The Tools

There’s a bewildering array of things to know about our financial world. However, they aren’t nearly as complicated as we might assume. Spending some time with an open mind and the belief that we CAN learn, little by little, is perhaps 90% of what we need to develop enough financial capability to foster the well-being we seek for ourselves and communities. The rest of it is in the packaging and the presentation.

Financial education as an industry has been around a while. Remember The Richest Man in Babylon earlier in this text? That was published a century ago. Financial columns in the newspapers have been written for at least 50 years. In the last half century, personal finance information’s been peddled in magazines, books, audio recordings, and a plethora of other media, online and off. What I’ve observed as I started tapping into these resources is that if you read one book, and then another, and then another, and then a couple of articles with some degree of frequency, the information all starts to sound pretty similar and you hit “saturation”. In research, when doing a review of the literature on a given topic, saturation is when you start seeing the same articles over and over, despite looking in different places. You’ve found pretty much most of what there is to find. Personal finance columns in the newspapers rarely share anything that’s novel. Instead, they perhaps put a new spin, or new context, on the concept of saving for retirement… but in the end, it’s still saving for retirement by the same methods: putting away a portion of your income today so it’ll grow and you’ll have a nest egg in the future.

I have a stack of personal finance books that I’ve collected over the past few years. They all say pretty much the same things. The differentiation is who they target (the audience to whom the author writes), their personal perspectives on how to lay out the concepts (should banking be discussed first, or debt?), and then the nit-picky differences that really boil down to preference (what to tackle first and how to design your debt repayment process). If you’re inclined, go to your library and see what’s out there and consider it additional perspective on what we’ve explored. But don’t feel like you’re missing out on a lot. In the end, much of it is just marketing.

In this next section, we’ll go through the basics that are often covered by everyone else, but in a way that reflects the values and principles previously discussed and the personal and collective goals we’re setting out to achieve. (See what I do with the packaging there?) I’ve designed it to be a bare-bones, basic primer and discussion to introduce you to various accounts and products. There are MANY more out there, but you’ll be able to learn about them when you’re ready and wanting to engage in some more self-directed education. This is simply to get you started and is not designed to be comprehensive. If there’s something that you want to learn more about, go do some research. Know that where legal rules apply (such as contribution limits imposed by the IRS), then the product or account will have the same features, regardless of which financial institution is offering it. Other accounts (such as designs of life insurance policies, CD account features, or types of investments held in a retirement account) will vary and each institution will put their own flavor, spin, quality, and cost on it – in these cases, it pays to comparison shop.

Ready? It’s time to jump in.

This book is a work in progress and we’ll all benefit from your input and collaboration. In the “Leave a Reply” below, please post examples, comments, questions, and needed edits. By posting, you grant permission for inclusion of any content to become part of the book, now or in the future, in whatever form it may take. I’ll give attributions to the extent possible. I know sharing about our financial lives can be sensitive, so if you want to share anonymously, please use the contact form instead and I’ll honor your request.

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