I write a lot about seeking financial independence rather than early retirement. That’s intentional. I don’t necessarily want to retire – not anytime soon – but what fires me up is the idea of working on my own terms.
My goal is to be financially free by age 45. That means I’d be free to ditch my day job and pursue my passion of helping people with their finances (through educational writing, financial planning, and hosting seminars or workshops). I wouldn’t be retired, since I’d still derive an income from these activities.
Many FIRE bloggers have the same idea – work hard, save a large percentage of their salary, and eventually ditch the cubicle life. The dream is to retire early, but more often than not their “work” turns into blogging, book writing, and speaking about early retirement.
Ironically, selling the dream of early retirement tends to be another full time pursuit. Just look at one of the original FIRE personalities, Canada’s self-professed youngest retiree Derek Foster. He’s written six books and runs a website where he sells his “portfolio picks”. He says “retired”, I say “quit his job to become a writer.”
To be clear, there’s nothing wrong with pursuing financial independence or wanting to retire early. Any movement that helps people spend less, save more, and strive for a happier life is to be celebrated.
The safe withdrawal math is easily ignored when the income needed to live is actually earned through blog revenue. The dirty secret of the FIRE blogger movement is they dont have to touch their investments while they’re out there selling the dream.
— Boomer and Echo (@BoomerandEcho) August 4, 2019
My caution to regular FIRE seeking folks is that if you intend to retire full-stop in your 30s or 40s you’ll need to have a massive amount of savings, an extremely conservative withdrawal rate, a commitment to lifelong frugality, and a plan ‘b’, ‘c’, and ‘d’ for when life throws its eventual curveballs.
Unlike your favourite FIRE blogger, you won’t have the luxury of supplementing your cash-flow with income earned online selling the dream.
I’m still striving for the FIRE blogger dream of quitting my job to blog part-time and pursue other activities. But when I do, I’ll call a spade a spade and not declare myself retired. How does FIE sound? Financially Independent Entrepreneur.
This Week’s Recap:
I managed just one post here this week, with a look at why actual investor returns are making GICs look good.
Over on Rewards Cards Canada I compared my accommodation experiences with Airbnb vs. Hotels.
And on Young & Thrifty I wrote about finding the best online mortgage lenders.
On another note, this blog is officially nine years old today!
Promo of the Week:
Speaking of Airbnb, the company has an awesome referral program that’s worth checking out. When you sign up for Airbnb with a referral link, you’ll get up to $62 off your first trip. How it works is you’ll get $45 off your home booking, and then another $17 to use towards an Airbnb experience worth $63 or more. An “experience” is an activity hosted be a local expert.
We’ve been using Airbnb since 2013. We love that we can get an entire place to ourselves for (typically) less than the cost of a hotel room.
Since we travel with kids, we often prefer to upgrade to a suite or adjoining rooms at a hotel – which can be costly. With an Airbnb, everyone gets their own bedroom, plus a living room, kitchen, and often more than one bathroom. For our upcoming trip to Italy, we rented an apartment in downtown Rome for $180/night, compared to the $350/night (starting at) rates at most decent hotel chains.
If you haven’t used Airbnb yet I highly recommend signing up and giving it a try for your next holiday or weekend away.
My Own Advisor Mark Seed is on the same page as me when it comes to FIRE. He prefers, Financial Independence Work On Own Terms.
Martin Dasko at Studenomics started his own Airbnb “coffee crawl” experience in Toronto. Martin’s endeavours prove just how easy it is to make money online.
U.S. banking giant Chase made a brief appearance in Canada, handling the Sears portfolio of credit cards and introducing the first Amazon.ca Rewards Visa. Chase shut down its Canadian operations in 2017, but cardholders with outstanding balances continued to make payments. That is, until this week when Chase informed its remaining Canadian customers that it will wipe out any outstanding card debt.
Dale Roberts reports that Vanguard’s asset allocation ETFs have already gathered $1 billion in assets.
PWL Capital’s Justin Bender looks into the expected returns for the Vanguard asset allocation ETFs:
“In the face of eternal uncertainty about what the future has in store, the wise investor builds an efficient, globally diversified portfolio that reflects their personal long-term goals and reasonable expectations about what markets have to offer. Then they sit tight for the ride.”
Million Dollar Journey blogger Frugal Trader asks, can you have too much RRSP?
Finally, Ben Carlson at A Wealth of Common Sense says that victim blaming (the idea that your money woes are all self-inflicted) is the biggest lie in personal finance.
Have a great weekend, everyone!