Trent Hamm, founder of The Simple Dollar blog, isn't afraid to talk about his financial mishaps. More importantly, he outlines in detail how he moved beyond his "financial meltdown" and learned valuable lessons about recovering from debt and tools for better money management.
Hamm took a moment to share his philosophies with LoveToKnow Save.
The Simple Dollar Interview
How does a regular guy gather up the courage to start a blog about his financial failure and repair?
When I started The Simple Dollar, I didn't anticipate that it would have a large readership. I mostly looked at it as a channel to write about the things I was learning about personal finance and to work through how they all fit together in my life. Along the way, the blog just happened to click with readers.
From my perspective, the real courage I had was walking away from a lifestyle of overspending and consumerism.
You stress that posts on your blog are for entertainment only, and not to be considered financial advice. Yet, much of what you talk about is sound money management techniques. What steps did you take to learn what you know?
Reading! Lots and lots of reading. I started off reading two or three personal finance books a week. Even now, I still read a personal finance book every week or two.
You also focus a lot on conservation -- of resources, energy, even regarding diet. In your opinion, is mindless consumption one of the reasons we may not have as much money to save as we might like?
Absolutely. Whenever you buy something, you're exchanging one resource (money) for another (stuff). You're deciding that the item you're buying is worth what you're giving up. Money is representative of freedom: the ability to do whatever you want.
When you regularly make choices to buy things you don't really need, you give away that freedom, a bit at a time. You have to keep working at a job you don't like. You have to deal with the stress of your workplace. You don't get to spend your time doing personally fulfilling things.
Learning Better Ways for Financial Management
You recommend a variety of money management books. How do you sort through the same messages to find something new?
If you've read a lot of personal finance books, it's pretty easy to tell if there's a compelling and interesting message in a new book fairly quickly. The table of contents is usually a big clue: does it follow the "connect-the-dots" pattern of making a budget, following it, and basic investing? Or does it present different ideas?
You talk about more than money on your blog, including tips for a good shave to the art of the thank you note. How do these posts fit in with your overall philosophy for the blog?
Time management and social networking are both very important for improving your personal financial situation.
Time management allows you to become more productive with the hours you have, enabling you to increase your income without increasing the time you spend earning it. Social networking helps you to open doors to any number of life possibilities, from new job opportunities to amazing financial deals.
Do you work another job in addition to maintaining the blog and if so, what do you do?
The blog and related writing opportunities, such as my upcoming book, are my full-time work at the moment.
Getting Through Tough Times
What ideas and practices are you holding on to during the tough economic times of 2008-09?
The principles that work well in an economic boom work well in an economic downturn, too.
- Spend less than you earn.
- Don't worry about what others think of you.
- Don't get into debt -- particularly credit card debt.
- Build a cash emergency fund, one that can sustain you for a few months in the event of a job loss.
- Start investing money for the future.
More from The Simple Dollar
- Review some of Hamm's favorite articles.
- See if you can follow Hamm's step-by-step instruction to fix your finances in 31 days.
- Receive The Simple Dollar direct to your inbox.
~Tracey L. Kelley