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I know we have a lot of fun on this blog, but don’t let the “change the world music” on our video and naïve Millennial “I can do anything” optimism fool you.
The goal of the Millennial Revolution is to talk about money in a fun and accessible way, with a whole lot of swearing and dick jokes thrown in.
If you read through our insane ramblings and have a quick laugh, our job is done. If you actually LEARNED something from us, that would be a bonus.
And if somebody were to actually CHANGE their situation, CHANGE their life from reading this blog? Now THAT would be a dream come true.
Two weeks ago, I posted a reader case called “Starting Over at 35”, in which our intrepid reader StartingOverAt35, who hustled his ass off and managed to grow his salary from $70K to $120K/year without a college degree, asked whether it would be a good idea to by a $225,000 house.
After Mathing that Shit Up, I gave him the Millennial Revolution seal of approval to buy the house, because it’s only two times his new annual salary, it doesn’t blow up his finances, and he isn’t relying on home appreciation to retire.
And to the surprise of NO ONE, the approval to buy a home was immediately attacked by House Horny Idiots (“Home-Boners”), who started fighting with me about how this person should buy a BIGGER house. Wow. I had no idea the Freedom Caucus was reading my blog.
Responsible homeowners (like RootofGood) and experienced real-estate investors (like Paula Pant) will never say “you need to buy a bigger house”. Because they don’t have most of their assets locked in one house. Whether you buy a bigger house or not, it doesn’t affect them. Paula even goes to say “if a property costs $205,000 and rents for $1,400, skip it. You deserve better.”
But idiots with most of their net-worth stuck in one expensive illiquid asset WILL. They will say “buy the biggest house you can afford”. Ignore the 1% rule of real-estate investing. Why? Because they don’t care about you. They want you to buy into the real-estate frenzy, to prop up THEIR house value. Because if people stopped buying houses, their house value would plummet. They want you to be screwed financially so THEY can profit.
If someone were to invest, would I tell them go into margin, borrow as much money as they can and throw it into a SINGLE stock? No.
Because that would be INSANE. Only considering the upside without looking at the risks is idiotic. Not diversifying your assets is stupid. Housing DOESN’T go up forever. Neither does the stock market. Investing always involves risks, so that’s why we always need to mitigate them. Blindly buying into an asset because “it’ll always go up” and borrowing as much as you can to invest into it isn’t investing. It’s gambling.
Luckily, our reader StartingOverat35 isn’t a gambler. Because after the post went live; he sent us this:
“So, thanks to you publishing my “StartingOverAt35” story, my wife got a chance to really read through it from someone’s perspective that wasn’t mine. I’ve been trying to talk her into staying where we are to become FI in 10-15 years. She was very house horny and wanted a big property, basement, etc.
As I told you, we have a very unique living arrangement, but what I didn’t (or at least I don’t think I did) tell you was that our rent is $250/month. The rough $800 I gave you INCLUDES all our NJ property taxes and all utilities. Almost nowhere in the US you can live that cheap and have the space we have. So little by little, your blog (and the books I’ve been reading, thanks to you), my wife is slowly changing her mind.
The other night she agreed that it maybe best we stay until our son graduates high school, and just make small “quality of life” upgrades in our home like re-doing our kitchen, knowing full well that $3-5k we will budget for it we wont get back. Nothing fancy, just ripping out the gross mold infested tile and putting down treated/reclaimed wood, ripping up the floor the assholes that lived there before us slapped together and replacing our 15-year-old fridge that sounds like demons live in it.
So long story short, she wants to up our savings % as much as possible so we can travel the world when my son graduates and introduce him to more culture, thanks for helping me wear her down.
It really came down to starting with YNAB in January and learning how that method worked. Since then she’s shown me every single receipt so I can log it. It was painful at first, but when I showed her personal capital (thanks for that), and how much our spending has gone down, she started to buy in. Then I showed her the blog post you had with my numbers on it, then she really started buying in.”
Sometimes you get messages and e-mails that make all the haters, trolls, late-night blog edits and the ENDLESS work of responding to comments/e-mail completely WORTH it.
This was one of them.
Thank you, StartingOverAt35, for inspiring all of us by proving that when you actually DO the challenging things you need to do to become Financially Independent, you make money your bitch.
This is why we write.
This is why we keep going. And I hope you will keep going too.
To everyone who reads our articles, contributes to our FI community, and takes steps (big or small) towards their dream of Financial Independence:
You are why we write.
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Whoowhee that is a great story! I tell all of my nieces and nephews to read your blog. Having f-you money is the greatest stress reliever of all time…it sure as hell is NOT owning a home. I gave my notice to retire this past Monday (OMG!!!) and told them I was willing to stay until Aug 31st. HR had recently made some changes to the compensation plans and I told them that I would only stay if they grandfathered me. After 22 years with this company you would hope that they will be reasonable, rational and professional….we will see… BUT, if they are not fair, then I am out the door at the end of this month…and that is after taking the last two weeks off as vacation….yes siree, having f-you money is the greatest thing in the world and allows you to call your own shots….
“Having f-you money is the greatest stress reliever of all time…”
So true. This is why people are creeped out by how happy we are all the time.
Congrats on reaching FIRE! And the best part of it is regardless of how HR responds, you don’t have to give two shits!
So what are you plans now that you’re retired?
Good for you, FIRECracker! And good for StartingOver and his family! Keep up the (literally) good work you’re doing.
I prefer owning vs renting, but buying “as much home as you can afford” when it’s only a single unit primary residence (aka a house) just for capital appreciation baffles me. Why the hell would you do that? If I had the means, I would by a 2-3 unit mixed use property as my primary residence and collect rent to offset the mortgage, and that would be my whole physical real estate exposure. But I don’t have the means, so I’m looking for a cheap coop/condo instead where I can pay off the mortgage early and just pay HOA fees (literally less than half market rate rent in my area). I’m looking at this from the perspective of me buying a thing (a very useful and necessary thing, but still a thing) rather than an investment because I don’t really view anything that doesn’t spit off income as a particularly valuable investment. And since a big house means more time cleaning, shoveling, and mowing, then I would personally buy as little as I need rather than as much as I can afford.
Haters will late, but lovers will love. So enjoy the love and ignore the hate!
Sincerely,
ARB–Angry Retail Banker
“I’m looking at this from the perspective of me buying a thing (a very useful and necessary thing, but still a thing) rather than an investment.
And that’s why you’re one of the smart ones and not a “Home-Boner”.
And having a renter to help pay the mortgage, does offset some costs, but not everyone wants to share their space or be a landlord. All it takes is one bad tenant to destroy your property.
Thanks FIREcracker for everything you guys do on this blog. I can honestly say you’ve changed my life, because I’ve felt the social pressure to buy a home in Calgary for a few years now. I’m in my early 30’s (same as you) and this blog has shown me a way to build wealth that doesn’t revolve around home ownership. The Investment Workshop has also been a game changer and introduced me to the world of ETF portfolios. I also appreciate the hilarious writing style and a female voice in a world of male-dominanted personal finance blogs. Much gratitude to you both.
Thanks, Laura! Completely feel you on the whole “pressure to buy a home” thing. It’s especially bad for Asians, because in our culture, it’s practically sacrilegious to not buy a house.
I’m glad this blog has helped you! Keep adding to that F-U money pile. As “OlderbutWiser” says “Having f-you money is the greatest stress reliever of all time…”
This blog has changed my life as well. The first day I discovered this blog I talked to my spouse and we made a decision that would change the course of our lives in a huge way. I had never even considered renting and didn’t know how to invest (other than going to the bank and buying mutual funds) before I read this blog. My spouse has recently quit his job and I have secured a work from home position so I can telecommute from the very remote location we will be living (moving there tomorrow) and I’m cutting my hours in half. We sold our townhouse and are moving into a place with very cheap rent ($350/month) that we were able to secure through family connections. I wish I’d known about this stuff sooner because I would have made a lot of different decisions if I’d have known about FIRE when I was 18 instead of finding out about this stuff at 30. I’ve always been good with money but when it comes to choosing a career I think I might have chosen differently so I could have achieved FI faster.
I’ll admit that when I first saw the youtube video that was linked on the CBC article I kind of wanted to hate you guys like the other haters in the comments (but I am not a troll about wouldn’t have actually left any nasty comments). I had bought a place and I was 4 years away from paying off the mortgage on it so I didn’t really agree with the renting thing (and if we didn’t have access to the really good rent deal that we’ve arranged then we wouldn’t be doing any of this at all) but by the end of the video you had won me over and I thought it wouldn’t hurt to look into the investing advice on your site. After reading a few posts I was hooked. I am glad I was able to keep an open mind. For all the haters out there it really is their loss. Thank you for all that you do!
Wow. Well done, Liz! I love hearing stories from readers who ACTUALLY make changes. It’s never easy but proves that you are a DO-er and not a Whiner.
The haters don’t matter at ALL, because readers like you make it all worthwhile!
I forget the impact we can have. I’ll occasionally get those feel good emails from folks who say “That article you wrote really changed my perspective and I’ve changed my financial path significantly in the past few months” or something similar. Amazing that one article can be such a game changer but I guess if you’re stuck reading the same ole same ole financial news you don’t get very good critical advise.
Yeah, I’m just as shocked as you. I thought this blog was only good for tweaking haters and making dick jokes, but somehow people actually made positive changes from it? huh? *scratches head*
Your blog had a major impact on me as I was devouring all the FI blogs on my way to FIRE. My thinking was “hey, this guy has MORE than 1 kid and he can do it. All the people who say oh you can’t do it with more than 1 kid can suck it.” So it really opened up my mind on how for every teardown, there’s always an example of someone proving them wrong.
Keep up the good work!
You should have 4 (!!) kids and prove the critics wrong. j/k what a horrible reason to have kids 🙂
Well, at least making them would be fun 😉
Justin’s blog made a HUGE impact on me as well! He’s one of the few of us who’ve actually done it and had more than 1 kid!
I wouldn’t be where I am today if it wasn’t for him!
I love this post and your witty blog! New to the FIRE space and your blog has been a driver in impacting and improving my life.
You and Firecracker are living proof that FIRE can actually be achieved and there is an end to working for the corporate slave-drivers!
I’m soon to be made redundant from the company I work for and the redundancy is peanuts, even for those who have been with the company for 20+ years. It’s made me realise that it’s critical to have FU money otherwise you end up being chained to the bossman forever.
xx Miss Piggy
https://theearnestaddiction.wordpress.com/
When I was working, people were getting let go all around me, so definitely know how much it sucks to be in that position. FU money is critical in that situation.
Sorry to hear about your upcoming layoff :(. Sometimes it turns out to be an opportunity to do something you love. And with FU money you won’t have to worry.
Awww….we love you too FIRECracker! Where else would I get my fill of food-porn, dick jokes, and personal finance advice all in one place?
Well, OK….other than my own blog! (I don’t look nearly as good in a bikini, so you get the win by default 😉 )
Hey, you can’t just let me win by default! Too easy. This Bikini contest needs to happen. Better start shopping for that Speedo…
I love your case studies. Keep writing and I will keep reading. You guys are an inspiration even to old fogies like me.
No such thing as “old”. Just “experienced in life” 🙂
It took me a while to figure it out, but downsizing the home was the best financial decision the wife and I have ever made. It truly was the biggest determining factor in accelerating our road to FI. The bigger is better mindset has no place in our world anymore. We are completely content in our little paid for townhouse. Home ownership really is more of a lifestyle choice than an investment. You need to come to your own conclusions on how much of your freedom that house is worth.
You may find this interesting: http://www.realsimplefi.com/home-investment-lifestyle-choice/
BTW…. Late night binge reading. This blog is so fun.
“Don’t Buy as Much House as You Can Afford, Buy Only as Much as You Need”. This is they key.
People tend to get caught up in “buying the biggest house they can afford” because that’s what the banks and their buddies tell them to do. Screw diversification. Screw risk mitigation.
Glad you didn’t fall into that trap. Thanks for sharing your article!
Another great post,keep it up!
I’m in the same boat as you guys,rent and invest 55%+ of my net income for FIRE,which is easy to do if you rent.I split my rent with a roommate so all in housing expenses is about 20%-25% of my monthly take home pay so in about a month I will be putting away about 75% of my take home pay into my FIRE account.
I just changed employers so that I am able to bike to work in about 30mins each way through rural farm country,last job payed better but cost $100/ wk in gas and 2-4 hrs in traffic.Wasn’t scared to change employers because being FI I was able to choose from the eight job offers the one that suited my lifestyle the most and not purely financial motive.
Everyone I know keeps hounding me to buy and that I am throwing my money away on rent,when I point out that their ongoing expenses to maintain,just maintain their house is triple what I pay they just blink and then tell me how much money their house has gone up.This may be true but once you add in the ongoing costs,interest on mortgage,renovation costs(don’t forget that all that weekend and evening labour to upkeep your investment should be calculated at double your wage because that’s what it would cost in the real world).Lastly these costs are with after tax dollars so add on about 25%-30% to this bill and see what it really costs to own a house and renting is a very good financial option.
People don’t realize that you never really pay off your house,
Well said. Let’s not even get into the fact that they actually have to SELL it to capture the gains. Which they won’t. Or if they do, they’ll just buy a bigger house.
That’s okay, I love those guys because every time they pay their mortgage, we get a piece of it as dividends by owning bank shares. So they are slaving away, and paying us to not work. Hats off to them 🙂
Good for you for having a 75% savings rate and being able to pick whatever job you want. Freedom is the best thing F-U money can buy!
This blog has inspired me as well. In January of 2016, I broke off my engagement and started a new job. Ahem. In January of 2016, I left a hostile work environment and my habitually lying partner. My goal then was to save more than half of my income so that I could buy a house more quickly. Once I started reading your blog, that goal changed. I’m still saving as much as I can, but my goal is FI.
Nice! It takes a lot of guts to change your situation when you’re not happy. For me, it was totally worth it. Hopefully it turns out that way for you too! Cheering you on on your journey to FI!