My short FI Journey thus far

[Asgard01]

Its been around 3 months since I got into all this Financial Independence stuff. I wanted to share what I had learnt so far and what I have managed to do to help in my progress towards my goals.

I got into all of this browsing a few websites about saving money as I wanted to save for some holidays and house improvements. I then first caught wind of FI. It's interesting that until this point I had never even considered the prospect of retiring early, or at least being able to if I chose to before the typical age of over 65 in the UK. I had a vague idea of retiring a little earlier as I am likely to gain an inheritance at some point but even that was long long away in the future.

I started in a fortunate position financially although through awful circumstances with loosing my mom to cancer last year completely unexpectedly within 9 weeks of finding out. I would sacrifice all my money and home and even of course future FI if I could have my mother back. This has deeply changed how I think about things and what my focus in life is. I started with $120,000 and a home with no mortgage which was partly from my mom and partly from money I had hidden from me that come from my grandad that was exposed in all of this.  Having this has obviously made achieving FI a lot more realistic and faster and I owe such a start to my dear mother.

Since this I have managed to make the following changes

-Got rid of all debt, this was minor debt apart from car loan but still a nice thing to do
-Lowered bills by around $400 a month
-Really enjoying a more simpler life, enjoying what I have and have brought before but never got around to using. Living life at a slower pace with deeper goals such as physical health, mental calm (meditation/mindfulness)
-Decluttered my whole house, got rid of many many things that I did not need. I really like and use what I have now
-Changed from a 0-5% Savings rate to a 55% savings rate - $1700 a Month
-I invest in a diversified collection of index funds, 60% Equity and 40% Bonds
-I keep $20,000 in Cash in a high (relatively) interest tax free ISA (UK account)
This gives me 2 years worth of Independent Basic FI, interest goes towards unexpected outgoings throughout the year. I like having cash outside of my investments, this is like a buffer and a comfort blanket so to speak maybe.
-I track all my expenses manually, It's not hard as I don't spend all that much and I actually enjoy doing this. I now have confidence that I can live on the amounts in my prediction as things currently stand. No guilt at all though in buying things that I value.

High level FI Planning
I aim to reach Basic Independent FI in 5 years at 32 years old
This includes all bills paid, home/food/drink/car/internet/phone etc and a nice $10 disposable weekly with $1000 unexpected bills yearly

I aim to reach Current Living Independent FI in 7 years at 34 years old
This includes all bills paid, home/food/drink/car/internet/phone etc and a nice $50 disposable weekly with $1000 unexpected bills yearly


My FI thinking/realisations

-I use the 4% SWR as I am optimistic hehe, 5% growth of funds on average
-I don't opt for 3% or lower because I don't intend to fully stop working.
If I was stop working later on, or change to part time. I would consider 4% as safe as safe can be due to carrying on earning to some degree. I also expect an inheritance but I do not like to plan this into any of my finances as its not something I want to happen but the reality is it likely will so its vaguely included in not worrying about money running out in old age.
-I live in the UK, so luckily I don't really need to factor in health care costs

-I am working for Independent FI first and foremost, My main aim is to have that lovely feeling that I choose to be at work and am not there through absolute necessity.
-I have come to the conclusion at the moment anyway that I want to work in some degree which will likely pay a wage to contribute to society, and play a part in life to help others - there is no need to reply to say you can still do that without working as I know.

-As a follow on from the last point. I have realised that completely retiring in my 30's is just not something I will do, I just know that I will delay pulling the trigger, I will likely want to earn more also to help with a family. I think I will like earning more and not mind working so much whether thats a different career or part time knowing that if I were to lose the job, I would be fine for all my core needs possibly even for life. That alone will make me feel like I am in control, Like I am choosing to go to work, it takes a lot of the ill feeling toward work out of the equation. I am getting hints at feeling like this already and it makes being at work a lot different.

- I have realised that I still can not like what I have even more so with regard to FI planning. I went from 23 years to some level of FI to 5 years (albeit partially due to unexpected cash increase) and I still get frustrated that its 5 whole years.... hehe. I have a 55% savings rate but feel in awe of those with 75% and wish I had higher at times. I see people who are earning $50k more than me and wish I could find a better job to earn more to reach FI quicker. I laugh at myself for doing this but I am being as open as possible.  It's worth saying that I don't always think like this. :)

-I have been far too obsessive over all of this, I have been checking the forums too frequently, researching all of this over and over again, putting my figures in calculators, lowering my FI amount, getting rid of expenses etc. Obsessive to a degree at times for sure.

-I have forgotten whilst being obsessed what I really want out of life, what I really want to do. The end game is not FI itself or sitting there not having to work. Life means so much more than that. I have realised that FI is a benefit, it is an enabler, it will allow me to feel like I have more freedom to pursue what I want in life. I have realised that I can live that life now more, I need to put more focus on now and living what I want life to be now rather than thinking about that idealised FI future state.
-I think I had kidded myself on what I can live on, ERE forum membership and the like. Its clearly possibly to live on those lower amounts, but I don't want to. It goes against a few things I want out of life.

-I don't want FI as escapism from a bad job or bad situation or just to live a life of leisure etc. I would rather get a good job, and enjoyable job with the security and comfort of knowing I can live without one for long periods and maybe, just maybe permanently. Toned down to part time or less hours or even starting my own business.

I better call a close to this as I may be rambling on now. I hope you lot don't mind me sharing all this, I just wondered if anyone could relate to some of what I said :).

Chris

[Judith681]

-I track all my expenses manually, It's not hard as I don't spend all that much and I actually enjoy doing this. I now have confidence that I can live on the amounts in my prediction as things currently stand. No guilt at all though in buying things that I value.


-I have come to the conclusion at the moment anyway that I want to work in some degree which will likely pay a wage to contribute to society, and play a part in life to help others - there is no need to reply to say you can still do that without working as I know.

-As a follow on from the last point. I have realised that completely retiring in my 30's is just not something I will do, I just know that I will delay pulling the trigger, I will likely want to earn more also to help with a family. I think I will like earning more and not mind working so much whether thats a different career or part time knowing that if I were to lose the job, I would be fine for all my core needs possibly even for life. That alone will make me feel like I am in control, Like I am choosing to go to work, it takes a lot of the ill feeling toward work out of the equation. I am getting hints at feeling like this already and it makes being at work a lot different.

- I have realised that I still can not like what I have even more so with regard to FI planning. I went from 23 years to some level of FI to 5 years (albeit partially due to unexpected cash increase) and I still get frustrated that its 5 whole years.... hehe. I have a 55% savings rate but feel in awe of those with 75% and wish I had higher at times. I see people who are earning $50k more than me and wish I could find a better job to earn more to reach FI quicker. I laugh at myself for doing this but I am being as open as possible.  It's worth saying that I don't always think like this. :)

-I have been far too obsessive over all of this, I have been checking the forums too frequently, researching all of this over and over again, putting my figures in calculators, lowering my FI amount, getting rid of expenses etc. Obsessive to a degree at times for sure.

-I have forgotten whilst being obsessed what I really want out of life, what I really want to do. The end game is not FI itself or sitting there not having to work. Life means so much more than that. I have realised that FI is a benefit, it is an enabler, it will allow me to feel like I have more freedom to pursue what I want in life. I have realised that I can live that life now more, I need to put more focus on now and living what I want life to be now rather than thinking about that idealised FI future state.

Thanks for sharing this honest article. I completely agree about having shifting goal posts that can still make you annoyed with your present situation. I have got my FI date closer and closer but I still too wish it was closer still. I need to be happy that I can do this in under 12 years.

The point about being obsessive, I can certainly relate to that. I have been thinking about planning and how to save more, earn more etc too much that's for sure. I agree that I need to focus more on now and doing what I want to do after FI now also just perhaps with less time.

I couldn't do the tracking expenses manually or to that extent to be completely honest. I also want to retire and not carry on working. I like the idea of a life of leisure. A lady of leisure..I shall not be working when I hit FI.

Good luck to you sir

J

[Asgard01]

I couldn't do the tracking expenses manually or to that extent to be completely honest. I also want to retire and not carry on working. I like the idea of a life of leisure. A lady of leisure..I shall not be working when I hit FI.

Thanks for your reply. I know that the tracking expenses manually and to the penny isn't for everyone. I didn't think it would be for me either. Good luck too in becoming a lady of leisure :).

Chris

[Punchingat50]

Its been around 3 months since I got into all this Financial Independence stuff. I wanted to share what I had learnt so far and what I have managed to do to help in my progress towards my goals.

I got into all of this browsing a few websites about saving money as I wanted to save for some holidays and house improvements. I then first caught wind of FI. It's interesting that until this point I had never even considered the prospect of retiring early, or at least being able to if I chose to before the typical age of over 65 in the UK. I had a vague idea of retiring a little earlier as I am likely to gain an inheritance at some point but even that was long long away in the future.

I started in a fortunate position financially although through awful circumstances with loosing my mom to cancer last year completely unexpectedly within 9 weeks of finding out. I would sacrifice all my money and home and even of course future FI if I could have my mother back. This has deeply changed how I think about things and what my focus in life is. I started with $120,000 and a home with no mortgage which was partly from my mom and partly from money I had hidden from me that come from my grandad that was exposed in all of this.  Having this has obviously made achieving FI a lot more realistic and faster and I owe such a start to my dear mother.

Since this I have managed to make the following changes

-Got rid of all debt, this was minor debt apart from car loan but still a nice thing to do
-Lowered bills by around $400 a month
-Really enjoying a more simpler life, enjoying what I have and have brought before but never got around to using. Living life at a slower pace with deeper goals such as physical health, mental calm (meditation/mindfulness)
-Decluttered my whole house, got rid of many many things that I did not need. I really like and use what I have now
-Changed from a 0-5% Savings rate to a 55% savings rate - $1700 a Month
-I invest in a diversified collection of index funds, 60% Equity and 40% Bonds
-I keep $20,000 in Cash in a high (relatively) interest tax free ISA (UK account)
This gives me 2 years worth of Independent Basic FI, interest goes towards unexpected outgoings throughout the year. I like having cash outside of my investments, this is like a buffer and a comfort blanket so to speak maybe.
-I track all my expenses manually, It's not hard as I don't spend all that much and I actually enjoy doing this. I now have confidence that I can live on the amounts in my prediction as things currently stand. No guilt at all though in buying things that I value.

High level FI Planning
I aim to reach Basic Independent FI in 5 years at 32 years old
This includes all bills paid, home/food/drink/car/internet/phone etc and a nice $10 disposable weekly with $1000 unexpected bills yearly

I aim to reach Current Living Independent FI in 7 years at 34 years old
This includes all bills paid, home/food/drink/car/internet/phone etc and a nice $50 disposable weekly with $1000 unexpected bills yearly


My FI thinking/realisations

-I use the 4% SWR as I am optimistic hehe, 5% growth of funds on average
-I don't opt for 3% or lower because I don't intend to fully stop working.
If I was stop working later on, or change to part time. I would consider 4% as safe as safe can be due to carrying on earning to some degree. I also expect an inheritance but I do not like to plan this into any of my finances as its not something I want to happen but the reality is it likely will so its vaguely included in not worrying about money running out in old age.
-I live in the UK, so luckily I don't really need to factor in health care costs

-I am working for Independent FI first and foremost, My main aim is to have that lovely feeling that I choose to be at work and am not there through absolute necessity.
-I have come to the conclusion at the moment anyway that I want to work in some degree which will likely pay a wage to contribute to society, and play a part in life to help others - there is no need to reply to say you can still do that without working as I know.

-As a follow on from the last point. I have realised that completely retiring in my 30's is just not something I will do, I just know that I will delay pulling the trigger, I will likely want to earn more also to help with a family. I think I will like earning more and not mind working so much whether thats a different career or part time knowing that if I were to lose the job, I would be fine for all my core needs possibly even for life. That alone will make me feel like I am in control, Like I am choosing to go to work, it takes a lot of the ill feeling toward work out of the equation. I am getting hints at feeling like this already and it makes being at work a lot different.

- I have realised that I still can not like what I have even more so with regard to FI planning. I went from 23 years to some level of FI to 5 years (albeit partially due to unexpected cash increase) and I still get frustrated that its 5 whole years.... hehe. I have a 55% savings rate but feel in awe of those with 75% and wish I had higher at times. I see people who are earning $50k more than me and wish I could find a better job to earn more to reach FI quicker. I laugh at myself for doing this but I am being as open as possible.  It's worth saying that I don't always think like this. :)

-I have been far too obsessive over all of this, I have been checking the forums too frequently, researching all of this over and over again, putting my figures in calculators, lowering my FI amount, getting rid of expenses etc. Obsessive to a degree at times for sure.

-I have forgotten whilst being obsessed what I really want out of life, what I really want to do. The end game is not FI itself or sitting there not having to work. Life means so much more than that. I have realised that FI is a benefit, it is an enabler, it will allow me to feel like I have more freedom to pursue what I want in life. I have realised that I can live that life now more, I need to put more focus on now and living what I want life to be now rather than thinking about that idealised FI future state.
-I think I had kidded myself on what I can live on, ERE forum membership and the like. Its clearly possibly to live on those lower amounts, but I don't want to. It goes against a few things I want out of life.

-I don't want FI as escapism from a bad job or bad situation or just to live a life of leisure etc. I would rather get a good job, and enjoyable job with the security and comfort of knowing I can live without one for long periods and maybe, just maybe permanently. Toned down to part time or less hours or even starting my own business.

I better call a close to this as I may be rambling on now. I hope you lot don't mind me sharing all this, I just wondered if anyone could relate to some of what I said :).

Chris

I hear you about obsessing. I have 15 years to go and run my FI numbers at least once a day. It sucks what happended, but at least something good came out of it.

[Daisy]

-I have forgotten whilst being obsessed what I really want out of life, what I really want to do. The end game is not FI itself or sitting there not having to work. Life means so much more than that. I have realised that FI is a benefit, it is an enabler, it will allow me to feel like I have more freedom to pursue what I want in life. I have realised that I can live that life now more, I need to put more focus on now and living what I want life to be now rather than thinking about that idealised FI future state.
-I think I had kidded myself on what I can live on, ERE forum membership and the like. Its clearly possibly to live on those lower amounts, but I don't want to. It goes against a few things I want out of life.

-I don't want FI as escapism from a bad job or bad situation or just to live a life of leisure etc. I would rather get a good job, and enjoyable job with the security and comfort of knowing I can live without one for long periods and maybe, just maybe permanently. Toned down to part time or less hours or even starting my own business.

I love this! I think you really "get it". FI isn't a single endpoint in your life. FI will be a result of your attitude change, learning self-reliance, having freedom and independence of thought free from the shackles of debt. The personal growth getting yourself ready for FI is what really matters. And really that's more important than the actual economic part of FI. You've verbalized what I think other young members on this forum can learn a lot from. Enjoy all of your life, don't idealize FI, and live the journey.

[Goldielocks]

I love that you did the opposite with a sudden large inheritance versus what "they" say.

You triggered onto MMM instead of spending mode.

You should be proud of yourself for getting through this time as you have.  Best of luck.

[Asgard01]

I love this! I think you really "get it". FI isn't a single endpoint in your life. FI will be a result of your attitude change, learning self-reliance, having freedom and independence of thought free from the shackles of debt. The personal growth getting yourself ready for FI is what really matters. And really that's more important than the actual economic part of FI. You've verbalized what I think other young members on this forum can learn a lot from. Enjoy all of your life, don't idealize FI, and live the journey.

Thanks for your comments Daisy. Enjoy all your life, don't idealise the journey and live the journey is a great sum up of a lot of what I have gone through indeed.

I love that you did the opposite with a sudden large inheritance versus what "they" say.

You triggered onto MMM instead of spending mode.

You should be proud of yourself for getting through this time as you have.  Best of luck.

Thanks goldielocks. I wasn't even tempted for a minute to splurge the money. I just had one holiday with some friends that I needed to have after what I went through, I needed to get away which I know my mom would of been pleased with.

[Shooter_D]

Hi Asgard01,

I'll start by saying I'm so sorry about the loss of your mother. I hope you're doing alright and that life is treating you well since that life-changing event.

It's nice to have something like FI to focus on when thinking about the future. I'm a similar age and have also recently started thinking about how to retire someday, and more recently how to reach FI earlier than later. I think with this kind of thought process there is a lot of obsessing, over forums like this or other sites, and even about watching investments grow (or not grow!) and hoping for that net worth value to keep growing. It's a kind of hobby and a good way to focus energy, but like others have said you still have to enjoy the journey.

Best of luck to you!

[Asgard01]

I thought I would provide an update on this as suggested by Arebelspy :).

I first posted this around 10 months ago and now I have passed the year mark of getting into this FI movement. I wanted to note down how I am getting and what has changed since I wrote this very honest and frank post.

Tracking expenses - I continue to track expenses manually and to the penny. I really enjoy doing this and knowing exactly where my money is going without feeling obsessed about it. This is a very important point. Earlier on, I think I was obsessing too much over spending, feeling bad for spending etc. I have loosened up on spending on things that I simply need/choose to spend money on. The things that bring me value now and that do not leave me feeling deprived. I do not really feel spending guilt anymore.

Food - I brown bag every day now for work, I really enjoy my sandwiches :). I still go with work friends for social reasons to town but I simply do not buy anything for lunch. I do not use the vending machines at work either, I used to use the tea machines but now I make tea upstairs for work colleagues and boss for free. I cook for myself most the time and have dinner at friends/family 3 nights a week. I go out for fast food/take away couple times a month which is a lovely cheap treat.

Spreadsheet checking - FI day dreaming. As helpful as this might be for some and for me initially, I felt like I was spending far too much time delaying living, anticipating the future of FI, exaggerating its impact on day to day living it will have etc at the cost of lived experience now. I very rarely check my spreadsheets now other than to fill in my expenses and look at my monthly planned spend which usually is very static. I do not check my balances other than every couple months. I do not listen to or read any speculation about the markets. I am an armchair investor, I sit back and will know if things are really bad by hearing this on the news - not that this will make me sell sell sell.

Targets - I feel confident in the 4% withdrawal rate due to knowing I should be receiving a large inheritance one day, knowing that I will likely still work part time and likely full time for the foreseeable future and will not actually retire. My reasons for this are due to wanting a family soon, it's one thing becoming independently FI myself but adding a family to the picture will push my FI date much further back. I feel comfortable knowing I have a huge financial safety net right now and feel very grateful for this.

As for numbers - I have managed to continue to save £1000 - $1500 a month 8 months out of 10 and now have £90000 /  $135000 in investments/cash. Mortgage free & no debts. I work a part time job helping my disabled friend out and with this income (1 night a week) and my 4% drawdown. I have bare bones survival FI which is comforting indeed. I no longer have a specific date for FI though. I have a yearly target amount but my self worth / identity is not too linked to this for me to feel that uneasy about not hitting it. I have the general target of full FI in under 10 years and continue to work towards this but it is no longer all consuming as it once was. This seems to work for me, but I know more specific targets help others. It was feeling like too much of a constraint for me personally.

I would say in summary, the FI project has become a background task that's pretty much automatic and I have got back into living guilt and obsession free about spending & planning which was a big step forward to me. I have a running joke with many friends about how tight I am etc, it amuses me and I don't take it seriously. A few of my friends have loosely started to work towards FI but most think it's simply unobtainable and think I am just lucky already owning a home without debts etc. it's not possible for them they say. I do not try to push my views any further on them. I feel very comfortable as I do not refuse to spend on activities/things I value.


Chris :)

[arebelspy]

Nice progress. Good to not focus exclusively on FI at the expense of today.  Thanks for the update!

[Asgard01]

Yeah. I think it's always about balance. Something you said a long time ago stuck with me about if you wanted an iPad or something or had to fix one, you would just buy one. There was no deprivation felt. You just had fewer wants in general. This is something I have definitely took on board.

The one thing I forgot to add as an update to this was spending money on my gift category. This is one category I love spending money on. I really do get a lot of pleasure treating people to simple small things etc. this is one category I never had before.

Chris