This is one of a series of interviews by Bloomberg Opinion columnists on how to solve the world’s most pressing policy challenges. It has been edited for length and clarity.
Alexis Leondis: You’re an illustrator, musician and founder of a financial firm, The Hell Yeah Group, that helps creative people with their personal and business finances. Earlier in your career, you worked at a major bank as a collections agent, and also at a more traditional financial planning firm. In your new book Finance for the People: Getting a Grip on Your Finances, you take those experiences being “inside” to help those who have felt ignored or underserved when it comes to money management. What’s the most important message for those readers?
Paco de Leon, founder, The Hell Yeah Group and author, Finance for the People: This world is for them. And I am a testament to that. I’ve been on the inside and I’ve still felt like I was on the outside. The reason why was because I didn’t feel like there was somebody there to usher me in and welcome me in. And I’m going to be that person for everyone who wants to go along for the ride.
If I had to boil it down to one theme, it’s not to fear your finances and not to be afraid to speak up and talk about it. There’s this cultural [idea] that it’s inappropriate to talk about money. It’s frowned upon in some workplaces to talk about your salary with your employees, which to me is so gnarly—because you’re literally at work to earn the money! And so, you’re walking around not saying the thing that you’re there for. This book and all the work I do is really about opening up a larger conversation about money. Because I believe once we’re more comfortable talking about money, people are going to start facing their finances.
AL: How do you think your approach to personal finance is different from other books that focus on the topic?
PDL: The book has something like 50 to 75 original illustrations that I drew. The point of those illustrations is to reach people who might look at a book about money and see blocks of text and feel intimidated. Sometimes looking at a picture of a cookie or a stack of pancakes helps you understand something that felt foreign. Things like worth and value are abstract; illustrations make them concrete.
Also, it’s a pretty judgment-free zone for people looking at their spending plan, or thinking about their past financial “mistakes.” Judgment has been such a pillar in the personal finance industry—it’s the attitude of like, “Just stop buying those lattes.”
AL: How should we view the personal finance “rules of thumb” that have been quoted for years: don’t spend more than 30% of your income on housing; withdraw 4% in retirement (now 3%), etc. Are they still valid today or do we need to just forget them entirely?
PDL: They’re great starting points. There are certain pieces of wisdom in the personal financial world that will always be true. For example, one ought to always spend less than they earn. It does get challenging, though, particularly when you’re graduating college and entering the workforce. That’s when personal finance gets personal. I think it’s great to understand the mentality behind the rules and the reasoning behind them. Then we can manipulate those rules and make our own choices.
AL: So much of our financial world seems to be contingent on working for an employer, from getting a mortgage to health insurance. Access isn't as easy when you’re self-employed. As more and more people start working for themselves, what do they need to know?
PDL: When you’re getting into the less traditional path, you have to really lock in and understand all the mechanics behind your personal finances. If you focus on getting your personal finances in line, that can only help with how you’re running your freelance practice, how you set your price, how you're managing your invoicing, how you're negotiating clients. All of that is overlapped and interconnected.