David Bach is a personal finance author who's written nine New York Times bestsellers and has more than 7 million books in print. His latest personal finance book, "The Latte Factor," is different than his previous work: It's told as a fictional parable, starring a millennial who struggles with money and the sage old man whose advice saves her. We talked to Bach about what inspired him to write this story.
This interview has been condensed and edited.
Why write the book as a narrative?
I can answer that very easily. 98% of people in the world will never read a book on personal finance. I've written 12 books. I know I have just not reached a lot of people. And there's a whole lot of people who need the information.
I've been personally profoundly impacted by story-based books. Books like "Who Moved My Cheese." It was read by all walks of life and taught a major business lesson that most people wouldn't have learned if they hadn't read through a story.
I turned to my publisher and I said I want to write this book called "The Latte Factor." I want to do a parable like "Who Moved My Cheese" and I want to make it 100 pages so anybody can get through it in an hour and it can be translated all over the world and my publisher's like, "No. You're not going to write that book. You've got a great system. You've got a great formula. Don't change it."
Every time I got done with a book I would go back to the publishing guys, "I want to do the Latte Factor." And I'd always get, "Oh, anything but your Latte Factor book." After 12 books I basically had to wait for a period of time to be free from my contract. And then I said, "I'm just going to write the book that I want. I'm going to work on this book until I think it's perfect."
The character's name is Zoey Daniels, she's 27 years old, she's your classic millennial, she's living paycheck to paycheck and she's going to come to the Oculus. Inside the Oculus she's going to see on this LCD screen: "If you don't know where you're going you might not like where you end up."
It's going to stick in her mind. She's going to stop at the 9/11 Memorial. She's going to sit on this bench. She walks by the 9/11 Memorial for six years and not looked at it, not really looked at it, not really taken it in because she's rushing to work like everybody else is rushing to work. Today she sits on the bench. She stares at the 9/11 Memorial. She sees people mourning and she stops and she asks the question, what is she doing with her life? It is her first moment where she starts to wake up to the fact that she's not happy, that her life's not working and that she's losing hope.
My mission with this book was to go out and reach young people. Specifically millennials and the generation below them. I figure this is the last financial book that I will ever do. I just felt like I'm going to write the book that my sole desire is to write in an effort to inspire the generation below me to learn these basic financial lessons that can change their lives.
Did anyone inspire Henry, the barista who imparts many of the book's lessons?
Yes. My grandmother, my Grandma Rose, who is my financial mentor who inspired me to start investing at the age of 7 and buy my first stock.
She started with nothing and became a self-made millionaire. I talk about my grandmother in a lot my book. She was the woman that "Smart Women Finish First," my first book, was dedicated to.
She's really the reason I wrote that first book. She was the one who taught me about money. So [Henry's] a combination of my grandmother and then quite a few of my clients, from being in financial services.
I've met so many of these people over my lifetime. You can't judge a book by its cover. Zoey is in this coffee shop thinking Henry is just a barista and later finds out maybe there's a lot more to Henry than she realized.
I don't want to give the whole story away but this is somebody who starts to teach her these incredible life lessons. When people are older they have life lessons because they have the wisdom of being older. They've gone through life.
He's able to not just share financial wisdom, but he shares life lessons. And then he introduces her to other people that share life lessons. I'm trying to create these characters that would bring to life that it's not about the money, it's actually about living rich.
There's three secrets to financial freedom, but they go way beyond money. The underlying theme of this book is to live rich now. You don't need to be rich to live rich. I think that's a message that's already resonating with people.
Can you explain the 'Three Secrets to Financial Freedom?'
Zoey's become financially selfish. And she's taught the single most important thing she can do in her life financially is pay herself first. What is instead of focusing on the percentage you need to focus on one hour a day of your income.
The real aha moment she's taught is this idea that if you go to work at 9, you should work from 9 to 10 for yourself. You should be financially selfish. You need to pay yourself first that first hour a day of your income and if you do that, you can have financial security for life. That is such a simple idea but it's so profound that I think it really wakes people up. Why would you work 90,000 hours of your life and not keep the first hour a day of your income?
It's a different way to think about money, to think about your life. That's really lesson number one and Henry hammers it home. It's the single most important lesson financially that you can ever get. You have to pay yourself first automatically, minimum one hour a day of your income, and it needs to go in a retirement account.
She learns the second lesson, which is you're not going to be able to do this by budgeting. Everybody tells you to budget. Budgets don't work. People hate them. They don't stick to them.
What works is making it automatic. These were lessons that were taught in "The Automatic Millionaire" book too. Because these lessons are timeless. They really create millionaires.
The third lesson is she's taught is you really need to think about the life you want today, not just 30, 40 years from now. What's most important to you now? What are your values? What do you care about? What would it look like for you to live a rich life now? What would it look like for you to live your dreams in two or three years? What are your dreams? She goes on this spiritual journey of thinking about that, really thinking about it.
Where does this fit with the other books you've written?
I've always told people up until now that the first book you should read is "The Automatic Millionaire." Now this is going to be the book I'm going to tell everybody to start with. Because it's a story. Because there's a better chance of them reading this book and really utilizing it.
Then when someone says I want to learn a lot more detail, then go to "The Automatic Millionaire." Then if you're a woman, go get "Smart Women Finish Rich." If you're a couple, go get "Smart Couples Finish Rich." If you're starting late, go get "Start Late Finish Rich."
Why should we listen to you?
I'm actually really good at what I do. I've been able to help millions of people all over the world. The proof is basically, as they say, in the pudding.
With 7 million books out, having had well over a million people go through my programs, the results are out there. I've been doing this for 26 years and there's just thousands and thousands and thousands of people who have posted online the fact that this stuff has changed their life. Just go on Amazon.
You can read people who don't just post reviews of the book, they'll post how 15 years ago they were broke, and now they're a millionaire. They'll post how five years ago they were in debt and now all their debt's paid off.
Nothing I teach is about getting rich quick. So you shouldn't read my books if you're looking to get rich quick. I teach you how to build wealth over your lifetime.
It takes often years and more often decades to really change your life financially. But now that I've been doing it for 26 years I have these success stories that are two decades in the making. I've really been fortunate to help a whole lot of people.
At the end of the day people help themselves, but I've been able to give people tools to go help themselves. I've got the track record. The results are there.
This book costs $14. You can buy a 2017 Malbec from Drink Dispatch for the same price. Why should we buy your book when we can have wine?
The book could change your life and someday maybe even help you afford to buy a vineyard in Argentina in Mendoza where Malbec is made. It could just help you afford to go on a trip to Mendoza and drink the Malbec. Because I've been to Mendoza and I've been Malbec tasting and that is a phenomenal time.
"The Latte Factor" is available wherever books are sold.
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Image: Phillip Blackowl