Hope To Prosper – Best of the Best Blogger Series

Hope To Prosper - Best of The Best Blogger SeriesIn the 21st edition of our Best of the Best Blogger series, we spoke with Bret Frohlich of Hope To Prosper.

Bret is truly the poster child for the American Dream. He’s what I refer to as a “throwback” American with a very simple (not necessarily easy) formula for success. He has been saving and investing his entire adult life and his success has been rooted in, well, simply keeping things simple.

As lifelong savers and investors themselves, Bret’s parents provided the crucial imprint for his financial philosophy, which can be summed up neatly in the following 3 tenets:

  • Put an honest day of work in every day
  • Spend less than you earn
  • Invest a portion of what you save

Now, things haven’t all been financial rainbows and roller skates for Bret. He’s looked into that deep, dark, financial abyss, just as many of us have, overwhelmed by massive revolving debt, stuck in low-paying jobs with anxious spouses watching and wondering.

Despite the difficulties that Bret faced along the way, he had faith, he kept things simple and he stuck with the things he learned from his parents. Today, Bret owns a home near the ocean in one of the most desirable places to live in Southern California with a great job, manageable expenses and a few bucks in the bank for retirement.

We sat down with Bret recently to talk about saving, investing and figuring out how to raise a family in a Southern California beach community on a single income.

Q: What was your inspiration behind HopeToProsper.com? Be specific.

Bret Frohlich
Bret Frohlich
A: Originally, I started blogging under my name BretFrohlich.com, because most of the domain names I wanted were taken by squatters. Two years ago, I was thinking about the ultimate goal for my life and I realized all I really wanted was to prosper. I didn’t want a mansion, luxury cars or other fancy things; I just wanted a happy and secure life. My dream lifestyle is to work from home a couple days a week, have a couple million put away and my house at the beach paid off. Right after I came up with this ultimate goal, I looked up HopeToProsper.com and it was available. So, I registered it and forwarded my old domain.

My inspiration for starting a blog was to try to help people get started investing. Even though the savings rate has risen from -1% when I started my blog to around 5% now, most of the people I know aren’t saving anything for their future. I have been saving and investing since I was 21 years old, so I have a lot of practical knowledge and experience to share. Most important, I just wanted to encourage people to get started. It’s not that difficult, but a lot of people are scared or confused.

Q: You’ve described how your parents, including your “two Dads”, have had such a huge impact on your life. With two grown children of your own, how often do you find yourself sounding like your own father(s) when talking to your kids about money?

A: I constantly tell my kids they need to save and invest their money. So far, I haven’t been nearly as successful at convincing them as my parents were with me. To be honest, I was almost 22 when I started to get it together financially and my son is 22 right now. So, I am hopeful he will start to pull ahead and manage his money better. My daughter is barely 18 and she’s a pretty good saver, once she decides she wants something.

I have a saying about talking to kids (and young adults), “It’s kind of like pouring water on a rock; it takes a while for it to sink in.” My kids can look forward to many years of me repeating this message, until I can see that they get it. The financial future is more tenuous for young people than I can remember. It is more important than ever for them to make wise choices.

Q: Of all the advice you’ve received, what’s the most impactful personal finance advice that your parents have given you?

Bret and his Dad, George

A: Both of my parents (and my Step-Dad) have given me an enormous amount of helpful advice, but it was the example they set that had the biggest impact on me. When you are young all you really hear your parent say is blah, blah, blah. But, when you see them make smart financial moves, it’s the example that grabs your attention and makes you want to emulate their success.

Here are some of the things I watched my parents do:

  • My Dad invested a high percentage of his income in mutual funds so he could retire 10 years early.
  • My Mom and Step-Dad accumulated 3 paid off houses to help fund their retirement comfortably.
  • My Mom went to night school while raising us, got a business degree and started her own business, which she sold at retirement.
  • My Mom and Step-Dad started mutual funds and gave savings bonds to each of their 20+ grand kids, to encourage them to save and invest.

It’s pretty hard for me to slack off with examples like that. Most people aren’t nearly as lucky in receiving good financial advice from their parents. This is a big reason I wanted to become a resource and help people.

Q: You’ve talked about the book “The Richest Man In Babylon” and its influence on you. Why is such simple wealth-building advice like “spend less than you earn” so difficult for Americans to grasp?

A: The Richest Man in Babylon is an awesome book. It was the spark that lit the candle for me. I remember being very broke when I was 19 and not being able to figure out why. I had moved to a wealthy area and it seemed like everybody had money but me. The opening scene in the book has Bansir the chariot builder sitting on his wall wondering why he is poor, while living in the wealthiest city in the ancient world. This was my exact situation and I immediately identified with the characters in the book. It had a huge impact on me.

As for the age-old question of why people spend more than they earn, that’s easy to answer. There is an enormous amount of time, money and brain power spent to separate people from their money. Things that were wants a couple of years ago are now perceived as needs, thanks to advertising. From the TV commercials for expensive consumer items to rules for how much you should spend on diamond rings, the advertisers are winning and consumers are losing. I just read debt is now among the most aggressively marketed products in history.

This has led many Americans to have expectations that vastly exceed their incomes. Working-class folks expect to have a big house, two new vehicles, flat-screen TVs, dinners out and nice vacations. Their kids expect cars, laptops, cell phones, a college education and a dream wedding. Managing these expectations realistically is the difference between living in debt and saving for your future. People need to regain control of their finances and ignore those who benefit from their spending.

Q: You’ve been saving and investing for 25 years. With all of the financial demands that come with living in Southern California, how has raising a family on a single income in Southern California impacted your saving and investing philosophy?

A: For 22 of those 25 years, my family has been the driving force for how I have managed our finances. I wanted to provide a safe, stable environment for my family, but I didn’t have a lot of money to do it. I wanted to continue living in San Clemente but qualifying for a house at the beach on one small income was tough. Saving and investing has really been the key to everything. I was able to save up a big enough down-payment to afford a nice house. I was able to save up college funds for my kids. I had enough money saved to avoid financial problems from a six-month layoff. And, we will likely have a comfortable retirement.

No matter where you live, how much you make or how many kids you have, there is no practical substitute for saving and investing. Even in the most challenging financial times I saved money and I was very glad I did. Now that I make a lot more and our expenses are low, I save even more. It’s also very important to avoid payments. They are a killer when your income stops.

Q: You’re an IT manager by trade. How does an IT guy become a personal finance blogger?

A: I have always had a strong interest in computers and investing. I have a high aptitude for math and numbers come naturally to me. I was drawn in initially because they are both like a mystery or a puzzle that needs to be solved. No matter how much you know about either subject, there is always more to learn.

I’d like to thank Bret again for taking the time and sharing his experiences with us. There’s remarkable wisdom in “sticking to your knitting” and keeping things simple and Bret’s story is proof of just that.

Thanks again for sharing your story with us Bret.