Our Financial Independence journey really got started after reading JL Collins’ now legendary book “The Simple Path to Wealth” and discovering the ChooseFI community with a weekly ChooseFI podcast hosted by Brad Barrett. The simplicity of the message of (1) eliminating debt in your life, (2) saving 50% or more of your income, and (3) investing the surplus in broad based low-cost index funds really resonated with us.
We had already been big proponents of index investing after Mr. FISU stumbled upon Vanguard and John Bogle’s The Little Book of Common Sense Investing over 10 years ago when he started his career as a Big Law attorney. Additionally, both of us had followed at least a degree of frugality and saving for years; however, it was not until discovering the concept of Financial Independence that really brought everything together and allowed us to design a tangible goal to work towards.
This goal was to save and invest enough to reach a net worth equal to at least 33 times our annual expenses, referred to as our “FI Number”, that would allow us to retire early and take out roughly 3% of our savings annually to fund our retirement (i.e. 3% safe withdrawal rate or “SWR”). This is a slightly more conservative retirement strategy than the more typical 4% rule but given Mr. FISU’s more conservative approach to risk, it allows us to sleep better at night. The goal of this strategy is to make our investment portfolio fund our lifestyle as long as possible without having to rely on 9-5 jobs or other forms of income.
Although our chosen strategy does share many of the key principals of a more traditional FIRE movement (Financial Independence, Retire Early) such as focusing on frugality and commitment to living well below our means as well as investing in passive income sources to build wealth through compounding interest and market appreciation, our end goal upon reaching our FI Number is not necessarily to stop working altogether but rather reaching a point where work becomes optional to both of us. This would then allow us freedom to take control of our time and choices in life – pursue our passions, hobbies, travel and spend time with our loved ones without having to worry about bringing in income to fund our lives.
Such a strategy did require us to make significant changes in our lives, which we will cover in future posts, but, as a teaser, this included selling our single family home and becoming happy renters as well as downgrading Mr. FISU’s beloved F-150 Lightning truck to an used bicycle with a toddler trailer in a very Mr. Money Mustache fashion.
Although at first this might sound as a significant sacrifice to a modern American lifestyle, we have noticed that we are actually happier and living more active and intentional lives than before. We are hoping that our journey will inspire you to re-evaluate your life and consider if Financial Independence might be worth pursuing. And if you decide this is the case, then take action and start your own journey towards financial freedom! We will be here to cheer you on!
Enjoy the ride!
– Mr. & Mrs. FISU
