The Awesomeness That Happens When You Focus on Money for Three Years
The last time we spoke I told you I was going to take a leap of faith. Well a lot of exciting things have happened since then. I'm going to get you up to speed over these next few posts.
The biggest change? I quit my job! Here's the deets on how I made it happen.
Three and a half years ago, when I started my job, everything was seemingly great. I had a few hundred dollars to my name. The job paid me well (~$50,000/yr post tax average over the three years), gave me great benefits and had a fun work culture. It was a solid fit for any normal employee.
But I wasn't a normal employee.
My sights were focused on financial independence. I wanted another layer of creativity to my day. I wanted to have more control over the time I "worked" and the time I "played." And so I began to save +50% of each paycheck.
In taking advantage of my pre-tax retirement accounts, I was able to save $97,000 in my first three working years. ($97,193.88 to be exact!)
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As it happens, when your stash grows your choice grows too.
At about two and a half years in to my journey, I began to dream of feeling the sun on my shoulders during a weekday. I began to think of all the more stimulating ways I could spend those 2,000 hours a year that I was giving to my job.
And at the same time, my girlfriend was itching to do some long term travel. A life dream I had always hoped to get out and do.
At that point I was staring at $75,066.15 of savings.
With a spending of about $20,000/yr (while living in the overly expensive city of San Francisco) I started to feel I had a solid safety margin. Maybe 5 years worth if I was living in a just as beautiful, less expensive area.
But I was just staring at it. I wasn't using it to help me build a better life. That is the whole point of this financial journey isn't it?
To me this doesn't mean I should start spending it all down. Of course not. Money exists to improve life, both present and future.
I should use the money to keep winning in increments for my present life while also making sure the numbers march upwards year after year for my future.
With all that in mind, I started to reevaluate my life design.
I recognized then that the benefits of a good job just didn't hold the weight they had when I had hired on with no money to my name.
At two and a half years in, I wasn't dependent on the job providing me with a paycheck every two weeks or covering my health care premiums anymore.
I had $75,000 (actually a fair amount more if you include investment returns) or 6+ years of personal lifestyle cost stashed away. That kind of flexibility made me ponder, how else could I use my time? Is there something more fulfilling out there?
I began to search deeper than what a job could provide, and decided that I wanted to use some of my previous time to do a long term travel trip with my girlfriend.
After some internal debate I chose a timeframe 6 months ahead to make the leap.
I used that 6 months to build a cash reserve meant specifically for traveling and being away from work.
I could have easily used my 6+ years of investments, but I'm not looking to drawn down on investments until I reach somewhere near the 4% rule (the point where an investment portfolio produces enough passive income to cover your lifestyle indefinitely).
Over the next 6 months I put away about 60% of each paycheck or $2,200/mo toward this travel reserve. Since I already had an emergency fund of $7,000 saved, I finished with just about $20,000.
That $20,000 was a number where I felt comfortable enough to say "Thank you and goodbye" to my employer and "Hello!" to extended travel and the unknown.
And so on August 17, 2016 I waltz my way in to work, flexed my financial independence muscle and gave notice that I'd be leaving for extended travel.
Since then, that's what I've been up to.
I haven't posted here because I wanted to honor that time off. It's been amazing. Thank you for honoring it back. Here are a few photos.
I'm excited to get you up to speed. Off we go...
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Keep reading. You won't regret it.