A Systems Approach to Lifestyle Design: Early Retirement Extreme by Jacob Lund Fisker (Book Summary)

About the Early Retirement Extreme book

“This book isn’t a ‘how-to’ manual to a specific lifestyle, but a ‘how-to’ manual for ‘how-to’ manuals. The intention is for each person to create his own strategy. In this sense, this book isn’t a travel journal, nor is it a set of map directions; it’s a book that teaches you to become a navigator. I used the principles in this book to reduce my expenses to a quarter of the average person and become financially independent in five years.”

• “This isn’t a book for beginners. It’s not a book one can pick up, read, and proceed to become financially independent just as reading a textbook about physics won’t turn a person into a physicist. This only happens when the concepts are constantly applied and one starts ‘thinking like a physicist.’ Things are similar for a person pursuing financial independence.”
• “I think of this book first and foremost as a philosophy book about strategy. Like most philosophical books, it’s voluminous compared to its content because much of it is dedicated to (re)defining underlying concepts and fundamentals, trying to find the words to describe something that isn’t automatically implied by the usual understanding of the words used. The lack of concrete specifics is intentional because they won’t pertain to very many people. The approach is deliberately open-ended to make the concepts applicable to as many different situations as possible.”
• “You must be willing to change your frame of mind and conquer old habits. In particular, you must be willing to do things that 95% of the population won’t be able to understand and 99% won’t be willing to do. This means that you must be exceedingly confident that you’re doing the right thing, which is why 90% of this book is dedicated to the development of a coherent philosophy.”

A Different Frame of Mind Needed to Break Free

“To successfully break free of one’s chains, one must build an overarching philosophy of what it means to live, which is different from the consumer philosophy of ‘follow advice/orders; work; get paycheck; spend paycheck; get stuff; repeat.'”

• “Changing your frame of mind is key to escaping, but change is a challenge. This challenge can become a struggle if your frame of mind is incompatible with your adopted lifestyle. In other words, you need to believe in your lifestyle as an end rather than as a means to an end.”
• “Intuitively speaking, if either dissatisfaction, vision, or practical first steps are lacking, it’s unlikely that action will be taken. Specifically: If dissatisfaction is low, obviously no change is going to happen. Why change strategy if you’re satisfied with the way things are? If vision is low, this can lead to a situation of comfortable misery where the vision isn’t strong enough or too scary to allow change. A high level of dissatisfaction can be accompanied by low vision in cases of depression, loss of faith or vision, or by external circumstances. For example, the mistake many make when becoming frugal is that they don’t replace their previous vision of accumulating more stuff with an equally strong vision of doing something else. Giving up the current vision thus results in feelings of deprivation, and is, in a sense, a loss of faith and even identity.”
• “I offer a philosophy modeled on the Renaissance ideal of the 17th century and the craftsmen of the 18th century who wrote the Constitution of the United States at the peak of the Age of Enlightenment. This is a framework of complexity where a person is skilled in more than just one area. It is, in a way, a contrarian approach to the contemporary idea of ‘one man-one specialization.’ It’s an interlocking way of arranging one’s life. In risk management parlance, one wants to transfer from a tightly coupled linear system of financed consumerism to a loosely coupled, complex system of the financially independent Renaissance man.“
• “What I’ll describe here is another kind of life, the life of an independently wealthy and widely skilled person—a modern Renaissance man.”

Why we Must Start with Strategy (vs Tactics)

“It’s important to understand that doing the right thing (good strategy) is much more important than doing things right (good tactics). This is why this book is short on tactics and long on strategies. Strategy is about defining the end-goals. Tactics is about the means to those ends.”

• “Few consciously think about complex strategies in daily living. On a daily basis, a functional strategy is invisible. Rarely do we step back and re-examine our strategy (lifestyle design). Most of the time we simply adopt the tactics that are handed down through the system without a second thought.”
• “To increase effectiveness, the focus must be on improving on the strategy rather than improving on the tactics. Rather than using better tactics to reach goals, the goal-setting method must become better.”
• “An important part of the systems thinking approach is to continuously increase the number of different problems that the strategy aims to solve or the number of different goals that the strategy intends to meet.”
• “A good strategy solves multiple problems at the same time!“
• “For progress, it’s essential to base goals on a consistent strategy that guides individual tactics.”