It was 2015, I had just started a role at a start up, excited to finally be in a place where I could make a big impact. I had been hired by a VP, who I admired, and we were creating a product that could make a real difference in people’s lives. Six months in, my boss changed and the situation didn’t feel the same anymore. Like I mentioned in my previous post, I came to the realization that what I was looking for was freedom, freedom to do what I loved and live a fuller, richer life, not be dependent on a paycheck from the corporate world. In my spare time during my commute and after the kids went to bed, my focus turned to financial independence. Here is some of what I learned.
The first rule of FI is spend less than you make.
The more you save, the faster you will get to FIRE, duhhh! And you would think most people spend less than they make but I read a recent article that talked about 50%+ of Americans spending more than they make.* A lot of the FIRE community reached FI by saving 75% of their income. We weren’t willing to save as much ……
… as we still wanted to do the things we loved like travel, but we did save 50% of our net income. And while we spent most of our paycheck, our biggest savings came from bonus and RSUs. And in 2015, with both of us working well paying jobs, we were able to raise the value of our money investments by 15%, even while taking out money for a down payment on a house. I had been steadily learning more about how to retire early and these were the strategies we used to get to where we are today.
TO BE CONTINUED
Sources
*https://bestmoneymoves.com/blog/2018/10/03/what-percentage-of-americans-spend-more-than-they-earn/