Why the financial independence community is wrong

ArmWrestleWow! I can’t believe you fell for that clickbait title. But now I have you here, perhaps you’ll hear me out.

I have to start with a massive disclaimer in huge flashing neon letters. I am part of the financial independence community.

For those of you who are unfamiliar with the concept, we ‘FIers’ are interested in the concept of building up enough investment capital to allow us to live from the investment returns and make working for a living entirely optional from a surprisingly young age (e.g. 30). Most people achieve this by saving a massive proportion of their income from a professional job.

To learn more about the FI community, follow a few of the personal finance links in my sidebar and the rest of the article. All of the sites I’ve linked to are full of useful resources.

It’s a really intriguing idea and, indeed is probably where I was heading before finalising my own strategy for job-freedom.

I’d definitely still count myself as part of ‘the movement’:

  • I live below my means.
  • I employ a passive, asset allocation-based investment strategy.
  • I believe that money is ‘for’ freedom, not stuff.
  • Having never discovered the FIRE movement, I would know nothing about being a private investor and would currently be suffering from a 1% per annum portfolio management charge inflicted by a financial adviser who sold me a shit actively managed product.

However…

The false dichotomy

…there’s a chance that some people are taking home the wrong message from the FI blogs:

You are either completely financially independent or you are not free. It is binary. Life has 2 stages: indentured servitude working full-time for The Man followed by paradise on Earth and complete freedom. There is no intermediate stage.

Now, it’s abundantly clear to me that none of the authors listed above are saying this. Most of them have stated as much. Some examples:

  • The FIREstarter went as far as to pretty much describe my current strategy and lifestyle in a blog post 2 years ago.
  • When Jacob Lund-Fisker originally retired extremely early he had a little side income from copy editing which coincidentally covered his expenses. He explicitly stated in that post that just doing the copy editing without having sufficient assets to live from passive income is a viable alternative that would allow for almost as much free time as full being fully FI.
  • Jim Collins has always written that the quest for FI was ‘never about retirement’ for him – just the ability to do whatever he wanted (which, for much of the time, was working in some capacity). Jim was also the inspiration for my definition of “Fuck You” money as enough cash to not worry about working for a while (rather than enough capital to keep you forever).

Although everybody who writes an FI blog puts a lot of effort into pointing out that achieving FI doesn’t magically switch off your ability to be productive, I occasionally see things like the graph in this post (from Retirement Investing Today – another blog I absolutely love) which adds some weight to the ‘it’s either complete FI or taking it from The Man’ perception. Note the ‘…you’re stuck working for the man’ wording below the FI line on the graph.

The thing is, I have a graph like that too. I’m nowhere near the FI line but I’m categorically not stuck working for The Man.

Miraculous

Please indulge me for a few minutes whilst I describe my process of falling in love with the FI movement. Perhaps you’ll recognise some of the feelings I describe here.

When I found the FIRE community, it almost felt like a miracle. I was already familiar with the concept of investing for income but had never taken it to its logical conclusion: investing enough to never need to work again while you’re still really young. Brilliant.

I was very disillusioned with the thought of sacrificing 5 out of every 7 days until I was so old that I wanted to sleep all the time anyway. I hated conforming to arbitrary rules and regulations just because somebody else had decided that I had to.

We already lived more frugally than our DINKY friends and were starting to build up savings.

Put all this together and you can see why I sunk my teeth all the way into the idea of building a big enough stash to never have to work again.

But there was a small problem. In order to make the numbers work, my wife and I would both have to work full-time for about 10 years. We were already quite stressed. In fact my wife had down-shifted to 60% of full-time hours as her job is physically and emotionally demanding and was taking its toll on her health.

We would also have to keep our spending really low. Now we were already sensible – old cars, planning meals, renting a cheap place etc. But to get to a 65%+ savings rate without any major career moves, we would have to maintain quite a limiting budget.

I was nearly 30 and my wife’s a couple of years older so starting a family loomed quite large on the horizon. Would we be able to tolerate the inevitable drop in income for the next 5-7 years until the kids were at school and still achieve FI quickly?

Looking back at our brief flirtation with the idea of working our arses off for 10 years to become independently wealthy, I can see that perhaps I had fallen into the trap of exchanging one type of freedom for another. We would have been pushing ourselves into an unpleasant box for the sake of reaching an arbitrary numerical target.

A better alternative?

I’m an extremely analytical person. I’m an engineer and, for some crazy reason, I like boring stuff like graphs, calculus and optimisation. I also can’t ever seem to turn my brain off (a double-edged sword, believe me!)

So I spent countless hours doing calculations in my head. I tried to work out new tax efficiency strategies. I worked on our supermarket shopping. I tried to get rid of one car. Whichever way I cut it though, becoming FI in less than 10 years would cause us to have to sacrifice other things which we valued.

However, when I started thinking about the income side of the equation, I (eventually) had a light bulb moment.

Getting better at earning

I had already spent many years failing my way to being able to profitably run a small computer support business in my spare time. The rate at which I had last billed out my computer support expertise was double my hourly rate as an employed design engineer.

Eureka! This was the side hustle to bring in the extra income to make the FI plan work. Time to start resurrecting that business.

But wait, even better… I was experienced enough to become a freelancer in my professional field! If I put those two things together, I could eventually be pulling in 6 figures (Sterling) and be FI in less than 10 years. All it would take is some really hard work.

But suffice it to say that after a couple of years of 60 hour weeks, I was very tired. I went for a routine eye examination and the ophthalmologist told me that I was overdoing it with screen time and needed to rest my eyes more.

Neither the business nor the freelance career was the silver bullet to reach FI quickly because I really wasn’t enjoying life then, whilst I was young enough to enjoy it.

I felt somewhat dejected. I’d put work into boosting my productivity and we didn’t spend a lot. But this had just left us quite cash rich (and nowhere near FI). I was about to throw in the towel and accept that I would be working more than 40 hours a week until I was in my late 40s or early 50s until… wait… the solution had been staring me in the face all along.

I had stupidly never put together the concepts of having a high-earning professional skill, being good at building small, efficient, flexible side-businesses and being sat on (by normal people’s standards) a mountain of cash.

But there it was – the solution.

  • We didn’t need a lot to be happy
  • We had plenty of padding
  • We lived way below our means
  • We were good at earning income efficiently and in flexible ways
  • I love the technical bits of engineering
  • My wife likes being a vet so long as she doesn’t have to do too much of it or be on-call at night

So why had I accepted the limiting belief that we needed to be FI to escape the grind?

We were already free if only we chose to be!

Pareto Financial Independence

I describe our current financial/work situation as being Pareto Financially Independent. I haven’t knowingly plagiarised this term but do let me know if I’ve just subconsciously adopted your terminology!

The Pareto Principle (commonly known as The 80:20 Rule) states that many observed phenomena display a common property: 80% of the effects can be explained by 20% of the causes. The exact numbers are irrelevant, but the concept is that a small amount of the total causes can usually explain most of the effects.

You can leverage the Pareto Principle, for example, to be happy with spending 2 hours writing a report, safe in the knowledge that it’s probably 80% as good as one which it would take you 10 hours to produce. The extra effort to achieve perfection is, although not completely wasted, much less effective at producing corresponding improvements in the output.

In my opinion, our current financial/work/business situation offers us 80% of the benefits of being completely FI:

  • We are stable. We can tolerate our income switching off for a long time
  • We can choose to only work with people we respect on projects which are interesting
  • We can choose to spend a lot of time on non-income-producing projects
  • I can avoid most office politics. My wife can ditch her job and look for something else to do at her leisure if the politics get too bad at her place of work.
  • We can take extended periods of time away from work
  • Neither of us have to work anything like 40 hours per week if we don’t want to
  • We can say ‘No!’

The question I had to ask myself when considering this approach was

What more would being completely financially independent give us that we don’t already have?

I’m certainly not saying that being completely FI wouldn’t give us any more benefits – it would. If somebody wants to throw me a few hundred grand so I never have to work again, feel free! However, to get the extra benefits in 10 years would cost so much that I don’t feel it would be worth it.

I also feel that our approach has some advantages over the ‘hit the number and then abandon the career’ approach.

Throwing out your assets

I don’t know about you, but at the moment, the best asset I have which I can combine with my labour to bring in very big chunks of cash is my professional skill. I have spent literally half of my life learning about computer architectures and electronics and all that effort has put me in a position where people will gladly pay me very well to solve problems for them. To completely replace this asset with something that could generate as much cash flow would take many times my FI number.

If I stopped doing any professional work completely for, say, 5 years, I wouldn’t be going completely back to zero, but I certainly wouldn’t be able to command a weekly pay rate in the thousands of pounds any more. It would take some time to get my skills up to date and rebuild my network. Dipping in and out of my engineering career would be almost impossible.

For this reason, even during the brief phase when I was contemplating going all out for full FI, I had at the back of my mind that I would never abandon my skills completely.

I wanted a hedge against investment returns not living up to expectations and a way of paying for some luxuries (like extended periods of travel). Also, as I mentioned previously, I enjoy the work.

I thought I could just aim to do a project every year or so after FI which would earn a bit of extra cash and still leave me with the option to ramp up the income production if I felt like it. But running the numbers, it was clear that just doing that would probably almost cover our minimal expenses anyway.

So why bother about being independently wealthy first?

Don’t waste your 30s

If I had one wish, it would be to be able to climb into a time machine, visit my 18 year old self and explain the concept of financial independence. Seriously though, if a wise 30 year old Mr Money Mustache could have reached me when I was in my early 20s, we’d probably be FI (or nearly there at least) already. I found this concept quite late. There’s nothing I can do about that.

The thing is, I know I’m not the only one.

There are many people out there in the FI community who also found the concept when they had already locked in a lot of big lifestyle decisions, such as having kids and becoming single income families to allow one parent to stay at home. I’m not for a moment suggesting that either of these choices preclude these people from reaching FI relatively young, merely that aiming to achieve it in 10 years might not be the best approach if they consider all of the costs and benefits involved.

So if you’re older than 25, have kids, have a good savings cushion and are a well-paid professional, I would strongly suggest that you at least think about changing course and doing something similar to what we have opted for to free up a large chunk of your time almost immediately. I can’t even imagine what it would be like trying to contend with 2 kids under the age of 3 whilst both of us held down full-time, stressful professional jobs.

Add to this this the fact that your kids are only little once. I’d imagine that a lot of time with them now is going to be more valuable than being constantly available for them when they’re grumpy teenagers who don’t want to know you.

Remember this

Here’s the takeaway: if you’re smart and talented enough to command a high salary and you’re willing to think outside the box (aren’t we all already thinking outside the box even considering early FI?) then a bit of learning and experimentation can lead you to being able to work extremely part-time very soon. This could easily allow you to live a balanced life with plenty of time for rest and hobbies and still retire wealthy before you’re 60.

I would imagine that for 80% of you, that approach will get you the majority of what you want in terms of freedom, autonomy and a low-stress life in a lot less than 10 years (and with the necessity for less bullshit along the way).

As for the other 20% – well we don’t pay any attention to them anyway. Thanks Mr Pareto! 🙂


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[Image “Cartoon Character Hamster Exercise” courtesy of saphatthachat at FreeDigitalPhotos.net]

36 thoughts on “Why the financial independence community is wrong

  1. Hi Andy,

    Thanks for the mention!

    Of course you are preaching to the converted here.

    Even when I first started out on the FI path I knew I wasn’t going for full FI, it was simply to build up enough to cover around half of our expenses and then quit my job and make up the rest with part time/fun work, within 5 years. Still a big ask starting from not a very big Net Worth!

    However even then I found out that 5 years was too long to wait and went part around 2 years into it (I think!)

    I will fully admit your method is better and it is definitely something I have been and am still considering, but I just can’t pull the plug right now. Better the devil you know and all that, and I am enjoying my part time hours and the extra freedom it allows me while being a bit more predictable on the income front.

    I really loved everything you’ve written here, honestly could not have put it any better myself, especially the bits about the kids only being young once, spot on sir!

    Our life paths and FI journeys sound remarkably similar, I did start to wonder whether we are long lost brothers or something 🙂 – We even share the same first name. SCARY!!

    Cheers!

    1. Hey TFS.

      You’re very welcome. We may never have met, but you’ve really helped me out over the past 3 years, so thanks for that.

      Yeah, I suspected that I might already have your agreement on this one. But then, you and I have been thinking about this particular problem for years. I think most people start to see the possibilities once they have some ‘wool on their backs’ financially and have thought about it enough.

      I spend most of my time trying to gently nudge people with more typical approaches to money (i.e. spending every penny) towards building more freedom using the one-two punch of frugality and entrepreneurship but it struck me that there are quite a few of the FI crowd out there who really hate their jobs and could benefit from free time now rather than in 5 (10? 20?) years.

      This post was really just an attempt to help some of the other 30-somethings with kids to use their already considerable nest eggs in a more optimal way to allow the good life to start almost immediately.

      It looks like you’ve done the cost/benefit analysis on the job situation and are happy sticking with what you’ve got for now. That’s awesome. You’re (deservedly) in a position that many would envy. Don’t forget that you’re probably worth twice as much per unit time as you’re currently earning though, just in case the work atmosphere does start to get any nastier! It would be interesting to know what exactly you specialise in as I always have an ear to the ground looking for opportunities.

      Incidentally, I’m not against early FI as a concept at all. DW’s on maternity leave at the moment and so accumulation has slowed drastically but, under normal circumstances, we usually still drop a decent 4-figure sum into the portfolio each month. I’ll probably end up accidentally doing more work than I intended anyway and still retire pretty young. I don’t necessarily think that my method is ‘better’. I just know that it’s possible and does what I need it to.

      I agree that our life paths, job titles, (ages?) do all seem to be veeerrrry similar. We should get together for a beer at some point.

      Take care!

  2. Followed FIrestarter’s link to this. It is a well thought through post. I’ve been following the usual FI blogs for a few years now and am, compared to most ‘normal’ people, in a good place financially. However I have two boys under three and a wife that hasn’t gone back to work at any point so savings rates are nowhere near 65% at the moment. However, I comfort myself knowing that my wife is able to stay at home and raise our two boys – time we will never get back and invaluable to us. I would much rather she did that and we took a hit on the savings rate now, than making her go back to work but miss out on these years. Yes it’s a bit lopsided at the moment with me working full time but we might be able to address that when the boys start school. I do think this obsession with ‘a number’ in the FI community kinda mises the point.

    1. Thanks for the comment LegalBeagle.

      I think the ‘number’ obsession thing is a variation of a problem that everybody seems to have (especially me): that of confusing means and ends. Although FI will be an achievement when I finally get there, I really see it as a means to an end that I desire (i.e. control over most of my time). Sometimes we want the ends so much that we get obsessed with the means and it gives us tunnel vision.

      It looks like you guys are already using your existing degree of financial independence to achieve the end that is important to you. We’re doing something slightly different but with the same sort of aim.

      I think that the kids starting school is a good line in the sand. My other half will be trying to do 2 days per week when she goes back after maternity leave and I don’t imagine she’ll do any more than that until school starts for the youngest.

  3. “…and would currently be suffering from a 1% per annum portfolio management charge inflicted by a financial adviser who sold me a shit actively managed product.” Recent work by Grant Thornton suggests that 1% is on average actually 2.56% annually. For me so far, in real inflation adjusted terms, that would have meant I would have surrendered 57% of my investment returns to the financial services industry had I followed that route. No thanks.

    1. Hey RIT.

      The one thing that’s stood out like a sore thumb to me as I’ve got really interested in PF over the past 5 years is that gaining more financial independence is as much about avoiding traps intentionally set out for us by counterparties as anything else. Whether we’re talking about ignoring marketers or thinking critically about financial advice, it’s really all about running things through a good rationalisation filter to protect our own interests.

      57%? Bloody hell. In your case I’d imagine that must be a fair old wodge!

      Thanks for stopping by. Please don’t give up the blog now you’re FI!

  4. Sounds like the light bulb moment we’re all waiting to have, google the tale of the Mexican fisherman, he already has everything he wants why toil more to get back to where he began.

    Really enjoy the blog (first time here, your going on my RSS)

    Cheers

    Dom

    1. Hi Dom.

      Thanks for taking the time to comment. Coincidentally, reading the tale of the Mexican fisherman for the 50th time was probably one of the biggest catalysts that pushed me to declare Pareto Financial Independence.

      It’s so true. I’m usually terrible for looking for a complicated Heath Robinson solution when a better, simpler one is staring me in the face. We live and learn I suppose.

      Take care.

  5. For most of us the journey is slow enough that there’s plenty of time to decide which exit to take. The binary choice was just in the direction, and on this I think the financial independence community has it right.

    For me it was an ill-fitting job and the financial dependency that was thrust upon me once I finished school that motivated my sprint down this road. It was mainly through low spending and to some extent taking on high risk speculative investments that pushed me past the goalpost after a dozen years of toil.

    The outcome I didn’t foresee was that once I didn’t need the paycheck, my job transformed into something I actually enjoy spending my time doing. My nest egg allowed me to turn down promotions into management (“lead or leave”) and stiffened my spine on my demands for a remote assignment on my own schedule covering purely the technical content I excel at. I credit my management for finding creative ways to work around my personality quirks that let me add value to our business. So reaching financial independence didn’t obviate my career as I had originally planned, it actually saved it.

    1. This is a really good way of explaining my point. The main thing that would improve most people’s lives would be achieving *some* financial independence, i.e. starting to walk in that direction.

      For some, walking down the road quickly (or sprinting!) is the best choice but I absolutely agree that the choosing the direction is what gives people options in life.

      Thanks for the comment!

      P.S. I guess from your email address (not visible to anybody else, don’t worry) that you and I could have a very interesting tech chat!

  6. Absolutely great post! I can relate to so many elements having discovered FIRE movement in my late 20s. With some big life changes and decisions coming up, you have given me much food for thought.

    It’s my first time reading one of your posts, will be sharing!

    1. Thanks MsMoneyMaximiser (ahh, another MMM… I thought the world was only big enough for one!)

      How many people have you chatted to online that just wish they’d bumped into the concept in their late teens? I hope I can convince a few people who think they’ve missed the boat that those initial savings might set them free after all.

      Thanks for sharing! Enjoy (what’s left of) the rest of your weekend.

      1. There is only one Mr Money Moustache! 🙂 I remember reading an article about his story a few years back and it introduced me to the world of Early Retirement. Totally blew my mind. Had me thinking “let me give this a go and see where it gets me”. So far, so good!

        Having just hit the third decade I agree it’s not too late to pursue your financial goals whether that be Early Retirement/Financial Independence, buying a house or general improvement of your finances. This article is a reminder of that.

        Happy Friday!

  7. Hi Andy,

    I come from perhaps a slightly different background as, whilst not quite a teenager, I did start to take an interest (first in ERE, then MMM, and finally in the UK PF blogs) over the course of a few years starting around 21.

    “So if you’re older than 25, have kids, have a good savings cushion and are a well-paid professional, I would strongly suggest that you at least think about changing course and doing something similar to what we have opted for”

    I have just turned 25 a month ago, have no kids, a relatively modest savings cushion and am not a well-paid professional. On the surface, therefore, I should probably not be considering the route you describe. However, I do see it as an option, or at least some variation on it, probably of a far less entrepreneurial kind. For now, I figure there’s no harm in aiming for “pure” FI, but it’s certainly occurred to me that if I can get promoted in the job I’m about to start (public sector and therefore flexible hours etc. though relatively low-paid) I could afford to work 50% even not accounting for my existing savings and anything I can add over the next few years whilst I target that promotion. Should I have kids, I can well see that this could become an attractive option.

    My (perceived or real) barrier to doing exactly what you do is that I have no record of delivering financial value. I’ve been in the public sector for the last four years, doing something entirely detached from financial outputs, and unlike an established professional have no immediately bankable skills. I could try and enter a profession, but figure by the time I’ve built up a freelance-worthy level of skills I could have semi-retired from saving hard anyway.

    1. Hi FreedomSoul.

      Congratulations for having your financial head screwed on from such a young age. I was never stupid with money, but I can only imagine where I’d be if I’d had ‘the awakening’ at 21.

      The whole 25+, kids, good savings cushion, professional skills idea I wrote about wasn’t intended as a list of qualifiers for my approach. Rather, I hate to see people who are in my life stage (i.e. early 30s, plenty of responsibilities etc) feeling stuck, even if they are on the long path to FI.

      I’d say do what makes you happy. If working your way up to a 50% FTE job ticks your boxes, go for it. If, on the other hand, you want to slog it out to FI, that’s a great option too. Both beat the hell out of working 9-5 until you’re 65, spending every penny that comes in.

      However, I do take issue with your final paragraph: “…by the time I’ve built up a freelance-worthy level of skills I could have semi-retired from saving hard anyway”.

      Here’s some truth: you’re smart. How do I know?

      1. You’re 25 and thinking about FI.
      2. I mean, read your comment back to yourself FFS. It’s clearly written by somebody who is articulate and gifted.

      Now, first accept my statement that you’re smart.

      Next, here’s a challenge for you. Work out something which you think somebody would pay a person £20 per hour to do for them. Learn how to do it. I don’t know where your talents lie but, judging by your comment, I bet you could, for example, learn to write sales copy if you put your mind to it. Now, keep your job but, in your spare time, go and find 1 person in the world who will pay you not £20, but £30 per hour for whatever it is you thought of. It might take a while and a few knockbacks but you’ll get there in the end.

      I am confident in stating that if you put your back into completing my challenge now, in one year from today, you will have a freelanceable skill which, if you wanted to, you could put effort into finding clients for.

      There is no way that your public sector job will pay £30 per hour.

      I’m not suggesting that you should do this, merely that the option exists if you’re willing to think outside the box.

      Thanks so much for a thoughtful comment.

      1. Hi again Andy,

        Thanks for such a detailed reply/pep talk. Your sales copy idea is actually a really good one, I agree, and I’ll have a think about anything else that I might already have some of the skills for. As you say, there are plenty of skills outside of classic professions which have decent hourly earnings potential.

        I do “side-hustle” to a certain extent with matched betting and (relatively unsuccessful!) Kindle publishing, but I like the idea of becoming my own most productive asset and diversifying my income streams. My brother actually already supports himself off 10 hours per week as a translator, but I do worry about him because he doesn’t really save anything and if his employer decided his services were no longer required I don’t believe he would get paid anywhere near as much at market rate – much less precarious to freelance like you do with multiple clients.

        I will give it some serious thought!

        1. It was my pleasure. Just ping me an email if you have any questions.

          At the risk of falling out of favour with the entire FI community…

          Have a think about matched betting as an example. I’ve done it. I know plenty of people have it as an ongoing income stream.

          However, think about what’s happening in those transactions. On average, the bookies are losing. I say this because exchanges are usually quite efficient markets with tight spreads, which means that they tend towards offering fair prices for lay opportunities. Bookies make money by winning, on average, not losing. Therefore, in the long run, bookies have an incentive to stop you from exploiting this.

          That being the case, I’d treat things which are basically tricks (like arbitrage, matched betting etc) as nice supplements but never to be relied upon as part of a long-term income production strategy.

          Matched betting is a zero-sum game which you’re currently winning, seemingly reliably.

          To build a sustainable income, I’d advise you to do things where your self-interest is aligned with that of your counterparty, whatever form that might take. For example, I have a sustainable career as a programmer because engaging in business transactions benefits both me and whoever has hired me. I get paid, they get the output produced by my skills and sell it for more than I cost them.

          TL;DR: Instead of using ‘tricks’ look for ways to produce wealth. Make it win-win.

          I hope that wasn’t teaching you to suck eggs or anything.

  8. I’ve been investing for less than a couple of years just putting in as much as I can afford every month. At my current savings rate it’ll be twenty years before I consider myself FI. I’ve not really calculated it too thoroughly though as I know I’m miles off. I don’t currently believe I have the skills to get into earning serious money to make it happen sooner.

    Your post has encouraged me to consider how I might achieve some kind of ‘semi-FI’ status sooner. Rather than try to cover 25x my living costs and assume no extra income, I wondered what the amount might be needed to supplement 16 hours a week on minimum wage. Some preliminary calculations give a number of 9.4x my living costs! This feels a much more manageable minimum target.

    1. Hey DW.

      Many thanks for your contribution.

      Happy to help. I hope that grabbing some freedom sooner rather than later now seems a bit more realistic.

      There are so many ways to skin this cat that we could come up with possible solutions all night. Living half off investment income and half off a part-time, minimum wage job would work. If that suits your particular situation, then hopefully you’ll have the balance you want sooner than you expected.

      However, I’m going to have to examine one particular sentence from your comment and pull it apart to perhaps try to win you over even more to my way of thinking (and hopefully make the situation seem even rosier):

      “I don’t currently believe I have the skills to get into earning serious money to make it happen sooner.”

      This might be true. However, the most important word in that sentence is ‘currently’. Perhaps you ‘currently’ can’t make income more efficiently, but that’s not set in stone forever.

      Trust me on this – from your initial description, it sounds like banking ~10x your current annual spending at your current rate of accumulation is going to take quite a long time (certainly more than 5 years). At that point, you’d still have to work 16 hours a week, probably doing something soul destroying to make ends meet.

      In contrast, you could definitely get your income production abilities way higher than minimum wage within around 2 years. How do I know that? Well, I’m going to repeat what I said to FreedomSoul in an earlier comment, but, you’re clearly very intelligent.

      You just wrote me a perfectly spelled, perfectly punctuated, expressive comment containing appropriate multi-syllabic words telling me that you don’t have the skills to earn money more efficiently. Surely you see the irony in this?

      I don’t know you, but assuming I’ve got a good read on your intelligence, I’d confidently say that, if you can find a niche skill or subject which has a high demand (watch this space over the next few weeks for a description of a micro-business I used to run that fit this description), you will be able to get more than £30 per hour for your time. All you need to do to achieve this is to identify what there is a market for, learn how to do it well and then sell it to people. Check out http://liberate.life/index.php/2016/08/29/how-to-work-33-of-full-time/ for some ideas.

      Now let’s do the maths again. 16 hours per week at £30 per hour gives us £480 per week. That sounds like the sort of number you might be able to live on. You already have savings for padding but you’d obviously have to continue to build the nest egg for when you’re eventually too old to work.

      What do you think? I hope that didn’t come across as too ‘in your face’ but, if it helps to highlight even more options you didn’t know about, it’s worth the risk in my book!

      1. Thank you for your response Andy, and your kind words.
        I am rather conscious of the impression that poor written communication presents so probably expend more effort than is really needed on ‘the final draft’. Watch me slip now…

        That particular sentence was carefully chosen. Due to various commitments outside work I am unlikely to be able to invest time in my career progression for the next year or two.
        I am on just under £30k and in my field of work could maybe double that in the private sector. I do not believe I have enough experience (or qualifications) yet to be able to shift outside my current employer. A MASSIVE draw to remain with my current employer is the fact that (being mid-thirties), I am part of a vanishingly small percentage who are still accruing benefits in a final salary pension scheme. That said I do have numerous side-hustles (mainly internet marketing and advertising) that are currently underperforming.

        I have deleted further details from here on in that basically sound like excuses. The upshot is I need to invest some time in preparing myself emotionally, and in maximising my income per hour. My job is currently that source, however my side-hustles provide by far the maximum per effort expended so I need to revisit those.

        Thanks again for your help in possibly motivating the change – I will be working through your emails.

        1. You’re welcome. I hope I didn’t come across as harsh in any way – I just like seeing people make the most out of their possibilities.

          I hope I’m able to help with your emotional preparation by producing some more useful content. I have a bit more ‘getting your head right’ type material planned amongst the usual ‘nuts and bolts’ type posts. Watch this space.

          If ever you want some one-to-one help, I do offer a coaching service, details here: http://liberate.life/index.php/coaching/.

  9. I loved this post. Here is the typical FI blog post: “Sell-out to maximize your salary and dramatically decrease your expenses to get a savings rate of 50-75%. Now do this for the next 7-15 years and then you are no longer beholden to a job and are free to choose what to do with the rest of your life.”
    I say ” No, thank you” to that mantra.
    I’m 28, just graduated, and married with 1 kid. My wife and I aggressively saved 60-70% of our income the last 2 years and we could theoretically “retire” in another 8-10 years. Of course that means we would miss the first decade of our daughter’s life in the pursuit of an arbitrary number, but this is the typical advice I read on FIRE blogs.
    Instead, our current plan is to grind it out another 4 years, get halfway to our FI number, then go PT and let our investments compound over the next decade until all work becomes optional.
    I think a lot of FI bloggers get bogged down in defining what FI means. At the end of the day, we are all striving for the same goal: to accumulate enough F-you money to make decisions based on our values instead of our monetary needs. But, telling people to keep working at a terrible job while missing major milestones in their personal life just to achieve a relatively arbitrary savings number seems to contradict this ideology.
    That’s my long-winded way of saying I think your post was refreshing and added a different perspective to the FI community. Keep up the good work.

    1. Hi Drew.

      Thanks for your comment. I’m glad I’ve struck a chord with at least a couple of people in the FI movement.

      Just to be explicit, I don’t think that any of the bloggers themselves push the concept of religiously sticking to the job until you can satisfy some arbitrary SWR criterion. However, reading through blog and forum comments, a lot of people in the community do seem to frame the problem in terms of ‘servitude vs freedom’.

      Perhaps this puts up an unnecessary barrier that stops people asking the question ‘what’s the best way to regain my autonomy and have enough free time to do what’s important soon?’ rather than ‘how can I put myself in a position to never have to work again?’

      It all seems like a bit of a Heath Robinson contraption to me, as pointed out above in the comment about the Mexican fisherman. I suppose I’m a bit biased though!

      Thanks again for taking the time to comment.

  10. Hey Andy,
    An absolutely brilliant post, I could not have said it better myself (who am I kidding, I could never get it down on paper as well as you just did). It resonates very well with me and our situation, and coincidentally we have actually been discussing pareto FI for a bit in the last few weeks. Simply because I don’t like my job at this stage anymore. It has become a means to and end, but it’s not making me happy at all. It’s certainly time for a change!
    Thanks for the additional inspiration.

  11. This was a nice article and a refreshing perspective. I started my site a few months ago with a focus on FI, but not necessarily RE. Right now we are focused on raising the kids and saving as much as we can. When the kids are off to college, perhaps my wife will go back to work. We shall see. In the meantime, life is very good!

  12. First time reader here. I completely agree with what you say. Other than for the very short term, I cannot get my brain around why some people choose to give up so much of the present in pursuit of a future they have no guarantee to get.

    I used to work crazy hours as a classroom teacher. I hated it and it impacted on my health and personal relationships. With a financial cushion behind me I was able to quit with nothing to go to after I had our second child. I’m now a self-employed private tutor earning as much as I did when I was FT in about 15-20 hours pw. Our quality of life is so much better that it was. For me, there was simply no way I could sustain another 10+ years working at that rate and missing out on my growing family in order to retire early.

    1. Hi Ellie.

      Thanks for your comment.

      I think that it’s really difficult for a lot of people to get their heads around the existence of a ‘middle ground’ which involves a tiny amount of entrepreneurship and thinking outside the box. If you think that having a full-time job is the only way of putting food on the table, of course you’re going to want to escape it in full.

      It looks like our life paths have been quite similar.

      In fact, it sounds like you’d be an awesome case study. Actually… just emailing you now.

    2. Hey Ellie,

      I wondered how you find enough tutoring work to provide a decent income? Are there any tutor sites you’d recommend, or any strategies? At the moment I use tutorhunt, but I only have one tutee. I wonder how many one would need to have on the go at once?

      Andrew

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