Today we talk to the one and only Barney, aka The Escape Artist! We discuss Barney’s personal FI journey, the best way to manage your investments and how a European can reach FI in the UK.
What we talk about:
- Barney’s personal FI journey and strategy
- How to keep your investing simple
- How to set up your portfolio against FX risks
- How a European arriving in the UK should take advantage of the UK banking system
Who is Barney TEA?
Barney is pretty well known in the personal finance community for retiring at the age of 40, and his pretty cool blog The Escape Artist.
Barney was born and bred in a tiny place in the countryside called Cambridgeshire, England. As he grew up, his parents borrowed quite a lot of money that caused them to get into a few difficulties. So at a young age, he had the idea of how important it was to be out of debt. He went on to study Economics and then got the highest paying job he could find: Accounting. He spent 20 years working in corporate finance, and was automatically saving over 50% of his salary. It wasn’t until 2013 that he stumbled on the world of FI, and realised he had enough when he retired in 2014.
What does he do now?
So of course, Mathias chimes in with the great question: ‘So what are you doing all day?’
He tells us that his blog takes a big chunk of his time, as he likes them well-written and funny (go see for yourself!). He also does some coaching and loves organising regular FI London meetups (they’re really great). He also has 3 children and is very serious about weight training.
But really, what Barney is saying is that he does what he wants. And that is what is so great about being FI – he’s always finding something interesting to do that brings value to his life.
How he invests
His FI strategy was nice and simple: save and invest 50% of his salary every single month. All his bonuses would be stashed away as well.
As an accountant, he knew how to analyse companies which meant his investing strategy was stock-picking – index funds weren’t really a thing yet. He is now in his wealth preservation phase and focuses on living off what he currently has.
- Day trading is for losers – you’re literally paying money to the financial services industry
- Stick your money into a Vanguard index fund tracker
- Diversify around the globe – Brexit!!
- Do not time the market
- Keep it simple – one hour you spend trying new investment strategies is one hour you’re not spending on increasing your income or tracking your expenses
- Your scarcest resources are time and headspace – be disciplined as to how you allocate your time
A European/anyone goes to work in the UK
What we were most interested in was understanding whether a European should consider moving to the UK to work and how they should take advantage of the investment opportunities in the UK.
The best career advice Barney ever got was that he could take 2 broad career approaches in life:
- Get the highest paying job and save as much as you can
- Do a job that pays less, but that you feel drawn to by a sense of mission and purpose
Can you do both at the same time? – personally, I think so. And I write about this here: Getting to FI in university (#promo)
He then gave us some excellent actionable steps to how a European should take advantage of the UK banking system:
- Know what’s happening with your workplace pension; if they offer a matching deal, get your percentage in
- Know what fund the pension is going into
- Know about the tax breaks
- Take advantage of the ISAs, where you get to put up to £20,000/year in tax free
- Pay Yourself First
- Set it and forget it
- Focus on increasing your income
We also touch on what kind of job should you get:
When Barney was graduating, the financial services industry was booming, so he decided to become an accountant. However, now things have changed, and people are predicting that these jobs will disappear with robots. So Barney says that if you want the highest paying job, you want to be getting into tech.
Nowadays having a job in tech means having more flexibility – it’s easier to work as a contractor or freelancer. And it can give you a lot of interesting opportunities and possibilities for the future.
A very interesting topic. In fact so interesting that we continued recording and talked more about the tech scene and how you can get into it. This does not appear on our recorded episode, however we will be releasing it in the next newsletter (this Thursday), so if you’re interested please feel free to join 😉
Some really great advice and tips here from Barney, and we soaked it all up. The UK has some amazing opportunities to invest and grow wealth, so we were very interested in hearing what Barney had to say. If you want to learn even more, we invite you to listen to the episode and sign up to our newsletter!