[Hi guys! Super excited to share this guest post with you today, as it comes from a personal friend and new blogger on the scene – Pie Lady FI. If you know anyone this could help, please pass it along as I’m sure we’ve all experienced one or two things from this list over the years!]
In any given day, it seems like there is a new article talking about the millions of people who live paycheck to paycheck having little to no savings for retirement. Let alone a rainy day fund.
More often than not, next to that article is a “how to” get control of your financial life.
So why is it that year over year, millions of people still have no money banked, even though there are more tools than ever to achieve financial freedom?
It got me reflecting about my own FIRE journey…
I didn’t start focusing on my own financial independence until 2008 (at 40 years old) and even then I spent the next 5 years educating myself on what financial independence is and how I was going to achieve it.
During this time I was in and out of temp jobs, money was not plentiful but time was. I didn’t even calculate my net worth until 2009, and only then did I realize I had about $255,000 of debt (~ 50% mortgage). Truth is, I didn’t want to know.
Once 2012 rolled around, I was able to downsize. In 2013, I had an opportunity to invest in real estate and took it. Fast forward a few more years to today, and my net worth currently hovers around $900,000.
(See addendum below for a break down of this net worth)
Why was I sabotaging myself all those years before 2008?
#1. Fear of Success
In my younger days, I always played it small. That is what I was taught. I did not live life to my full potential, and I never spent time thinking about what I wanted or ever put my own needs first. To switch that mindset was a tough mountain to climb. I was scared and felt selfish to think about myself in that way. Thus, the 5 years of reading and educating myself. To an extent, procrastination was my companion.
No one expected anything from me and so I never had to try. It’s not that I enjoyed living like this but it was familiar. Then I was on my own with two kids relying on me. It was no longer about me and my comfort. It was the rock bottom I needed to open my eyes and overcome my fears. I could no longer afford to hide, and that meant change. No more procrastination. I started with baby steps and the rest, as they say, is history.
#2. Feeling Undeserving
For most of my life, this is where I squarely lived. Growing up, I was put down and told that I was stupid and not worthy, along with a few other nasty words I am not going to repeat here. My self-esteem and self-worth was low. When I told my mom I wanted to go to college, her reply was, “Why? You need to learn to cook, clean and take care of children. I can teach you that.”
Eventually I moved away from my family and ended up marrying someone who treated me the same. Just watching my own parents, I thought the “M” in marriage was to be miserable. Being unhappy in my own marriage was a familiar life. Then I hit a turning point and started to see myself differently, that I am worthy. I was starting to change.
People will treat you no better than you treat yourself. In those 5 years of self-educating and planning my road map to financial independence, I also read lots of self-help books. I lost a lot of friends during this time and while it hurt, it also made room for new like-minded friends. Friends who accepted, supported and valued me.
#3. Unlimited Time
In my 20s and 30s, retirement age seemed like a thousand years away. It’s easy to put retirement planning aside in favor of other more immediate goals and priorities.
This is the beauty of the FIRE movement and why I fell in love with it. It takes away the unknown future and puts the future within reach – if you want it.
If we think about life in terms of simple math, the average person lives to be in their 80s. The first 25 years of life is school time, giving us about 55 years of living ahead of us. If we spend just 10 years focusing on our financial independence, that would still leave us with 45 years of life ahead of us! A life with less risk, more flexibility and (my personal favorite) peace of mind.
Does it require sacrifice? Yes. Ten years of focus on financial independence is better than 20, 30 or 40 years of partially trying. In my short years of being on this journey, I can’t say that it was easy or there weren’t setbacks. Big change doesn’t happen in a day. But each setback was an opportunity to learn, grow and stretch.
As I reflect on my life, I have come to realize one very important thing. Hitting rock bottom was both a blessing and necessity in that it was the proverbial “kick in the ass” I needed to get my life back on track.
What I realized is that my “financial picture” is just a snapshot in time, and I always have the power to change that picture.
As my kids say, “mom, you may not be perfect, but every day you try your best.”
That is all any of us can ask of ourselves.
Pie Lady FI is a FIRE blogger committed to educating women on how to go from financial couch potato to super star, by leveraging 10 years of her own personal experience and inspiring others to Grab Their Slice too. She can be found at ThePieceOfThePie.com.
Along with this guest post, Pie Lady FI also passed along a screenshot of her current net worth, as well as a timeline of how she was able to turn things around these past 10 years.
Rather than include these in our Other Peoples’ Money series it was originally intended for, I thought it would be more helpful to pair it with this post here to give a more overall picture.
Huge thanks to Pie Lady FI for being so open and willing to share!! I hope you’ll visit her site afterwards as she’s new to blogging and eager to start helping people! :)
2008: My marriage ended
2009: Calculated my net worth for the first time after being too scared to see. Realized I had about $255,000 of debt (~ 50% mortgage).
2008-2012: Did a lot of temp work, opening up a 401k account with each new job and putting some money into it (without matches). At the end of each of these jobs I would roll the 401k money into an IRA. I also spent a large portion of my unemployed days reading about budgeting, financial independence & real estate investing, and perfecting a budget format that to this day I still use.
2012: The housing market took an upswing, just enough for me to sell my house and downsize with a smaller mortgage payment.
2013-2015: Used my HELOC to purchase each rental property for “cash,” and then would turn around and take a loan out for 80% of the purchase price. Since I was already preapproved and knew exactly what I had to work with, I hustled and purchased 5 properties within the time span of 3 years.
From 2015 to present I have maxed out my 401k every year, and finally got around to opening a Roth IRA and Health Savings Account which I now max out as well.