 1990s, when I began as a columnist of The Wall Street Journal, one of the things that I preached relentlessly, perhaps, you know, we should really say repetitively was that you cannot beat the market the the surest way to success is simply to accept returns to the financial markets by buying broad based index funds. So that strategy, coupled with things like being aware of the behavioral mistakes that we make, saving diligently, these sorts of humble steps are the way to financial freedom. If you talk to people about money, you know, most people will tell you about their winners about their successes, they’re very reluctant to tell you about their losers. With humble dollar what we’re trying to do is to get people to think of money from a different direction to flip this script to say yes, you know, if I am humble, if I accept returns the financial markets if I live beneath my means, if I make sure I have the right insurance, if I only take the risks that I really need to take, I will be financially successful, a humble approach to personal finances more likely to lead success, the one that comes from as you put it, a place of ego.

george grombacher 5:00
it really be that simple. It really

Jonathan Clements 5:03
can be that simple. Managing money is simple, but it is never easy. And the part that isn’t easy is the behavioral stuff. We grow overconfident when markets climb. You know, we can’t resist the impulse to splurge, we grow fearful, during market declines. These are the things that implode our financial progress. But if we can hold those behavioral demons at bay, and pursue the humble course towards managing money, success, not immediately, not today, not tomorrow, but over a career of careful money management and diligent saving, that will be yours.

george grombacher 5:48
Slow and steady does in fact, win the race. Do we have a desire for complexity? Do we want to make it harder? Do I want to get rich and that was that that’s that that’s, that’s, that’s why I screw up.

Jonathan Clements 6:06
So I think there are a number of reasons why people end up with finances that are overly complicated. And one of the things that people will learn from reading my money journey is that, you know, the road to success does not have to involve complexity. And yet many people do end up with complexity. One is because of Wall Street, you know, the more complex a financial solution, the more money Wall Street makes, if it’s a simple investment product, like a broad based index fund, Wall Street makes almost nothing. But if it’s some complicated, actively managed fund throwing a few options and futures, you know, maybe layer it over some sort of insurance contract. And suddenly you get this very expensive product that even the people who sell them don’t fully understand. So that’s one reason why people end up with complex solutions. The other is that people assume that things that are complicated, are sophisticated. And people like to be sophisticated, they like to appear clever, it does feed their ego. And it does take humility to say, hey, I don’t need the complicated solution. I can get to my financial goals with simple investment products. And in fact, I will get there faster.

george grombacher 7:23
That’s That’s something I’ve been spending a lot of time thinking it’s just been sort of bouncing around my head is the idea that you know, what, what would I prefer to appear to be wealthy or don’t want to be wealthy? Do I want to this is, do I want to be a successful investor? Or do I want to appear to be a successful investor?

Jonathan Clements 7:39
Oh, yes, it’s, you know, this is another thing that crops up in the book, I mean, the you know, the appearance of wealth is the mortal enemy of wealth. The most of the people who contributed the book and maybe all the people who contributed the book are super diligent saver as they are The Millionaire Next Door, who wears doesn’t wear designer clothes doesn’t drive a European luxury sedan doesn’t live in the biggest house in the neighborhood. And this is the reason they are wealthy. Because you know, if you see a couple, you know, who live in the mega mansion, with the His and Her BMW in the driveway and this Kathleen manicured lawn, if you see that couple, there’s a good chance that they are loaded to the gills with debt. And they sit around at night wondering how they’re going to pay the bills.

george grombacher 8:37
They’re certainly I see immense value in learning from people who are who are really prominent, or famous, famous people. And I find it to be really relatable when I can hear from somebody that I can, like I said, kind of relate to was that one of the one of the drivers for putting this book together?

Jonathan Clements 8:59
I think that hearing stories is the way that we learn and the way that we pass values down through the generations. You know, we all know that in many ways statistics, give more accurately depict the world than stories do than anecdotal evidence. Nonetheless, anecdotal evidence is much more powerful than statistics. You know, tell me a good story. And I’ll remember it tell me some dazzling number and I’ll forgotten it within five minutes. So yes, hearing stories about people who have done the mundane things necessary in order to grow wealthy and gain their financial freedom, I believe is very powerful. It may not be an exact replica of the best way to grow rich, but it’ll be the story that will inspire you and make you realize that yes, this is something that I too can do.

george grombacher 10:01
Now you, you’ve selected 30 people. Why? Why? Why 30?

Jonathan Clements 10:07
Well, I’ve already had one because I contribute an essay. So I was down to 29. And George was not very complicated. I sent out a mass email to the people who had been contributing to humbled dollar. And I said, Hey, would you like to contribute to this book? And, you know, I didn’t know how many people would said yes, but as, as it turned out, 29 Other people said, Yes. And that’s how I ended up with the 30 essays. From there, you know, they had to put up with a couple of different edits from me to make sure that, you know, everything was accurate, the stories were compelling, and so on. And for many it was, it was a difficult exercise, I mean, to sit down, and think about your life and how you got from A to B, and put it in terms that the rest of the world will find compelling is, is not an easy exercise, you have to reflect on your life on the things you did, right, and the things that you did wrong. And in fact, one of the things that I do in the book right at the end, is say that if anybody wants to take a shot at writing their money journey, and send me a copy, I will consider publishing it, what I’m looking for essays of sort of two to 3000 words, you know, these are not essays about your thoughts about the financial markets. These are essays about what you have done financially, where you’re willing to talk about the nitty gritty of how you managed to make financial progress. And I’m hoping that one of the things that comes out of this book is that we’ll have a whole new series of essays that I can then publish on humble dollar.

george grombacher 11:43
I love it, what a, what a wonderful exercise, to, to go through. And even if you don’t even ever send it into Jonathan, just putting pen to paper and starting to think about, you know, what maybe is unique here or there, it is sort of counterintuitive to think of ourselves specifically around money as doing something that’s unique. But to your point, we all have unique journeys.

Jonathan Clements 12:11
And I would say that, when you sit down and you write your financial journey, what you’re really writing is your life journey, because you name almost any topic, and there is a financial angle to it, you know, having children getting married, death, everything has financial implications. So when you write your financial journey, you’re really writing your life journey. And beyond making you reflect on your life and learn the lessons of it. This isn’t a valuable record that your children, your great your grandchildren will appreciate reading. I mean, I wish I knew more about my great grandparents, I have a few photographs, but I don’t really know the full details their life. Would I like to read 2000 Woods, they wrote about their life and what had occurred, the highlights the you know, the low moments, Sure, I’d love to have that. So even if you don’t send your essay to me, you know, write it, you know, put it with your other important papers. And maybe, you know, decades and decades from now, your family will still be reading about you. The only immortality we have in this life is the memory of others. And you can ensure that you are remembered if you write your life story, and you pass it on to your children, your nephews, your nieces, whoever is in your family.

george grombacher 13:45
Yeah, I think that we would all cherish that from our parents and our great grandparents and even great, great grandparents to be able to have that. Like that. That’d be a really special thing. In terms of writing process. For the 18 years that you were writing for The Wall Street Journal with which I imagine you had pretty serious deadlines. And now where we are today, how is tell us a little bit about your process.

Jonathan Clements 14:11
I find that the longer a takeover a piece, the better it gets. So while I don’t encourage people to procrastinate, what I do generally say is that you should at least follow the three day rule. And the three day rule is this day one, you bang out a great first draft, you know, don’t worry too much about you know, whether every sentence is beautifully constructed. Just get it down on paper. Then day two, you spent polishing it up, you know, you really want to try and make those sentences saying you and look it with the eyes of somebody who’s coming to this fresh either. Think about the reader, what will the reader make of this? Will they understand what you’re saying? You know Will, are you telling them all the necessary details. And then Day Three is the day where you go through you double check everything, you make sure that you know there are no spelling mistakes, make sure everybody’s names are spelled correctly and so on. Because, you know, I’ll tell you from decades as a writer, if you want to lose the trust of your readers, just make a stupid mistake. And immediately your credibility is gone. And the entire piece is called into question. And I’ll just tell you one really small example. Warren Buffett may be one of the richest men in America. But it does seem that half the population cannot spell his last name. I have seen Buffett’s name with just a single T at the end. So frequently. I mean, it’s unbelievable. George is unbelievable. And whenever I see that, my immediate reaction is whoever is writing this really doesn’t know what they’re doing. That may be unfair. But the fact is, if you can’t spell Warren Buffett’s last name correctly, the rest of the pieces in doubt.

george grombacher 16:12
Yeah. Well, fair enough. I appreciate that very much. Do you have opinions about or thoughts on actual pen and paper versus screen and typing?

Jonathan Clements 16:23
Yeah, at this point, I do everything on all my laptop, I’ve long since given given up doing pen and paper. And in fact, if anybody’s seen my handwriting of late, they will realize that I very rarely put pen to paper.

george grombacher 16:39
As those those those practical uses for it, I get it. We’re probably this is beyond the scope of our conversation today. But while I have you your thoughts on GPT, artificial intelligence.

Jonathan Clements 16:52
I don’t have strong opinions on that, George, but I think that, you know, whether we like it or not, this is going to be part of our lives. And, you know, we better get used to it. And and, and come to understand, you know, what it can do and what the limitations are? Yeah, I believe that artificial intelligence is going to be a huge part of the future.

george grombacher 17:23
We talked about how anybody is capable of being good with money. Can anybody be a good writer?

Jonathan Clements 17:32
That’s an interesting question. I think everybody can be a better writer, including me. And one of the best ways to become a better writer is to become a more diligent reader. If you read a lot, you will become a better writer. And I think that that is the first step to becoming a better writer is just to make sure that you read widely. And then the second is to not be like your five year old when he or she does a picture, you know, a five year old will pull out a piece of paper, do a drawing in two minutes, you know, with crayons, and then hand it to the parent and say, you know, let’s frame this. Once you’ve, you’ve read widely, and then you start to write, take your time, nothing is going to be perfect on the first draft.

george grombacher 18:37
I love at least recognize or adhere to that three day rule that Jonathan was talking about earlier. I love it. Which I then thank you so much for coming back on where can people learn more about you? Where can they find the humble dollar? And where can they get their copy of my money journey how 30 people found financial freedom and you can too,

Jonathan Clements 18:57
so I would encourage people to go to humble dollar.com The site is completely free. We are supported solely by advertising and by donations from readers. We have a free twice weekly newsletter that you can sign up for a we don’t sell our email list. We don’t do affiliate marketing relationships, none of that nonsense. All we do is run it based on donations and advertising and everything is free to the reader. And I know you’ll be shocked by this George but the book my money journey is available on Amazon

george grombacher 19:31
shocking and dead. Have you enjoyed this as much as I did? So Jonathan, your appreciation and share today share with a friend who also appreciates good ideas go to humble dollar.com and check out all the great resources that are on the site and you could find a handful of contributions from yours truly sign up for the weekly or the twice weekly newsletter as well. I know how just how valuable it is and probably I’m sure that you got a good feel for it. Jonathan and the way he likes to communicate from our time together today, and pick up your copy of my money journey at humble dollar or you can go on Amazon wherever you’d like to buy your books. Thanks. Good, Jonathan.

Jonathan Clements 20:11
All right. My pleasure.

george grombacher 20:13
Thank you, George. And until next time, remember, do your part by doing your best

Transcribed by https://otter.ai