Our story seems quite different than most. However, anyone can use the lessons (or mistakes) from our life to better themselves.
My LifeInFIRE started out when I was 12-years-old. I grew up in a middle-class home, and in many ways I was lucky. I was taught how to save and how bonds and high-interest rates worked. That year Alaskans each received checks of $1000. My dad made me save mine, while all my friends bought new stuff. Because I saved, a few years later I had enough to buy a car. But I was told to buy an older car. I worked a part-time job in the summer. My dad told me he would match any of the money I saved from that job. I saved all of my paychecks and spent his contribution. These lessons were tough for a kid, but they were a solid foundation for learning how to manage my money.
I watched my parents log their spending in a multi-column budget book each evening. They could quickly and easily track their expenses over time. I’ve done this in a few different ways since high school. It helps me stay aware of my current and historical spending. Note: we spend almost the same amount decade after decade as some items rise in price and other categories drop.
I learned that I can get what I want. First I make sure it’s what I really want and that I can pay for it, rather than buying on credit and paying the bank back with interest. I was a lucky child because I received a gift for Christmas and my birthday each year. Usually, I received what I asked for over the previous months. I learned that I could to wait to get what I wanted, it became normal to wait. 30 years later, I still plan for what I want. I research, validate and then make the purchase decision at a later time. It helps to stay out of stores. If I need to go to the store, I bring a shopping list for some structure.
Don’t follow my mistakes. I learned about investing in bonds with 12-15% interest rates in the 80s. At the time a stock trade could be hundreds of dollars. Now I know about low-cost index funds. I wish my MBA had taught me three little words: Total Market Index. I had no clue. If you are reading this, you already know about this. Remember, you can overcome lower investment returns by saving well. However, it’s very hard to use investment returns to overcome low savings.
It was never my intent to retire at 43. I originally planned to leave corporate America in my early 50’s to teach at a community college. To prepare for the change, I taught night classes for over 20 years, while working a busy day job (side hustle wasn’t even a thing yet). I saved every dollar from my teaching side hustle in what I termed my “playcheck.”
We do not have children. We took out manageable student loans for our undergraduate and graduate degree. We did have some assistance with this cost (parents and employers helped to fund some of the education) and we paid these loans down aggressively for a few years (at 90’s tuition rates). We were both working professionals. We lived off one salary and saved the second. That allowed less stress from daily work—even the possibility of a layoff. Financial Independence has many levels, but they all give you control, power, freedom.
These basic principles helped in our journey to FI: same spouse, same house, same cars over time, save early and continually for the future. That’s the best advice I can offer you. If most of these items work out, you will have a stronger, less stressful financial life and possibly (much) more freedom into the future. (Yes, that was worth repeating from above)
For us: we’ve had the same spouse (25+yrs together), same house (27yrs, 1026 sq ft), same cars (10+ yrs, purchased used), saved early (live on one paycheck * 20yrs) and continually (we still have a little part-time work for “playchecks”).
A big part of my life entails giving back in my own way. There is rarely a five-foot-giant-check handed to someone in need, but rather lots of small efforts combined to make their life better. Giving back can look like this; teaching, presenting, writing, having a conversation, listening to someone, performing an action to help (carry something, pick something up for someone, smile) in the smallest of ways. If you give out positivity, you will soon be surrounded by positivity. (Even grumbling old(er) men can give, I prove that).
It is vital that you put effort into your health and wellbeing. A strong, happy body will carry you throughout your day much easier than a broken down one. I lost 140 pounds before I turned 30. That is why I believe that anything is possible. Move, get some sunlight, smile to others and fuel your body with the vitamins and nutrients you need.
My wife and I live normal lives, you might say that we have “stealth wealth.” But we do what we enjoy and lead a great life. Thousands of smart little decisions over time created this for us, and it may multiply into your greatness or really goodness.
By Kevin Sebesta of LifeInFIRE.com