If financial independence early retirement (FIRE) is your goal, then it takes more than just cutting coupons. It takes more than the salary earned at a 9-5 too. The journey to financial freedom requires you to have your hard earn money working for you!
There are many ways to achieve FIRE. From real estate to stock market investing and everything in-between. The choice is yours!
First, it’s critical to get crystal clear on why you are striving for FIRE. When the going gets rough, going back to your “WHY” will help you stay motivated and keep you on track.
My financial history is far from perfect.
There are many things I wish I did differently with my money in my 20’s and early 30’s. I made a lot of financial mistakes from not investing early to overspending on things I didn’t need.
Even as a business major in college, one would think I’d be better with my personal finances. I figured, all I had to do was make more than I spend. End of story.
Enough was enough.
It wasn’t until I realized how much I craved freedom from a cubicle that I started waking up to my beliefs and habits around money. And when I really couldn’t stand my job, I knew I needed to have an exit strategy.
Sometimes I stuck to this plan. Other times, I would just quit the next day without a Plan B. Not my best moment.
I ended up going back to the employer for my job back.
Since I was so frustrated with the 9-5 rat race, I wanted to achieve financial freedom earlier than the average retirement age. I knew I had more to contribute to society than what I was doing at my cubicle all day.
I wanted to be able to travel whenever I wanted, take a nap in the middle of the day, and have more time to do yoga.
Most importantly, I wanted to be able to help others through sharing my financial lessons learned on a full-time basis without worrying about the bills.
During the first month after I quit my job, I had no choice but to face the numbers. I needed to determine how I was going to support myself without a bimonthly paycheck.
In doing so, I recognized where my hard earned money could be passively increasing in value greater than inflation rate.
I learned a lot of personal financial strategies the hard way.
Through trial and error, I’m living proof that financial freedom is within reach regardless of past financial mistakes. After coming across countless interviews of Jim L. Collins, author of “The Simple Path to Wealth”, I was able to really understand investing in the stock market.
The Simple Path to Wealth by Jim L. Collins changed my life...
I began to reallocate funds from my savings account to a more diversified asset portfolio. When it comes to the stock market, I have a pretty high risk tolerance.
But being an emotionally sensitive empath, sometimes the market volatility can still get the best of me! So here’s how I minimize risks:
Diversify across different asset classes
Diversify within asset classes
Diversify across markets, countries and currencies
Last but not least, I made sure I diversified across time. I’m talking at least a ten year long term investment strategy. No jumping in and out of the market.
Even the top financial gurus are not able to predict the right time to buy stocks. But if I kept adding to my investments systematically over months and years, I reduced my risk and increased my returns over time.
Passive income from dividends and capital gains.
Specifically, I followed author of “The Simple Path to Wealth” Jim L. Collins investment strategy. I opened a Vanguard brokerage account and invested in Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX). It is a low cost index fund that hits all the diversification points mentioned above.
Roth IRA? HSA? 401K account? Yes, yes and yes.
Yes, almost 100% of my investment portfolio is invested in VTSAX. And I sleep very well each night. After all, I’m “not a bond girl”! Interested in taking a deeper look into this strategy? Read “The Simple Path to Wealth” here!
Or if you're like me and prefer audiobooks, I bought mine on Amazon to listen to over and over for the investment tips and mainly for the inspiration.
Start listening to “The Simple Path to Wealth” here!
Money is emotional for many people.
It’s not easy to stay on track with our financial goals when we allow our emotions to get the best of us. Sometimes, unexpected emergencies happen too. Check out Jim L Collins' simple but effective strategies on how to pave your path to financial independence!
Click below to start reading!
What’s the fastest way to achieve FIRE?
In addition to binge listening to the above mentioned podcasts, enhance your journey to FIRE with the free F.I.R.E. Like a Boss Course!
When I started Not A Bond Girl, I wanted to help others reach FIRE with me. I came across a lot of similar questions about how to achieve FIRE faster.
Of course, everyone’s financial situation is different. So what worked for me may not necessarily work for the masses.
But I’m living proof that it’s never too late to achieve financial freedom. You just have to take small but consistent baby steps towards creating wealth.
Money mistakes and financial setbacks are a part of the learning process.
Financial literacy is a lifelong learning process. There are so many things I wish I didn’t have to learn the hard way. In this course, I cover my best FIRE tips to help you reach your financial goal.
After all, no job is 100% secure. If you hate your job, give yourself some breathing room by having an emergency fund, aka F-You money.
Having F-You money allows you to swipe right on the 9-5 rat race. And if you do end up saying F-You to the boss, be sure to tell me about it.
Get FIRE’d up about achieving financial freedom!
There are a endless ways to create side hustle income and reach FIRE. Investing in stocks, owning rental property, creating your own online biz, and so forth.
But it doesn’t mean you need to do it all. Just pick 1 or 2 that gets you excited.
Everyone's financial situation and personal interests is unique. It’s important to try out different side hustles to see what works best for you.
I tried many different side hustles from teaching yoga to index fund investing. Eventually, I narrowed down my preference and was able to reach FIRE mainly through index fund investing.
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