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Financial Freedom by Grant Sabatier – Book Summary and Review

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Financial Freedom by Grant Sabatier is a powerhouse of advice and tips that cover personal finances, mindset, and entrepreneurship. The subtitle makes a big promise: A Proven Path to All the Money You Will Ever Need. Does the book deliver?

I found myself nodding in agreement a lot while reading Financial Freedom. If there’s one book I’d recommend to people who are ready to invest in themselves, build skills, and earn and save more money, this is the book. Grant gives a lot of big ideas on how to set yourself up for a wealthy life. And he balances those ideas with practical tips like maximize your current full-time job first and save as much as you can today to optimize your return on investments.

If I had to condense the book’s message down to one sentence, it would be:

respect and maximize the value of your time to live a life of freedom.

Grant’s message throughout Financial Freedom is that while money is unlimited, time is not. So time is more valuable than money. Multiple times, and in several ways, Grant says that money is only as valuable as the freedom it buys.

 

Financial Freedom is about a lot more than money, it’s about living a richer life. – David Bach, author of The Automatic Millionaire

Who is Grant Sabatier?

Grant Sabatier is an entrepreneur, podcaster, and writer. He blogs at millennialmoney.com.

Also, while starting from basically zero, Grant increased his net worth by over a million dollars in 5 years.

At age 24, he’d been fired twice in a short period of time and was living at his parents’ house. He found himself sleeping in the same bed he’d slept as a child.

Grant decided to invest in himself and build skills.

He began to study marketing, and in a few months, he got hired by a digital marketing agency for $50,000 a year. Proactively, he used his time with the agency to learn about web design and digital marketing and, in a short time, started his own side hustles.

He built websites for local businesses and charged increasingly more money while getting more referrals.

He soon left the ad agency to start his own consulting business. And less than 5 years later, he had earned enough money to afford freedom of time and freedom of location. That is to say, he earned financial freedom.

 

RelatedWhy You Should Retire Early – The Benefits of Financial Freedom

Why Financial Freedom Matters

Financial freedom matters because money affords you freedom of time. And, ultimately, time matters more than money.

Financial Freedom covers a lot of ground. Before delving into the meat of the book, Grant introduces the 7 levels of financial freedom.

Seven Levels of Financial Freedom

Grant states that moving through these levels will make you feel increasingly empowered and less stressed about money. Financial Freedom progresses logically from this list. Each chapter grows on the last to help you move from whichever level you’re at to the next, and beyond.

  1. Clarity. Know where are you now and decide where you want to go.
  2. Self-sufficiency. Earn enough money to cover your own expenses.
  3. Breathing room. No longer live paycheck to paycheck.
  4. Stability. Have 6 months of living expenses invested and no bad debt.
  5. Flexibility. Have at least 2 years of living expenses invested.
  6. Financial independence. You can live off of the returns from your investments. Work is now optional.
  7. Abundant wealth. You have more money than you’ll ever need.

Depending on which level you’re starting from, your actionable takeaways from Financial Freedom will vary. I’m at the point where I’m trying to have easily 2 years of expenses invested. Since I’m pursuing level 5 (flexibility), my main strategy is to maximize income from my full-time job and start pursuing side hustles.

I’ve been at level 1 and level 2 before. If you’re there now, I know it’s tough. Just work on gaining clarity about your goals and getting to a point where you’re earning enough to take care of your own needs.

To gain clarity fast, start tracking your finances today using free software like Personal Capital.

 

Related: The Best Free and Paid Personal Finance Software

Your Number

Early on, to help readers gain clarity, Grant introduces the concept of “Your Number”. Anyone into financial independence/retire early (FIRE) has probably already calculated “their number”.

Your number is the amount that you need to have saved and invested in order to be able to live without working for more money. It’s the amount that you can live on basically forever without withdrawing from your investment principal — the amount of money you’ve invested not counting the gains.

If you want to afford the same lifestyle you have now after you “retire”, your number is roughly your annual spending multiplied by 25. This gives you the amount you need to have invested to live following the 4 Percent Rule. The rule is that you can safely withdraw 4% of your total investments annually which allows your money to continue growing into the future.

The Only Budget You’ll Ever Need

Chapter 7 of Financial Freedom keeps budgeting simple by focusing on the largest 3 expenses we have: housing, transportation, and food.

Since housing accounts for about 33 percent of the average American’s expenses, keeping your housing costs low can have an immediate and huge impact on your ability to save. Grant provides suggestions and details for living rent-free. Some options include house-sitting, house-hacking (basically being a creative land-lord), and bartering.

With transportation coming in at about 19 percent of expenses, reducing the cost of commuting offers a lot of financial benefits. While some people have to own and operate a vehicle to get to a distant workplace (and family and out-of-town activities), there are lots of ways to reduce the cost of transportation.

Some suggestions:

  • Buy the cheapest car you can. Buying a new car is not a good financial decision. Car payments eat into your ability to save in a huge way.
  • Public transportation can reduce your commuting expenses by thousands of dollars a year and hundreds of thousands over your life in compound interest.
  • Use paid ride-sharing services like Uber and Lyft. In some places, it may be cheaper to use these services than to own and operate your own vehicle.

For food, the suggestions are pretty simple and no-nonsense. Buy your own groceries and cook at home. Until you get to a point where the value of your time exceeds the value of money saved by shopping and cooking your own food, avoid eating out and stop overpaying for convenience.

 

Related: Saving Money: Groceries and Save Money Using Public Transportation

The Full-Time Job and The Side Hustle

Financial Freedom first emphasizes maximizing the income and benefits of your full-time job. Grant encourages building skills, increasing your market value, and negotiating for raises. After you maximize the benefits of your full-time job, it’s time to start some side hustles.

For people new to side hustles and those who want to start and scale a side business, there’s a huge amount of value in these chapters.

Grant offers lots of advice for choosing side hustles that are in-demand and scaleable, and he provides a framework for evaluating which side hustles are best for you. This framework includes asking:

  • what are your passions and skills?
  • what would you like to learn?
  • how much should you charge?
  • should you scale and, if so, when?

He also covers the tax advantages of having your own business and gives details for protecting yourself by using an LLC.

Anyone who wants to build skills and start a side hustle would benefit massively from these sections.

Investing Your Money

A book on financial freedom wouldn’t be complete if it didn’t include how to maximize the returns on your investments. After all, what’s the point of earning money if it isn’t working for you?

Grant breaks down some popular and trusted investment strategies. One thing I like is that he provides common suggestions and how, in some cases, he deviates from the strategy — along with his reason for doing so. I like seeing both solid advice plus reasons why you might not follow the advice exactly.

There’s a lot of advice in these chapters ranging from having short-term and long-term investment strategies to balancing your assets between stocks and bonds.

One of the most important sections is on keeping your investment fees as low as possible.

Grant shows the difference between two investment accounts over time. The first is invested in low-fee index funds which charge 0.04 percent in fees. The second account is an actively managed fund at 1.2 percent with a 1 percent advisor fee for a total of 2.2 percent. Over 25 years, the actively managed account lost 29 percent of the account value due to fees. The index fund lost less than 1 percent.

Financial Freedom is filled with great takeaways and actionable advice like this.

Financial Freedom by Grant Sabatier: Review

Overall, I think Financial Freedom by Grant Sabatier is an excellent book for anyone pursuing financial freedom from any of the seven levels of financial freedom.

If you don’t yet have clarity about your current financial situation and goals, Grant offers plenty of resources and examples for getting started today.

Interested in building your skills and maximizing your income at work or negotiating a raise? Grant covers it.

Want to start a side hustle or turn one into your main business? Grant provides plenty of examples and suggestions from his own experience and the experiences of others.

Want to maximize your investment returns and learn how to reduce the taxes you pay now and after you retire? It’s in the book.

Seriously, whatever you’re looking for, Financial Freedom either covers it in detail or provides enough information to help you start your own research. As of January 2020, if someone asked me for one personal finance book, especially one geared towards entrepreneurs and side hustlers, Financial Freedom is the one book I’d recommend. I’ve already suggested it to family members and friends.

You can pick up a new or used copy of Financial Freedom on Amazon.

Want more book reviews?

  • Ultralearning by Scott Young. Scott provides an actionable guide to master skills quickly so you can earn more and lead a more fulfilling life.
  • The Dip by Seth Godin. Seth teaches you when to keep going, when to quit, and how to quit effectively.

 

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Lyle

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