A tough Christmas?

Last week I did an (unpaid!) gig for Australia’s largest mental health support organisation, Beyond Blue.
 
Unbeknown to me, an eager beaver from their comms team went ahead and entitled the presentation “Take the pressure down: A guide to navigating end-of-year stress with Beyond Blue and the Barefoot Investor.”
 
As I read the title, a shot of anxiety squirted smack bang into my left eyeball … a place that’s generally reserved for my two-year-old, who is currently attempting to drop his afternoon napandpotty training.
 
Beyond Blue’s commissioned research has revealed that the overwhelming majority of people (77%) are feeling stressed heading to the end of the year, and over eight in ten of them say the top stressor impacting their mental health is financial pressure.
 
What could I say about that?
 
Quite a lot actually, though I was a little stressed that I was about to depress everyone, which kind of goes against the entire ethos of Beyond Blue.
 
You see, I actually don’t agree that it will be a tough Christmas formostpeople.
 
Yes, I know only too well that forsomepeople – like many financial counselling clients, and the people I’m serving at the local Foodbank – it’s going to be pretty grim.
 
For the rest of us?
 
Not so much. The fact is we’re rear-ending another ‘annus horribilis’, to quote the dearly departed Queen. And so many of us will, either consciously or unconsciously, let it all hang out over the holidays, and pinky promise ourselves that we’ll ‘get it under control’ in January (or February). In other words, there ain’t no one counting calories when the Christmas pudding gets passed around.
 
So let’s you and I talk about how to make this Christmas the most enjoyable one yet.
 
Quick quiz time:  
 
What did you get for Christmas last year?
 
Go on, stop reading now, and spend 10 seconds thinking about it.
 
You’ll be lucky if you can remember one thing. (Fun fact: I did this with my four children, who each have Christmas lists longer than my last manuscript, and even they couldn’t remember more than a handful of things.)
 
Chances are you (or your kids) won’t remember the gifts you received – but you likelywillremember the vibe of the house, especially if it was full of stress and anxiety.
 
So I have a couple of suggestions.
 
First, don’t be a tight-arse this Christmas.
 
It’s been a tough year. Life is for living, so spend lavishly on nice food and booze (or mocktails for us teetotallers). You’ll get a similar dopamine rush anticipating and enjoying a nice spread than you will from that soap-on-a-rope gift set. So go all out on the Christmas pudding.
 
(Another fun fact: each Christmas my father threatens to slip coins into the pudding for the kids to ‘discover’ as they’re eating, just like when he was a kid. Depending on how much Christmas cheer he’s had, the results could range from diarrhoea to death. Seriously, do you know how much bacteria there is on the average coin? It’s always a tense time for Liz … “What if one of the children swallows a 20-cent piece? They’ll choke!”)
 
Second, don’t focus on the economy, or house prices, or interest rates, or your boss – you have no control over any of that. Instead focus on what you can control, and take some small but decisive steps to build your confidence and control.
 
And lastly, don’t waste money on expensive presents for adults.
 
They don’t want or need another scented candle. Or a key-ring. (Which is what my wife bought me a few Christmases ago. Nothing says 11 years of marriage quite like a key-ring wrapped and put under the tree: “You’re always losing your keys, so I thought this would be … practical”, she said, passively aggressively.)
 
Ho! Ho! No!
 
Instead, I’d suggest buying people books. They’re cheap (under $30), don’t need a card (just scribble a message on the first page), and the bookshop will even wrap it for you. Best of all, it says to the recipient “I think you’re smart”, which is, after all, the emotion you’re really trying to buy.

The best Christmas gift under $30

Christmas shopping sucks, right?

Not for me.

Years ago, I cracked the Christmas shopping code: I buy people books.

They’re the ultimate present — they cost under $30, they don’t need a separate card (I simply scribble a Merry Christmas message on the inside cover), and my local bookstore will even gift wrap them for me.

Job done!

Here are the books I’ve got in my Santa sack this year:

Devil Take the Hindmost: A History of Financial Speculation
Edward Chancellor

This is probably the best book on financial speculation ever written.

Devil Take the Hindmost finds that most speculative booms over the past 400 years have followed the same script:

It begins with a breakthrough technology that promises to revolutionise the world and deliver untold riches to investors.

The early investors make a fortune, which attracts novice investors (who often gamble with borrowed money).

And then, when least expected, prices begin to wobble. The true believers see it as a blip, and buy the dip.

And then comes Black [Insert Day], when prices plunge and everyone loses their mind, and their shirt.

This book is a great gift for anyone who holds Dogecoin.

Meditations
Marcus Aurelius

It’s been said that the majority of the stuff we consume on our phones was created within the last 24 hours.

We snack on clickbait headlines, mean tweets and skin shots like sugary junk food designed to hit our dopamine receptors. And it leaves us feeling empty, insecure and unsatisfied.

My view?

It’s time to get a bit more fibre in your information diet.

Tweets can be fired off on the toilet. Clickbait articles are spun out in media sweatshops solely for eyeballs. Writing a book, on the other hand, takes hundreds of hours of labour, deep thought and craft. And the very best stand the test of time – some literally for thousands of years – like Meditations, by Marcus Aurelias.

It’s called that because that’s what you’re reading: the private thoughts and meditations from the wisest Roman emperor in history, who is riffing on how to be a strong, stoic person … and not totally freak out and rock in a corner with crippling anxiety when you’re surrounded by war and disease.

“When you arise in the morning, think of what a privilege it is to be alive, to think, to enjoy, to love ...” (but presumably not to scroll mindlessly through Insta).

A great gift for anyone face down in their newsfeed over Christmas lunch.

Atomic Habits
James Clear

This is easily the best book on habit change I’ve ever read.

Let’s say you want to develop the habit of going to the gym. Rather than relying on willpower, or positive affirmations, or flogging yourself, Atomic Habits will get you to break the habit down as small as possible, like putting on your runners and showing up at the gym but not forcing yourself to go in and work out.

What’s all that about?

What you’re doing is proving to yourself that you’re the type of person who turns up at the gym. “Every action you take is a vote for the type of person you wish to become. No single instance will transform your beliefs, but as the votes build up, so does the evidence of your new identity”, says Clear.

A great gift after the trainwreck of the last few years. I mean, who doesn’t want to make a few changes in 2022?

Tread Your Own Path!

The 87 year investment

When I first began the Barefoot Investor, I wasn’t married. I didn’t even have a girlfriend.

Today, I have three kids … and in a couple of weeks we’ll be welcoming our fourth.
So, on this my final column for the year, let me tell you how I’m planning for their* future.

(*While we haven’t found out the sex, I’m totally convinced it’s a boy.)

There are three steps:

First, on the day my son is born I’ll buy a newspaper.

While I’m sitting at the hospital, I’ll get a red pen and circle all the terrible, and scary things that are happening in the world right now. And there’s a lot of them: the second (or third?) wave of the pandemic is sweeping the planet, governments are going deep in debt, and we have a fragile global economy. Then there’s the Donald Trump reality show, which is yet to be cancelled.

Second, I’ll invest $1,000 into an international shares index fund, which holds the largest companies in the world (think Apple, Amazon, Berkshire Hathaway, Nestle … and 1,540 large businesses from around the world), and another $1,000 in an Aussie index fund.

Finally, in 21 years’ time, when newspapers are a relic, I’ll pull it out and let him leaf through it.

He’ll be struck at how insanely cheap the prices of things in the ads are.

(‘Hey Dad! Here’s an ad for an iPhone. I haven’t seen one of those things in years!’)

He’ll marvel at how young his old man looks in his column photo.

Yet most of all he’ll understand that all the scary headlines were a sideshow to the real story of human progress.
I encourage anyone who has kids or grandkids to do the same:

It’s a real life lesson on the power of compound interest.

Tread Your Own Path!

I’ve been waiting to write this piece for years

I’ve been waiting to write this piece for years.

No, really.

My very first Barefoot Investor column 16 years ago campaigned for practical financial education to be taught in schools.

And that’s why the Victorian Government’s decision to ban school banking, and replace it with practical, independent school-led programs, is a massive step forward.

See, for far too long schools have outsourced teaching this essential life skill to banks.

And what have they done?

Well, they’ve mostly used it as an advertising play: signing up students as customers, and putting them into their sophisticated marketing database that spits out credit cards when the kid turns 18.

(And that’s when the real education begins!)

Let me be clear: having banks teach our kids about money is like having Ronald McDonald teach them about food nutrition.

Moreover, the result is that our young people finish school scoring an ‘F’ for finances.

And, as a result of that, they often go on to make really poor financial decisions. (ASIC research tells us that some of the most financially illiterate people in Australia are young people who have just left school.)

If I had a dollar for every deep-in-debt twenty-something who told me they ‘sucked at money’ or ‘weren’t good with numbers’, I’d have enough money to buy shoes for my bare feet.

Now, here’s the thing: you and I know that once your financial confidence is shot it’s bloody hard to change. And once that belief takes hold, it ends up colouring your entire life.

In my work, I sit across the table from people who have made a lot of money mistakes.

And often there’s a frightened little kid that comes along with them.

And that is why the announcement from the Victorian State Government — to teach truly independent financial education in our schools — is so freaking important.

This is a very good day for every Victorian kid. Every Victorian parent. Every Victorian taxpayer.

After all, we all have a dog in this fight.

Creating financially confident young people will have positive long-term effects on our society, and our economy. Let’s hope the rest of the states are watching this, and taking notes ...

Barefoot’s Favourite Things

Last week we discussed what to buy kids for Christmas, so this week let’s deal with the oldies.

See, years ago, I cracked the Christmas code: I buy people books.

Gifting a book says, “I think you’re smart”. And it’s a smart deal for me too: books cost under $30, they don’t require a separate card (I simply scribble a Merry Christmas message on the inside cover), and my local bookstore will even gift-wrap them for me.

Job done!

So, here are the books I’ve got in my Santa sack this year:

The Obstacle is the Way

Has life knocked the stuffing out of you?

That’s good!

The obstacles you’re facing provide an opportunity for you to become tougher, calmer and more successful.

This ain’t a new-agey self-help book. Author Ryan Holiday draws on the ancient wisdom of the Stoics and shows you how to turn your trials into triumph.

This is a great present for anyone who’s been upended by 2020, particularly struggling small business owners and young people looking out for their first job in a recession.

The Deficit Myth

Are you concerned about all the money-printing that’s happening around the world right now?

Don’t be, says Stephanie Kelton in her bestseller The Deficit Myth.

The book serves as an introduction to Modern Monetary Theory (MMT), which is the hottest argument in economics right now. Essentially it argues that governments should embrace huge debt in order to grow the economy.

Seriously, how sexy a theory is that?

Especially for politicians who love spending other people’s money and winning votes!

While I loved the book, I don’t agree with the theory. Instead, I see MMT as a justification for the situation we find ourselves in, and a free pass for the monetary madness that will come because of it.

Still, it’s a fascinating read, and a great present for anyone interested in the future.

Ben Hogan’s Five Lessons

Have you ever tried your hand at golf and failed miserably?

Me too.

Golf pro Ben Hogan wrote this book in the 1950s, and since then it has taken on an almost reverential regard.

Self-help guru Tim Ferris described it as “the most perfect how-to book I’ve ever read”.

Maybe. Or maybe I’m a middle-aged white guy ... so, well … golf.

A great present for anyone in your life who wants to crack 80.

And finally ...

You guessed it. I’ll be giving away a serve of double happiness: The Barefoot Investor: The Only Money Guide You’ll Ever Need and The Barefoot Investor for Families: How to Teach Your Kids the Value of a Buck.

The bulk of my sales come from people gifting it to their family and friends. Why? Because the Barefoot Steps work, and they keep you safe. And that’s a pretty cool Christmas present to give, right?

Tread Your Own Path!

Cheap Pressies for Kids this Christmas

So this year I’m playing the role of Santa and the elves.

Reason being, Mrs Claus is heavily pregnant, with an official due date of … Christmas Eve.

“What a wonderful Christmas present!” gush people who clearly don’t already have three kids under the age of seven.

(My crew are understandably a little suspicious of the ‘present’ Mummy has been carrying around in her sack.)

Ho! Ho! D’oh!

So here are three stocking-fillers I’m getting my kids which may provide some inspiration for the kids in your life.

The Famous Five

Every night I tuck the boys into bed and read them two chapters of Enid Blyton’s The Famous Five.

Honestly, it’s the best 30 minutes of my day, and easily the best thing I’ve done this year.

Now Enid Blighton may have typed these tales nearly 80 years ago, but her stories of adventure still nail it.

Better yet, there’s plenty of ’em: 21 Famous Five books, plus another 17 in the sister series The Secret Seven.

Soup and Baked Beans

My kids know that I made a major life change this year and now work in the community helping people who are stressed and broke. They also know that many of my clients have kids ... who often don’t have enough food to eat.

And so the festive season throws up plenty of opportunities to expose your kids to the gift of giving — to charities like Foodbank, or even serving up Christmas lunch at a shelter.

Okay, so technically this isn’t a stocking-filler. (Can you imagine? Santa got me … a can of minestrone soup?)

Still, setting an example for your kids, showing them how to be humble and kind, is important … and never more so than on what for many is the loneliest day of the year.

Trees

Yes, trees.

Over the past few years I’ve literally become a ‘tree hugger’.

My kids and I plant a tree together and take a photo: it’s done and planted in 10 minutes flat.

My grandfather did it for me when I was a little kid; I vividly remember the fun of planting it with him and then quickly racing off to play with my toys (which are now buried in landfill).

My grandfather is long gone, but when I’m back home I make a point of visiting that tree. Every. Single. Time.

Okay, so let me level with you: Santa will also be bringing pink bicycles, nerf guns and spy sets.

Yet the truth is that these three stocking-fillers are as much for me as for the kids.

They’re what memories are made of.

Tread Your Own Path!