Speaker 1: Welcome to How the Money. I'm Joel and I and
Speaker 1: Matt and today we're talking about fire. Choose your own adventure,
Speaker 1: that's right, Joel. The fourth of July was on Sunday,
Speaker 1: and we're talking about financial independence, retire early, and we're
Speaker 1: specifically going to talk about how it can look different
Speaker 1: depending on what you wanted to look like, depending on
Speaker 1: what your goals are and what you're trying to achieve.
Speaker 1: I'm excited for this episode, buddy. There's different routes to success,
Speaker 1: just like if you're playing a game like Settlers of Catan, right,
Speaker 1: I mean, there's different ways that you can win, and
Speaker 1: so you don't always have to take take the same routes.
Speaker 1: And I think sometimes when we talk about fire, the
Speaker 1: fire movement, it seems like there's one prescribed way to
Speaker 1: get there, but we say no, there's actually a lot
Speaker 1: of different paths. And so we're going to kind of
Speaker 1: cover that in this episode for folks that are interested
Speaker 1: in reaching financial independence, in doing so before they get
Speaker 1: super wrinkly, uh, we'd say this episode for you. Speaking
Speaker 1: of Gatan, I was always a fan of building multiple
Speaker 1: cities on a high rolling commodity, like say sheep and
Speaker 1: then getting that two to one port trading directly to
Speaker 1: the bank. That way you don't have to trade with
Speaker 1: any of your fellow players. That was always a fun
Speaker 1: That was a good move for you to because you
Speaker 1: annoyed all of your fellow players so much they didn't
Speaker 1: want to trade with you. So I had been known
Speaker 1: to do that. It's been years since we've played Settlers
Speaker 1: like we would always play some of the other games
Speaker 1: like king Domino or Carcassone. Acquire is like a new
Speaker 1: real estate one that I feel like that. You know
Speaker 1: that we've been playing a decent bit, but Settlers, like
Speaker 1: the o G haven't touched it in years. Been a minute,
Speaker 1: spent a minute, Gotta pull it out, dusted off. Okay,
Speaker 1: speaking of Acquire, this makes me think about real estate
Speaker 1: and Matt. Before we start talking about fire, I want
Speaker 1: to let you know, uh and our listeners know. So,
Speaker 1: our family were having some renovations done to our house.
Speaker 1: We're getting basically when when we bought this house, it's
Speaker 1: a nineteen thirties house. It needed a ton of work,
Speaker 1: but we decided to live in it. We're not the
Speaker 1: back for a few years, um and now our family
Speaker 1: wants to take over the whole house, and so we
Speaker 1: need to renovate it away from being a duplex into
Speaker 1: a single family home. And I got that second kitchen
Speaker 1: that was kind of pointless. No need for two kitchens
Speaker 1: really right in our family. And yeah, there's a lot
Speaker 1: of work that needs to be done. So we're moving
Speaker 1: out and we moved into this like super tiny house,
Speaker 1: like square feet so kind of interesting, a lot smaller
Speaker 1: than what you're used to write. I was starting to
Speaker 1: a friend who used to live in New York and
Speaker 1: he's like, that sounds palatial at least by New York standards,
Speaker 1: but yeah, for Atlanta standards. To the family five, it's
Speaker 1: very small. But it's actually it's it's been good for
Speaker 1: our family in a lot of ways. We've been able
Speaker 1: to kind of pare down some of our possessions and
Speaker 1: it's been kind of fun to live in small quarters.
Speaker 1: But I met my new neighbor there who's flipping the
Speaker 1: house next door, and this is his second home that
Speaker 1: he's he's renovating it and he's going to rent it out.
Speaker 1: His name's Kyle, and it's so fun to kind of
Speaker 1: talk to him as he's kind of just getting started
Speaker 1: it in his real estate investing adventures. He's super excited.
Speaker 1: He's listening to like the Bigger Pockets podcast every single
Speaker 1: day because that's a one of one of the better
Speaker 1: real estate investing podcasts out there. And yeah, I just
Speaker 1: wanted to say, like one go Kyle, I'm proud of you,
Speaker 1: and I'm I hope you kicked butt and um and
Speaker 1: just to everybody out there, like if you've been wanting
Speaker 1: to get started investing in real estate, I know, now
Speaker 1: maybe not the easiest time to buy a house, but
Speaker 1: you know what, Kyle made it happened. He's he's the
Speaker 1: numbers work for the house that he bought. And it's
Speaker 1: not gonna work in every market, but I just want
Speaker 1: to let you know, you know, Kyle, is this glimmer
Speaker 1: of sunshine in like a market of insanity out there
Speaker 1: that it can be done. You can buy a rental
Speaker 1: property where the numbers actually are going to work for you. Yeah,
Speaker 1: the opportunities still exist, right, I mean, it's not going
Speaker 1: to be as easy as it was, say ten years ago,
Speaker 1: but the deals are out there, especially if you're willing
Speaker 1: to put in the work, uh to find those specific deals,
Speaker 1: and of course you'll make sure to keep all of
Speaker 1: us updated as to how your home renovation is going.
Speaker 1: Maybe after living in that that new tiny more uh affordable.
Speaker 1: I don't want to call it a cheap house because
Speaker 1: it's actually really nice. I've I've checked it out. Maybe
Speaker 1: what if you end up deciding to live there full
Speaker 1: time and uh, you guys start downsizing, you're gonna take
Speaker 1: the minimalist approach. Down with the downsizing. I am down
Speaker 1: with the downsizing, But we would miss our house. Yeah,
Speaker 1: and in our our location. We were already we have
Speaker 1: all about the location. We haven't been in the house
Speaker 1: very long. It's just you know, a mile and a
Speaker 1: half away. But still that's that's a long way away
Speaker 1: from my people, so my neighbors that I love, my
Speaker 1: you know, friends right down the street. I missed that already.
Speaker 1: Instead of a two minute bike commute now to the
Speaker 1: studio here, now you have like a ten minute bike
Speaker 1: commute or something like that. But it's actually kind of nice.
Speaker 1: I get more work out of it. That's that's actually
Speaker 1: one of the benefits. School has been out, man, and
Speaker 1: I actually haven't been biking at all, and I got
Speaker 1: up my game when it comes to my physical fitness,
Speaker 1: but kind of counter to that, let's introduce the beer
Speaker 1: that we're gonna enjoy this episode. This is a beer
Speaker 1: by Microphone Brewing, and this one it's called Smells Like
Speaker 1: Being Spirit and it's a double maple stouts. Looking forward
Speaker 1: to enjoying this one and sharing our thoughts on it
Speaker 1: at the end of the episode. Sounds good. But for now,
Speaker 1: let's get to the subject at hand. We're talking about fire,
Speaker 1: financial independence, retire early, choose your Own Adventure, and basically,
Speaker 1: matt Um, we were talking about kind of what how
Speaker 1: we wanted to approach this episode. I was thinking about
Speaker 1: those Choose your Own Adventure books. Um, I'm you know,
Speaker 1: we all read them as kids. I always enjoyed them.
Speaker 1: I think Actually Netflix recently did a similar style television
Speaker 1: show with bear Grills or he's like out in the
Speaker 1: wild and he's like, do you want me to eat
Speaker 1: the snake or punch it? Uh? Seriously, yeah, I know.
Speaker 1: I mean they never watched it, but that's what Black
Speaker 1: Mirror did that with like one of their finales, Bander Snatch,
Speaker 1: you know, where they had multiple endings or four or
Speaker 1: five different endings that you could choose, uh, to kind
Speaker 1: of incorporate some of that nostalgia from the from the
Speaker 1: nineties and those Choose your Own Adventure books. So, yeah,
Speaker 1: choose your own adventure still still hot, still happening in
Speaker 1: these days. But I always remember I kind of keeping
Speaker 1: my finger on the original page as I made the
Speaker 1: next choice, just in case I was like, oh, man,
Speaker 1: I don't like that. I'm going back and I'm gonna
Speaker 1: opt for the other choice in case you get bitten
Speaker 1: by a snake. Exactly exactly. And since Independence Day was
Speaker 1: this past weekend, it's really only fitting to keep talking
Speaker 1: about the pursuit of financial independence today on the show, right,
Speaker 1: And yeah, just like those Choose your Own Adventure books,
Speaker 1: I think the path that people take towards to achieve
Speaker 1: financial independence, it can look really different from person to person.
Speaker 1: There are lots of different types of financial independence and
Speaker 1: then also to lots of different tactics you can take
Speaker 1: to get there. Yeah, this past Monday's episode, that's what
Speaker 1: we talked about with Rachel Richards. We actually talked through
Speaker 1: some of the different ways to generate passive income, uh
Speaker 1: that would eventually hopefully lead you to financial independence. But yeah,
Speaker 1: the pursuit a financial independence doesn't have to look a
Speaker 1: specific way. Uh. So, yeah, we wanted to talk today
Speaker 1: about the different styles, the different flavors of being financially
Speaker 1: independent and sometimes, you know, just discovering just even the
Speaker 1: range of options can be a major encouragement as we
Speaker 1: seek to find a lifestyle that works for our own
Speaker 1: personal lives. You know, saving up five million dollars so
Speaker 1: that you can kick back in your in your later
Speaker 1: years might not be your thing. It may not even
Speaker 1: be possible. Right, Yeah, that's a tall task, and that's
Speaker 1: okay because fire can look different for everyone. And so
Speaker 1: we'll talk about the different types of fire and then
Speaker 1: some of the most important tactics to consider on your
Speaker 1: path to achieving fire. Uh. There is no right or
Speaker 1: wrong answer. There's just different approaches to financial independence, for sure.
Speaker 1: And so yeah, we I mentioned that FIRE stands for
Speaker 1: financial independence retire early. That acronym has become maybe fraught
Speaker 1: with some baggage, although it has been the gateway for
Speaker 1: a lot of young people to realize that they have
Speaker 1: more power over their financial lives than they thought. I
Speaker 1: feel like as that acronym has caught on, it's been
Speaker 1: kind of a whipping horse for the media at many
Speaker 1: turns to kind of disparage the movement and people that
Speaker 1: are seeking to retire early. But at the same time,
Speaker 1: it's helped a lot of people conceptualize the idea that
Speaker 1: they can reach financial independence before they do hit traditional
Speaker 1: retirement years. Um. It's empowered a lot of hard working
Speaker 1: folks to realize that the stock American belief that working
Speaker 1: forty plus hours so week for forty plus years then
Speaker 1: retiring to Florida isn't the path that they have to take.
Speaker 1: And yeah, we think that's a good thing. Um. It's
Speaker 1: simply put fire. Getting to that point where you're financially
Speaker 1: independent usually means having twenty five times your annual expenses
Speaker 1: saved up, although one of the things we covered on
Speaker 1: Monday's episode with Rachel is that that's not always how
Speaker 1: it looks. Sometimes it can look like your monthly spending
Speaker 1: being covered by passive income through something like real estate too.
Speaker 1: That's right. Yeah, So we're gonna talk about fire in
Speaker 1: depth today, but we don't necessarily endorse everything you know
Speaker 1: that the movement is all about. We talked about the
Speaker 1: pros and the cons of fire back in episode to
Speaker 1: twenty one, so you can check that one out if
Speaker 1: you haven't listened to it. Uh, And there really are
Speaker 1: a lot of good things that the movement has done,
Speaker 1: including starting some important conversations in the public space. As
Speaker 1: big media has covered fire, I feel like it has
Speaker 1: open the eyes of a lot of folks who haven't
Speaker 1: considered it before. But that doesn't mean that fire is
Speaker 1: for everyone, right. I could even see it being harmful
Speaker 1: to some individuals. Right, So, say you jump too heavily
Speaker 1: into the fire world, you might be tempted into grinding
Speaker 1: too hard for the next fifteen years to achieve this
Speaker 1: specific monetary goal, and then reaching that goal may not
Speaker 1: be as satisfying as you think it will be. And
Speaker 1: so we're you know, we're bigger fans of the f
Speaker 1: I part, the financial independent part, and we're all about
Speaker 1: making intentional choices to make sure that we get there,
Speaker 1: but not necessarily pursuing it with all the gusto that
Speaker 1: you can muster. We feel that can that can lead
Speaker 1: to burnout. A lot of times. I think folks think
Speaker 1: that when they achieve fire, once they're financially independent, that
Speaker 1: all the problems are going to go away. But that's
Speaker 1: definitely not the case. I think those folks are going
Speaker 1: to be in for a rude awakening, Yeah, for sure.
Speaker 1: And Matt, let's talk maybe about the history of the
Speaker 1: Fire movement too, because that's helpful, I think as as
Speaker 1: we kind of discuss it at length today. In the
Speaker 1: history of Fire really predates the acronym. I don't know
Speaker 1: exactly when the Fire acronym started. It feels like, I
Speaker 1: don't know, maybe sometime ten years ago, eleven years ago,
Speaker 1: that's my that's my guess. But really there were people
Speaker 1: talking about this concept um and people living a life
Speaker 1: that reflected this concept far before that acronym came about.
Speaker 1: Vicky Robin. She was the co author of the best
Speaker 1: selling book Your Money or Your Life, and she and
Speaker 1: her co author really helped popularize the idea of financial
Speaker 1: independence in the nineteen nineties. But these principles have been
Speaker 1: around even before that, and it really it really starts
Speaker 1: with creating a big gap between what you earn and
Speaker 1: what you spend. And um, the bigger the gap, you know,
Speaker 1: the quicker you're gonna be able to reach that place
Speaker 1: in your life where your money is working harder for
Speaker 1: you than you have to work for it. And Yeah,
Speaker 1: the cool thing is that those fundamental principles haven't changed,
Speaker 1: but the way that those ideas get communicated really has.
Speaker 1: And so yeah, that, like we said, has helped this
Speaker 1: movement out in a big way. It's become a really
Speaker 1: powerful communication tool to help spread a message that can
Speaker 1: be pretty empowering. That is true. But you know, in
Speaker 1: recent years, the actual fire acronym has been popularized, you know,
Speaker 1: quite a bit by single males who work in higher
Speaker 1: paying like software and technology jobs, um, and you know,
Speaker 1: sort of like you mentioned earlier, like the movement has
Speaker 1: caught some flak for that. It has become a whipping
Speaker 1: horse with media, and in some ways, we feel that
Speaker 1: this was kind of a bit of a stereotype because
Speaker 1: on our show, many of the guests that we've had
Speaker 1: that are in the Fire movement they don't fit that bill.
Speaker 1: They're not you know, single males who were working in
Speaker 1: you know, high paying jobs. Although we definitely have had
Speaker 1: some of those guys on, We've also had folks on
Speaker 1: the show like Jillian John's Rude Julian and Kirsten from
Speaker 1: from rich and regular here in Atlanta, Liz Thames, Tanya Hester.
Speaker 1: They have all shown that there is more diversity than
Speaker 1: than some people think inside of the actual Fire movement. Yeah,
Speaker 1: and I think the Fire movement has grown to really
Speaker 1: encompass a whole lot of folks that look a lot
Speaker 1: different than the stereotypes that we see portrayed. And although
Speaker 1: like probably one of the most popular figures in the movement,
Speaker 1: it probably does fit that stereotype to a large degree.
Speaker 1: And that's Mr money Mustache, right, who was a software
Speaker 1: engineer but before he quit, right, And so yeah, he's
Speaker 1: he's like probably the best known writer um in that spear. Uh.
Speaker 1: And he is a really good writer. So there's a
Speaker 1: reason why, right, he has well it in creative posts
Speaker 1: that help people think through what it looks like to
Speaker 1: save more money by changing their lifestyle. And Matt he
Speaker 1: takes us really like brash approach in in how he
Speaker 1: writes and h yeah, he's referred to the typical middle
Speaker 1: class lifestyle as and I quote an exploding volcano of wastefulness.
Speaker 1: It talks about folks driving around in their clown cars,
Speaker 1: you know, just like the different vehicles that we drive
Speaker 1: that are completely unnecessary and and we you know, we
Speaker 1: agreed to that to a certain extent. That's a part
Speaker 1: of why we love biking. So much, but like when
Speaker 1: you read his post, you feel compelled to change some
Speaker 1: of the things that you're doing because of the stark
Speaker 1: contrast anything that it hangs. He does a good job
Speaker 1: with that, and so yeah, he makes fire, financial independence
Speaker 1: and retiring early feel like something you don't have to
Speaker 1: grind to achieve, but more like away folks should be
Speaker 1: living anyway instead living less wastefully and just living more intentionally. Yeah,
Speaker 1: he makes it make intuitive sense where it feels like
Speaker 1: it's something that you should naturally be doing anyway. And
Speaker 1: the thing is too folks like Mr money Mustash and
Speaker 1: Vicky Robbin. For them, the fire concept goes beyond just
Speaker 1: the dollars in the set. You know, they're all about
Speaker 1: decreasing our environmental footprint as well. You know, connecting your
Speaker 1: spending and your money choices to bigger ideals can be
Speaker 1: really helpful. But that's just one of the additional benefits
Speaker 1: of fire right. It's not necessarily a requirement, because again,
Speaker 1: fire can look different for everyone. You can choose your
Speaker 1: own adventure. And so we're actually gonna talk more about
Speaker 1: the different types of fire, financial independence, retire early, some
Speaker 1: of the different flavors out there that you might want
Speaker 1: to subscribe to. And we'll get to that right after
Speaker 1: this break. All we're back, we're talking about fire and
Speaker 1: how there's a bunch of different ways that you can
Speaker 1: get to that point. I think it's helpful for folks
Speaker 1: to know that there's not just a one size fits all, uh,
Speaker 1: when you're looking to save up enough money that you
Speaker 1: don't have to work anymore. So, Matt, But before we
Speaker 1: get to maybe some of those different types of models
Speaker 1: that people can follow in order to achieve that, let's
Speaker 1: maybe talk about the general concept of retire it for
Speaker 1: just a second, because you know, just like we talked
Speaker 1: about the fire movement, the fire acronym being relatively new, well,
Speaker 1: the general concept of retirement is pretty new in and
Speaker 1: of itself. For most of human history, working your whole
Speaker 1: life was the thing, like you didn't really have. We
Speaker 1: didn't have, you know, social security, but choice, we didn't. Yeah,
Speaker 1: it's what you had to do, like working working to
Speaker 1: land until you dropped dead while working the land. And
Speaker 1: I'm glad that that's not the way life is anymore, right, um,
Speaker 1: And So retirement being a thing is a good thing,
Speaker 1: but it's also important to keep that in mind. As
Speaker 1: we discussed this that the modern concept of retirement is
Speaker 1: relatively new. Uh, it's not something that our ancestors four
Speaker 1: hundreds of years have been participating participating in. It's not like,
Speaker 1: you know, you're great great, great, great great great Grandpa
Speaker 1: in the sixteen hundreds moved Florida and walked on the
Speaker 1: beach every day because searching for sharks, which is let
Speaker 1: our kids do know, wake at at the beach. Ye
Speaker 1: back then it was the thing. Yeah, back then they're
Speaker 1: just trying to avoid the bubonic plague, right, which actually
Speaker 1: that's not too different I guess from our recent the
Speaker 1: recent year that we've had. Uh. And you know, the
Speaker 1: concept of fire, it does have its merits, right, the
Speaker 1: fact that you don't have to work when you save
Speaker 1: up enough money is great. But at the same time,
Speaker 1: some folks in the fire movement emphasize the negativity of work, right.
Speaker 1: It's you know, it's certainly not that everyone get gets
Speaker 1: pumped to wake up and to go and do their
Speaker 1: job every day, but focusing on early retirement makes work
Speaker 1: seem like a drag meant to be ditched at the
Speaker 1: earliest possible moment. And you know, we're not really down
Speaker 1: with that, and that's another reason why we're just more
Speaker 1: focused on the financial independence side of the equation less
Speaker 1: on the retire early side of things. Um. I think,
Speaker 1: I mean, I think we both believe that in order
Speaker 1: to live a fulfilling life that it involves service, whether
Speaker 1: or not you're getting paid for it, whether or not
Speaker 1: you're being compensated at a very high amount, or if
Speaker 1: you're just kind of receiving just kind of a you know,
Speaker 1: may we have a more minimum wage for for the
Speaker 1: service that you're doing, but service eagles work, right, And
Speaker 1: so for that reason, we're not trying to escape work.
Speaker 1: But we do want folks to have more options as
Speaker 1: they go through life. And that's what we're talking about today.
Speaker 1: And if someone came up to me and they said,
Speaker 1: all right, if I take this job and I work
Speaker 1: for the next twelve years really hard, I can reach
Speaker 1: financial independence, but I'll hate most every minute of working
Speaker 1: at this job, I would say, don't do it. I
Speaker 1: would rather you take much much longer to achieve financial
Speaker 1: independence than pursuing something for the next decade plus that
Speaker 1: you don't enjoy in the least. Um, just in order
Speaker 1: to get there more quickly. Assuming that the alternative is
Speaker 1: a job that you love, right, So twelve years of
Speaker 1: basically life that you hate. But that's the thing, there's
Speaker 1: that that's never the only option. It is like between
Speaker 1: two jobs that you hate, right, right, you can always
Speaker 1: go find something that you love to pay is less
Speaker 1: or that you enjoy and granted, like like you said,
Speaker 1: even people that enjoy their jobs, they're not going to
Speaker 1: be thrilled to go into the office every day or
Speaker 1: you know, even even coming to the microphone. Sometimes I'm like,
Speaker 1: maybe I'm not in the best mood to record a
Speaker 1: podcast that day, but I get through it. You know, Um,
Speaker 1: maybe you're mad at me, anything to share today. We're good.
Speaker 1: We're good, good. But yeah, that's that's one of those
Speaker 1: things where I think sometimes the fire movement can turn
Speaker 1: work into such a villain that it can really affect
Speaker 1: the mindset of some of the people working to achieve fire,
Speaker 1: and I think that leads to the downfall of some
Speaker 1: of those people. Um and maybe like the burnout factor
Speaker 1: that some of the people trying to go down the
Speaker 1: fire path tend to experience. That's right, Yeah, so the
Speaker 1: path to fire can look different based on your particular circumstances,
Speaker 1: your specific goals, and you know, unsurprisingly, the media tends
Speaker 1: to take extreme positions. Uh, And I feel like they
Speaker 1: oftentimes either make fire seem like like it's only for
Speaker 1: incredibly high earning tech bros out there, or just for
Speaker 1: folks who you know, want to live a meager existence
Speaker 1: of like eggs and beans, or like like just the
Speaker 1: cheapest what's like, what its rising? Beans? Why say eggs,
Speaker 1: because like, eggs are really cheap. Eggs are super affordable,
Speaker 1: good for you, they're cheap, large part of our diet
Speaker 1: here in our household, but just essentially subsisting on like
Speaker 1: fifteen thousand dollars a year, right, that's the only way
Speaker 1: you can achieve it is if you either make bouckoos
Speaker 1: of dollars or you live on next to nothing exactly.
Speaker 1: And that's just not the case. That dichotomy is not
Speaker 1: quite right. Yeah. Yeah, there's more diversity all on the
Speaker 1: fire spectrum, and chances are that there's going to be
Speaker 1: a version or a flavor that is going to appeal
Speaker 1: to you. So let's get it off me, let's talk
Speaker 1: about some of the different types of fire. Let's do
Speaker 1: it all right, so we just you know, you mentioned
Speaker 1: the beans and rices lifestyle living on k there are
Speaker 1: some people who that style of fire. It fits their needs,
Speaker 1: it fits like their desires in life, and they're like,
Speaker 1: I just want to be financially independent and I don't
Speaker 1: mind living an incredible frugal lifestyle. And for those folks
Speaker 1: who lean in that direction, they're going to be into
Speaker 1: what's called lean fire. And so yeah, this is for
Speaker 1: the folks who just can't wait to quit work and
Speaker 1: don't mind having an incredibly small residual income. And yeah,
Speaker 1: these folks are basically looking to cover their basic needs
Speaker 1: like food, transportation when they need it and trying to
Speaker 1: keep those costs to a minimum and uh, you know,
Speaker 1: a really small rent or mortgage. Some of these folks,
Speaker 1: you know, they might even move to different lower cost
Speaker 1: of living areas of the country or even the world
Speaker 1: in order to achieve this. Right, So let's say you
Speaker 1: know you're saving like Panama or Thailand, right, Yeah, Portugal
Speaker 1: is another destination where some people are moving, which sounds
Speaker 1: like fun Like that's uh, I mean, I mean we're
Speaker 1: actually not planning to talk about this, but like the
Speaker 1: nomadic fire lifestyle or you know, like that's another sort
Speaker 1: of shand or another flavor that I kind of feel
Speaker 1: like lends itself to lean fire as well. Yeah, yeah, yeah,
Speaker 1: because if you have your money saved up in US dollars,
Speaker 1: but your dollar goes three times as far in another
Speaker 1: you know, lower cost of living area, then it makes sense,
Speaker 1: right you can live that lean fire lifestyle on your
Speaker 1: money if you're willing to make that move, right, right,
Speaker 1: So yeah, the upside is that you're able to achieve
Speaker 1: financial independence really quickly, but the downside is that you're
Speaker 1: gonna have to make some serious sacrifices if you go
Speaker 1: in that direction. So, Matt, I don't know about you,
Speaker 1: but the lean fire approach doesn't really have any appeal
Speaker 1: to me, but I can see how some people might
Speaker 1: be interested in that. Yeah. Yeah, the pros are that
Speaker 1: you don't have to work anymore, but she also can
Speaker 1: do much of anything else. Like I feel like this
Speaker 1: really does lend itself to kind of like the more
Speaker 1: minimalist approach. Like, for instance, if you ended up staying
Speaker 1: in the house that y'all are in instead of renting
Speaker 1: it out, which is your plan, Uh, you could be
Speaker 1: lean fire probably today, right, because it's it's a really,
Speaker 1: really affordable house. But yeah, that doesn't lend itself to
Speaker 1: the lifestyle that you're looking for. And I think it's
Speaker 1: tougher too with kids, right, Like, it's hard enough maybe
Speaker 1: to get a partner on board with cutting Hey we're
Speaker 1: gonna cut back our lifestyle completely. What do you think
Speaker 1: about that? This is what our lives are gonna look like,
Speaker 1: This is how little we're gonna travel, things like that.
Speaker 1: But it's even more difficult, I think with kids, and
Speaker 1: not because I'm not going to subscribe to the you know,
Speaker 1: the reports that you see that kids cost like, you know,
Speaker 1: five dollars, but you know by the time that they
Speaker 1: leave your house at tea right there. Yeah, but they
Speaker 1: do have a tougher time understanding the same goals that
Speaker 1: you as an adult have, right I mean, and it's
Speaker 1: understandable like kids or kids they don't think like adults,
Speaker 1: and so I think at times it might be difficult
Speaker 1: to get kids on board. So that's something to keep
Speaker 1: in mind. I think it lends itself to the single
Speaker 1: software engineer who might be down with like living in
Speaker 1: a van down by the river kind of thing, but
Speaker 1: a little bit tougher with maybe a larger family or
Speaker 1: if you have other goals in life that you're looking
Speaker 1: to pursue. Yeah, that doesn't mean that you can't live
Speaker 1: frugally as a family, But lean fire is like cutting
Speaker 1: to the bone, and that's a little too much for
Speaker 1: most people to stomach, that's right. Yeah, And so next
Speaker 1: let's get to coast fire, which can be ideal for
Speaker 1: some of the younger folks in the movement, especially that
Speaker 1: this fire route is all about saving up huge chunks
Speaker 1: of money in your early working years and then not
Speaker 1: having to prioritize saving and investing after that. Right, So
Speaker 1: essentially you're front loading the sacrifice. So let's say that
Speaker 1: you max out your retirement accounts, you're four one K
Speaker 1: your roth ira A say, for ten years running through
Speaker 1: your twenties into your early thirties, you'll have sucked away
Speaker 1: over two or fifty thousand dollars, right, not to mention
Speaker 1: the growth that you'll will have already seen on those
Speaker 1: dollars that you have invested early on. But at this point,
Speaker 1: your index fund portfolio is almost guaranteed. I mean it
Speaker 1: is guaranteed to turn into a good bit more than
Speaker 1: one million dollars. If it's not, we've encountered really termulent troubling,
Speaker 1: you know at times when we're all screwed. Yeah. Yeah,
Speaker 1: by the time you hit retirement age, right, and so
Speaker 1: once you have that done, you can now stop contributing
Speaker 1: to retirement accounts altogether. Uh, and you can look to
Speaker 1: do something like increasing your spending levels, finding ways to
Speaker 1: maximize your enjoyment out of life essentially, you know, and
Speaker 1: especially as you maybe you start to have kids stuff
Speaker 1: like that, and let's say your thirties, it affords you
Speaker 1: a little more breathing room because you can soak up
Speaker 1: more of that income into your spending now because you
Speaker 1: did such a good job during those first ten years
Speaker 1: of your investing lifetime and you built up such a
Speaker 1: large nest egg that you don't have to keep funding
Speaker 1: it because you don't need five million dollars in retirement.
Speaker 1: You just need one million something like that, right. And
Speaker 1: the idea too. So this is called coast fire. It's
Speaker 1: not to be confused with like. This doesn't mean that
Speaker 1: you're living like on the coast, like the Amulfi coast, right.
Speaker 1: This means that you've worked hard. Uh. It's like imagine
Speaker 1: that you're flooring it. You're getting close to this hill,
Speaker 1: a big downhill, and then you start going down downhill,
Speaker 1: and then you can let your foot off the gas
Speaker 1: a little bit and you get the coast all the
Speaker 1: way down. That's the kind of coast that we're talking
Speaker 1: about here. Yeah, I feel like to the good thing.
Speaker 1: The thing I like about that route and that strategy
Speaker 1: to achieving fire is that can completely change how you
Speaker 1: view work, because if you're no longer having to save
Speaker 1: towards retirement, you know, once you've kind of done that
Speaker 1: hard work, you can switch jobs or careers if you
Speaker 1: don't find your current line of work fulfilling, or if
Speaker 1: it's become too stressful. Maybe, of course, you still have
Speaker 1: expenses to pay for in the meantime, but if you
Speaker 1: no longer have a boatload of debt and you're not
Speaker 1: worried about how you're gonna survive, you know, in your
Speaker 1: elderly years, you can then have the freedom to pursue
Speaker 1: things that bring you joy instead of doing something that
Speaker 1: you don't love. And you and I were were all
Speaker 1: about that, teaching things that you don't love, getting that
Speaker 1: stuff out of your life, even if it produces a
Speaker 1: giant monetary return um for most people, most of the time,
Speaker 1: it's not worth it. Yeah, what's crazy about Coast fire
Speaker 1: is I think for a lot of folks, I think
Speaker 1: they if they crunch the numbers, they might realize that
Speaker 1: they have kind of already achieved Coast fire, right, And
Speaker 1: so I actually crunched them are specific numbers because I
Speaker 1: wanted to see what it took for someone to hit
Speaker 1: one million dollars by the time they hit sixty five.
Speaker 1: And all that means is that you need to have
Speaker 1: ninety four thousand dollars invested by the time you're thirty
Speaker 1: years old, and so thousand that's I mean, that's pretty attainable.
Speaker 1: I mean, it's easy, but it's attainable. And I don't
Speaker 1: want you exactly, I don't want to downplay how hard
Speaker 1: it is to get together close to a hundred thousand dollars.
Speaker 1: But if you have that money invested and you're earning
Speaker 1: about seven percent every year through the power of compounding interest,
Speaker 1: you're going to hit over a million dollars by the
Speaker 1: time you hit sixty five years old. And granted, we're
Speaker 1: talking about fire, which is retire early, and sixty five
Speaker 1: is obviously more of a traditional view of retirement. But
Speaker 1: I guess I wanted to point that out because I
Speaker 1: think a lot of folks might realize, oh wow, like
Speaker 1: I am on the spectrum to a certain extent. And
Speaker 1: if you are at that point, just like you said, Dull,
Speaker 1: it gives you the freedom to start making some choices
Speaker 1: in life that may not be the best choices when
Speaker 1: it comes to your money as far as the dollar amount,
Speaker 1: but it might be more fulfilling work. It makes me
Speaker 1: think about what we're doing right now. I mean this podcast.
Speaker 1: You and I have gone into creating this show. It's
Speaker 1: something that we have a lot of passion about, something
Speaker 1: that we're excited to spread the good news of financial independence,
Speaker 1: of people doing smart things with their money in order
Speaker 1: for them to have more options down the road. And
Speaker 1: I believe you and I had a degree of confidence
Speaker 1: to step into creating the show full time because, Yeah,
Speaker 1: we look back at the ten plus years of our
Speaker 1: lives where we had done smarter things with our money,
Speaker 1: where we were primarily focused on the dollar amount, and
Speaker 1: if we wanted to, we could, You and I could
Speaker 1: could both stop contributing to our retirement and investing that
Speaker 1: money and just you know, say we were only making
Speaker 1: enough to subsist and exist and you know, pay the
Speaker 1: bills today. By the time we hit sixty five, you
Speaker 1: and I both are going to be okay. So I mean,
Speaker 1: technically speaking, you and I are both in the coast
Speaker 1: fire camp. That's the stage of life that that we're in. Yeah,
Speaker 1: for me, Matt, what it comes down to saving the
Speaker 1: investing well gives you options, and uh, coast fires kind
Speaker 1: of all about those options, like I'm gonna work really
Speaker 1: hard in the beginning and then I'm gonna be able
Speaker 1: to do what I want. And often times it does
Speaker 1: mean it gives you those options to not necessarily amass
Speaker 1: this huge nest egg of money for your future self,
Speaker 1: because who really needs five million dollars with retirement. I
Speaker 1: guess some people. Nobody really needs it, but some people
Speaker 1: want it. Some people want it, that's what they're going for.
Speaker 1: And we say, we don't really, we don't really need
Speaker 1: that much money. Um, we'd rather make choices now in
Speaker 1: our thirties to do work that we love, to get,
Speaker 1: to enjoy more time with our family, with our kids,
Speaker 1: really to create the lifestyle that we want. And so yeah,
Speaker 1: coast Fire I think resonates with both of us a
Speaker 1: lot more than maybe some of the other types of
Speaker 1: fire that we'll talk about. Yeah, because it's I mean, again,
Speaker 1: I don't want to feel like I'm beating a dead horse.
Speaker 1: But it's it's not like we're forsaking work altogether. Like
Speaker 1: we're still working hard, but it's just it's not like
Speaker 1: a light switch that's either on or off. And I
Speaker 1: think a lot of times when it comes to retirement
Speaker 1: or fire, folks, that's how they that's how they approach it, right,
Speaker 1: It's like it's either on in a working crazy hard
Speaker 1: and I'm neglecting my health, my relationships, my mental health,
Speaker 1: just everything that's out there, and then eventually we're gonna
Speaker 1: flip it off. I'm no longer gonna work. But you
Speaker 1: and I, I mean, we're talking about approaching this less
Speaker 1: as like an on off switch and more like a
Speaker 1: dimmer switch. It's just like, Okay, you know, we were
Speaker 1: pretty close us to full capacity, you know, full brightness level,
Speaker 1: but now let's just kind of dim it down a
Speaker 1: little bit. You know, We're we're definitely still working, but
Speaker 1: we also have the ability to prioritize some other things
Speaker 1: in our life, like relationships and in different things that
Speaker 1: we want to pursue. Yeah, I think the dimmer switch
Speaker 1: is a good concept when when it comes to fire
Speaker 1: doesn't have to be all or nothing. And so yeah,
Speaker 1: I think the next you know fire type makes uh
Speaker 1: it fits into that category. It's called Barista fire, which
Speaker 1: is more of an attempt to save and invest well
Speaker 1: with the goal of retiring, but also still needing to
Speaker 1: work part time and and have that part time work
Speaker 1: offer you benefits, particularly healthcare benefits. So Starbucks is obviously
Speaker 1: known for offering excellent healthcare benefits to employees that work
Speaker 1: only twenty hours a week. So yeah, the thus the
Speaker 1: Barista fire exactly. So that Barista fire strategy is this
Speaker 1: alternative essentially for people who aren't ready to save more
Speaker 1: than their income, because that's a tall order in order
Speaker 1: to retire ridiculously early. That's maybe not what they care about,
Speaker 1: but they just want the flexibility to be able to
Speaker 1: work less as they get old, and so yeah, similar
Speaker 1: to Coast fire, you still have a job much of
Speaker 1: the time, but you're even less dependent on it, right,
Speaker 1: So it's it's kind of like partial retirement. It's not
Speaker 1: get to work just part time and you have those benefits, right,
Speaker 1: like healthcare obviously would be a huge drain on your
Speaker 1: budget if you're retired. Paying for your own health benefits
Speaker 1: is one of the biggest conundrums in the fire community.
Speaker 1: And so if you're Barista Fire, you have enough money
Speaker 1: to pay for your living expenses, but you're saying, I
Speaker 1: still't want an employer, or one for part time income,
Speaker 1: and then two for some of these benefits that are
Speaker 1: kind of crucial to being able to, you know, live
Speaker 1: the life I want to live. Yeah. Again, one of
Speaker 1: the similarities between Barista Fire and Coast Fire is just
Speaker 1: a high view of work, so it's not something that
Speaker 1: we're trying to completely escape from. And of course at
Speaker 1: the other end of the frugality spectrum is fat fire.
Speaker 1: If this is your aim, you're gonna need to save
Speaker 1: up a pretty large nest x that your lifestyle doesn't
Speaker 1: get cramped in the slightest you might be in that Actually,
Speaker 1: I do want five million dollars in my retirement account,
Speaker 1: you know, territory and the kind of life I would
Speaker 1: have lived. Perhaps you want to include even more spending
Speaker 1: than you're used to. People going in this direction either
Speaker 1: work a few years longer to build up those savings,
Speaker 1: or they they suck away an amazingly high percentage of
Speaker 1: their pay in order to to achieve fat fire. Apparently
Speaker 1: there's an obese fire as well. I've even heard it
Speaker 1: referred to as morbidly obese fire. And so the acrimonym
Speaker 1: is MO fire. It's safe to assume folks that can't
Speaker 1: want to be able to participate in all that life has,
Speaker 1: regardless of the cost. So, now that we've covered a
Speaker 1: few of the different types of financial independence, retire early,
Speaker 1: a few of the different models that you can choose
Speaker 1: to kind of look to as you're figuring out how
Speaker 1: you're going to invest and how you're going to live
Speaker 1: today while you're also trying to pursue financial independence down
Speaker 1: the road. Well, let's talk about some of the tactics
Speaker 1: that it takes to get there, how to achieve financial
Speaker 1: independence and retire early. We'll get to our thoughts on
Speaker 1: that right after this break. We are back and Joel,
Speaker 1: this is fire Choose your own Adventure episode. And we've
Speaker 1: talked about the different types of fire, and so now
Speaker 1: let's discuss how to do it. Uh. And you know,
Speaker 1: at a very high level, you have to to spend
Speaker 1: less than you make, like Essentially, that's how you do it.
Speaker 1: That's the basics. That's not really it's if you're living
Speaker 1: paycheck to paycheck, if you have no margin in your life,
Speaker 1: fire isn't even going to be on your radar. Of course,
Speaker 1: if you're you know, if you're spending more than you
Speaker 1: make and you're going further into debt each successive month,
Speaker 1: then you're going in the opposite direction and you're digging
Speaker 1: yourself in a hole that will become, at least over time,
Speaker 1: harder and harder to climb out of. Yeah. So, Matt,
Speaker 1: before someone can even decide, well I want to go
Speaker 1: towards fat fire or I wanna I'm more of a
Speaker 1: coast fire person, really, they have to think about their savings, right, right.
Speaker 1: That's like one of the biggest tactics that you have
Speaker 1: to figure out is how much of your money ken
Speaker 1: you save, because that's going to determine how quickly you're
Speaker 1: able to get to that point of finding independence. There
Speaker 1: is another overarching principle here. Yeah, so we personally believe
Speaker 1: that listeners should be shooting for a savings rate of
Speaker 1: at least fifteen of their income. We'd like to see
Speaker 1: most of that money invested for the future too. And
Speaker 1: Mr money Mustache we referred to to him earlier. He's
Speaker 1: got this great chart on his website that puts some
Speaker 1: concrete numbers to your savings rate and then how long
Speaker 1: it's going to take you to reach financial independence. Uh.
Speaker 1: The post is called the Shockingly Simple Math behind Early Retirement.
Speaker 1: Will link to it in the show notes. But the
Speaker 1: accompanying chart can be really motivational to get you interested
Speaker 1: in investing more of your money because every percentage point
Speaker 1: that you ratch it up to your four oh one
Speaker 1: K contributions has this direct correlation to the amount of
Speaker 1: years that you're gonna have full financial freedom. Yeah. And
Speaker 1: as Mr money Mustache says in the post, cutting spending
Speaker 1: is even more important than earning more money. Uh. It
Speaker 1: has that twofold effect of giving you more money to
Speaker 1: invest now, which means you have less of a lifestyle
Speaker 1: that you're saving up to fund and so your non
Speaker 1: working years won't cost you as much if you're able
Speaker 1: to keep that lifestyle inflation and check. He specifically links
Speaker 1: to this kind of chart calculator thing on net worthifi
Speaker 1: dot com, but we'll make sure to link to that
Speaker 1: specific calculator in our show notes. So that savings rate
Speaker 1: is crucial when it comes to the timeline of you
Speaker 1: being able to achieve financial independence. And I do think, Matt,
Speaker 1: that calculator you just mentioned and that post overall is
Speaker 1: just a huge motivator um and a huge eye opener
Speaker 1: for a lot of people who are looking to handle
Speaker 1: their money well and starting down that road to financial independence.
Speaker 1: It can be helpful to see some of those cold
Speaker 1: hard numbers that help you realize, wait a second, if
Speaker 1: I make this one of these one or two small changes,
Speaker 1: it's going to take years off my need to work
Speaker 1: at least. Yeah, cutting a monthly expense, you can see
Speaker 1: how that changes your retirement from like nineteen years to
Speaker 1: thirteen years. Like, holy crap, just just that one thing,
Speaker 1: she just like takes six years of me potentially having
Speaker 1: to work and an a job that I don't like anymore. Like,
Speaker 1: like you said, like, that's when your eyes are open
Speaker 1: and you see that there's a potentially another path for you. Yeah,
Speaker 1: it's fun to mess around with. So let's talk about
Speaker 1: some of the tactics to like savings very it's huge,
Speaker 1: But we already said that the path of financial independence
Speaker 1: can look different based on how quickly you want to
Speaker 1: get there and what you want your life to look
Speaker 1: like now. But even still, the levers are pretty much
Speaker 1: the same regardless if you're planning on pursuing lean fire
Speaker 1: or fat fire or morbidly obese fire MO fire. I
Speaker 1: didn't know about until until you mentioned So, Yeah, let's
Speaker 1: talk about some of the universal tactics for a second,
Speaker 1: and let's start with income, right, Matt, because that's going
Speaker 1: to be one of the most important factors. Like, how
Speaker 1: much money you make is definitely going to be important
Speaker 1: on your road to achieving financial independence. Yeah, we probably
Speaker 1: don't talk about this one enough, but we would encourage
Speaker 1: folks to find ways to make more money. And here's
Speaker 1: the thing. We're not talking about working more. Uh, We're
Speaker 1: not talking about working more crazy unsustainable hours that will
Speaker 1: leave you burned out. Instead, we want you to pursue
Speaker 1: a higher income through increasing your skills or getting an
Speaker 1: advanced degree, starting your own business. Don't forsake the ability
Speaker 1: to invest in yourself because getting that degree like that's
Speaker 1: gonna pay dividends for years to come, mentally, emotionally, and
Speaker 1: obviously financially as well. Focus on multiple streams of income.
Speaker 1: This can also be a big advantage as well, if
Speaker 1: you're in a job or a career that doesn't easily
Speaker 1: lend itself to making more, even just a modest boost
Speaker 1: in what you're investing every year can lead to huge
Speaker 1: returns down the road. Again, Joel, I'm ill love the numbers,
Speaker 1: so crunching more numbers. And if you're able to invest
Speaker 1: six thousand dollars, which happens to be the rath ira
Speaker 1: a maximum contributions for you know, every year. But if
Speaker 1: you could do that every year for the next thirty
Speaker 1: seven years, you're gonna have over one million dollars if
Speaker 1: that money is invested as it compounds, earning seven percent
Speaker 1: interest every single year. And that's like I'm not even
Speaker 1: contributing to my employer plan, and I'm not getting the
Speaker 1: free match which six always get. Yea, yeah, it's leaving
Speaker 1: all that aside. Even just a simple rath Ira six
Speaker 1: thousand dollars. And again we're not just like getting a
Speaker 1: D nine four thousand dollars by the time you're thirty.
Speaker 1: I'm just letting it sit. I'm not saying that this
Speaker 1: is like super easy to do six thousand dollars, but
Speaker 1: I'm also pointing out like we want to highlight that
Speaker 1: this is attainable for a lot of folks out there. Yeah.
Speaker 1: So one of the taxics is, like you said, to
Speaker 1: increase your income to invest in yourself that pays big
Speaker 1: time dividends. Another tactic that it takes on the path
Speaker 1: of fire is to, you know, tamp down your expenses,
Speaker 1: especially on the bigger ticket items like housing and transportation.
Speaker 1: Most people allocate their take home pay to paying their
Speaker 1: mortgage or their rent, but you can't really do that
Speaker 1: if you want to retire early, so you have to
Speaker 1: consider other routes to your lessen the costs of what
Speaker 1: you're paying for housing. So we would suggest things like
Speaker 1: live in real estate flips, house hacking, or even just
Speaker 1: renting a cheaper place instead of buying an ice home.
Speaker 1: Those are all worthwhile considerations if you're looking to achieve
Speaker 1: financial independence earlier than you previously thought. And that's just
Speaker 1: such an important area because you can move the needle
Speaker 1: so aggressively in such a small period of time. Let's
Speaker 1: say you're in the lease now for a three bedroom
Speaker 1: apartment in like a fancy part of town. Maybe you
Speaker 1: can say, well, we don't need quite need this much
Speaker 1: space we can instead for this two bedroom apartment that's
Speaker 1: three miles away and in a good bit cheaper location,
Speaker 1: we can say four or fifty a month. I mean,
Speaker 1: that's the kind of thing that instantly gets you to that,
Speaker 1: you know six, being able to fully invest in your
Speaker 1: roth IRA every year. That it's those kind of moves
Speaker 1: that have a huge impact on your trajectory. And it
Speaker 1: is important to crush your transportation costs too. We would
Speaker 1: recommend for folks to own fewer cars or at least
Speaker 1: cheaper cars. Again, consider biking more. It really isn't rocket
Speaker 1: science because there's no simpler way of massively boosting or
Speaker 1: savings rate than to permanently cut expenses in order to
Speaker 1: reach financial independence. Essentially, folks that want to reach fire
Speaker 1: like they're gonna have to think creatively about all the
Speaker 1: different sorts of other expenses in their lives as well,
Speaker 1: Like you know, how much you spend on entertainment and
Speaker 1: eating out, or how much you spend on travel, right,
Speaker 1: And that's to say that you're not traveling at all,
Speaker 1: Like many of them still like to travel, but they
Speaker 1: just choose to travel hack, uh, instead of paying top
Speaker 1: dollar you know for their lodging instead, maybe their house sitting,
Speaker 1: or maybe they're used in their credit card points to
Speaker 1: to score those airline tickets. Creativity is one of the
Speaker 1: hallmark traits of someone who is legit serious about reaching
Speaker 1: financial independence at an early age. You know, we're want
Speaker 1: to point out that it's not painless. Uh, it's gonna
Speaker 1: take a lot of work. But you're gonna have to
Speaker 1: also find that sweet spot between working really hard and
Speaker 1: you know, making some sacrifices in life, but at the
Speaker 1: same time making sure that you're not sacrificing too much, right.
Speaker 1: You want to make sure that you're setting realistic, moderate
Speaker 1: goals so that you don't completely burn out and it's
Speaker 1: not something that you're able to achieve at all. Yeah, man,
Speaker 1: I know, I totally agree. I think creativity actually is
Speaker 1: probably one of the adjectives I would most strongly associate
Speaker 1: with the Fire Movement. Most of the people I know
Speaker 1: in there have done really interesting and unique things in
Speaker 1: order to help put themselves in a strong financial position
Speaker 1: without having to miss out on some of the things
Speaker 1: that they love the most. I think travel, like you said,
Speaker 1: is one of those areas where a lot of people
Speaker 1: the Fire Movement travel more than people that aren't in
Speaker 1: the fire movement that I know, they just found creative
Speaker 1: ways to do it for less money, and um, yeah,
Speaker 1: let's talk about Yeah, the other tactics to take. Investing
Speaker 1: is another tactic that you obviously need to be doing
Speaker 1: if you want to achieve fire with all the money
Speaker 1: that you have at the end of the month by
Speaker 1: house hacking or not having a car payment, you know,
Speaker 1: all the other ways that you'll discover that you're wasting money, Well,
Speaker 1: you're going to want to invest that money like crazy,
Speaker 1: and you're gonna want to invest in low costs, widely
Speaker 1: diversified index funds. You'll first want to max out all
Speaker 1: the tax advantage retirement accounts that are available to you.
Speaker 1: This is gonna be a big factor in lowering the
Speaker 1: amount that you pay in taxes each year. And then
Speaker 1: the more that you invest in these accounts, the more
Speaker 1: that you're gonna be super charging the growth of that
Speaker 1: retirement nest egg. So someone who wants to achieve fire
Speaker 1: can't be content to save their money in a savings account.
Speaker 1: Not that they don't need some of that money hanging
Speaker 1: around in an emergency fund, right, but if they want
Speaker 1: to achieve fire. They need to have their money working
Speaker 1: for them and that only comes through investing, and investing
Speaker 1: mostly in the stock market, that's right, And that's why
Speaker 1: we talk so much about investing. Sometimes folks think that
Speaker 1: we talk about it a little too much, but it's
Speaker 1: because it's so important. Yeah, and I don't want to
Speaker 1: say I said mostly the stock market, but just like
Speaker 1: we talked about with Rachel on Monday, and just like
Speaker 1: you and I are also advocates of real estate is
Speaker 1: one of those other avenues. That's also another one of
Speaker 1: those tactics. It doesn't just have to be low cost
Speaker 1: index funds that gets most of the press, but when
Speaker 1: it comes to is definitely the most passive way, Like
Speaker 1: I mean that truly is the only passive way to
Speaker 1: you know, have a stream of income. But there are
Speaker 1: other ways that have higher rates of income, but they're
Speaker 1: gonna take a little bit more work. So it kind
Speaker 1: of depends which level of work that you're willing to
Speaker 1: sign up for. And we've talked about real estate quite
Speaker 1: a bit on the show. You can find other episodes,
Speaker 1: but that is definitely one of the ways of investing
Speaker 1: that you can consider if you're looking to achieve financial independence,
Speaker 1: and we've encourage you in that direction too. Yeah, and
Speaker 1: since you've listened this far into the episode, because you're
Speaker 1: clearly serious about fire, you're likely wondering how you're going
Speaker 1: to have access to all those funds that are going
Speaker 1: to be in your retirement accounts, since that's the way
Speaker 1: that most folks are going to have their retirement savings invested.
Speaker 1: After all, you know, we're we're talking about retiring early
Speaker 1: and waiting until you're fifty nine and a half doesn't
Speaker 1: really sound lead to me. Uh, And so you might
Speaker 1: be tempted to think that investing within a brokerage account
Speaker 1: is the way to go, but that is not the case.
Speaker 1: By utilizing more complicated strategies like a roth IRA conversion
Speaker 1: ladder as well as there's this other thing called the
Speaker 1: step seventy two t you will still still get that
Speaker 1: tax advantage. I'll love the complexity of the I R
Speaker 1: S tax, but the I R s yet they're incredibly creative.
Speaker 1: Not but by utilizing these strategies, you'll still get that
Speaker 1: tax advantage and you actually be able to start tapping
Speaker 1: those accounts well before traditional retirement age. It's a little
Speaker 1: more complicated, but money that is invested for retirement. You
Speaker 1: don't necessarily have to wait until you're sixty years old
Speaker 1: before you can draw all those funds. Will actually specifically
Speaker 1: linked to a post by the Mad Scientist, and he
Speaker 1: outlines how you can do that with a roth Ira
Speaker 1: conversion ladder or with the seventy two t He even
Speaker 1: outlines how just even taking that ten percent penalty UH
Speaker 1: for the early withdrawals on retirement account, how that still
Speaker 1: will come out ahead um airs of money that you
Speaker 1: would have invested in a brokerage account. So again, we'll
Speaker 1: make sure to link to that in our show notes. Yeah,
Speaker 1: the Matt Finists is one of the best people in
Speaker 1: the movement to love that guy, and he's also Yeah,
Speaker 1: I just put a lot of effort into thinking through
Speaker 1: some of those strategies and some of the tax roadbumps
Speaker 1: that you might run into along the way, and how
Speaker 1: to minimize the impact of taxes on the money that
Speaker 1: you've worked really hard to save and invest in. So
Speaker 1: that post in particular is a really helpful one. Yeah,
Speaker 1: we'll link to that one. And Matt wrapping this up,
Speaker 1: I feel like, you know, if any listeners out there
Speaker 1: have found listening to this episode the concept of fire intriguing.
Speaker 1: We would say that's great, but know that in order
Speaker 1: to start pursuing pursuing fire, you're gonna have to shift
Speaker 1: your relationship with money. I don't think I've ever read
Speaker 1: a story or heard anybody say that they kind of
Speaker 1: stumbled into early financial independence. He usually takes some intentional moves,
Speaker 1: like we've talked about during this episode in order to
Speaker 1: get there, and you need to do some thinking, is
Speaker 1: some deep thinking about whether or not that lifestyle is
Speaker 1: going to work for you in the long run. Because yeah,
Speaker 1: some sacrifice now in order to save a decent chunkier
Speaker 1: pay in order to achieve financial independence is a good thing.
Speaker 1: But you can also overdo it. You can get burned
Speaker 1: out in the process. And I've read, definitely read accounts
Speaker 1: of that of people saying I'm going home on the
Speaker 1: fire movement and then they lose steam because it's really
Speaker 1: hard to keep up a fift savings rates and living
Speaker 1: you know, massively frugal lifestyle. So yeah, especially if it
Speaker 1: means you're working too much now in order to avoid
Speaker 1: work altogether later, that's not a good strategy. Like that's
Speaker 1: a recipe for burnout. Um, But we are all about
Speaker 1: increasing your savings rate. We're just not about it to
Speaker 1: the point of making yourself miserable. That's not worth it.
Speaker 1: So it's a better idea to find and pursue work
Speaker 1: that you love now than to put your nose to
Speaker 1: the grindstone for a decade or more in order to
Speaker 1: retire early. Just know that if you're interested in fire,
Speaker 1: there are a ton of helpful resources out there, and
Speaker 1: we do think for some folks it's a worthy goal,
Speaker 1: it's a worthy ambition, and at the same time, there
Speaker 1: are a lot of routes you can take to get there.
Speaker 1: It's not one size fits all, and I think that's
Speaker 1: encouraging to is that actual independence retirely doesn't mean you
Speaker 1: have to retire at twenty seven like Rachel Richards did,
Speaker 1: which is impressive. It can mean retiring at forty seven
Speaker 1: and that's still is much faster than many of your peers.
Speaker 1: Or it can mean continuing to work until you're seventy
Speaker 1: five because you love what you do. But you you
Speaker 1: chose that route on purpose, and you know on purpose
Speaker 1: I think is right. Yeah, absolutely, it's about figuring out
Speaker 1: what it looks like for you, right, Because we've outlined,
Speaker 1: you know, like four or five different sort of flavors,
Speaker 1: but you make your own flavor. You figure it out
Speaker 1: what it is that you want to pursue, and then
Speaker 1: you figure out how to get there. I mean, that's
Speaker 1: what we do with on the you know, on the podcast.
Speaker 1: Every single week we talk about things that will get
Speaker 1: you closer to that goal, and you can choose to
Speaker 1: implement what we talk about or not, depending on yeah,
Speaker 1: your own personal goals. But enough of the money talk.
Speaker 1: Tollis shift gears. Let's get back to the beer. For
Speaker 1: this episode, you and I both enjoyed a smells like
Speaker 1: Being Spirit, which is obviously a nod to the Nirvana song.
Speaker 1: You know that the album cover has got the baby
Speaker 1: swimming in the pool. That's that's naked or whatever. Well
Speaker 1: the can art is a nod to that. It's ut
Speaker 1: uh So this is a coffee stout and it's got
Speaker 1: like a little baby made of coffee beans. On the
Speaker 1: fun of it, it looks like it's swimming kind of
Speaker 1: floating there in the water. But yeah, this is smells
Speaker 1: like Bean Spirit. This is a double maple stout. What
Speaker 1: were your thoughts on this beer? Man? This bee was
Speaker 1: really good. And I feel like this brewery. I've only
Speaker 1: had one beer from them before and it was like
Speaker 1: a variant of this beer. But I saw this in
Speaker 1: the store and I was like, that was such a
Speaker 1: good beer, I'm gonna want to get this other variant
Speaker 1: of it. So this one had a lot of maple
Speaker 1: syrup infused into the beer. So yeah, the predominant flavors
Speaker 1: you were getting were coffee and maple syrup, and those
Speaker 1: are two great flavors. Man. It made me feel like
Speaker 1: I was eating like pancakes while my coffee, you know,
Speaker 1: for breakfast. Um, and that's a good feeling. So I
Speaker 1: don't know. I thought the way that the depth of
Speaker 1: flavors that they infused were really impressive. Maybe maybe a
Speaker 1: little bit overkill on the maple syrup, but it's too
Speaker 1: sweet for you. I enjoyed it. You don't like things
Speaker 1: nearly as sweet as I do. I've got a sugar tooth,
Speaker 1: for sure. I feel like I could have taken this
Speaker 1: and just poured it over my pancakes like this beer
Speaker 1: right here, and I would have been Actually, probably wouldn't
Speaker 1: have been sweet enough, because maple syrup is quite sweet.
Speaker 1: You're a fan of like the real maple syrup, right, yeah,
Speaker 1: you can't get forget the get the cheap stuff, you
Speaker 1: forget the Oh yeah, yeah, I'm all about the real stuff.
Speaker 1: And that stuff is really sweet, but it's also so good.
Speaker 1: I felt like they definitely use like real maple syrup
Speaker 1: in this beer. But yeah, the maple syrup coffee vibes
Speaker 1: that had gone on, it's delicious, even in the middle
Speaker 1: of summer because we're sitting inside and the a C.
Speaker 1: This definitely isn't a sitting out on the front porch
Speaker 1: out in the heat kind of beer. But I'm glad
Speaker 1: you and I got to enjoy this one on the episode.
Speaker 1: And yeah, props to Microphone Brewing, who I have never
Speaker 1: even heard of before. It looks like they're they're based
Speaker 1: out of Illinois somewhere, but maybe we'll have more of
Speaker 1: their beers here soon. If the other beers or anything
Speaker 1: like this one, I'm sure they'll be delightful. I'd be
Speaker 1: all about it. All right. Well, that's gonna do it
Speaker 1: for this episode. For folks that want the show notes
Speaker 1: and links to some of the resources that we mentioned,
Speaker 1: we'll have those up on our website at how to
Speaker 1: money dot com. That's right, And if you have just
Speaker 1: stumbled upon this episode, we want to make sure that
Speaker 1: you don't miss future episodes, so make sure to mash
Speaker 1: that subscribe button. And if you've been listening for a while,
Speaker 1: we would greatly appreciate if you head over to Apple
Speaker 1: Podcasts leave us a solid review over there, or wherever
Speaker 1: it is that you listen to podcasts. That helps others
Speaker 1: out there to find the show. It's going to help
Speaker 1: others to to start on that path towards financial independence.
Speaker 1: We want to help folks to achieve that by doing
Speaker 1: smart things with their money. So John, that's gonna be it, buddy.
Speaker 1: Until next time, Best Friends Out, Best Friends Out,