Have you ever seen someone comment on social media with this: TL;DR?

It stands for “Too Long, Didn’t Read.” I find it hilarious, and love that every chapter of Rachel’s book “Money Honey” starts with a TL;DR summary. Although, that shouldn’t be a concern for readers of her book, because the chapters themselves are short, so it’s already a fun and quick read.

Yeah girl, that wasn’t a typo! This is a personal finance book that is actually fun.

But don’t worry if you’re not “hip to the jive” with all the latest texting shorthand the kids are using nowadays. Rachel includes a page of definitions in the back of her book for the crustier readers, like myself: a (sometimes) wise, old Gen-Xer.

In an effort to avoid making this post a TL;DR itself, I’ll say upfront that: (1) I loved this book, (2) Why I think you probably will too, (3) What I learned from it, and (4) What I’ve already started applying.

Who Does She Think She Is?!

For one, Rachel is, like me, out-and-proud about being a money nerd. In “Money Honey,” she opens with a story of a “nightmare scenario” from childhood when she “had” to spend a day of summer vacation at… brace for it… a waterpark! But luckily, Rachel found a Motley Fool book about investing for teens and had a welcome diversion to help her survive the day.

That anecdote makes me love her even more. She’s pretty much my sister from another mister!

As a former financial planner, Rachel has admittedly spent “preposterous amounts of time” studying whole life insurance and recommends that the vast majority of people stay away from it. That’s my girl!

After deciding to pursue financial independence (FI), she went all-in. Within two years, and at the impressive age of 27, she and her husband were able to take their combined income of just over $100,000/year and find creative ways to purchase 40 rental properties which now generate $10,000/month in passive income for them.

In TL;DR fashion, I’ll give you the short answer to that.

Mrs. Richards kept her living expenses down to a sock away a 50% savings rate, leveraged her real estate license to quickly get the down payment money from each real estate purchase to help them buy the next property quicker, and purchased in her hometown of Louisville, KY where the prices are low and cash flow is high.

Also, she maximized units by renting out rooms of a house dorm-style where each tenant has a bedroom to themselves and share the common living space with the other renters. If you’d like to hear more of the specifics of how she did it, check out her excellent podcast interview on Bigger Pockets.

In short, two years of Hustle and now she’s retired. Game over. Mic drop.

Meeting Rachel in Person

While at FINCON, I was perusing the vendor booths and there she was: Rachel herself, signing copies of her book for conference attendees. I already knew of her but hadn’t read much any of her stuff yet. So, I got my signed copy of her first book and have been following her ever since.

Summary of Her 7-Step Guide

To all the followers of Dave Ramsey and his 7 Baby Steps, hear me out. Girl… it’s time for an upgrade! Rachel lays out the adult version of what to do to before and after getting out of debt. If you want to go beyond the basics, Rachel will help you step your p*ssy up and get with the program, financially speaking.

I’ve spent a few years as a facilitator for Ramsey’s multi-day financial peace university course. Some of his curriculum I still love, like the way he’s able to inspire people to wake up from their credit card addiction and adopt some much-needed behavior modification. His passionate analogy for gazelle intensity to be able to outrun the ravenous cheetahs of the credit card industry who want to keep us in debt… that was my jam!

But after people’s household debt is paid off, I have to say… I think he does a disservice to his audience by referring them to actively managed mutual funds (which are proven to NOT beat the market over time) and commission-based financial planners who pay to be in his referral network.

Check with any reputable source, such as the Frontline documentary I reference on my Resources page. They all say to avoid investing your retirement somewhere with high fees of 1-2% or more. And that is the type of financial planner (a.k.a. whole life insurance salesperson) who Dave is sending people to.

That fact that Dave leaves people high and dry after getting out of debt always bugged me, so I have usually referred people who want to know what to do after Dave’s baby steps to the FIRE bloggers for more advanced content. So, the great thing about Rachel’s 7-Step Guide: she covers the same content for beginners while also going into more advanced content. And all that while, helps people avoid all the pitfalls that will only need to be fixed later. Here’s a quick summary of her more enlightened 7-Step Guide:

1. Know Your Current Story (with a site like Mint)

2. Brainstorm Your Financial Goals

3. Grow Your Golden Number (by earning more and saving more, which Paula Pant has called “Growing the Gap”)

4. Fill Up Bucket #1 (the $1,000 emergency fund)

5. Determine Your Minimum Contribution to Bucket #4 (retirement accounts like a 401k and Roth IRA)

6. Prioritize and Achieve Your Goals (save up money in Buckets #2 and #3 and invest it wisely in cash flowing assets like real estate)

7. Complete an Annual Review (basically, conduct some Financial Hygiene  and course correct as needed)

And those 7 steps of Rachel’s are just one chapter of her book! Here’s a taste of the table of contents so you can see everything else she covers.

Who This Book is For

In an interview on Bigger Pockets, Rachel says she wrote this first book, Money Honey, for female millennials. However, I object, Your Honor!

I really think her style has a much broader appeal. Girl, if you like my sassy writing style, trust me—you’ll love Rachel. She takes the boring and complicated and makes it fun.

I pride myself in someone who’s not a financial planner, but has learned enough about personal finance to break it down in simple terms. Rachel has the same approach, yet she used to be a former financial planner and has all the knowledge of the minutia, but has chosen a different path to serve people en masse. While my blog focuses on Finance 101, Rachel starts at the basics and then goes way beyond for anyone who’s ready to continue learning. But all the while, keeping it fun and light. Below is a sample from Chapter 2 that made me do a literal LOL.

Some of the Things I Learned

Okay, I’ll admit that my bullet list below may seem boring to some people, so feel free to skip this part. But just know that her book has a lot even for the money nerds like myself who THOUGHT they was pretty competent with personal finance.

• • • APY (Annual Percentage Yield). Banks offer different compounding rates, so a bank offering 1% a interest rate compounded monthly is much better than a bank offering 1% interest compounded yearly. To compare apples-to-apples, always compare the APY. How you like them apples?
  • • Student loan consolidation comes in two forms: federal and private. Federal will not lower your interest rate or payment. Private refinancing will. If this is a sitch that appeals to you, she lists a few companies in her book to check out.
  • • An option for building credit is to become an authorized user on someone else’s credit card. This is someone I’ve been considering for my Airbnb cohost (to open a business credit card for the rental property’s purchases), so it’s good to know that it will be helping his credit while also simplifying the bookkeeping of our business expenses.
  • • Exchange Traded Funds (ETFs) are a subset of index funds, which are also passively managed and offer expense ratios even lower than index funds. For those of you paying a commission-based financial planner 1-2% or more of a management fee, I have two words of advice: (1) shame on you, stop that now; and (2) if you moved over to an ETF, your expense ratio could be as low as 0.03%
  • • Market capitalization or “market cap.” It’s used to gauge the size of a company and is calculated by multiplying the stock’s current share price times the total number of shares. If a company’s market cap is less than $2 Billion, it’s a “small cap.” Between $2-10B, it’s “mid cap.” If it’s more than $10B, it’s “large cap.”
  • • Global Funds do not equal International Funds. Mind blown! A global fund pulls stocks and bonds from around the world, including the country where you live. International, however, are based in countries outside of where you live.
  • • Outside of the stock market, Rachel has only invested in real estate. I’ve also been gunshy about alternative investments like cryptocurrencies and commodities, so to hear that a money-savvy boss b*tch like Rachel avoids them as well was reassuring that my style of calculated risks is on track.
  • • Vanguard waives commissions when you buy and sell mutual funds and ETFs from a Vanguard account. I’ve already been a devoted user of Vanguard, so this gave me one more reason to stay the course with them.
  • • She’s only ever used “Market Order” when purchasing stocks and mutual funds and recommends the same for new investors. I’m in the same boat, so this was good to hear.
  • • It’s worth hiring a CPA to do your taxes when you get into estates, owning a corporation, real estate investing, etc. Because of her real estate investing, Rachel always uses a CPA. I’ve also always used one since owning rental property, so this was reassuring that I shouldn’t be saving money by switching to TurboTax.
  • • If you’d like to develop some Ramsey-style “gazelle intensity” to dig yourself out of debt or just lower your monthly expenses for 12 months or so, she has an excellent template for an email you can send to friends and family to garner their support.

What I’ve Applied So Far

I already had my Bucket #1 (emergency fund) set. And my Bucket #4 (retirement savings) has long been maxed out, so that’s good-to-go also.

Rachel’s book got me thinking more about my Bucket #2 (high-yield savings with a lower interest rate that I plan to access within a year) and Bucket #3 (money for big purchases like real estate that I won’t need to access for over a year). I’m already using Acorns as an easy-to-access account for my Bucket #3 using dollar round-ups with every purchase, and I also like to add an extra $10/day to it.

If you haven’t tried Acorns yet, below is an affiliate link where we both get a hookup.

For my Bucket #2, I googled the current interest rates on high yield savings accounts. But currently, those “high yields” are only 0.40% or less, so it doesn’t seem to me to be worth the trouble to use any of them just yet. However, I am going to follow her advice and be sure I keep 3-6 months of living expenses (which would normally go into Bucket #2) available as a backup to the $1,000 emergency fund in my Bucket #1 (of my checking account).

Rachel says that you only need life insurance if you have people who are dependent on you financially. I’ve been paying for term life insurance for the last 10 years in the event that I get married and would like to name that person as a beneficiary. (See, I wanted to lock it in while I was young and healthy and would have a lower premium.)

However, as I approach my FI (financial independence) and continue hitting new highs for my net worth, I’m looking at the prospect of cancelling my policy soon since I am essentially self-insured with my total estate for any possible future dependents who I might have down the road.

Conclusion

Let’s say you’ve taken my advice and gotten Rachel’s book and, as a result, taken HER advice. Let’s say you now have your financial $hit together. What next?

Luckily, she has a follow-up book about passive income through real estate called “Passive Income, Aggressive Retirement.” I try to avoid buying too many books at once because I don’t want them to sit on a shelf collecting dust, so I’m glad I waited and read Honey Money first. That helped fill in some my knowledge gaps. Now, I feel ready to read her follow-up.

As I move forward, I will continue saving money in Bucket #3 via Acorns and I may start buying shares of Vanguard ETFs as well with any money I have saved beyond my 3-6 months of living expenses for Bucket #2. My plan for the next few years: continue building on my knowledge base so I can have all my ducks in a row and be ready to strike when I have enough money saved up for my next investment property or other form of passive income. And for me, that preparation will include reading Rachel’s follow-up book.

That’s it! If you made it this far, props to you!

And props to me, because it means by some great miracle, my post wasn’t TL;DR.   🙂