Are You a Financial Extremist?

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by Ryan

There are a ton of different financial websites and blogs on the web. Each with their own strategy or mix of ideas. Reading through these blogs makes you realize that some ideas mix as well as oil and water. Enter financial extremism.

The vast majority of personal finance blogs are middle of the road. Pay off your credit card debt, invest in your 401k, wait 40 years, retire, die. It seems to be the pattern of the majority. Personally I’m not a fan of the idea of retirement or working somewhere for 40 years that I don’t enjoy… I suppose I’m not really a big fan of dying either…

Don’t get me wrong, I think a solid financial base with the personal finance 101 stuff is important, but it’s a bit like common sense and there isn’t much upside. Like J.D. so eloquently put it, you’re going to Get Rich Slowly. Is this a bad thing? One thing’s for sure, it’s fool proof and not too risky.

Of course like any group there are outliers. In the world of finance this means the rich, or the poor. Everything is relative of course as most anyone living in the US is richer than many of their global counterparts. Even so, the woman who can’t afford her Coach purse feels like she’s poor (life is rough, tear).

There are two blogs in the personal finance arena that are obviously outliers.

Adrian at 7 Million 7 Years… How many people do you know that are worth 7 million? Adrian did it in 7 years and writes about his strategies that are, of course, not common sense and not mainstream. He advocates starting businesses and investing in commercial real estate.

Jacob at Early Retirement Extreme… He retired in 5 years via traditional work, lots of traditional work, and cutting his living expenses to the bare minimum. This allowed him to retire with a nest egg much smaller than what your average financial planner would recommend. He currently resides in his RV and only works a few hours a month.

So are these guys financial extremists? A standard definition of extremism is:

“One who advocates or resorts to measures beyond the norm”

Yup, they’re financial extremists. Heck Jacob even put the word in his blog name! I see completely where both of these guys are coming from and both strategies (or a mix) seem tempting. The question though, that I ask you is, is it worth it to be a financial extremist?

Am I an extremist?

I would say that I am more so than the average American. I live considerably below my means, don’t believe in the traditional career path (personal choice), ride a bike around town, and have fairly lofty financial goals which will require businesses and real estate to accomplish.

So to wrap this up I’m curious about your opinion and if you find value in the idea of being an extremist. Is it worth it and is the idea attractive to you?

What do you think? Are you a financial extremist?

Where do you think financial extremism starts?

What strategy do you like best? Get Rich Slowly, 7 Million 7 Years, or Early Retirement Extreme?

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{ 11 comments… read them below or add one }

Moon Hussain February 12, 2010 at 5:00 am

I’m not a fan of any kind of extremism, financial or otherwise. The idea of financial exteremism? No thank you. I like saving, but not to the point where I can’t splurge a bit every few months. I have my nice tv, my games, a nice apartment, and I save on the side.

I wouldn’t be happy living in an RV. I’d rather have my own business and live life on my own terms. I want to travel, but not at the expense of selling my car or my house.

With that said, I’m going to check out your recommended blogs!
.-= Moon Hussain´s last blog ..Check-Off Friday: Where I Am With My Goals (And Where The Hell Are You With Yours?!) =-.

Investing Newbie February 12, 2010 at 6:55 am

Wow! Moon took the words right out of my mouth.

When I started blogging, I didn’t plan on joining the PF niche. After reading my fair share of blogs, I can’t say that I agree with a lot of the goals they have. I’ve always believed, you can only make as much as you envision.

I personally don’t want to set a goal, reach it, and then stop. I want to work forever. I want to live comfortably. I want nice things. These are situational/lifestyle goals that won’t necessarily ever be reached. I mean, how much does it take to live comfortably? I’m not sure. But right now, like you, I’m living below my means, but also saving a good amount of income for retirement as well as a house, while not depriving myself of treat once in a while.

To think I wouldn’t be able to buy shoes?!! The horror!
.-= Investing Newbie´s last blog ..2010 Goals…so far =-.

Evan February 12, 2010 at 7:06 am

What do you think? Are you a financial extremist?
There is NO chance that I am an extremist. Really, how many attorneys are?

I don’t think AJC (who is a GREAT guy by the way) is an extremist. He is an entrupenuer through and through, but I don’t think that makes him an extremist. He is an amazingly savy investor and business owner/broker/seller

Where do you think financial extremism starts?
It is inside of you just like those crazy nuts swimming with sharks (oooo good dig! )

What strategy do you like best? Get Rich Slowly, 7 Million 7 Years, or Early Retirement Extreme?
7m7y is the best – basically MAKE AS MUCH AS YOU CAN and don’t spend it all. I would follow that any day before I start worrying about how much I spend on toothpaste
.-= Evan´s last blog ..Party of “No”? That is Just Garbage Populist Rhetoric =-.

Money Funk February 12, 2010 at 9:43 am

I definitely would be an extremist, but my husband is not. Tend to bump heads with it. I would kill the cable, the cell phone, etc… just to kick the debt quickly. Where as, my husband choses to live a normal life while paying it off. I don’t blame him, but sometimes it drives me bonkers!

Since, I can’t do that I am in the midst of finding multiple income streams (or one if it works) to get me out of the traditional job core and live my life!

Financial Samurai February 12, 2010 at 10:13 am

I’m definitely an extremist, but in hiding. Nobody knows what my net worth is, and that’s the way I like it.

The best is to have that large net worth, pretend you are poor, and work for fun. I’m telling ya, it is awesome. It’s like going to business school part-time and learning for the sake of learning, not worrying about getting straight A’s.
.-= Financial Samurai´s last blog ..Getting Busy This Valentine’s Weekend! (Singles Especially) =-.

Ryan February 12, 2010 at 10:39 am

Couldn’t have said it better myself.

jacqjolie February 15, 2010 at 6:02 am

I’m all for semi-extremism just like I’m for semi-retirement.

I’ve had some good months this last year of saving 84% of my income, and some not so great months of 30% savings. There’s a strange situation that occurs in that the more you save, the more you want to save. It’s like some kind of personal challenge that’s highly motivating.

I took the 5 year route to go from a savings of $0 to semi-retirement but there wasn’t the level of deprivation that Jacob at ERE went through to get there. I focused more on the income side of the equation, which I realize may not be possible for most people. But maybe it is?

Early Retirement Extreme February 19, 2010 at 7:33 am

Despite having the word Extreme in my blog name, I think one can go too far. For instance, hunter gatherers spend about 15 hours a week to supply their needs and they are not a technologically advanced as we are, so spending 40 hours a week or more which is about 36 or 37 hours more than modern people need simply to buy extra things or quick experiences does sound a bit extreme to me 😉 I mean, what is the point of that. It’s like heating a swimming pool in the backyard and never taking a swim in it. (Next time you fly over LA or any city for that matter, try counting pools and see if you can find even one person out enjoying the pool he paid for.)
.-= Early Retirement Extreme´s last blog ..Promotion versus production =-.

Moneymonk February 19, 2010 at 11:14 am

I am waht you call stealth wealth. Nice income/cash but have a low middle class mentality
.-= Moneymonk´s last blog ..Friday Quote =-.

Andy May 17, 2010 at 1:45 am

I’m a financial extremist. I like Jacob’s approach the most, simply because it fits me best. I live around the poverty level, even though I make more money than that. I have yet to see where it will lead me, but the extreme early retirement concept has already changed my life and my mentality. I like it, it’s an exciting journey.
.-= Andy´s last blog ..Extreme Early Retirement =-.

Darren June 22, 2010 at 7:48 am

I like a little bit of each strategy. Working at a day job will only allow me to get rich slowly. What I do outside the hours of 9-5 can possibly reach “7 million in 7 years” or semi-retire early.

I do think there is value in being an extremist. The drawback to this is that other people may think you’re really odd! But if you’re not too concerned with what they think, then you move on with your extreme ways.

If extremism is living beyond the norm, seeing what the norm is and deciding if we want to be a part of that helps to decide if we want to be extreme.

I see the norm as working at a job we barely tolerate (or even hate), living for the weekends, being in debt, keeping up with the joneses, and wishing for a decent retirement at the end of life. Sounds uninspiring to me. Therefore, maybe some extremism is a good thing!
.-= Darren´s last blog ..Why You Don’t Need An Emergency Fund =-.

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