- How Self-Isolation Taught Me About Happiness - July 6, 2020
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- How Has Covid-19 Affected Your FIRE Journey? Part 5 - June 26, 2020
After our “what do you want to read about” poll, I heard you all loud and clear. All guest posts all the time!
Seriously though, you will like this guest post I swear (also I had this post scheduled before I ran the poll so deal with it)
Anyhoo…today, I want to introduce you to a very special person I met at Fincon. I didn’t know her background at the time, or the fact that she become financially independent at 32— despite growing up poor, like me, and never having a 6-figure salary. She even managed to become FI, while raising six—yes you read that right–SIX kids! Two of them are her biological children and four are adopted.
All that would’ve completely blown me away, but at the time I didn’t know any of this, and I was STILL blown away. All I knew at the time was Jillian is the most carefree, bubbly, outgoing person I’d ever met. Not only was she floating around the dance floor like a carefree butterfly, she was the only one who’d lost her voice completely by the end of Fincon by being the most outgoing, friendliest person on earth.
Little did I know, 6 years ago, Jillian had lost her son. How could someone so happy and positive been forged in the crucible of hardship and poverty?
Well, today, I invited Jillian to tell us her story, so we can find out. She is living proof that you can become FI, build your dream life, and do it with kids—even if you didn’t come from privilege and never earned a fat salary.
For those of you who are frustrated about your FI date being too far away, or FIRE being too lofty of a goal, Jillian’s got you covered. She’s going to show you an even better way to become financially free…
Take it away, Jillian!
I always had big, audacious goals and dreams. Ones that I didn’t feel entirely entitled to have. Dreams that didn’t seem reasonable or even possible.
I met my husband when we were in college. Together we had $55,000 in debt and I was living in a camper. The starting salaries in our chosen fields was $24,000. $24,000 if we were lucky. Some of our friends graduated with debt and started their careers earning $16,000 or $18,000.
That all would have been fine if I had been able to settle into a normal life and normal trajectory.
But we had other plans.
We wanted to adopt kids. We wanted to travel the world. We wanted to take mini-retirements. And I wanted to create financial freedom. Oh, I also wanted to pay cash for a house. Sooner than later, preferably.
George Bernard Shaw wrote:
“The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”
I knew there was a well worn path. Get a good job, buy a house, upgrade your car every four years, save 10%, retire at 65.
I was incredibly curious if we could do things differently. Different choices and different outcomes.
It would take a lot more intention. We would need a really clear (and small) list of the things we wanted and wouldn’t compromise on. Everything else would need to be flexible. It would take more creativity to custom design our life.
Given our situation, I assumed we would not become financially independent until our 60’s. FIRE wasn’t a movement or an idea I had ever heard of. I just knew I wanted more financial freedom. Growing the gap between our earning and spending seemed like the best way to go about that.
Because I assumed financial independence was decades off, we got busy fitting in our dreams any way possible. Life delayed wasn’t an option.
Our combined annual income never hit $100,000. We would have to come up with another plan.
Mini-retirements seemed like the best option to do the time sensitive things we wanted to do instead of pushing the best of our life until 65.
We took four mini-retirements before we became FI. From a month long to 9 months. I used a month long one to travel coast to coast with my best friend. We used two of the mini-retirements to buy and renovate rentals. Because of the mini-retirements we were able to buy homes that needed extensive work. That enabled us to pay for our first house with cash and then add two rentals. The mortgage savings is about $1200 a month and we earn $1200 a month between our two rentals.
We took our last one after we hit FI and it lasted three years. We spent it resting, traveling and starting a new career doing our best work.
Without high incomes we became more focused, more creative and intentional with what we did have.
Years back we started doing a Quit List.
We would list out all the expenses, activities, hobbies, relationships, or physical possessions we were willing going to get rid of for the coming year.
It was like a game of poker. We had a new hand and wanted to be able to double down on it. Everything we gave up was extra poker chips to push to the middle of the table. We were willing to allot more time, energy and money for the chance of these new things working out. Trading the good for the great.
Our Quit List is made up of three parts.
1. Stop: All the things we are just stopping. Toxic relationships, hobbies that no longer fit, possessions that aren’t serving us well, or expenses that aren’t adding a lot of value.
2. Pause: These are good things. Things that we love and do add value. But we pause them for the month or the year. We let them go, knowing that they will have a spot in our life at some point. For example, I’m almost obsessed with ducks. They are my dream pet. We had ducks for a number of years, but two years we decided to go all in on traveling with our kids. We hit pause with the ducks. They aren’t the best travelers! Ducks will come back when the time is right.
3. Say: Not Now: There are things I know would add value to our life and are a lifelong dream. But I’ve said to those things, “not now.” I’ve wanted to build a lovely, bespoke home since I was 11. Instead, for the last 16 years of marriage, we have lived in a camper, small apartments, had roommates and purchased an ugly, mold filled home for cash. Because while a bespoke home is still a dream, other things had to come first. Travel, living abroad, adopting, and becoming financially independent.
I think there is a lot of power in knowing what you want out of life.
There are so many things we could do. An equal amount of things that we might feel like we should do. But what do you want to do?
The Quit List freed up the time, energy and money to devote them to the great things. The things we really wanted.
How to get started with mini-retirements
I’m a huge fan of mini-retirements. They are more accessible, more practical and easier to get started than FIRE. You don’t even have to leave your job. Once you have a bit of financial freedom, it’s possible to negotiate a month off. A month off, spent wisely, can be life changing. If your burned out, tired or in need of some adventure and inspiration, a month can take you a long way.
Benefits of Mini-retirements
1. More accessible: It can take years to achieve financial independence. If you don’t earn a high salary, it might be 10+ years. Most people can get started with a mini-retirement in 1-2 years.
2. Recover from burnout: If the idea of keeping your head down and pushing through for a few more years makes you want to cry, you might be burned out. If your biggest goal for retirement is sleeping in and naps, you’re probably burned out. The only way to recover from burnout is to rest. It’s incredibly hard to think creatively, dream or plan out your best life if you’re burned out. Taking a few weeks or months off can give you the fresh eyes you need.
3. Time sensitive things: Some things can’t wait. The window is closing. This year we took a 10 week road trip to 10 National Parks in a pop-up camper with our five kids. We could have waited another decade, but it’ll be a different trip in ten years. Our kids are 2-10 right now. In my 20’s, I took a month long road trip coast to coast with my best friend. It was amazing. And those days are long gone. Even if we wanted to do that again, that season has passed for both of us. We have more epic trips ahead of us, but not that one. Some things have a shelf life. Mini-retirements lets you do those before the moment passes you by.
4. Test out FIRE: Change is scary. Step into the unknown and things might not work out like you plan. Retiring in your 30’s or 40’s is no exception. A Mini-retirement let’s you test this thing out. “Experiments” are easier to stomach than “this is our new life forever.”
5. Start something new: My working definition of a mini-retirement is this: any time we step away from the 9-5 to do something that matter to us. You get to define what that is. I think it’s a great time to start something new. Tour with a band. Renovate or build a home. Write a book. Start a business. Learn to surf. Just start something new.
6. Less risk: Stepping away from paid work forever feels risky. Really anything new that stretches us and puts us outside of our comfort zone feels risky. I mentor people through work transitions. People starting mini-retirements, stepping away from the 9-5, restructuring or selling companies, or starting a new business. You know what they all feel as we go through the process? Fear. It’s not a bad thing. It’s always there, everytime we grow. It’s only bad if it causes people to stay stuck. One more year. Just another 100k, or another 200k. Almost everyone blames the numbers. “I just need a little bit more and then I won’t feel hesitant.” BS. I see people’s numbers every single day. No matter what the numbers are the feelings are the same. Just start. Maybe start with a month or a year. Start where ever you can stomach. The people I mentor have been able to use the confidence they have because they have more financial freedom (even if they aren’t 100% FI) to negotiate 6 months off, a month off, part time work, become self employed or switch jobs. Once you have some financial freedom, it’s time to start experimenting with how you can use that to make your life better.
7. Easier to explain: Ok, let’s be real. “Retiring” in your 30’s is weird. Same for 40’s. Actually, same for 50’s. It’s weird. Ask anyone. And it’s weird to explain. A mini-retirement is still weird, but less so. Your not burning bridges. Your friends and family will be a little bit more comfortable. Don’t get me wrong: Live a big life, a life on the edges of the norm, your best life, and someone will be uncomfortable. But a mini-retirement is a more palatable way to start. And what do I really want you to do: Just start!
Mini-Retirements on the Path to FIRE
I wasn’t planning on hitting FI so early. I was 32 when our passive income covered our expenses.
People’s biggest concern with taking mini-retirements is that it will slow the process down. The idea is “just keep your head down and push through for a few more years.” For us mini-retirements helped us speed up the process.
First it helped us be more intentional. The payoff for our savings and frugality came sooner. And it helped us figure out what we really wanted. We lived in Europe for four years and traveled every month. I learned that I love traveling! Having the flexibility to travel for 10-15 weeks a year was wonderful. I also learned, I don’t really want to travel full time! I liked coming home and doing other things. After we hit FI, we were able to build that exact life. We travel 10-15 weeks a year and are home the rest of the time. Renting out our house while we are gone covers up to half our travel cost.
We were able to buy and renovate three homes during our mini-retirements. It dramatically reduced our fixed expenses and created 30% of our passive income. Plus they created savings and earning before we hit FI which helped grow our stock investments.
Our current expenses average $30,000 a year. Only $700 a month of that are bills (insurance, cell phones, wifi, electric, water, ect) so it’s leaves a lot of room in the budget for travel and fun stuff. Our passive income includes: $17400 military pension (plus health care) and $14,400 from rentals which covers all our expenses (total of $31,800 year). We could also pull (at 4%) $8000 from investments, but we haven’t needed to pull from those yet (total passive income $39,800 year).
Mini-retirements also gave us a chance to figure out what we really wanted our life to look like. Often people work a FIRE plan for a decade based on an assumption of what they think they will want, only to find out, they don’t actually want that life. Because of mini-retirements, I was able to test different variations of FIRE. I found out that I like working on a few projects a year. I like to have a few days a week with a few hours of structured work time. So I used our last mini-retirement to figure out what work I would really enjoy. Because we don’t need the income to pay our bills, it’s fun to figure out what to do with the extra money.
Mini-Retirements don’t have to set your plans back. They can be as short as a month and very affordable. Plus they can give you a better understanding of where you want to end up. You might learn your FIRE lifestyle isn’t as expensive as you thought, or how much you can rent your home out for, or that you would want to work 10 hours a week. All that info can dramatically speed up the process.
Want to find out more about Jillian and how to create your own mini-retirements? Check out:
She’s also designed a FREE 10 day video course, to teach you how to walk a better path:
If you want to go one step farther, to meet and hang out with Jillian in person? Great news! She will be joining us as a speaker at Chautauqua this year:
UK Week 2: June 15-22
Add your name to the Mailing List for first notice when tickets go on sale.
And finally, want to hear JLCollins, the Godfather of FI’s take on Jillian’s story? Check out his post here:
What do you think of Jillian’s story? Would you consider mini-retirements? What would you do with your free time?
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