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Speaker 1: Welcome to How the Money. I'm Joel and I and

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Speaker 1: Matt and today we're talking about fire. Choose your own adventure,

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Speaker 1: that's right, Joel. The fourth of July was on Sunday,

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Speaker 1: and we're talking about financial independence, retire early, and we're

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Speaker 1: specifically going to talk about how it can look different

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Speaker 1: depending on what you wanted to look like, depending on

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Speaker 1: what your goals are and what you're trying to achieve.

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Speaker 1: I'm excited for this episode, buddy. There's different routes to success,

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Speaker 1: just like if you're playing a game like Settlers of Catan, right,

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Speaker 1: I mean, there's different ways that you can win, and

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Speaker 1: so you don't always have to take take the same routes.

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Speaker 1: And I think sometimes when we talk about fire, the

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Speaker 1: fire movement, it seems like there's one prescribed way to

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Speaker 1: get there, but we say no, there's actually a lot

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Speaker 1: of different paths. And so we're going to kind of

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Speaker 1: cover that in this episode for folks that are interested

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Speaker 1: in reaching financial independence, in doing so before they get

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Speaker 1: super wrinkly, uh, we'd say this episode for you. Speaking

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Speaker 1: of Gatan, I was always a fan of building multiple

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Speaker 1: cities on a high rolling commodity, like say sheep and

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Speaker 1: then getting that two to one port trading directly to

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Speaker 1: the bank. That way you don't have to trade with

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Speaker 1: any of your fellow players. That was always a fun

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Speaker 1: That was a good move for you to because you

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Speaker 1: annoyed all of your fellow players so much they didn't

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Speaker 1: want to trade with you. So I had been known

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Speaker 1: to do that. It's been years since we've played Settlers

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Speaker 1: like we would always play some of the other games

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Speaker 1: like king Domino or Carcassone. Acquire is like a new

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Speaker 1: real estate one that I feel like that. You know

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Speaker 1: that we've been playing a decent bit, but Settlers, like

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Speaker 1: the o G haven't touched it in years. Been a minute,

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Speaker 1: spent a minute, Gotta pull it out, dusted off. Okay,

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Speaker 1: speaking of Acquire, this makes me think about real estate

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Speaker 1: and Matt. Before we start talking about fire, I want

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Speaker 1: to let you know, uh and our listeners know. So,

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Speaker 1: our family were having some renovations done to our house.

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Speaker 1: We're getting basically when when we bought this house, it's

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Speaker 1: a nineteen thirties house. It needed a ton of work,

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Speaker 1: but we decided to live in it. We're not the

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Speaker 1: back for a few years, um and now our family

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Speaker 1: wants to take over the whole house, and so we

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Speaker 1: need to renovate it away from being a duplex into

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Speaker 1: a single family home. And I got that second kitchen

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Speaker 1: that was kind of pointless. No need for two kitchens

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Speaker 1: really right in our family. And yeah, there's a lot

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Speaker 1: of work that needs to be done. So we're moving

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Speaker 1: out and we moved into this like super tiny house,

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Speaker 1: like square feet so kind of interesting, a lot smaller

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Speaker 1: than what you're used to write. I was starting to

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Speaker 1: a friend who used to live in New York and

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Speaker 1: he's like, that sounds palatial at least by New York standards,

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Speaker 1: but yeah, for Atlanta standards. To the family five, it's

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Speaker 1: very small. But it's actually it's it's been good for

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Speaker 1: our family in a lot of ways. We've been able

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Speaker 1: to kind of pare down some of our possessions and

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Speaker 1: it's been kind of fun to live in small quarters.

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Speaker 1: But I met my new neighbor there who's flipping the

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Speaker 1: house next door, and this is his second home that

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Speaker 1: he's he's renovating it and he's going to rent it out.

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Speaker 1: His name's Kyle, and it's so fun to kind of

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Speaker 1: talk to him as he's kind of just getting started

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Speaker 1: it in his real estate investing adventures. He's super excited.

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Speaker 1: He's listening to like the Bigger Pockets podcast every single

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Speaker 1: day because that's a one of one of the better

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Speaker 1: real estate investing podcasts out there. And yeah, I just

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Speaker 1: wanted to say, like one go Kyle, I'm proud of you,

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Speaker 1: and I'm I hope you kicked butt and um and

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Speaker 1: just to everybody out there, like if you've been wanting

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Speaker 1: to get started investing in real estate, I know, now

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Speaker 1: maybe not the easiest time to buy a house, but

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Speaker 1: you know what, Kyle made it happened. He's he's the

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Speaker 1: numbers work for the house that he bought. And it's

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Speaker 1: not gonna work in every market, but I just want

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Speaker 1: to let you know, you know, Kyle, is this glimmer

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Speaker 1: of sunshine in like a market of insanity out there

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Speaker 1: that it can be done. You can buy a rental

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Speaker 1: property where the numbers actually are going to work for you. Yeah,

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Speaker 1: the opportunities still exist, right, I mean, it's not going

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Speaker 1: to be as easy as it was, say ten years ago,

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Speaker 1: but the deals are out there, especially if you're willing

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Speaker 1: to put in the work, uh to find those specific deals,

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Speaker 1: and of course you'll make sure to keep all of

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Speaker 1: us updated as to how your home renovation is going.

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Speaker 1: Maybe after living in that that new tiny more uh affordable.

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Speaker 1: I don't want to call it a cheap house because

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Speaker 1: it's actually really nice. I've I've checked it out. Maybe

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Speaker 1: what if you end up deciding to live there full

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Speaker 1: time and uh, you guys start downsizing, you're gonna take

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Speaker 1: the minimalist approach. Down with the downsizing. I am down

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Speaker 1: with the downsizing, But we would miss our house. Yeah,

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Speaker 1: and in our our location. We were already we have

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Speaker 1: all about the location. We haven't been in the house

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Speaker 1: very long. It's just you know, a mile and a

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Speaker 1: half away. But still that's that's a long way away

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Speaker 1: from my people, so my neighbors that I love, my

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Speaker 1: you know, friends right down the street. I missed that already.

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Speaker 1: Instead of a two minute bike commute now to the

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Speaker 1: studio here, now you have like a ten minute bike

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Speaker 1: commute or something like that. But it's actually kind of nice.

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Speaker 1: I get more work out of it. That's that's actually

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Speaker 1: one of the benefits. School has been out, man, and

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Speaker 1: I actually haven't been biking at all, and I got

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Speaker 1: up my game when it comes to my physical fitness,

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Speaker 1: but kind of counter to that, let's introduce the beer

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Speaker 1: that we're gonna enjoy this episode. This is a beer

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Speaker 1: by Microphone Brewing, and this one it's called Smells Like

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Speaker 1: Being Spirit and it's a double maple stouts. Looking forward

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Speaker 1: to enjoying this one and sharing our thoughts on it

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Speaker 1: at the end of the episode. Sounds good. But for now,

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Speaker 1: let's get to the subject at hand. We're talking about fire,

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Speaker 1: financial independence, retire early, choose your Own Adventure, and basically,

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Speaker 1: matt Um, we were talking about kind of what how

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Speaker 1: we wanted to approach this episode. I was thinking about

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Speaker 1: those Choose your Own Adventure books. Um, I'm you know,

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Speaker 1: we all read them as kids. I always enjoyed them.

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Speaker 1: I think Actually Netflix recently did a similar style television

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Speaker 1: show with bear Grills or he's like out in the

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Speaker 1: wild and he's like, do you want me to eat

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Speaker 1: the snake or punch it? Uh? Seriously, yeah, I know.

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Speaker 1: I mean they never watched it, but that's what Black

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Speaker 1: Mirror did that with like one of their finales, Bander Snatch,

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Speaker 1: you know, where they had multiple endings or four or

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Speaker 1: five different endings that you could choose, uh, to kind

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Speaker 1: of incorporate some of that nostalgia from the from the

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Speaker 1: nineties and those Choose your Own Adventure books. So, yeah,

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Speaker 1: choose your own adventure still still hot, still happening in

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Speaker 1: these days. But I always remember I kind of keeping

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Speaker 1: my finger on the original page as I made the

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Speaker 1: next choice, just in case I was like, oh, man,

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Speaker 1: I don't like that. I'm going back and I'm gonna

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Speaker 1: opt for the other choice in case you get bitten

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Speaker 1: by a snake. Exactly exactly. And since Independence Day was

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Speaker 1: this past weekend, it's really only fitting to keep talking

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Speaker 1: about the pursuit of financial independence today on the show, right,

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Speaker 1: And yeah, just like those Choose your Own Adventure books,

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Speaker 1: I think the path that people take towards to achieve

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Speaker 1: financial independence, it can look really different from person to person.

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Speaker 1: There are lots of different types of financial independence and

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Speaker 1: then also to lots of different tactics you can take

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Speaker 1: to get there. Yeah, this past Monday's episode, that's what

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Speaker 1: we talked about with Rachel Richards. We actually talked through

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Speaker 1: some of the different ways to generate passive income, uh

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Speaker 1: that would eventually hopefully lead you to financial independence. But yeah,

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Speaker 1: the pursuit a financial independence doesn't have to look a

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Speaker 1: specific way. Uh. So, yeah, we wanted to talk today

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Speaker 1: about the different styles, the different flavors of being financially

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Speaker 1: independent and sometimes, you know, just discovering just even the

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Speaker 1: range of options can be a major encouragement as we

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Speaker 1: seek to find a lifestyle that works for our own

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Speaker 1: personal lives. You know, saving up five million dollars so

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Speaker 1: that you can kick back in your in your later

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Speaker 1: years might not be your thing. It may not even

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Speaker 1: be possible. Right, Yeah, that's a tall task, and that's

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Speaker 1: okay because fire can look different for everyone. And so

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Speaker 1: we'll talk about the different types of fire and then

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Speaker 1: some of the most important tactics to consider on your

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Speaker 1: path to achieving fire. Uh. There is no right or

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Speaker 1: wrong answer. There's just different approaches to financial independence, for sure.

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Speaker 1: And so yeah, we I mentioned that FIRE stands for

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Speaker 1: financial independence retire early. That acronym has become maybe fraught

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Speaker 1: with some baggage, although it has been the gateway for

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Speaker 1: a lot of young people to realize that they have

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Speaker 1: more power over their financial lives than they thought. I

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Speaker 1: feel like as that acronym has caught on, it's been

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Speaker 1: kind of a whipping horse for the media at many

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Speaker 1: turns to kind of disparage the movement and people that

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Speaker 1: are seeking to retire early. But at the same time,

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Speaker 1: it's helped a lot of people conceptualize the idea that

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Speaker 1: they can reach financial independence before they do hit traditional

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Speaker 1: retirement years. Um. It's empowered a lot of hard working

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Speaker 1: folks to realize that the stock American belief that working

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Speaker 1: forty plus hours so week for forty plus years then

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Speaker 1: retiring to Florida isn't the path that they have to take.

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Speaker 1: And yeah, we think that's a good thing. Um. It's

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Speaker 1: simply put fire. Getting to that point where you're financially

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Speaker 1: independent usually means having twenty five times your annual expenses

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Speaker 1: saved up, although one of the things we covered on

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Speaker 1: Monday's episode with Rachel is that that's not always how

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Speaker 1: it looks. Sometimes it can look like your monthly spending

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Speaker 1: being covered by passive income through something like real estate too.

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Speaker 1: That's right. Yeah, So we're gonna talk about fire in

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Speaker 1: depth today, but we don't necessarily endorse everything you know

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Speaker 1: that the movement is all about. We talked about the

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Speaker 1: pros and the cons of fire back in episode to

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Speaker 1: twenty one, so you can check that one out if

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Speaker 1: you haven't listened to it. Uh, And there really are

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Speaker 1: a lot of good things that the movement has done,

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Speaker 1: including starting some important conversations in the public space. As

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Speaker 1: big media has covered fire, I feel like it has

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Speaker 1: open the eyes of a lot of folks who haven't

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Speaker 1: considered it before. But that doesn't mean that fire is

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Speaker 1: for everyone, right. I could even see it being harmful

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Speaker 1: to some individuals. Right, So, say you jump too heavily

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Speaker 1: into the fire world, you might be tempted into grinding

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Speaker 1: too hard for the next fifteen years to achieve this

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Speaker 1: specific monetary goal, and then reaching that goal may not

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Speaker 1: be as satisfying as you think it will be. And

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Speaker 1: so we're you know, we're bigger fans of the f

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Speaker 1: I part, the financial independent part, and we're all about

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Speaker 1: making intentional choices to make sure that we get there,

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Speaker 1: but not necessarily pursuing it with all the gusto that

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Speaker 1: you can muster. We feel that can that can lead

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Speaker 1: to burnout. A lot of times. I think folks think

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Speaker 1: that when they achieve fire, once they're financially independent, that

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Speaker 1: all the problems are going to go away. But that's

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Speaker 1: definitely not the case. I think those folks are going

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Speaker 1: to be in for a rude awakening, Yeah, for sure.

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Speaker 1: And Matt, let's talk maybe about the history of the

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Speaker 1: Fire movement too, because that's helpful, I think as as

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Speaker 1: we kind of discuss it at length today. In the

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Speaker 1: history of Fire really predates the acronym. I don't know

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Speaker 1: exactly when the Fire acronym started. It feels like, I

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Speaker 1: don't know, maybe sometime ten years ago, eleven years ago,

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Speaker 1: that's my that's my guess. But really there were people

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Speaker 1: talking about this concept um and people living a life

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Speaker 1: that reflected this concept far before that acronym came about.

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Speaker 1: Vicky Robin. She was the co author of the best

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Speaker 1: selling book Your Money or Your Life, and she and

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Speaker 1: her co author really helped popularize the idea of financial

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Speaker 1: independence in the nineteen nineties. But these principles have been

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Speaker 1: around even before that, and it really it really starts

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Speaker 1: with creating a big gap between what you earn and

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Speaker 1: what you spend. And um, the bigger the gap, you know,

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Speaker 1: the quicker you're gonna be able to reach that place

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Speaker 1: in your life where your money is working harder for

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Speaker 1: you than you have to work for it. And Yeah,

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Speaker 1: the cool thing is that those fundamental principles haven't changed,

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Speaker 1: but the way that those ideas get communicated really has.

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Speaker 1: And so yeah, that, like we said, has helped this

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Speaker 1: movement out in a big way. It's become a really

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Speaker 1: powerful communication tool to help spread a message that can

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Speaker 1: be pretty empowering. That is true. But you know, in

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Speaker 1: recent years, the actual fire acronym has been popularized, you know,

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Speaker 1: quite a bit by single males who work in higher

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Speaker 1: paying like software and technology jobs, um, and you know,

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Speaker 1: sort of like you mentioned earlier, like the movement has

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Speaker 1: caught some flak for that. It has become a whipping

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Speaker 1: horse with media, and in some ways, we feel that

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Speaker 1: this was kind of a bit of a stereotype because

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Speaker 1: on our show, many of the guests that we've had

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Speaker 1: that are in the Fire movement they don't fit that bill.

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Speaker 1: They're not you know, single males who were working in

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Speaker 1: you know, high paying jobs. Although we definitely have had

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Speaker 1: some of those guys on, We've also had folks on

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Speaker 1: the show like Jillian John's Rude Julian and Kirsten from

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Speaker 1: from rich and regular here in Atlanta, Liz Thames, Tanya Hester.

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Speaker 1: They have all shown that there is more diversity than

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Speaker 1: than some people think inside of the actual Fire movement. Yeah,

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Speaker 1: and I think the Fire movement has grown to really

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Speaker 1: encompass a whole lot of folks that look a lot

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Speaker 1: different than the stereotypes that we see portrayed. And although

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Speaker 1: like probably one of the most popular figures in the movement,

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Speaker 1: it probably does fit that stereotype to a large degree.

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Speaker 1: And that's Mr money Mustache, right, who was a software

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Speaker 1: engineer but before he quit, right, And so yeah, he's

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Speaker 1: he's like probably the best known writer um in that spear. Uh.

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Speaker 1: And he is a really good writer. So there's a

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Speaker 1: reason why, right, he has well it in creative posts

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Speaker 1: that help people think through what it looks like to

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Speaker 1: save more money by changing their lifestyle. And Matt he

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Speaker 1: takes us really like brash approach in in how he

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Speaker 1: writes and h yeah, he's referred to the typical middle

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Speaker 1: class lifestyle as and I quote an exploding volcano of wastefulness.

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Speaker 1: It talks about folks driving around in their clown cars,

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Speaker 1: you know, just like the different vehicles that we drive

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Speaker 1: that are completely unnecessary and and we you know, we

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Speaker 1: agreed to that to a certain extent. That's a part

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Speaker 1: of why we love biking. So much, but like when

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Speaker 1: you read his post, you feel compelled to change some

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Speaker 1: of the things that you're doing because of the stark

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Speaker 1: contrast anything that it hangs. He does a good job

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Speaker 1: with that, and so yeah, he makes fire, financial independence

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Speaker 1: and retiring early feel like something you don't have to

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Speaker 1: grind to achieve, but more like away folks should be

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Speaker 1: living anyway instead living less wastefully and just living more intentionally. Yeah,

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Speaker 1: he makes it make intuitive sense where it feels like

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Speaker 1: it's something that you should naturally be doing anyway. And

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Speaker 1: the thing is too folks like Mr money Mustash and

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Speaker 1: Vicky Robbin. For them, the fire concept goes beyond just

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Speaker 1: the dollars in the set. You know, they're all about

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Speaker 1: decreasing our environmental footprint as well. You know, connecting your

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Speaker 1: spending and your money choices to bigger ideals can be

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Speaker 1: really helpful. But that's just one of the additional benefits

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Speaker 1: of fire right. It's not necessarily a requirement, because again,

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Speaker 1: fire can look different for everyone. You can choose your

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Speaker 1: own adventure. And so we're actually gonna talk more about

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Speaker 1: the different types of fire, financial independence, retire early, some

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Speaker 1: of the different flavors out there that you might want

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Speaker 1: to subscribe to. And we'll get to that right after

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Speaker 1: this break. All we're back, we're talking about fire and

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Speaker 1: how there's a bunch of different ways that you can

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Speaker 1: get to that point. I think it's helpful for folks

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Speaker 1: to know that there's not just a one size fits all, uh,

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Speaker 1: when you're looking to save up enough money that you

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Speaker 1: don't have to work anymore. So, Matt, But before we

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Speaker 1: get to maybe some of those different types of models

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Speaker 1: that people can follow in order to achieve that, let's

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Speaker 1: maybe talk about the general concept of retire it for

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Speaker 1: just a second, because you know, just like we talked

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Speaker 1: about the fire movement, the fire acronym being relatively new, well,

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Speaker 1: the general concept of retirement is pretty new in and

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Speaker 1: of itself. For most of human history, working your whole

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Speaker 1: life was the thing, like you didn't really have. We

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Speaker 1: didn't have, you know, social security, but choice, we didn't. Yeah,

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Speaker 1: it's what you had to do, like working working to

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Speaker 1: land until you dropped dead while working the land. And

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Speaker 1: I'm glad that that's not the way life is anymore, right, um,

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Speaker 1: And So retirement being a thing is a good thing,

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Speaker 1: but it's also important to keep that in mind. As

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Speaker 1: we discussed this that the modern concept of retirement is

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Speaker 1: relatively new. Uh, it's not something that our ancestors four

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Speaker 1: hundreds of years have been participating participating in. It's not like,

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Speaker 1: you know, you're great great, great, great great great Grandpa

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Speaker 1: in the sixteen hundreds moved Florida and walked on the

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Speaker 1: beach every day because searching for sharks, which is let

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Speaker 1: our kids do know, wake at at the beach. Ye

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Speaker 1: back then it was the thing. Yeah, back then they're

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Speaker 1: just trying to avoid the bubonic plague, right, which actually

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Speaker 1: that's not too different I guess from our recent the

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Speaker 1: recent year that we've had. Uh. And you know, the

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Speaker 1: concept of fire, it does have its merits, right, the

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Speaker 1: fact that you don't have to work when you save

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Speaker 1: up enough money is great. But at the same time,

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Speaker 1: some folks in the fire movement emphasize the negativity of work, right.

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Speaker 1: It's you know, it's certainly not that everyone get gets

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Speaker 1: pumped to wake up and to go and do their

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Speaker 1: job every day, but focusing on early retirement makes work

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Speaker 1: seem like a drag meant to be ditched at the

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Speaker 1: earliest possible moment. And you know, we're not really down

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Speaker 1: with that, and that's another reason why we're just more

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Speaker 1: focused on the financial independence side of the equation less

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Speaker 1: on the retire early side of things. Um. I think,

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Speaker 1: I mean, I think we both believe that in order

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Speaker 1: to live a fulfilling life that it involves service, whether

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Speaker 1: or not you're getting paid for it, whether or not

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Speaker 1: you're being compensated at a very high amount, or if

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Speaker 1: you're just kind of receiving just kind of a you know,

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Speaker 1: may we have a more minimum wage for for the

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Speaker 1: service that you're doing, but service eagles work, right, And

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Speaker 1: so for that reason, we're not trying to escape work.

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Speaker 1: But we do want folks to have more options as

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Speaker 1: they go through life. And that's what we're talking about today.

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Speaker 1: And if someone came up to me and they said,

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Speaker 1: all right, if I take this job and I work

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Speaker 1: for the next twelve years really hard, I can reach

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Speaker 1: financial independence, but I'll hate most every minute of working

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Speaker 1: at this job, I would say, don't do it. I

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Speaker 1: would rather you take much much longer to achieve financial

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Speaker 1: independence than pursuing something for the next decade plus that

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Speaker 1: you don't enjoy in the least. Um, just in order

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Speaker 1: to get there more quickly. Assuming that the alternative is

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Speaker 1: a job that you love, right, So twelve years of

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Speaker 1: basically life that you hate. But that's the thing, there's

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Speaker 1: that that's never the only option. It is like between

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Speaker 1: two jobs that you hate, right, right, you can always

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Speaker 1: go find something that you love to pay is less

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Speaker 1: or that you enjoy and granted, like like you said,

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Speaker 1: even people that enjoy their jobs, they're not going to

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Speaker 1: be thrilled to go into the office every day or

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Speaker 1: you know, even even coming to the microphone. Sometimes I'm like,

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Speaker 1: maybe I'm not in the best mood to record a

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Speaker 1: podcast that day, but I get through it. You know, Um,

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Speaker 1: maybe you're mad at me, anything to share today. We're good.

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Speaker 1: We're good, good. But yeah, that's that's one of those

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Speaker 1: things where I think sometimes the fire movement can turn

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Speaker 1: work into such a villain that it can really affect

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Speaker 1: the mindset of some of the people working to achieve fire,

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Speaker 1: and I think that leads to the downfall of some

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Speaker 1: of those people. Um and maybe like the burnout factor

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Speaker 1: that some of the people trying to go down the

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Speaker 1: fire path tend to experience. That's right, Yeah, so the

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Speaker 1: path to fire can look different based on your particular circumstances,

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Speaker 1: your specific goals, and you know, unsurprisingly, the media tends

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Speaker 1: to take extreme positions. Uh, And I feel like they

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Speaker 1: oftentimes either make fire seem like like it's only for

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Speaker 1: incredibly high earning tech bros out there, or just for

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Speaker 1: folks who you know, want to live a meager existence

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Speaker 1: of like eggs and beans, or like like just the

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Speaker 1: cheapest what's like, what its rising? Beans? Why say eggs,

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Speaker 1: because like, eggs are really cheap. Eggs are super affordable,

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Speaker 1: good for you, they're cheap, large part of our diet

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Speaker 1: here in our household, but just essentially subsisting on like

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Speaker 1: fifteen thousand dollars a year, right, that's the only way

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Speaker 1: you can achieve it is if you either make bouckoos

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Speaker 1: of dollars or you live on next to nothing exactly.

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Speaker 1: And that's just not the case. That dichotomy is not

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Speaker 1: quite right. Yeah. Yeah, there's more diversity all on the

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Speaker 1: fire spectrum, and chances are that there's going to be

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Speaker 1: a version or a flavor that is going to appeal

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Speaker 1: to you. So let's get it off me, let's talk

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Speaker 1: about some of the different types of fire. Let's do

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Speaker 1: it all right, so we just you know, you mentioned

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Speaker 1: the beans and rices lifestyle living on k there are

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Speaker 1: some people who that style of fire. It fits their needs,

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Speaker 1: it fits like their desires in life, and they're like,

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Speaker 1: I just want to be financially independent and I don't

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Speaker 1: mind living an incredible frugal lifestyle. And for those folks

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Speaker 1: who lean in that direction, they're going to be into

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Speaker 1: what's called lean fire. And so yeah, this is for

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Speaker 1: the folks who just can't wait to quit work and

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Speaker 1: don't mind having an incredibly small residual income. And yeah,

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Speaker 1: these folks are basically looking to cover their basic needs

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Speaker 1: like food, transportation when they need it and trying to

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Speaker 1: keep those costs to a minimum and uh, you know,

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Speaker 1: a really small rent or mortgage. Some of these folks,

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Speaker 1: you know, they might even move to different lower cost

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Speaker 1: of living areas of the country or even the world

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Speaker 1: in order to achieve this. Right, So let's say you

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Speaker 1: know you're saving like Panama or Thailand, right, Yeah, Portugal

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Speaker 1: is another destination where some people are moving, which sounds

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Speaker 1: like fun Like that's uh, I mean, I mean we're

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Speaker 1: actually not planning to talk about this, but like the

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Speaker 1: nomadic fire lifestyle or you know, like that's another sort

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Speaker 1: of shand or another flavor that I kind of feel

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Speaker 1: like lends itself to lean fire as well. Yeah, yeah, yeah,

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Speaker 1: because if you have your money saved up in US dollars,

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Speaker 1: but your dollar goes three times as far in another

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Speaker 1: you know, lower cost of living area, then it makes sense,

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Speaker 1: right you can live that lean fire lifestyle on your

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Speaker 1: money if you're willing to make that move, right, right,

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Speaker 1: So yeah, the upside is that you're able to achieve

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Speaker 1: financial independence really quickly, but the downside is that you're

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Speaker 1: gonna have to make some serious sacrifices if you go

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Speaker 1: in that direction. So, Matt, I don't know about you,

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Speaker 1: but the lean fire approach doesn't really have any appeal

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Speaker 1: to me, but I can see how some people might

428
00:19:55,640 --> 00:19:58,240
Speaker 1: be interested in that. Yeah. Yeah, the pros are that

429
00:19:58,280 --> 00:19:59,919
Speaker 1: you don't have to work anymore, but she also can

430
00:20:00,080 --> 00:20:02,760
Speaker 1: do much of anything else. Like I feel like this

431
00:20:02,800 --> 00:20:04,440
Speaker 1: really does lend itself to kind of like the more

432
00:20:04,440 --> 00:20:06,560
Speaker 1: minimalist approach. Like, for instance, if you ended up staying

433
00:20:06,560 --> 00:20:08,080
Speaker 1: in the house that y'all are in instead of renting

434
00:20:08,080 --> 00:20:10,600
Speaker 1: it out, which is your plan, Uh, you could be

435
00:20:10,840 --> 00:20:13,679
Speaker 1: lean fire probably today, right, because it's it's a really,

436
00:20:13,720 --> 00:20:16,399
Speaker 1: really affordable house. But yeah, that doesn't lend itself to

437
00:20:16,440 --> 00:20:18,840
Speaker 1: the lifestyle that you're looking for. And I think it's

438
00:20:18,840 --> 00:20:21,400
Speaker 1: tougher too with kids, right, Like, it's hard enough maybe

439
00:20:21,400 --> 00:20:24,400
Speaker 1: to get a partner on board with cutting Hey we're

440
00:20:24,400 --> 00:20:26,280
Speaker 1: gonna cut back our lifestyle completely. What do you think

441
00:20:26,280 --> 00:20:28,480
Speaker 1: about that? This is what our lives are gonna look like,

442
00:20:29,320 --> 00:20:32,080
Speaker 1: This is how little we're gonna travel, things like that.

443
00:20:32,119 --> 00:20:34,959
Speaker 1: But it's even more difficult, I think with kids, and

444
00:20:35,000 --> 00:20:37,919
Speaker 1: not because I'm not going to subscribe to the you know,

445
00:20:38,000 --> 00:20:40,560
Speaker 1: the reports that you see that kids cost like, you know,

446
00:20:40,560 --> 00:20:42,600
Speaker 1: five dollars, but you know by the time that they

447
00:20:42,680 --> 00:20:46,320
Speaker 1: leave your house at tea right there. Yeah, but they

448
00:20:46,400 --> 00:20:49,840
Speaker 1: do have a tougher time understanding the same goals that

449
00:20:49,880 --> 00:20:51,800
Speaker 1: you as an adult have, right I mean, and it's

450
00:20:51,840 --> 00:20:54,920
Speaker 1: understandable like kids or kids they don't think like adults,

451
00:20:55,080 --> 00:20:57,160
Speaker 1: and so I think at times it might be difficult

452
00:20:57,359 --> 00:20:59,239
Speaker 1: to get kids on board. So that's something to keep

453
00:20:59,240 --> 00:21:01,719
Speaker 1: in mind. I think it lends itself to the single

454
00:21:02,200 --> 00:21:04,440
Speaker 1: software engineer who might be down with like living in

455
00:21:04,520 --> 00:21:06,560
Speaker 1: a van down by the river kind of thing, but

456
00:21:06,800 --> 00:21:09,320
Speaker 1: a little bit tougher with maybe a larger family or

457
00:21:09,400 --> 00:21:10,920
Speaker 1: if you have other goals in life that you're looking

458
00:21:10,960 --> 00:21:13,160
Speaker 1: to pursue. Yeah, that doesn't mean that you can't live

459
00:21:13,280 --> 00:21:16,080
Speaker 1: frugally as a family, But lean fire is like cutting

460
00:21:16,080 --> 00:21:18,400
Speaker 1: to the bone, and that's a little too much for

461
00:21:18,440 --> 00:21:20,680
Speaker 1: most people to stomach, that's right. Yeah, And so next

462
00:21:20,760 --> 00:21:23,679
Speaker 1: let's get to coast fire, which can be ideal for

463
00:21:23,760 --> 00:21:26,840
Speaker 1: some of the younger folks in the movement, especially that

464
00:21:26,920 --> 00:21:29,399
Speaker 1: this fire route is all about saving up huge chunks

465
00:21:29,440 --> 00:21:32,400
Speaker 1: of money in your early working years and then not

466
00:21:32,520 --> 00:21:35,720
Speaker 1: having to prioritize saving and investing after that. Right, So

467
00:21:35,840 --> 00:21:38,320
Speaker 1: essentially you're front loading the sacrifice. So let's say that

468
00:21:38,320 --> 00:21:40,240
Speaker 1: you max out your retirement accounts, you're four one K

469
00:21:40,320 --> 00:21:43,440
Speaker 1: your roth ira A say, for ten years running through

470
00:21:43,480 --> 00:21:45,920
Speaker 1: your twenties into your early thirties, you'll have sucked away

471
00:21:45,960 --> 00:21:48,879
Speaker 1: over two or fifty thousand dollars, right, not to mention

472
00:21:48,920 --> 00:21:52,200
Speaker 1: the growth that you'll will have already seen on those

473
00:21:52,240 --> 00:21:55,200
Speaker 1: dollars that you have invested early on. But at this point,

474
00:21:55,240 --> 00:21:58,800
Speaker 1: your index fund portfolio is almost guaranteed. I mean it

475
00:21:58,880 --> 00:22:00,800
Speaker 1: is guaranteed to turn into a good bit more than

476
00:22:00,880 --> 00:22:04,639
Speaker 1: one million dollars. If it's not, we've encountered really termulent troubling,

477
00:22:04,720 --> 00:22:06,520
Speaker 1: you know at times when we're all screwed. Yeah. Yeah,

478
00:22:06,560 --> 00:22:08,479
Speaker 1: by the time you hit retirement age, right, and so

479
00:22:08,600 --> 00:22:11,000
Speaker 1: once you have that done, you can now stop contributing

480
00:22:11,040 --> 00:22:14,159
Speaker 1: to retirement accounts altogether. Uh, and you can look to

481
00:22:14,280 --> 00:22:17,159
Speaker 1: do something like increasing your spending levels, finding ways to

482
00:22:17,520 --> 00:22:21,000
Speaker 1: maximize your enjoyment out of life essentially, you know, and

483
00:22:21,160 --> 00:22:23,560
Speaker 1: especially as you maybe you start to have kids stuff

484
00:22:23,600 --> 00:22:26,719
Speaker 1: like that, and let's say your thirties, it affords you

485
00:22:26,880 --> 00:22:29,760
Speaker 1: a little more breathing room because you can soak up

486
00:22:29,800 --> 00:22:32,000
Speaker 1: more of that income into your spending now because you

487
00:22:32,080 --> 00:22:34,879
Speaker 1: did such a good job during those first ten years

488
00:22:35,359 --> 00:22:38,280
Speaker 1: of your investing lifetime and you built up such a

489
00:22:38,400 --> 00:22:40,760
Speaker 1: large nest egg that you don't have to keep funding

490
00:22:40,760 --> 00:22:43,440
Speaker 1: it because you don't need five million dollars in retirement.

491
00:22:43,480 --> 00:22:46,040
Speaker 1: You just need one million something like that, right. And

492
00:22:46,080 --> 00:22:48,280
Speaker 1: the idea too. So this is called coast fire. It's

493
00:22:48,680 --> 00:22:50,440
Speaker 1: not to be confused with like. This doesn't mean that

494
00:22:50,480 --> 00:22:53,120
Speaker 1: you're living like on the coast, like the Amulfi coast, right.

495
00:22:53,480 --> 00:22:56,439
Speaker 1: This means that you've worked hard. Uh. It's like imagine

496
00:22:56,440 --> 00:22:58,240
Speaker 1: that you're flooring it. You're getting close to this hill,

497
00:22:58,280 --> 00:23:00,479
Speaker 1: a big downhill, and then you start going down downhill,

498
00:23:00,520 --> 00:23:01,800
Speaker 1: and then you can let your foot off the gas

499
00:23:01,840 --> 00:23:03,560
Speaker 1: a little bit and you get the coast all the

500
00:23:03,600 --> 00:23:05,760
Speaker 1: way down. That's the kind of coast that we're talking

501
00:23:05,760 --> 00:23:07,960
Speaker 1: about here. Yeah, I feel like to the good thing.

502
00:23:08,320 --> 00:23:10,560
Speaker 1: The thing I like about that route and that strategy

503
00:23:10,760 --> 00:23:14,800
Speaker 1: to achieving fire is that can completely change how you

504
00:23:14,880 --> 00:23:17,000
Speaker 1: view work, because if you're no longer having to save

505
00:23:17,040 --> 00:23:19,000
Speaker 1: towards retirement, you know, once you've kind of done that

506
00:23:19,040 --> 00:23:21,480
Speaker 1: hard work, you can switch jobs or careers if you

507
00:23:21,520 --> 00:23:23,760
Speaker 1: don't find your current line of work fulfilling, or if

508
00:23:23,760 --> 00:23:26,320
Speaker 1: it's become too stressful. Maybe, of course, you still have

509
00:23:26,400 --> 00:23:28,679
Speaker 1: expenses to pay for in the meantime, but if you

510
00:23:28,760 --> 00:23:30,600
Speaker 1: no longer have a boatload of debt and you're not

511
00:23:30,640 --> 00:23:33,360
Speaker 1: worried about how you're gonna survive, you know, in your

512
00:23:33,480 --> 00:23:36,320
Speaker 1: elderly years, you can then have the freedom to pursue

513
00:23:36,440 --> 00:23:39,119
Speaker 1: things that bring you joy instead of doing something that

514
00:23:39,119 --> 00:23:41,080
Speaker 1: you don't love. And you and I were were all

515
00:23:41,080 --> 00:23:43,320
Speaker 1: about that, teaching things that you don't love, getting that

516
00:23:43,320 --> 00:23:45,919
Speaker 1: stuff out of your life, even if it produces a

517
00:23:45,960 --> 00:23:49,160
Speaker 1: giant monetary return um for most people, most of the time,

518
00:23:49,200 --> 00:23:51,320
Speaker 1: it's not worth it. Yeah, what's crazy about Coast fire

519
00:23:51,440 --> 00:23:53,120
Speaker 1: is I think for a lot of folks, I think

520
00:23:53,280 --> 00:23:55,240
Speaker 1: they if they crunch the numbers, they might realize that

521
00:23:55,280 --> 00:23:58,240
Speaker 1: they have kind of already achieved Coast fire, right, And

522
00:23:58,320 --> 00:24:01,560
Speaker 1: so I actually crunched them are specific numbers because I

523
00:24:01,560 --> 00:24:03,760
Speaker 1: wanted to see what it took for someone to hit

524
00:24:03,800 --> 00:24:05,800
Speaker 1: one million dollars by the time they hit sixty five.

525
00:24:06,119 --> 00:24:07,880
Speaker 1: And all that means is that you need to have

526
00:24:08,000 --> 00:24:11,520
Speaker 1: ninety four thousand dollars invested by the time you're thirty

527
00:24:11,560 --> 00:24:15,320
Speaker 1: years old, and so thousand that's I mean, that's pretty attainable.

528
00:24:15,320 --> 00:24:17,000
Speaker 1: I mean, it's easy, but it's attainable. And I don't

529
00:24:17,000 --> 00:24:18,840
Speaker 1: want you exactly, I don't want to downplay how hard

530
00:24:18,840 --> 00:24:21,760
Speaker 1: it is to get together close to a hundred thousand dollars.

531
00:24:21,800 --> 00:24:23,800
Speaker 1: But if you have that money invested and you're earning

532
00:24:23,800 --> 00:24:27,320
Speaker 1: about seven percent every year through the power of compounding interest,

533
00:24:27,400 --> 00:24:29,439
Speaker 1: you're going to hit over a million dollars by the

534
00:24:29,480 --> 00:24:31,840
Speaker 1: time you hit sixty five years old. And granted, we're

535
00:24:31,840 --> 00:24:34,920
Speaker 1: talking about fire, which is retire early, and sixty five

536
00:24:35,000 --> 00:24:37,600
Speaker 1: is obviously more of a traditional view of retirement. But

537
00:24:37,680 --> 00:24:39,159
Speaker 1: I guess I wanted to point that out because I

538
00:24:39,160 --> 00:24:41,639
Speaker 1: think a lot of folks might realize, oh wow, like

539
00:24:41,720 --> 00:24:43,840
Speaker 1: I am on the spectrum to a certain extent. And

540
00:24:43,880 --> 00:24:45,600
Speaker 1: if you are at that point, just like you said, Dull,

541
00:24:45,800 --> 00:24:48,000
Speaker 1: it gives you the freedom to start making some choices

542
00:24:48,160 --> 00:24:51,239
Speaker 1: in life that may not be the best choices when

543
00:24:51,240 --> 00:24:53,520
Speaker 1: it comes to your money as far as the dollar amount,

544
00:24:53,760 --> 00:24:55,920
Speaker 1: but it might be more fulfilling work. It makes me

545
00:24:56,000 --> 00:24:58,080
Speaker 1: think about what we're doing right now. I mean this podcast.

546
00:24:58,119 --> 00:25:01,800
Speaker 1: You and I have gone into creating this show. It's

547
00:25:01,840 --> 00:25:03,680
Speaker 1: something that we have a lot of passion about, something

548
00:25:03,680 --> 00:25:07,600
Speaker 1: that we're excited to spread the good news of financial independence,

549
00:25:07,600 --> 00:25:09,640
Speaker 1: of people doing smart things with their money in order

550
00:25:09,680 --> 00:25:11,760
Speaker 1: for them to have more options down the road. And

551
00:25:11,800 --> 00:25:13,719
Speaker 1: I believe you and I had a degree of confidence

552
00:25:13,960 --> 00:25:17,640
Speaker 1: to step into creating the show full time because, Yeah,

553
00:25:17,680 --> 00:25:19,800
Speaker 1: we look back at the ten plus years of our

554
00:25:19,800 --> 00:25:22,160
Speaker 1: lives where we had done smarter things with our money,

555
00:25:22,160 --> 00:25:25,000
Speaker 1: where we were primarily focused on the dollar amount, and

556
00:25:25,040 --> 00:25:26,720
Speaker 1: if we wanted to, we could, You and I could

557
00:25:26,840 --> 00:25:29,639
Speaker 1: could both stop contributing to our retirement and investing that

558
00:25:29,720 --> 00:25:32,000
Speaker 1: money and just you know, say we were only making

559
00:25:32,119 --> 00:25:34,639
Speaker 1: enough to subsist and exist and you know, pay the

560
00:25:34,640 --> 00:25:36,560
Speaker 1: bills today. By the time we hit sixty five, you

561
00:25:36,560 --> 00:25:38,800
Speaker 1: and I both are going to be okay. So I mean,

562
00:25:38,800 --> 00:25:41,240
Speaker 1: technically speaking, you and I are both in the coast

563
00:25:41,320 --> 00:25:44,560
Speaker 1: fire camp. That's the stage of life that that we're in. Yeah,

564
00:25:44,600 --> 00:25:47,040
Speaker 1: for me, Matt, what it comes down to saving the

565
00:25:47,080 --> 00:25:50,479
Speaker 1: investing well gives you options, and uh, coast fires kind

566
00:25:50,480 --> 00:25:52,200
Speaker 1: of all about those options, like I'm gonna work really

567
00:25:52,200 --> 00:25:54,160
Speaker 1: hard in the beginning and then I'm gonna be able

568
00:25:54,200 --> 00:25:56,480
Speaker 1: to do what I want. And often times it does

569
00:25:56,560 --> 00:25:59,680
Speaker 1: mean it gives you those options to not necessarily amass

570
00:25:59,760 --> 00:26:03,399
Speaker 1: this huge nest egg of money for your future self,

571
00:26:03,480 --> 00:26:06,240
Speaker 1: because who really needs five million dollars with retirement. I

572
00:26:06,280 --> 00:26:09,200
Speaker 1: guess some people. Nobody really needs it, but some people

573
00:26:09,240 --> 00:26:10,840
Speaker 1: want it. Some people want it, that's what they're going for.

574
00:26:11,080 --> 00:26:13,400
Speaker 1: And we say, we don't really, we don't really need

575
00:26:13,440 --> 00:26:16,520
Speaker 1: that much money. Um, we'd rather make choices now in

576
00:26:16,560 --> 00:26:18,920
Speaker 1: our thirties to do work that we love, to get,

577
00:26:18,920 --> 00:26:21,040
Speaker 1: to enjoy more time with our family, with our kids,

578
00:26:21,359 --> 00:26:24,120
Speaker 1: really to create the lifestyle that we want. And so yeah,

579
00:26:24,119 --> 00:26:26,280
Speaker 1: coast Fire I think resonates with both of us a

580
00:26:26,320 --> 00:26:28,080
Speaker 1: lot more than maybe some of the other types of

581
00:26:28,119 --> 00:26:30,400
Speaker 1: fire that we'll talk about. Yeah, because it's I mean, again,

582
00:26:30,440 --> 00:26:32,160
Speaker 1: I don't want to feel like I'm beating a dead horse.

583
00:26:32,200 --> 00:26:34,399
Speaker 1: But it's it's not like we're forsaking work altogether. Like

584
00:26:34,440 --> 00:26:36,280
Speaker 1: we're still working hard, but it's just it's not like

585
00:26:36,359 --> 00:26:38,000
Speaker 1: a light switch that's either on or off. And I

586
00:26:38,000 --> 00:26:39,680
Speaker 1: think a lot of times when it comes to retirement

587
00:26:39,760 --> 00:26:42,760
Speaker 1: or fire, folks, that's how they that's how they approach it, right,

588
00:26:42,800 --> 00:26:45,400
Speaker 1: It's like it's either on in a working crazy hard

589
00:26:45,440 --> 00:26:48,400
Speaker 1: and I'm neglecting my health, my relationships, my mental health,

590
00:26:48,480 --> 00:26:50,600
Speaker 1: just everything that's out there, and then eventually we're gonna

591
00:26:50,600 --> 00:26:53,280
Speaker 1: flip it off. I'm no longer gonna work. But you

592
00:26:53,280 --> 00:26:55,600
Speaker 1: and I, I mean, we're talking about approaching this less

593
00:26:55,640 --> 00:26:56,920
Speaker 1: as like an on off switch and more like a

594
00:26:56,960 --> 00:26:59,439
Speaker 1: dimmer switch. It's just like, Okay, you know, we were

595
00:26:59,480 --> 00:27:02,280
Speaker 1: pretty close us to full capacity, you know, full brightness level,

596
00:27:02,520 --> 00:27:04,080
Speaker 1: but now let's just kind of dim it down a

597
00:27:04,119 --> 00:27:06,359
Speaker 1: little bit. You know, We're we're definitely still working, but

598
00:27:06,400 --> 00:27:08,600
Speaker 1: we also have the ability to prioritize some other things

599
00:27:08,600 --> 00:27:11,399
Speaker 1: in our life, like relationships and in different things that

600
00:27:11,400 --> 00:27:13,680
Speaker 1: we want to pursue. Yeah, I think the dimmer switch

601
00:27:13,680 --> 00:27:15,560
Speaker 1: is a good concept when when it comes to fire

602
00:27:15,600 --> 00:27:17,480
Speaker 1: doesn't have to be all or nothing. And so yeah,

603
00:27:17,520 --> 00:27:20,800
Speaker 1: I think the next you know fire type makes uh

604
00:27:20,840 --> 00:27:23,840
Speaker 1: it fits into that category. It's called Barista fire, which

605
00:27:24,160 --> 00:27:26,320
Speaker 1: is more of an attempt to save and invest well

606
00:27:26,400 --> 00:27:30,000
Speaker 1: with the goal of retiring, but also still needing to

607
00:27:30,040 --> 00:27:32,880
Speaker 1: work part time and and have that part time work

608
00:27:32,920 --> 00:27:37,360
Speaker 1: offer you benefits, particularly healthcare benefits. So Starbucks is obviously

609
00:27:37,359 --> 00:27:40,640
Speaker 1: known for offering excellent healthcare benefits to employees that work

610
00:27:40,920 --> 00:27:43,560
Speaker 1: only twenty hours a week. So yeah, the thus the

611
00:27:43,600 --> 00:27:47,119
Speaker 1: Barista fire exactly. So that Barista fire strategy is this

612
00:27:47,240 --> 00:27:50,159
Speaker 1: alternative essentially for people who aren't ready to save more

613
00:27:50,200 --> 00:27:53,640
Speaker 1: than their income, because that's a tall order in order

614
00:27:53,680 --> 00:27:56,359
Speaker 1: to retire ridiculously early. That's maybe not what they care about,

615
00:27:56,680 --> 00:27:58,240
Speaker 1: but they just want the flexibility to be able to

616
00:27:58,240 --> 00:28:01,240
Speaker 1: work less as they get old, and so yeah, similar

617
00:28:01,280 --> 00:28:03,679
Speaker 1: to Coast fire, you still have a job much of

618
00:28:03,720 --> 00:28:06,000
Speaker 1: the time, but you're even less dependent on it, right,

619
00:28:06,280 --> 00:28:09,200
Speaker 1: So it's it's kind of like partial retirement. It's not

620
00:28:09,359 --> 00:28:13,080
Speaker 1: get to work just part time and you have those benefits, right,

621
00:28:13,080 --> 00:28:15,639
Speaker 1: like healthcare obviously would be a huge drain on your

622
00:28:15,640 --> 00:28:18,360
Speaker 1: budget if you're retired. Paying for your own health benefits

623
00:28:18,359 --> 00:28:20,600
Speaker 1: is one of the biggest conundrums in the fire community.

624
00:28:20,760 --> 00:28:23,680
Speaker 1: And so if you're Barista Fire, you have enough money

625
00:28:23,680 --> 00:28:26,679
Speaker 1: to pay for your living expenses, but you're saying, I

626
00:28:26,720 --> 00:28:28,680
Speaker 1: still't want an employer, or one for part time income,

627
00:28:28,720 --> 00:28:30,679
Speaker 1: and then two for some of these benefits that are

628
00:28:30,720 --> 00:28:32,800
Speaker 1: kind of crucial to being able to, you know, live

629
00:28:32,800 --> 00:28:34,399
Speaker 1: the life I want to live. Yeah. Again, one of

630
00:28:34,440 --> 00:28:37,439
Speaker 1: the similarities between Barista Fire and Coast Fire is just

631
00:28:37,520 --> 00:28:39,400
Speaker 1: a high view of work, so it's not something that

632
00:28:39,440 --> 00:28:42,400
Speaker 1: we're trying to completely escape from. And of course at

633
00:28:42,440 --> 00:28:45,760
Speaker 1: the other end of the frugality spectrum is fat fire.

634
00:28:46,440 --> 00:28:48,480
Speaker 1: If this is your aim, you're gonna need to save

635
00:28:48,560 --> 00:28:51,480
Speaker 1: up a pretty large nest x that your lifestyle doesn't

636
00:28:51,480 --> 00:28:54,600
Speaker 1: get cramped in the slightest you might be in that Actually,

637
00:28:54,640 --> 00:28:57,240
Speaker 1: I do want five million dollars in my retirement account,

638
00:28:57,520 --> 00:28:59,560
Speaker 1: you know, territory and the kind of life I would

639
00:28:59,560 --> 00:29:02,520
Speaker 1: have lived. Perhaps you want to include even more spending

640
00:29:02,520 --> 00:29:04,680
Speaker 1: than you're used to. People going in this direction either

641
00:29:04,880 --> 00:29:07,240
Speaker 1: work a few years longer to build up those savings,

642
00:29:07,360 --> 00:29:10,560
Speaker 1: or they they suck away an amazingly high percentage of

643
00:29:10,640 --> 00:29:14,120
Speaker 1: their pay in order to to achieve fat fire. Apparently

644
00:29:14,200 --> 00:29:17,040
Speaker 1: there's an obese fire as well. I've even heard it

645
00:29:17,040 --> 00:29:20,240
Speaker 1: referred to as morbidly obese fire. And so the acrimonym

646
00:29:20,360 --> 00:29:24,240
Speaker 1: is MO fire. It's safe to assume folks that can't

647
00:29:24,240 --> 00:29:26,960
Speaker 1: want to be able to participate in all that life has,

648
00:29:27,560 --> 00:29:30,239
Speaker 1: regardless of the cost. So, now that we've covered a

649
00:29:30,240 --> 00:29:33,760
Speaker 1: few of the different types of financial independence, retire early,

650
00:29:33,920 --> 00:29:36,760
Speaker 1: a few of the different models that you can choose

651
00:29:37,080 --> 00:29:40,560
Speaker 1: to kind of look to as you're figuring out how

652
00:29:40,560 --> 00:29:42,160
Speaker 1: you're going to invest and how you're going to live

653
00:29:42,480 --> 00:29:45,600
Speaker 1: today while you're also trying to pursue financial independence down

654
00:29:45,600 --> 00:29:48,040
Speaker 1: the road. Well, let's talk about some of the tactics

655
00:29:48,040 --> 00:29:51,040
Speaker 1: that it takes to get there, how to achieve financial

656
00:29:51,040 --> 00:29:53,520
Speaker 1: independence and retire early. We'll get to our thoughts on

657
00:29:53,520 --> 00:30:05,680
Speaker 1: that right after this break. We are back and Joel,

658
00:30:05,720 --> 00:30:09,040
Speaker 1: this is fire Choose your own Adventure episode. And we've

659
00:30:09,040 --> 00:30:11,400
Speaker 1: talked about the different types of fire, and so now

660
00:30:11,480 --> 00:30:14,200
Speaker 1: let's discuss how to do it. Uh. And you know,

661
00:30:14,240 --> 00:30:16,240
Speaker 1: at a very high level, you have to to spend

662
00:30:16,560 --> 00:30:18,880
Speaker 1: less than you make, like Essentially, that's how you do it.

663
00:30:19,360 --> 00:30:22,920
Speaker 1: That's the basics. That's not really it's if you're living

664
00:30:22,920 --> 00:30:25,760
Speaker 1: paycheck to paycheck, if you have no margin in your life,

665
00:30:25,960 --> 00:30:28,560
Speaker 1: fire isn't even going to be on your radar. Of course,

666
00:30:28,600 --> 00:30:30,680
Speaker 1: if you're you know, if you're spending more than you

667
00:30:30,760 --> 00:30:34,280
Speaker 1: make and you're going further into debt each successive month,

668
00:30:34,600 --> 00:30:37,080
Speaker 1: then you're going in the opposite direction and you're digging

669
00:30:37,120 --> 00:30:39,760
Speaker 1: yourself in a hole that will become, at least over time,

670
00:30:40,000 --> 00:30:42,480
Speaker 1: harder and harder to climb out of. Yeah. So, Matt,

671
00:30:42,520 --> 00:30:44,760
Speaker 1: before someone can even decide, well I want to go

672
00:30:44,880 --> 00:30:47,320
Speaker 1: towards fat fire or I wanna I'm more of a

673
00:30:47,320 --> 00:30:50,840
Speaker 1: coast fire person, really, they have to think about their savings, right, right.

674
00:30:50,880 --> 00:30:53,040
Speaker 1: That's like one of the biggest tactics that you have

675
00:30:53,080 --> 00:30:54,880
Speaker 1: to figure out is how much of your money ken

676
00:30:54,920 --> 00:30:57,560
Speaker 1: you save, because that's going to determine how quickly you're

677
00:30:57,600 --> 00:31:01,040
Speaker 1: able to get to that point of finding independence. There

678
00:31:01,080 --> 00:31:05,160
Speaker 1: is another overarching principle here. Yeah, so we personally believe

679
00:31:05,240 --> 00:31:07,440
Speaker 1: that listeners should be shooting for a savings rate of

680
00:31:07,560 --> 00:31:10,400
Speaker 1: at least fifteen of their income. We'd like to see

681
00:31:10,440 --> 00:31:13,320
Speaker 1: most of that money invested for the future too. And

682
00:31:13,480 --> 00:31:15,880
Speaker 1: Mr money Mustache we referred to to him earlier. He's

683
00:31:15,920 --> 00:31:18,240
Speaker 1: got this great chart on his website that puts some

684
00:31:18,320 --> 00:31:21,200
Speaker 1: concrete numbers to your savings rate and then how long

685
00:31:21,200 --> 00:31:24,080
Speaker 1: it's going to take you to reach financial independence. Uh.

686
00:31:24,440 --> 00:31:27,320
Speaker 1: The post is called the Shockingly Simple Math behind Early Retirement.

687
00:31:27,320 --> 00:31:29,000
Speaker 1: Will link to it in the show notes. But the

688
00:31:29,040 --> 00:31:33,240
Speaker 1: accompanying chart can be really motivational to get you interested

689
00:31:33,280 --> 00:31:36,440
Speaker 1: in investing more of your money because every percentage point

690
00:31:36,480 --> 00:31:37,800
Speaker 1: that you ratch it up to your four oh one

691
00:31:37,880 --> 00:31:41,280
Speaker 1: K contributions has this direct correlation to the amount of

692
00:31:41,440 --> 00:31:44,040
Speaker 1: years that you're gonna have full financial freedom. Yeah. And

693
00:31:44,080 --> 00:31:46,480
Speaker 1: as Mr money Mustache says in the post, cutting spending

694
00:31:46,560 --> 00:31:49,200
Speaker 1: is even more important than earning more money. Uh. It

695
00:31:49,280 --> 00:31:51,680
Speaker 1: has that twofold effect of giving you more money to

696
00:31:51,720 --> 00:31:54,880
Speaker 1: invest now, which means you have less of a lifestyle

697
00:31:54,920 --> 00:31:57,320
Speaker 1: that you're saving up to fund and so your non

698
00:31:57,360 --> 00:31:59,640
Speaker 1: working years won't cost you as much if you're able

699
00:31:59,720 --> 00:32:02,960
Speaker 1: to keep that lifestyle inflation and check. He specifically links

700
00:32:03,000 --> 00:32:06,400
Speaker 1: to this kind of chart calculator thing on net worthifi

701
00:32:06,640 --> 00:32:08,560
Speaker 1: dot com, but we'll make sure to link to that

702
00:32:08,560 --> 00:32:11,560
Speaker 1: specific calculator in our show notes. So that savings rate

703
00:32:11,680 --> 00:32:15,040
Speaker 1: is crucial when it comes to the timeline of you

704
00:32:15,080 --> 00:32:17,280
Speaker 1: being able to achieve financial independence. And I do think, Matt,

705
00:32:17,320 --> 00:32:19,920
Speaker 1: that calculator you just mentioned and that post overall is

706
00:32:19,960 --> 00:32:22,959
Speaker 1: just a huge motivator um and a huge eye opener

707
00:32:23,040 --> 00:32:25,920
Speaker 1: for a lot of people who are looking to handle

708
00:32:25,920 --> 00:32:29,320
Speaker 1: their money well and starting down that road to financial independence.

709
00:32:29,760 --> 00:32:31,520
Speaker 1: It can be helpful to see some of those cold

710
00:32:31,520 --> 00:32:34,200
Speaker 1: hard numbers that help you realize, wait a second, if

711
00:32:34,240 --> 00:32:36,360
Speaker 1: I make this one of these one or two small changes,

712
00:32:36,560 --> 00:32:39,680
Speaker 1: it's going to take years off my need to work

713
00:32:39,720 --> 00:32:41,880
Speaker 1: at least. Yeah, cutting a monthly expense, you can see

714
00:32:41,880 --> 00:32:44,560
Speaker 1: how that changes your retirement from like nineteen years to

715
00:32:44,920 --> 00:32:47,719
Speaker 1: thirteen years. Like, holy crap, just just that one thing,

716
00:32:47,840 --> 00:32:50,080
Speaker 1: she just like takes six years of me potentially having

717
00:32:50,080 --> 00:32:52,800
Speaker 1: to work and an a job that I don't like anymore. Like,

718
00:32:52,800 --> 00:32:54,560
Speaker 1: like you said, like, that's when your eyes are open

719
00:32:54,600 --> 00:32:57,240
Speaker 1: and you see that there's a potentially another path for you. Yeah,

720
00:32:57,240 --> 00:32:59,160
Speaker 1: it's fun to mess around with. So let's talk about

721
00:32:59,200 --> 00:33:01,360
Speaker 1: some of the tactics to like savings very it's huge,

722
00:33:01,400 --> 00:33:03,640
Speaker 1: But we already said that the path of financial independence

723
00:33:03,640 --> 00:33:05,680
Speaker 1: can look different based on how quickly you want to

724
00:33:05,720 --> 00:33:07,920
Speaker 1: get there and what you want your life to look

725
00:33:07,960 --> 00:33:10,880
Speaker 1: like now. But even still, the levers are pretty much

726
00:33:10,920 --> 00:33:13,920
Speaker 1: the same regardless if you're planning on pursuing lean fire

727
00:33:14,040 --> 00:33:18,440
Speaker 1: or fat fire or morbidly obese fire MO fire. I

728
00:33:18,440 --> 00:33:20,800
Speaker 1: didn't know about until until you mentioned So, Yeah, let's

729
00:33:20,800 --> 00:33:23,160
Speaker 1: talk about some of the universal tactics for a second,

730
00:33:23,240 --> 00:33:26,240
Speaker 1: and let's start with income, right, Matt, because that's going

731
00:33:26,280 --> 00:33:28,719
Speaker 1: to be one of the most important factors. Like, how

732
00:33:28,760 --> 00:33:31,320
Speaker 1: much money you make is definitely going to be important

733
00:33:31,680 --> 00:33:34,480
Speaker 1: on your road to achieving financial independence. Yeah, we probably

734
00:33:34,480 --> 00:33:36,880
Speaker 1: don't talk about this one enough, but we would encourage

735
00:33:36,880 --> 00:33:39,640
Speaker 1: folks to find ways to make more money. And here's

736
00:33:39,640 --> 00:33:42,960
Speaker 1: the thing. We're not talking about working more. Uh, We're

737
00:33:42,960 --> 00:33:45,520
Speaker 1: not talking about working more crazy unsustainable hours that will

738
00:33:45,600 --> 00:33:48,320
Speaker 1: leave you burned out. Instead, we want you to pursue

739
00:33:48,440 --> 00:33:51,280
Speaker 1: a higher income through increasing your skills or getting an

740
00:33:51,280 --> 00:33:55,000
Speaker 1: advanced degree, starting your own business. Don't forsake the ability

741
00:33:55,040 --> 00:33:57,480
Speaker 1: to invest in yourself because getting that degree like that's

742
00:33:57,480 --> 00:34:01,800
Speaker 1: gonna pay dividends for years to come, mentally, emotionally, and

743
00:34:01,800 --> 00:34:05,720
Speaker 1: obviously financially as well. Focus on multiple streams of income.

744
00:34:05,760 --> 00:34:08,400
Speaker 1: This can also be a big advantage as well, if

745
00:34:08,400 --> 00:34:10,840
Speaker 1: you're in a job or a career that doesn't easily

746
00:34:10,920 --> 00:34:14,120
Speaker 1: lend itself to making more, even just a modest boost

747
00:34:14,320 --> 00:34:17,160
Speaker 1: in what you're investing every year can lead to huge

748
00:34:17,160 --> 00:34:20,120
Speaker 1: returns down the road. Again, Joel, I'm ill love the numbers,

749
00:34:20,480 --> 00:34:22,880
Speaker 1: so crunching more numbers. And if you're able to invest

750
00:34:22,920 --> 00:34:25,279
Speaker 1: six thousand dollars, which happens to be the rath ira

751
00:34:25,280 --> 00:34:27,840
Speaker 1: a maximum contributions for you know, every year. But if

752
00:34:27,880 --> 00:34:29,560
Speaker 1: you could do that every year for the next thirty

753
00:34:29,600 --> 00:34:32,960
Speaker 1: seven years, you're gonna have over one million dollars if

754
00:34:33,000 --> 00:34:35,600
Speaker 1: that money is invested as it compounds, earning seven percent

755
00:34:35,680 --> 00:34:37,640
Speaker 1: interest every single year. And that's like I'm not even

756
00:34:37,640 --> 00:34:39,880
Speaker 1: contributing to my employer plan, and I'm not getting the

757
00:34:39,920 --> 00:34:43,760
Speaker 1: free match which six always get. Yea, yeah, it's leaving

758
00:34:43,760 --> 00:34:46,239
Speaker 1: all that aside. Even just a simple rath Ira six

759
00:34:46,280 --> 00:34:49,480
Speaker 1: thousand dollars. And again we're not just like getting a

760
00:34:49,640 --> 00:34:52,160
Speaker 1: D nine four thousand dollars by the time you're thirty.

761
00:34:52,160 --> 00:34:54,120
Speaker 1: I'm just letting it sit. I'm not saying that this

762
00:34:54,200 --> 00:34:56,440
Speaker 1: is like super easy to do six thousand dollars, but

763
00:34:56,480 --> 00:34:58,960
Speaker 1: I'm also pointing out like we want to highlight that

764
00:34:59,040 --> 00:35:01,439
Speaker 1: this is attainable for a lot of folks out there. Yeah.

765
00:35:01,480 --> 00:35:03,360
Speaker 1: So one of the taxics is, like you said, to

766
00:35:03,360 --> 00:35:05,960
Speaker 1: increase your income to invest in yourself that pays big

767
00:35:05,960 --> 00:35:09,439
Speaker 1: time dividends. Another tactic that it takes on the path

768
00:35:09,480 --> 00:35:11,840
Speaker 1: of fire is to, you know, tamp down your expenses,

769
00:35:12,360 --> 00:35:16,040
Speaker 1: especially on the bigger ticket items like housing and transportation.

770
00:35:16,400 --> 00:35:19,520
Speaker 1: Most people allocate their take home pay to paying their

771
00:35:19,560 --> 00:35:22,560
Speaker 1: mortgage or their rent, but you can't really do that

772
00:35:22,640 --> 00:35:24,960
Speaker 1: if you want to retire early, so you have to

773
00:35:25,000 --> 00:35:28,680
Speaker 1: consider other routes to your lessen the costs of what

774
00:35:28,760 --> 00:35:31,160
Speaker 1: you're paying for housing. So we would suggest things like

775
00:35:31,280 --> 00:35:34,000
Speaker 1: live in real estate flips, house hacking, or even just

776
00:35:34,040 --> 00:35:36,440
Speaker 1: renting a cheaper place instead of buying an ice home.

777
00:35:36,480 --> 00:35:40,440
Speaker 1: Those are all worthwhile considerations if you're looking to achieve

778
00:35:40,440 --> 00:35:44,400
Speaker 1: financial independence earlier than you previously thought. And that's just

779
00:35:44,440 --> 00:35:47,000
Speaker 1: such an important area because you can move the needle

780
00:35:47,160 --> 00:35:49,919
Speaker 1: so aggressively in such a small period of time. Let's

781
00:35:49,920 --> 00:35:51,920
Speaker 1: say you're in the lease now for a three bedroom

782
00:35:51,960 --> 00:35:55,560
Speaker 1: apartment in like a fancy part of town. Maybe you

783
00:35:55,600 --> 00:35:57,440
Speaker 1: can say, well, we don't need quite need this much

784
00:35:57,440 --> 00:36:00,800
Speaker 1: space we can instead for this two bedroom apartment that's

785
00:36:00,880 --> 00:36:03,600
Speaker 1: three miles away and in a good bit cheaper location,

786
00:36:03,840 --> 00:36:05,879
Speaker 1: we can say four or fifty a month. I mean,

787
00:36:06,280 --> 00:36:09,600
Speaker 1: that's the kind of thing that instantly gets you to that,

788
00:36:09,719 --> 00:36:12,480
Speaker 1: you know six, being able to fully invest in your

789
00:36:12,560 --> 00:36:14,960
Speaker 1: roth IRA every year. That it's those kind of moves

790
00:36:15,000 --> 00:36:18,319
Speaker 1: that have a huge impact on your trajectory. And it

791
00:36:18,400 --> 00:36:20,919
Speaker 1: is important to crush your transportation costs too. We would

792
00:36:20,920 --> 00:36:23,399
Speaker 1: recommend for folks to own fewer cars or at least

793
00:36:23,480 --> 00:36:28,320
Speaker 1: cheaper cars. Again, consider biking more. It really isn't rocket

794
00:36:28,360 --> 00:36:31,719
Speaker 1: science because there's no simpler way of massively boosting or

795
00:36:31,760 --> 00:36:35,040
Speaker 1: savings rate than to permanently cut expenses in order to

796
00:36:35,080 --> 00:36:38,040
Speaker 1: reach financial independence. Essentially, folks that want to reach fire

797
00:36:38,160 --> 00:36:40,360
Speaker 1: like they're gonna have to think creatively about all the

798
00:36:40,360 --> 00:36:42,399
Speaker 1: different sorts of other expenses in their lives as well,

799
00:36:42,440 --> 00:36:44,400
Speaker 1: Like you know, how much you spend on entertainment and

800
00:36:44,560 --> 00:36:48,439
Speaker 1: eating out, or how much you spend on travel, right,

801
00:36:48,680 --> 00:36:50,600
Speaker 1: And that's to say that you're not traveling at all,

802
00:36:50,680 --> 00:36:52,399
Speaker 1: Like many of them still like to travel, but they

803
00:36:52,440 --> 00:36:55,520
Speaker 1: just choose to travel hack, uh, instead of paying top

804
00:36:55,560 --> 00:36:59,040
Speaker 1: dollar you know for their lodging instead, maybe their house sitting,

805
00:36:59,239 --> 00:37:01,120
Speaker 1: or maybe they're used in their credit card points to

806
00:37:01,120 --> 00:37:03,640
Speaker 1: to score those airline tickets. Creativity is one of the

807
00:37:03,680 --> 00:37:07,080
Speaker 1: hallmark traits of someone who is legit serious about reaching

808
00:37:07,080 --> 00:37:10,319
Speaker 1: financial independence at an early age. You know, we're want

809
00:37:10,320 --> 00:37:12,880
Speaker 1: to point out that it's not painless. Uh, it's gonna

810
00:37:12,920 --> 00:37:14,360
Speaker 1: take a lot of work. But you're gonna have to

811
00:37:14,560 --> 00:37:17,759
Speaker 1: also find that sweet spot between working really hard and

812
00:37:18,040 --> 00:37:20,480
Speaker 1: you know, making some sacrifices in life, but at the

813
00:37:20,480 --> 00:37:23,440
Speaker 1: same time making sure that you're not sacrificing too much, right.

814
00:37:23,480 --> 00:37:25,760
Speaker 1: You want to make sure that you're setting realistic, moderate

815
00:37:25,760 --> 00:37:28,000
Speaker 1: goals so that you don't completely burn out and it's

816
00:37:28,080 --> 00:37:31,000
Speaker 1: not something that you're able to achieve at all. Yeah, man,

817
00:37:31,040 --> 00:37:33,600
Speaker 1: I know, I totally agree. I think creativity actually is

818
00:37:33,680 --> 00:37:36,280
Speaker 1: probably one of the adjectives I would most strongly associate

819
00:37:36,280 --> 00:37:38,279
Speaker 1: with the Fire Movement. Most of the people I know

820
00:37:38,520 --> 00:37:41,560
Speaker 1: in there have done really interesting and unique things in

821
00:37:41,640 --> 00:37:44,120
Speaker 1: order to help put themselves in a strong financial position

822
00:37:44,280 --> 00:37:46,080
Speaker 1: without having to miss out on some of the things

823
00:37:46,080 --> 00:37:48,640
Speaker 1: that they love the most. I think travel, like you said,

824
00:37:48,719 --> 00:37:50,520
Speaker 1: is one of those areas where a lot of people

825
00:37:50,600 --> 00:37:53,200
Speaker 1: the Fire Movement travel more than people that aren't in

826
00:37:53,239 --> 00:37:55,840
Speaker 1: the fire movement that I know, they just found creative

827
00:37:55,840 --> 00:37:58,000
Speaker 1: ways to do it for less money, and um, yeah,

828
00:37:58,080 --> 00:38:01,160
Speaker 1: let's talk about Yeah, the other tactics to take. Investing

829
00:38:01,239 --> 00:38:03,680
Speaker 1: is another tactic that you obviously need to be doing

830
00:38:03,800 --> 00:38:06,480
Speaker 1: if you want to achieve fire with all the money

831
00:38:06,640 --> 00:38:08,000
Speaker 1: that you have at the end of the month by

832
00:38:08,040 --> 00:38:10,480
Speaker 1: house hacking or not having a car payment, you know,

833
00:38:10,520 --> 00:38:13,600
Speaker 1: all the other ways that you'll discover that you're wasting money, Well,

834
00:38:13,719 --> 00:38:16,240
Speaker 1: you're going to want to invest that money like crazy,

835
00:38:16,560 --> 00:38:19,160
Speaker 1: and you're gonna want to invest in low costs, widely

836
00:38:19,200 --> 00:38:22,799
Speaker 1: diversified index funds. You'll first want to max out all

837
00:38:22,880 --> 00:38:25,359
Speaker 1: the tax advantage retirement accounts that are available to you.

838
00:38:25,920 --> 00:38:27,920
Speaker 1: This is gonna be a big factor in lowering the

839
00:38:27,960 --> 00:38:30,600
Speaker 1: amount that you pay in taxes each year. And then

840
00:38:30,680 --> 00:38:32,600
Speaker 1: the more that you invest in these accounts, the more

841
00:38:32,640 --> 00:38:34,600
Speaker 1: that you're gonna be super charging the growth of that

842
00:38:34,680 --> 00:38:37,640
Speaker 1: retirement nest egg. So someone who wants to achieve fire

843
00:38:38,040 --> 00:38:41,400
Speaker 1: can't be content to save their money in a savings account.

844
00:38:41,480 --> 00:38:43,600
Speaker 1: Not that they don't need some of that money hanging

845
00:38:43,600 --> 00:38:46,680
Speaker 1: around in an emergency fund, right, but if they want

846
00:38:46,680 --> 00:38:48,960
Speaker 1: to achieve fire. They need to have their money working

847
00:38:49,080 --> 00:38:52,440
Speaker 1: for them and that only comes through investing, and investing

848
00:38:52,520 --> 00:38:54,399
Speaker 1: mostly in the stock market, that's right, And that's why

849
00:38:54,400 --> 00:38:57,040
Speaker 1: we talk so much about investing. Sometimes folks think that

850
00:38:57,080 --> 00:38:59,080
Speaker 1: we talk about it a little too much, but it's

851
00:38:59,080 --> 00:39:01,040
Speaker 1: because it's so important. Yeah, and I don't want to

852
00:39:01,040 --> 00:39:03,600
Speaker 1: say I said mostly the stock market, but just like

853
00:39:03,640 --> 00:39:05,200
Speaker 1: we talked about with Rachel on Monday, and just like

854
00:39:05,239 --> 00:39:07,359
Speaker 1: you and I are also advocates of real estate is

855
00:39:07,400 --> 00:39:09,400
Speaker 1: one of those other avenues. That's also another one of

856
00:39:09,440 --> 00:39:11,319
Speaker 1: those tactics. It doesn't just have to be low cost

857
00:39:11,360 --> 00:39:14,399
Speaker 1: index funds that gets most of the press, but when

858
00:39:14,400 --> 00:39:17,360
Speaker 1: it comes to is definitely the most passive way, Like

859
00:39:17,400 --> 00:39:19,440
Speaker 1: I mean that truly is the only passive way to

860
00:39:19,719 --> 00:39:21,400
Speaker 1: you know, have a stream of income. But there are

861
00:39:21,400 --> 00:39:24,359
Speaker 1: other ways that have higher rates of income, but they're

862
00:39:24,360 --> 00:39:25,839
Speaker 1: gonna take a little bit more work. So it kind

863
00:39:25,840 --> 00:39:28,520
Speaker 1: of depends which level of work that you're willing to

864
00:39:28,520 --> 00:39:30,319
Speaker 1: sign up for. And we've talked about real estate quite

865
00:39:30,320 --> 00:39:32,200
Speaker 1: a bit on the show. You can find other episodes,

866
00:39:32,400 --> 00:39:34,680
Speaker 1: but that is definitely one of the ways of investing

867
00:39:34,680 --> 00:39:37,719
Speaker 1: that you can consider if you're looking to achieve financial independence,

868
00:39:37,719 --> 00:39:40,120
Speaker 1: and we've encourage you in that direction too. Yeah, and

869
00:39:40,160 --> 00:39:42,480
Speaker 1: since you've listened this far into the episode, because you're

870
00:39:42,520 --> 00:39:45,640
Speaker 1: clearly serious about fire, you're likely wondering how you're going

871
00:39:45,640 --> 00:39:48,040
Speaker 1: to have access to all those funds that are going

872
00:39:48,080 --> 00:39:49,759
Speaker 1: to be in your retirement accounts, since that's the way

873
00:39:49,760 --> 00:39:53,480
Speaker 1: that most folks are going to have their retirement savings invested.

874
00:39:54,000 --> 00:39:56,000
Speaker 1: After all, you know, we're we're talking about retiring early

875
00:39:56,040 --> 00:39:58,960
Speaker 1: and waiting until you're fifty nine and a half doesn't

876
00:39:59,040 --> 00:40:02,279
Speaker 1: really sound lead to me. Uh, And so you might

877
00:40:02,320 --> 00:40:04,800
Speaker 1: be tempted to think that investing within a brokerage account

878
00:40:04,880 --> 00:40:07,080
Speaker 1: is the way to go, but that is not the case.

879
00:40:07,680 --> 00:40:11,719
Speaker 1: By utilizing more complicated strategies like a roth IRA conversion

880
00:40:11,760 --> 00:40:13,920
Speaker 1: ladder as well as there's this other thing called the

881
00:40:13,960 --> 00:40:17,480
Speaker 1: step seventy two t you will still still get that

882
00:40:17,520 --> 00:40:19,360
Speaker 1: tax advantage. I'll love the complexity of the I R

883
00:40:19,480 --> 00:40:23,080
Speaker 1: S tax, but the I R s yet they're incredibly creative.

884
00:40:24,160 --> 00:40:28,040
Speaker 1: Not but by utilizing these strategies, you'll still get that

885
00:40:28,080 --> 00:40:30,800
Speaker 1: tax advantage and you actually be able to start tapping

886
00:40:30,840 --> 00:40:34,760
Speaker 1: those accounts well before traditional retirement age. It's a little

887
00:40:34,800 --> 00:40:38,759
Speaker 1: more complicated, but money that is invested for retirement. You

888
00:40:39,000 --> 00:40:41,359
Speaker 1: don't necessarily have to wait until you're sixty years old

889
00:40:41,480 --> 00:40:44,400
Speaker 1: before you can draw all those funds. Will actually specifically

890
00:40:44,440 --> 00:40:46,440
Speaker 1: linked to a post by the Mad Scientist, and he

891
00:40:46,480 --> 00:40:49,480
Speaker 1: outlines how you can do that with a roth Ira

892
00:40:49,560 --> 00:40:52,759
Speaker 1: conversion ladder or with the seventy two t He even

893
00:40:52,760 --> 00:40:55,560
Speaker 1: outlines how just even taking that ten percent penalty UH

894
00:40:55,800 --> 00:40:58,200
Speaker 1: for the early withdrawals on retirement account, how that still

895
00:40:58,280 --> 00:41:00,560
Speaker 1: will come out ahead um airs of money that you

896
00:41:00,600 --> 00:41:02,960
Speaker 1: would have invested in a brokerage account. So again, we'll

897
00:41:03,000 --> 00:41:04,719
Speaker 1: make sure to link to that in our show notes. Yeah,

898
00:41:04,800 --> 00:41:06,960
Speaker 1: the Matt Finists is one of the best people in

899
00:41:07,000 --> 00:41:09,120
Speaker 1: the movement to love that guy, and he's also Yeah,

900
00:41:09,120 --> 00:41:11,640
Speaker 1: I just put a lot of effort into thinking through

901
00:41:11,719 --> 00:41:15,520
Speaker 1: some of those strategies and some of the tax roadbumps

902
00:41:15,560 --> 00:41:17,439
Speaker 1: that you might run into along the way, and how

903
00:41:17,520 --> 00:41:20,839
Speaker 1: to minimize the impact of taxes on the money that

904
00:41:20,880 --> 00:41:23,279
Speaker 1: you've worked really hard to save and invest in. So

905
00:41:23,520 --> 00:41:25,879
Speaker 1: that post in particular is a really helpful one. Yeah,

906
00:41:25,880 --> 00:41:28,400
Speaker 1: we'll link to that one. And Matt wrapping this up,

907
00:41:28,440 --> 00:41:31,000
Speaker 1: I feel like, you know, if any listeners out there

908
00:41:31,160 --> 00:41:35,000
Speaker 1: have found listening to this episode the concept of fire intriguing.

909
00:41:35,520 --> 00:41:38,239
Speaker 1: We would say that's great, but know that in order

910
00:41:38,280 --> 00:41:41,600
Speaker 1: to start pursuing pursuing fire, you're gonna have to shift

911
00:41:41,600 --> 00:41:44,000
Speaker 1: your relationship with money. I don't think I've ever read

912
00:41:44,040 --> 00:41:46,680
Speaker 1: a story or heard anybody say that they kind of

913
00:41:46,920 --> 00:41:51,359
Speaker 1: stumbled into early financial independence. He usually takes some intentional moves,

914
00:41:51,400 --> 00:41:54,080
Speaker 1: like we've talked about during this episode in order to

915
00:41:54,120 --> 00:41:56,640
Speaker 1: get there, and you need to do some thinking, is

916
00:41:56,680 --> 00:41:58,800
Speaker 1: some deep thinking about whether or not that lifestyle is

917
00:41:58,840 --> 00:42:01,680
Speaker 1: going to work for you in the long run. Because yeah,

918
00:42:01,680 --> 00:42:04,280
Speaker 1: some sacrifice now in order to save a decent chunkier

919
00:42:04,320 --> 00:42:07,200
Speaker 1: pay in order to achieve financial independence is a good thing.

920
00:42:07,480 --> 00:42:09,200
Speaker 1: But you can also overdo it. You can get burned

921
00:42:09,239 --> 00:42:11,880
Speaker 1: out in the process. And I've read, definitely read accounts

922
00:42:11,880 --> 00:42:13,840
Speaker 1: of that of people saying I'm going home on the

923
00:42:13,880 --> 00:42:17,080
Speaker 1: fire movement and then they lose steam because it's really

924
00:42:17,080 --> 00:42:20,240
Speaker 1: hard to keep up a fift savings rates and living

925
00:42:20,360 --> 00:42:23,440
Speaker 1: you know, massively frugal lifestyle. So yeah, especially if it

926
00:42:23,480 --> 00:42:26,360
Speaker 1: means you're working too much now in order to avoid

927
00:42:26,360 --> 00:42:29,319
Speaker 1: work altogether later, that's not a good strategy. Like that's

928
00:42:29,520 --> 00:42:32,440
Speaker 1: a recipe for burnout. Um, But we are all about

929
00:42:32,480 --> 00:42:34,920
Speaker 1: increasing your savings rate. We're just not about it to

930
00:42:34,920 --> 00:42:37,360
Speaker 1: the point of making yourself miserable. That's not worth it.

931
00:42:37,480 --> 00:42:39,959
Speaker 1: So it's a better idea to find and pursue work

932
00:42:40,080 --> 00:42:42,400
Speaker 1: that you love now than to put your nose to

933
00:42:42,440 --> 00:42:44,400
Speaker 1: the grindstone for a decade or more in order to

934
00:42:44,560 --> 00:42:47,240
Speaker 1: retire early. Just know that if you're interested in fire,

935
00:42:47,400 --> 00:42:49,600
Speaker 1: there are a ton of helpful resources out there, and

936
00:42:49,640 --> 00:42:52,000
Speaker 1: we do think for some folks it's a worthy goal,

937
00:42:52,040 --> 00:42:54,359
Speaker 1: it's a worthy ambition, and at the same time, there

938
00:42:54,400 --> 00:42:56,120
Speaker 1: are a lot of routes you can take to get there.

939
00:42:56,120 --> 00:42:57,560
Speaker 1: It's not one size fits all, and I think that's

940
00:42:57,600 --> 00:43:02,200
Speaker 1: encouraging to is that actual independence retirely doesn't mean you

941
00:43:02,239 --> 00:43:04,600
Speaker 1: have to retire at twenty seven like Rachel Richards did,

942
00:43:04,640 --> 00:43:07,880
Speaker 1: which is impressive. It can mean retiring at forty seven

943
00:43:08,120 --> 00:43:10,880
Speaker 1: and that's still is much faster than many of your peers.

944
00:43:11,120 --> 00:43:13,520
Speaker 1: Or it can mean continuing to work until you're seventy

945
00:43:13,520 --> 00:43:15,920
Speaker 1: five because you love what you do. But you you

946
00:43:16,040 --> 00:43:18,720
Speaker 1: chose that route on purpose, and you know on purpose

947
00:43:18,719 --> 00:43:22,239
Speaker 1: I think is right. Yeah, absolutely, it's about figuring out

948
00:43:22,280 --> 00:43:24,480
Speaker 1: what it looks like for you, right, Because we've outlined,

949
00:43:24,600 --> 00:43:27,279
Speaker 1: you know, like four or five different sort of flavors,

950
00:43:27,440 --> 00:43:29,200
Speaker 1: but you make your own flavor. You figure it out

951
00:43:29,280 --> 00:43:31,359
Speaker 1: what it is that you want to pursue, and then

952
00:43:31,560 --> 00:43:33,000
Speaker 1: you figure out how to get there. I mean, that's

953
00:43:33,040 --> 00:43:34,760
Speaker 1: what we do with on the you know, on the podcast.

954
00:43:34,760 --> 00:43:36,799
Speaker 1: Every single week we talk about things that will get

955
00:43:36,800 --> 00:43:39,080
Speaker 1: you closer to that goal, and you can choose to

956
00:43:39,200 --> 00:43:41,680
Speaker 1: implement what we talk about or not, depending on yeah,

957
00:43:41,680 --> 00:43:44,200
Speaker 1: your own personal goals. But enough of the money talk.

958
00:43:44,280 --> 00:43:46,799
Speaker 1: Tollis shift gears. Let's get back to the beer. For

959
00:43:46,800 --> 00:43:50,400
Speaker 1: this episode, you and I both enjoyed a smells like

960
00:43:50,520 --> 00:43:53,920
Speaker 1: Being Spirit, which is obviously a nod to the Nirvana song.

961
00:43:54,400 --> 00:43:56,160
Speaker 1: You know that the album cover has got the baby

962
00:43:56,160 --> 00:43:58,160
Speaker 1: swimming in the pool. That's that's naked or whatever. Well

963
00:43:58,160 --> 00:44:00,239
Speaker 1: the can art is a nod to that. It's ut

964
00:44:00,560 --> 00:44:03,839
Speaker 1: uh So this is a coffee stout and it's got

965
00:44:03,840 --> 00:44:06,400
Speaker 1: like a little baby made of coffee beans. On the

966
00:44:06,400 --> 00:44:08,080
Speaker 1: fun of it, it looks like it's swimming kind of

967
00:44:08,080 --> 00:44:10,480
Speaker 1: floating there in the water. But yeah, this is smells

968
00:44:10,480 --> 00:44:12,440
Speaker 1: like Bean Spirit. This is a double maple stout. What

969
00:44:12,480 --> 00:44:14,239
Speaker 1: were your thoughts on this beer? Man? This bee was

970
00:44:14,239 --> 00:44:17,919
Speaker 1: really good. And I feel like this brewery. I've only

971
00:44:17,960 --> 00:44:19,680
Speaker 1: had one beer from them before and it was like

972
00:44:19,719 --> 00:44:22,440
Speaker 1: a variant of this beer. But I saw this in

973
00:44:22,480 --> 00:44:23,759
Speaker 1: the store and I was like, that was such a

974
00:44:23,760 --> 00:44:26,080
Speaker 1: good beer, I'm gonna want to get this other variant

975
00:44:26,120 --> 00:44:27,880
Speaker 1: of it. So this one had a lot of maple

976
00:44:27,920 --> 00:44:31,640
Speaker 1: syrup infused into the beer. So yeah, the predominant flavors

977
00:44:31,640 --> 00:44:35,759
Speaker 1: you were getting were coffee and maple syrup, and those

978
00:44:35,760 --> 00:44:38,040
Speaker 1: are two great flavors. Man. It made me feel like

979
00:44:38,040 --> 00:44:41,840
Speaker 1: I was eating like pancakes while my coffee, you know,

980
00:44:41,880 --> 00:44:44,520
Speaker 1: for breakfast. Um, and that's a good feeling. So I

981
00:44:44,920 --> 00:44:47,239
Speaker 1: don't know. I thought the way that the depth of

982
00:44:47,239 --> 00:44:50,759
Speaker 1: flavors that they infused were really impressive. Maybe maybe a

983
00:44:50,800 --> 00:44:53,080
Speaker 1: little bit overkill on the maple syrup, but it's too

984
00:44:53,120 --> 00:44:55,680
Speaker 1: sweet for you. I enjoyed it. You don't like things

985
00:44:55,800 --> 00:44:58,360
Speaker 1: nearly as sweet as I do. I've got a sugar tooth,

986
00:44:58,400 --> 00:44:59,759
Speaker 1: for sure. I feel like I could have taken this

987
00:44:59,800 --> 00:45:02,399
Speaker 1: and just poured it over my pancakes like this beer

988
00:45:02,480 --> 00:45:05,080
Speaker 1: right here, and I would have been Actually, probably wouldn't

989
00:45:05,040 --> 00:45:08,880
Speaker 1: have been sweet enough, because maple syrup is quite sweet.

990
00:45:09,120 --> 00:45:11,640
Speaker 1: You're a fan of like the real maple syrup, right, yeah,

991
00:45:11,680 --> 00:45:13,759
Speaker 1: you can't get forget the get the cheap stuff, you

992
00:45:13,840 --> 00:45:17,960
Speaker 1: forget the Oh yeah, yeah, I'm all about the real stuff.

993
00:45:18,239 --> 00:45:20,560
Speaker 1: And that stuff is really sweet, but it's also so good.

994
00:45:20,760 --> 00:45:23,200
Speaker 1: I felt like they definitely use like real maple syrup

995
00:45:23,440 --> 00:45:26,319
Speaker 1: in this beer. But yeah, the maple syrup coffee vibes

996
00:45:26,360 --> 00:45:28,279
Speaker 1: that had gone on, it's delicious, even in the middle

997
00:45:28,280 --> 00:45:30,719
Speaker 1: of summer because we're sitting inside and the a C.

998
00:45:31,200 --> 00:45:32,879
Speaker 1: This definitely isn't a sitting out on the front porch

999
00:45:32,920 --> 00:45:34,879
Speaker 1: out in the heat kind of beer. But I'm glad

1000
00:45:34,920 --> 00:45:36,600
Speaker 1: you and I got to enjoy this one on the episode.

1001
00:45:36,719 --> 00:45:39,799
Speaker 1: And yeah, props to Microphone Brewing, who I have never

1002
00:45:39,840 --> 00:45:41,520
Speaker 1: even heard of before. It looks like they're they're based

1003
00:45:41,520 --> 00:45:43,640
Speaker 1: out of Illinois somewhere, but maybe we'll have more of

1004
00:45:43,640 --> 00:45:46,000
Speaker 1: their beers here soon. If the other beers or anything

1005
00:45:46,040 --> 00:45:47,840
Speaker 1: like this one, I'm sure they'll be delightful. I'd be

1006
00:45:47,880 --> 00:45:49,560
Speaker 1: all about it. All right. Well, that's gonna do it

1007
00:45:49,600 --> 00:45:51,839
Speaker 1: for this episode. For folks that want the show notes

1008
00:45:51,920 --> 00:45:54,560
Speaker 1: and links to some of the resources that we mentioned,

1009
00:45:54,640 --> 00:45:56,320
Speaker 1: we'll have those up on our website at how to

1010
00:45:56,400 --> 00:45:58,440
Speaker 1: money dot com. That's right, And if you have just

1011
00:45:58,440 --> 00:46:00,719
Speaker 1: stumbled upon this episode, we want to make sure that

1012
00:46:00,760 --> 00:46:03,400
Speaker 1: you don't miss future episodes, so make sure to mash

1013
00:46:03,520 --> 00:46:05,880
Speaker 1: that subscribe button. And if you've been listening for a while,

1014
00:46:06,160 --> 00:46:08,760
Speaker 1: we would greatly appreciate if you head over to Apple

1015
00:46:08,800 --> 00:46:11,960
Speaker 1: Podcasts leave us a solid review over there, or wherever

1016
00:46:12,000 --> 00:46:14,720
Speaker 1: it is that you listen to podcasts. That helps others

1017
00:46:14,719 --> 00:46:16,600
Speaker 1: out there to find the show. It's going to help

1018
00:46:16,640 --> 00:46:19,360
Speaker 1: others to to start on that path towards financial independence.

1019
00:46:19,560 --> 00:46:21,680
Speaker 1: We want to help folks to achieve that by doing

1020
00:46:21,719 --> 00:46:24,479
Speaker 1: smart things with their money. So John, that's gonna be it, buddy.

1021
00:46:24,560 --> 00:46:27,520
Speaker 1: Until next time, Best Friends Out, Best Friends Out,