Don’t Listen to Us // Blogs Don’t Tell the Full FI Story

I feel super lucky to have met a ton of financial independence bloggers in the time I’ve been writing Our Next Life, and I’ve learned so much from them. Not a meetup has gone by when I haven’t come away with some nugget of wisdom about finances or blogging, often both. And at FinCon? My brain practically exploded.

But over time, something else has occurred to me: Many bloggers who have reached financial independence — essentially all the “big” FI blogs — earn money off of their blogs. Sometimes serious money.

And that’s awesome! It’s great to see people rewarded for their work and for the ideas they contribute to our collective community.

But it also probably means that almost no one whose blog you look to as an authority is actually putting the 4 percent rule or their own specific early retirement income plan to the test. 

And that’s a problem if we’re all singing the praises of early retirement, trumpeting how easy it is to achieve, highlighting how smoothly it is going for us and leaving it at that. Never looking at the potential pitfalls or risks because that blogging income insulates us from them.

I have no doubt that everyone has saved as much as they say they’ve saved, and that they would still be FI even if their blogs went away tomorrow. But when bloggers are treated as authorities on these things, and we aren’t actually practicing what we preach, we’re putting a skewed story out there.

Readers deserve to know that.

Mr. Money Mustache has been tepidly open about how much he now earns from his blog, product referrals and other public appearances, and I’m not even talking about his level of earnings. (Though rock on, Pete. Good for you!)

Most of us who reach financial independence at a young age do so by keeping our lifestyles in check and controlling our expenses, so we have plenty of practice at that by the time we reach early retirement. It doesn’t take much new income to cover a big chunk of annual expenses in early retirement, reducing or eliminating what you’d otherwise have taken out of your portfolio.

While blogging is certainly not easy money, if you go into retirement with several years of blogging behind you, and a sizeable audience built up, it’s not hard to earn enough to massively offset expenses, even without putting ad network junk on your site.

Take affiliate links, for example. This post on Principles of Increase has a thorough rundown of all the companies that regularly solicit blogger referrals and what they offer in return. The reason you see so many referral links to Personal Capital is that they give bloggers $100 for every person who signs up for investing through that referral link. (And also, plenty of people love PC and would recommend it even without the referral bonus, though I’m less of a fan.)

This isn’t necessarily a bad thing, because it doesn’t cost the person who signs up anything, but it’s worth knowing that there’s a payment attached, so you know when you click the link that you’re willingly putting yourself on Personal Capital’s hard sell list. (They have to make that $100 back somehow, right? They don’t exist solely to underwrite bloggers. I would probably put their affiliate link up if they did!)

If you’re a blogger who has built up a big enough audience that you can get, say, 400 of your readers to click a Personal Capital link and then sign up for investing every year? Well now you’ve just made $40,000, which is in the ballpark of what a lot of FI folks aim to live on each year in retirement. Now you can leave those shares at Vanguard alone, and maybe even reinvest the dividends you had planned to use as cashflow.

That’s great for the blogger, but not always great for the readers.

The Paradox of the Successful Blogger

I get the challenge that’s embedded in all of this. As your audience grows, more and more people want you to put their stuff on your site, and most people like earning a little more money with no more work. (I am fully aware that I am the freakish outlier on this. And that could change if a product that I truly love with no reservations came on the market. But I have yet to find said product, despite the escalating offers thrown our way.)

And I think we’d all agree that there’s absolutely nothing wrong with earning money from something you spend hours on each week and invest a lot of yourself in. Something you nurture and grow, do research for and pay for in the form of hosting fees, designers, etc. If anything, I think the best bloggers deserve to earn more from their blogs, given how much they contribute to the community.

The tough thing is that once you do become monetarily successful, especially if you’re in the post-career stage of life, you’ve essentially violated your founding principle, which was almost certainly some variation of “You can do this because I’m doing it. Follow along and do as I do.” 

Because not everyone can have a widely read blog. And not everyone can be fully retired and still earn enough to cover all of their living expenses.

(Also consider: for those who earn significant blogging income in the first few years of retirement, they eliminate a lot of sequence of returns risk, because they can just let their investments grow. Meaning their chance of later problems down the road goes down that much more.)

What Do We Do About This?

I’m sure there will be folks who read this and see what I’m saying as fightin’ words. And that’s not my intention. Let me be clear:

I applaud bloggers who successfully monetize their blogs, and think they should be proud of that result. They deserve every penny. 

The problem isn’t that money is changing hands, it’s how we talk about it (or don’t talk about it). And it’s how we all as readers interpret what we’re reading. So to that end, I have two modest proposals:

For bloggers:

We owe it to our readers to disclose when we’re no longer sticking to our original retirement plan, whether that’s reducing what we’re withdrawing or increasing our spending. If we don’t, we misrepresent the prevalence of risks in early retirement that folks who don’t have a successful blog face, because we are in some ways insulated from those risks. And we owe it to our readers to find stories different from our own and share those, including the warts and struggles and all.

For readers:

We can be big fans of someone and still bring a healthy dose of skepticism to our reading, and that’s what we should all be doing. It’s not to discredit what anyone says, but simply to remind ourselves that those ideas come from a certain privileged position, and they may not apply to everyone.

What I commit to you:

First, I will disclose if we ever monetize this blog. We do have plans in motion to use this blog as an introduction to us that will feed other work we’ll do outside of the blog, but we won’t put ads, affiliate links or any other monetization method here without telling you first.

Second, we don’t share our numbers, and that won’t change in retirement, but we have shared the concepts that underpin our entire retirement strategy. If we earn income that takes the pressure off of that strategy, we’ll share that here.

Third, I will try harder to share stories from folks who have struggled in early retirement and how they overcame their challenges, whether they were financial or related to the massive life adjustment that comes from completely redefining yourself and your patterns. (If you want to share your story, please email me at ournextlifeblog [at] gmail dot com. Happy to keep stories anonymous if you prefer. You know I can respect anonymity!) ;-) There are certainly some great lessons to be learned from how people overcome challenges, and we’ll all be better off if we hear about them.

Just as I believe that acknowledging your privilege doesn’t diminish your accomplishments or how hard you’ve worked, I feel strongly that acknowledging when you’re able to take pressure off your FI plan in no way detracts from what you’ve achieved.

It simply tells your readers the full story, and lets them head into FIRE that much better informed.

What Do You Think?

What do you wish more bloggers would discuss or disclose? For the bloggers out there, what do you share, and what would you feel hesitant to share about your finances? Who’s with me on being clearer about when and how we diverge from the financial plans we’ve put out there? For the non-bloggers, do you automatically assume that folks are making blog income and not relying entirely on their passive income? So much to discuss! Let’s dig into it all in the comments.