If you are a consumer of Financial Independence content on a regular basis then you can’t ignore that there has been a MASSIVE uptick in the people who have really struggled 2-5 years into their retirement.
It makes sense though, depending on how you measure the growth of this movement, there is no denying that it has grown to a scale no one imagined. It’s also been around long enough that there is a sizable population that has been early retired for some large chunks of their lives. Nearly all of the earliest FI bloggers have been retired for years and many of them decades. Some of them are starting to admit online that they got slapped in the face that “money doesn’t buy happiness” still applies if you live frugally. People need a purpose.
I follow plenty of the bloggers who have been varying levels of happy and content with their choices, but the takeaway that I heard “was that burning your life energy away to reach that FIRE finish line at all costs is a miserable decision and might even be worse than the “normal” folk who work until 63”. I also took away that nearly everyone who seemed happiest among the FIRE Giants out there is that they all had some form of meaningful pastime that they pursued very purposefully.
The fear of the post FI regret was all too real for me and in searching for guidance on that issue I found the Die With Zero book I wrote about. Elements of that book are exactly what I needed to guide my decisions with less than 5 years to go until our FIRE date.
Invest in hobbies and interests I’ve always been interested in. I’ve done a lot of thinking about what would produce the most happiness in our family compared to actual dollar costs. Here is the current list to achieve:
Spend as many clear nights as possible looking at the stars, when covid ends, reach out to astronomy groups, clubs and observatory in walking distance, consider volunteering there. I’ve spent too many years wanting to study astronomy and it’s so silly I never have. That stops; it’s time to live more intentionally.
Invest in my health to ensure I never am the slow leg when taking our family on adventures.
Show our children as much of the US as possible, every national park at the very least, and hopefully for months or years at a time. Anything is on the table to achieve this.
Increase our knowledge of homesteading, including doubling our growing capacity in the next two seasons.
Some of these are personal and others are shared goals of our entire family. I expect that when we reach FI/RE and are truly comfortable while being able to achieve these goals that we will be giving our children a better childhood than anyone I’ve ever met experienced.
In the end, all of these goals point back to the only goal that really matters. To make sure we give our children the best life we possibly can.
Budgets are the worst lie being told by the personal finance industry. People like Dave Ramsey are happy to sell you a shitload of useless products to budget more effectively. All you have to do is pay him some money for those products and he promises he will save you even MORE money back!
If you’re brand new to the concept of how money works then sure, budgeting is a great form of training wheels. Once you have a basic understanding of saving, investing and Money 101 then budgeting is a colossal waste of time and resources. How is budgeting still a thing that is being sold to people in the FI/RE community?
Over the years I have tried every budgeting approach you can think of. I kept trying different approaches and then always giving up or failing. The reason I kept going back was I would fail then end up reading some blogger or article about how budgeting is the number one key to financial success! Turns out, that’s all bullshit.
When you look at ways to simplify your life you’ll want to look put the magnifying glass on every way you spend time each day. After multiple failed attempts at budgeting I was trying again. Putting each item I had bought in a spreadsheet to figure out how much I spent, trying to figure out how to categorize some random purchase and I realized this is a colossal waste of time. Don’t believe me? These are Dave Ramsey’s top 10 signs you need to spend MORE TIME on your budget.
1. You’re constantly worrying about money emergencies. 2. You use the same exact budget each month. 3. You aren’t tracking purchases. 4. You don’t have a budget line for giving. 5. You overspend in one category. A lot. 6. You forget annual expenses. 7. You need space for a new budget line item. 8. You aren’t budgeting to zero. 9. You just hit a Baby Step milestone. 10. Your budget doesn’t line up with your money goals. 11? You Need to Refresh Your Budget by Season
How many hours a month am I supposed to dedicate to this bullshit? I have to spend every single dollar before the month begins……why?
Here is what I do now and I have done for the last several years. It takes almost no tracking, no line items, no seasonal budget adjustments and it maximizes our savings.
FireDad’s budget approach:
Automate all your savings and investments
Spend less that what’s left in your account
Don’t waste money on stupid shit
There you go! If you follow the patented FireDad budget not only will you not stress about your zero balanced budget, you won’t think about budgeting at all! Even better there are no envelope systems to buy, no software, no step by step books, this budget can fit on a sticky note you attach to your credit card and can sit in your wallet unaltered for years like that expired condom.
Stop wasting time on worthless tasks that over complicate life.
This week my lovely wife is 22 weeks pregnant. There have been a lot of projects and things going on in the house and we are slowly converting rooms into baby appropriate spaces. Along with this has been a list of items we need to get before FIREbaby pops out. These are purchases that the baby industrial complex will hound you and prey on the unsuspecting adult in unforeseen ways.
The bombardment of things you “need” to buy to keep your baby safe is overwhelming and can be about 5 posts. Today we are just going to talk about the approach we are taking to getting clothing from 0-12 months old.
We live pretty remote from normal civilization. It’s about an hour drive from a city that has places to shop. With that in mind I had some items we needed to take to the thrift store and I also knew I could combine those trips into a baby clothes trip.
I ended up going to three different thrift stores and buying pieces that looked in like new or new condition (some still had the tags). We ended up spending $86.50 across two different stores (one store didn’t have anything worthwhile) We are not finding out the gender of our baby so I was somewhat limited. While I strongly hold the belief that a baby doesn’t care what it wears I still wouldn’t want to put my potential son in a Broncos cheerleader outfit or my potential daughter in a “I’m daddy’s little man” shirt. I stuck to the tried and true, cute animal prints.
For my $86.50 I got:
NB pants – 1 NB onesie – 9 0-3mo onesie – 10 baby sock – 1 3mo onesie – 6 3-6mo onesie – 12 3-6mo pants – 4 3-6mo top – 2 6-12mo onesie – 3 12mo onesie – 1 12mo top – 1 A total of 50 new or like new items of baby clothing for an average cost of $1.73.
Nothing was damaged, nothing was worse than a onesie you see at Target, GAP or any other store. I used those two specifically because in that pile there are items from GAP and Target that had the original tags on them.
In everything in life I’m finding that the sustainable method is usually the most affordable in the long term as well as the best for our planet. Babies don’t care what they wear and these clothes are pretty cute. It’s not like your baby is going to be upset it’s not wearing designer clothing so why are you buying it?
The best part is that when we are done we can either donate these items back to the thrift store or we can sell them in a yard sale for at least what we paid. My goal is for the cost of our babies first year of clothing to be as close to $0 as possible. I think with garage sales (once this COVID shit is over) and thrift stores are going to allow me to do it. Everyone has told us that kids are super expensive and if everyone says something there is a good chance it’s wrong.
If there was a single word to describe my entire philosophy in life it would be Optimization. I’m at the point where I work a full-time job as a CFO, in my events company I am the lead consultant and run the org as President, I own and manage a retail speciality running store, I own and rent out ½ of the duplex we live in, I own another rental property and at this time have built an indoor grow room to learn hydroponics to start a produce business. There is really only one way I got to this point where I can keep track of everything on this list and that’s optimization.
Even our FIRE dream of homesteading is built on a foundation of optimization and the most affordable way to live a sustainable life.
My work life is really where this started as I just found myself bored quickly in my first office jobs. Those early jobs in accounting had such old school approaches that when I took over from Joe Boomer who was retiring who took 45 hours a week to do a job that only takes 20 with a computer and the ability to type with more than two fingers. Still, I was stuck there in this office with 20 hours a week to do nothing. At first I browsed the internet and read articles, because I was so committed to being available I didn’t want anything I couldn’t instantly shift focus from. As time went on I learned the value of turn based card games like Hearthstone. If this sounds like the perfect job to you then I promise you it’s not what it seems. At a certain point, no matter what freedom you have, being forced to sit at a desk for 20 hours a week with absolutely nothing to do or accomplish is soul sucking.
After 6 months I took the approach to do my job the best I could and that meant to come up with the most efficient and accurate way for everything. Over the next few months I tediously and relentlessly went about automating every task I had. I was the only accountant for a K-8 private school. Here is an example of what I would do:
There was this super complicated report that I prepared for my Board of Directors monthly. I learned how to make a plug in that allowed me to export from my accounting system into a series of excel spreadsheets that all compiled everything into a pretty template. Took me about 2 weeks to learn how to do all the steps I needed to get what I wanted. My predecessor would spend almost 2 days making these reports, I had it down to about 2 hours a month, then I built a program that made it 2 minutes.
I applied this approach to nearly every single task I could. By the time I left this job I had my core duties down to 8-15 hours a week. The other advantage was the quality of my work was better. I got really good at solving problems because building the structure of how to make my job efficient gave me really good problem solving skills.
Once the free time really started piling up but still having to sit in my office I had to get creative. This led to me starting companies while I worked a “full-time” job. From there it’s a series of different full time jobs with me starting and running more and more businesses “on the side.”
Over the last 15 years my approach has evolved and I expect it will continue to evolve. After I recently hit LeanFIRE my priorities shifted away from ruthlessly pursuing money towards more fun ideas and tasks.
Here are a few of the things I do:
Payments, utilities, communications, filings, investments, and even shopping should be automated at the maximum level you can. Use a bag of dog food every 4 weeks? Sign up for an auto-delivery and you will never spend a thought on it again.
Everything in your life that happens regularly that you need to be involved in gets a calendar reminder – always. For an accountant this is tax filings, budget work, planning, payroll, check runs, etc. Anything that you actually have to be actively involved in at any regular interval gets one.
Your calendar reminders should be set for a realistic time on a day that you have time. When they pop up you should always complete the task or the moment you hit a wall you then stop and make another calendar reminder.
When you are working on a joint task that has a lot of back and forth you want to always 100% finish what you can and then pass it back. I typically check my email 4-6 times a day, with notifications turned off because they are distractions from whatever I’m currently working on. During those email times I delete all the junk, then work my way from the oldest email through to my newest and do one of three things:
Fully complete whatever task the email is asking of me
Set a reminder to complete the task at a later, but specific date
Delegate the email to a subordinate
When email time is over because something else comes up or my inbox is 100% empty I then can move on.
When I’m working on a task I’m hyper focused and don’t let much distract me. What I’ve found, in the white collar world at least, is that most people tend to do the opposite. They let little distractions pepper their day and let the work pile up. They float in and out of tasks over a 10 hour work day, but never seem to accomplish much. Now I’ve read books that would call those people lazy. The truth is that I’m the lazy one. I value my free time so much that whenever works needs to be done I want it done and over with so I can focus on either my own businesses more, my leisure time or my family. Procrastinating is the enemy of the lazy person.
Optimization is the lazy man’s best friend as it’s the best way to maximize the amount of time you get to do whatever you want.
So go on, be lazy like me and optimize every single thing you can.
I suppose today is the day I became lean FI. There were no sirens, alarms, parties or even mentions. I discovered it looking at my FI/RE spreadsheet and updating some numbers. The part that felt the weirdest was that reaching this during a pandemic was…cheating? Either way as I’ve come to accept that we are Lean FI and will continue to work; this milestone doesn’t really change anything from our plan. While it’s true that we could not work the pay off to keep going 3-5 more years is huge. If we chose to live like the Little house on the prairie then we would be fine, but that’s not the goal.
Our napkins goals for different levels of FI/RE are:
Lean FI/RE # – $60,000/yr mostly passive income FI/RE # – $110,000/yr mostly passive income Fat FI/RE # – $150,000/yr mostly passive income with no mortgage on primary residence
Those numbers are not the way I typically see other FI articles, but it’s the method I prefer to use. When I buy a rental property, invest in the market, or invest in a business I can calculate the return based on how Americans calculate their lives every day; in annual salary. For the market I use 4.5% on investments. These numbers are all based on living a homestead lifestyle with significant amounts of land, livestock and crops.
Our current income per month is:
$1,000 – Renting ½ of our duplex $800 – Rental condo $5,000 – Retail store $0 – Events business (COVID, we are shut down) $9,900 – Finance salary $16,700 or $200,400/yr
As you can see our income is sizable and we are a one income household, but I work as much as I can to achieve our FI/RE dream and be able to take care of our children together rather than just the one of us. Our long term FI/RE goal is to buy a homestead on a significant amount of timber. This will allow us to live a lifestyle more connected to the world and the things that are important to us.
Today is also the day I’ve decided to slow down the grind. Sure it may take a little longer to reach that full FIRE number but from this point forward we will always have a place to live and enough income for food to eat. That’s a win by my standards and seems like a good of time as any to slow down my hungering pursuit of making money. It’s one of the reasons that I’m finally starting a blog.
I have no less than 4 folders in my Gdrive with 1-6 articles I’ve written over the last 8 years with the intention of starting a blog. I’ve always been too busy with other things, mostly I didn’t want to focus on anything that I couldn’t guarantee a profit. I didn’t want to write a blog that was focused on money, and until now that didn’t seem like a good use of our resources and time. Now that we have reached the point of lean fire everything is just that much more relaxed and our whole family can focus on more fun projects. For me, that project is finally starting my blog.
Over here at the FIREdad house we have shifted gears into planning for our retirement which seems to be getting closer every day. The journey of FI/RE has been pretty short for us compared to most and that is in large part to some major upticks in income in recent years mostly from businesses that I have started. I started about 8 years ago and should be done in the next 5.
We have gone from an initial goal amount of $750,000 in assets with a paid for house to thinking we would want $2 million. At this point we have scaled it back and the FI/RE goal for us looks something like this:
$60,000/yr in income from various sources $400,000 in pre-tax retirement savings A paid for homestead on 40 or more acres of timber
Today I’m going to dive deeper into each of those goals, how we are going to achieve them, where we are on the path to that goal and what the future holds.
$60,000/yr in income from various sources
I expect that point is 2-5 years away depending on where life takes us. Most people would look at those lists above and say something like “They want $60k a year in income, sounds like work to me!” and snicker because they outsmarted me. When I think about FI/RE I rarely think about the Retire Early part. The end goal for us is to live life exactly how we want without needing money to be a part of the equation.
When I write that we want $60,000 in annual income to be FI that sounds like a conflicting statement, but here is what I mean by that and the breakdown. We currently own multiple businesses that I have built up while working full-time in Accounting & Finance. At this time I have two that are producing fairly well with minimal involvement from myself.
Retail Running Speciality Shop – This business has been around for 30 years and is quite established. It was one of the first jobs I had after graduating college doing their accounting and selling shoes in the store. Over the last 10 years I became very close to the family that owned and operated the store. Last year the owner passed away suddenly and I offered to purchase the business. We had been talking about it for years, but that unexpected incident really lit a fuse. As of today I spend about 10-15 hours a week as the owner of the business. I have an extremely reliable manager and staff that run the business day-to-day. $40,000/yr – This will vary greatly as the health of the shop financially is my main goal
Racing Consulting Business – I also run and manage a race timing/consulting business. I’ve sold ⅔ of the business over the years to 2 other partners which has been both rewarding and challenging. Until 2020 I was President and lead consultant for this company and at our peak we were supporting around 100 events annually. With COVID there is no telling when this business will come back. When it does come back I’ll be scaling my involvement in this business back quite a bit by hiring a President and other employees. I’ll just be doing the events I want. $0/yr during a pandemic – Roughly $20,000 when I hire out all my current work
Rental properties – We own 1 fully paid for condo worth $130,000. I use a property management company to make this as passive as possible which is great, especially considering the condo is 800 miles away from our home. I would really like to purchase 1-3 more before reaching retirement age. We also rent out ½ of our primary residence. Our attic is remodeled to be a studio apartment and the COL is so high here that it generates $1,000 a month. Our homestead dream will reduce this income by $12,000/yr as we will sell our current residence and lose that studio rental. $21,600/yr Now $9,600/yr post FI
CFO – I am also still working a full-time accounting/finance job. I am 2nd in command at a Destination Marketing Organization. This is a really rewarding position that is quite fun at times. However, quitting this job is the main driving force of FI/RE for us. This is more of a traditional job and that is the thing I am trying to get away from. When we reach our goals I will quit this position, purchase our homestead property and make homestead our primary “job”. $110,000/yr
As you can see when we review the list of our FIRE goals that the income side is already met with my businesses and rental properties. That means the CFO role is currently being held to supercharge the savings rate to accomplish these other goals.
$400,000 in pre-tax retirement savings
401k,457,IRA, Roth IRA, CO PERA (pension)- As of today we max both a 401k and a 457 as well as the maximum allowed in IRAs each year. The CO PERA pension will be multiple posts in the future but it currently automatically takes 8.5% of my salary and goes into that bucket.
$220,400 – All retirement accounts including cash value of pension
When you look at our income and see we ‘only’ have about $220k in retirement it might seem like we have a terrible savings rate. The truth is that we do save quite a bit of money but I have used that savings over the years to invest in businesses, rental properties and other ventures rather than just pure retirement savings.
$400k in pre-tax accounts that are left alone until we reach retirement age will turn into $1.5-$2.5 million by the time we turn 59.5. The plan is to get that to $400k then let it sit for the next 25 years in VTSAX, international and a small % of bond funds with an annual rebalancing.
In 2020 we will have contributed $58,000 to our retirement accounts. Assuming we aren’t faced with a major economic collapse (apart from COVID) this goal should be met by 2023 and with average returns will be even sooner.
A paid for homestead on 40 or more acres of timber
We have set a budget of around $400,000 and not to exceed $500,000 on our homestead plans. This is the land, home and improvements we want to do.Our list for the homestead phase of our life is far more luxurious than I’ve seen on most homestead bloggers and YouTubers. It’s why I am such a big proponent of living the life you want to life, but just being intelligent about it.
Our list includes:
40 or more acres, mostly timber where I can build MTB and running trails
Water on or accessible from the property: lakes, streams, rivers are all acceptable
3 acres or more of semi cleared land near the home for agriculture
Outbuildings – at least 1 but more is better
A mostly or fully remodeled home with 3 bedrooms, 2 bathrooms with significant space for food storage
This is the part of the plan that is going to take the longest. While we could afford a mortgage on this dream property it is a personal goal to have no mortgage. Our current home is worth $75,000-$100,000 more than what we owe. We also have another $30,000 in after tax savings.
I put a lot of my free time into working on projects at our current home to raise the value as well as living frugally to save as much of our income as we can.
We currently save 100% of the income from all our businesses towards this goal. There are a lot of variables but this should be achievable in 3-5 years depending on market returns and if we can maintain these income levels.
When reviewing this plan there are people who would say it’s too conservative that with our income, savings and expenses that we could quit today and go homesteading now. There are others that would say I’m not going to have enough of a cushion should things change. All of those perspectives and opinions are equally valid. The plan above works for us. Both my wife and I have serious anxiety issues and this very conservative plan with multiple revenue streams along with a very comfortable retirement account is what works for us to sleep at night. If we needed to we could live on just the retail business income, if that needed to stop we could live on just the investment properties income, if that didn’t work then at least we own land that is producing a majority of our food and water needs.
That’s the plan. Keep maxing the retirement accounts and save everything else to buy a homestead with cash. Then spend our days teaching our children how to live off the land, growing your own food along with selling at farmer’s markets/roadside, and hiking on our private slice of rural America on trails we built ourselves. I can’t think of a better dream to be able to pursue.
Hey there, I’m the FIRE Dad. I have been working on this idea for years and even have multiple old blog style posts on my Google Drive. I have never published anything or put real effort into the process, but with the pandemic of 2020 and some life changing events I have decided that now is the best time.
I have played around with the idea of FIRE for a long time now. I’m not nearly as frugal as those that usually blog, but I’m nowhere near as spendy-pants as others at my income level. Through some decent investments and saving so much of what we make each year and investing that money into business opportunities at the age of 35 I have reached the point of Leanfire.
Along with reaching Leanfire in the middle of a global pandemic, finding out my wife is pregnant and having one of my businesses totally shut down (we are in live events) we had a lot of time to finally evaluate what we really wanted out of life. Surprise, surprise it isn’t career oriented. My wife and I currently live in one of the most beautiful places in the world, Estes Park, CO. The views will take your breath away almost every day. We have world class hiking, climbing, trail running, backcountry skiing along with any other adventure you could want. The town is small but the tourists bring bigger businesses and we have those benefits year round. Despite it being a nearly perfect place to live we have decided to plan on a move and not a move that most anyone would expect.
Our goal is to buy a large plot of land in the northern midwest with 30 or more acres with a mostly done house and lots of timber. Any guest quarters, outbuildings will be high on our list along with any farming equipment because we are taking steps to start homesteading. We have some experience and are taking the next 1-4 years to hone those skills before we go “live” and us eating is somewhat dependent on our skills.
So that’s the goal, we want to spend $400,000 or less on a homestead with tons of timber to hike, run, bike, and build more trails. I believe in doing things as cost effectively as possible while providing the most enjoyment. For us, homesteading is going to be the way we want our children raised. We want them to gain the skills to be self-sufficient, knowing where your food comes from and how to get it, how to hunt and respect where your meat comes from as well, and have a family that is active and engaged in their upbringing.
We have grown herbs and small vegetables in the past, but were not particularly successful. We also had chickens which went quite well until a bear came and caused a bloodbath. Homestead 101 began for 2020 and it’s set to hard mode living in the mountains, but we are looking forward to growing our skills and getting ready for the big leagues. On this blog you can expect topics that relate to this journey in any way, from how I make a living, saving, investing to how I build my raised beds, my hydroponics experiments and which tomatoes can grow at 7,500’ of elevation.