When we begin our big adventure towards financial independence, it’s extremely exciting.
We can see the dollars building up. We can see our future options expanding.
The later stage of the journey is also filled with anticipation and excitement, as we count down the days to freedom.
But what about the middle?
We’ve got our money figured out. We’re saving and investing regularly. Now it’s more or less a waiting game. Repeating that process until our investments are big enough to sustain us forever.
Hardly thrilling, is it? So today I’ll share my advice for how to get through the boring middle part of your FI journey. I’ll tell you how I dealt with it and what I would do differently.
The main problem with the ‘boring middle’ is there’s not a whole lot to do. We’re already doing all the right things. We just wish it would go faster. Hurry up already, I want to retire!
Sometimes we wonder if early retirement will ever come.
Can you really wait another 5-10 years to reach this state of freedom? After all, it feels SOOOO LONG!
I remember these feelings all too well! As I see it, there are four clear options available which can help us at this point.
While it’s normal to get impatient when we have a burning desire to reach our financial goals, consider the following…
How incredible is it that Financial Independence is even possible?
We can actually save and invest enough so that we get to the point where we control 100% of our time. We are then completely free to not work if we choose. All in just a decade or two.
That opportunity itself is pretty incredible. Something we have to be grateful for. This simply wasn’t possible for the middle class 100 years ago. Incomes were much lower in real terms. Access to low cost, diversified investments was virtually non-existent.
I’ve met many readers in real life who tell me they’re annoyed it took them so long to find the Financial Independence community. We all have that feeling at some point.
My response is always the same. We can’t go back. Imagine you never found out about FI at all. What if you kept working another 10, 20, 30 years and and never knew?
That would be a real tragedy! There’s always a more helpful way to frame things to alleviate our stress.
Being pleased about the path we’re on is just as important as the actions we’re taking. We know we’re doing the right things. So, we can choose to spend our energies on making the most of our current life, while slowly working towards our ideal life.
Appreciating the time we do have with family and friends. Finding small ways to enjoy our work (even I managed this one!). Making the most of our days off, taking care of our health, and celebrating all the tiny wins along the way:
– each investment we make
– every incremental saving we find
– seeing our dividends come in
– when our portfolio hits a big number
Most people focus on this one. And come on, it’s hard not to!
There’s definitely no shortage of ways to bring that freedom date closer. We can do the following…
First, we should make sure we’re being paid well for our job, by comparing salaries and roles on sites like Indeed. You might want to take on more responsibilities in your current role and prove to your employer that higher pay is deserved.
You could start a second-job in your spare time or a side hustle using whatever marketable skills you have. And of course, you can go the old fashioned route like I did, and simply work more hours by doing overtime.
In my view, probably the most fun of all the options. When you can cut things from your life which offer little to no value, it frees you to focus more of your energy and money on what matters.
Like leaks in a boat, increments matter. Finding a bunch of small savings adds up and is immensely satisfying. You’ll also want to carve out a special day (or weekend) each year to enjoy Optimisation Day: The Annual Gift to Your Future Self, where you nail down the best deals on all your current expenses.
Okay, so this one isn’t a huge cash-producer. But reducing our ownership of ‘stuff’ has multiple benefits. It decreases clutter, mentally and physically. It gives you less things to clean, maintain and replace. And it does create extra funds to feed your hungry investment account.
Start mapping out your retired life.
Some of us have a solid plan in mind for when we reach the point of no longer having to work.
Others, like myself and our recent guest Orangestreet, decide to simply figure it out later and leave everything completely open.
For some reason, this is how I thought life would look after leaving work…
And it actually did for a little while! But that doesn’t last. You need some productive and meaningful things to do.
So, mapping out your options is a wise move. Create a list of stuff you’d like to do. Write down any skills you’d like to learn. Topics you want to learn more about. Maybe you can even bring some of these things into your life right now.
Sometimes we put these off until later because they seem harder and take longer in our head than in reality.
Now, of course some things will probably have to wait until you’re retired. That 6-month trip around Australia. Having lunch with your family everyday. Hard to do with a full-time work schedule.
But exploring possible part-time retirement gigs and leisurely projects? That one’s easy. You might even be able to try one or two or these ideas and love it, which could change your plans altogether.
Start working on this stuff now if you can. You’ll be able to transition into your FI life much easier having thought about it beforehand.
A less obvious way to get through the boring middle part of your FI journey is to retire earlier instead!
I think semi-retirement (or semi-FI if you want to call it that), is a hugely under-appreciated option.
Now I’ll admit there’s something magical about the thought and feeling of never having to work again. But in reality, you can get most of the benefits in less time with semi-retirement.
Let’s put a fictitious line in the sand. I think you can class yourself as semi-FI if you reach 50% of your goal.
So if you need $1 million of investments to fully retire, $500k is enough to semi-retire. You can make up the rest from part-time work, and even saving a little will get you to 100% FI over time.
Yes, you can semi-retire on much less. Technically, Mrs SMA and I need zero investments since we can live on part-time income alone.
But I think having investments cover half your expenses (or having your house paid off) is a solid and respectable benchmark.
I cover the topic of semi-retirement in more detail in the following post: Semi-Retirement: Your Shortcut to Freedom?
Switching to part-time work and having a shorter journey would be just as satisfying for many people.
If you can’t imagine slogging it out for enough years and want to taste freedom sooner, then try it.
Worst case, if you don’t like it you can always ramp up work and savings until you are completely financially independent.
Clearly, there is plenty we can do to sail through the boring middle part of our FI journey. We can…
Personally, I got a bit obsessive and focused mostly on #2 – speeding it up. Looking back, I don’t regret it. But I should have more deeply considered the other solutions too!
The middle part of the journey is something most of us find difficult. Whichever of these options you choose, remember to be eternally glad for learning about FI in the first place, and living in a country and time where this is possible.
Because ultimately, even just knowing you’re on the way to financial independence is an incredible place to be!
My thoughts on a behavioural trap I see in the FI community, how to recognise it and how to fix it. Far more common than you might think, and it can prevent you from enjoying the wonderful wealth you’re building.
Lizzie changed her career, moved location, sold her home and switched investment strategy. Now she’s looking to semi-retire in her 30s.
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Thanks Dave. I needed this today. We definitely are chaffing at the bit for 1st Jan 2024 which is my walk-into-the-sunset date. Mrs has been retired for 7 months now and has truly come alive. Mrs is project managing things around the house getting it fully ready for retirement…… solar, water tanks, gardens, fruit trees, big maintenance items etc.
I could retire immediately, but I just have a psychological $ figure in my head I need to reach.
Initially I was annoyed that I had not discovered FIRE earlier, but these days I’m just grateful that I did. I use myself as an example of discovering FIRE late yet still achieving it.
And what happens if the markets turn down??
Your psychological figure drifts further away..
Just do it, trim the budget if you need to
But do it now while you can
????
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I know right!
Hey Phil, glad this post was timely for you! Sounds like your partner is loving it and really setting things up nicely – sounds fantastic 😀
It’s great you get to see how retirement has affected her in such a positive way, I’m sure it gives you even more excitement to join her.
Definitely a needed post. We all get so excited in anticipation that we forget to be present. We work so hard and invest so we have time in the future – but there’s no point if you don’t admit that there’s so much access to time and good times even now. We love appreciating the little wins like just investing more money.
Haha yeah absolutely! Personally, I got really sucked into always thinking about the future. It helped me get thru some shit days at work, but it also meant I didn’t appreciate certain things in the meantime. It’s not easy to balance it, but sounds like you’re onto it!
Thanks for this post SMA. We are 412 days from fatFIRE and following your advice we will start planning our RE life today. So excited!
Very nice Tom, that is exciting!
Hi Dave
Great article. I definitely agree that its a mental challenge in the middle years of the journey to FIRE. I reached my FIRE number a few years ago. However, unfortunately hedonistic creep set in and I was unable to walk away from work as I had intended to and always thought that I would the earliest moment that I could. Instead the lure of owning a better house and having better holidays set in and I have continued to work and set up a new FIRE number. I agree with you that thinking about what to do post FIRE will hopefully prevent this from happening to me again when I reach the new FIRE number.
Hi Jon ,
Just do it mate !! ….If you are happy and joyful in life , what are you waiting for ?? When you reach your second number , guess what ?? …you want a 3rd and 4th and more !!! ….so get rid of that word want in the previous sentence and replace with need and live the life you deserve!!!
All the best
Cheers ????
Great work Dave!
The semi retirement option is for me for a couple of reasons. First I started too late to effectively “retire early”. If I was to retire in 10 to 15 years it would be right on cue with the old folks. But more importantly I don’t intend to ever stop hustling for money until I’m done. If I see an opportunity to hustle a buck mate I don’t like to sit around and let it escape. What I want is to have a big enough financial tailwind from dividends and investments that the pressure is off. To be in a position to operate on my own terms and tell any customer or employer to go jump if I feel that such action is warranted. Thanks Dave I always enjoy your blog.
I Wanna Be Ritcher Get The Picture
That’s a good way to frame it. Having enough savings and investments to ‘take the pressure off’. Getting to a position of lower stress and freedom to venture off into new things of interest which will also probably earn a few dollars. Sounds great. And thanks, glad you’re enjoying it!
Haha well said Jimmy. Ripping the band aid off might seem logical to us (people would kill for Jon’s situation!), but it’s a mental barrier than Jon has found himself in, and probably related to fear of the unknown and the comfort of leaving things as they are. Hopefully he can do some soul-searching and figure out what really matters to him.
Fascinating Jon, thanks for sharing. Moving the goalposts (which is pretty common I think) can be slippery slope to just chasing bigger numbers and fancier stuff – when we know in reality, we aren’t going to actually be meaningfully happier with those things. It’s just a way of putting off something that scares us a bit – leaving the cushy environment of having a steady income and accumulating wealth. It sounds like you really need to do some thinking about what your life is going to be about. I hope you can spend some time on this, since it’s super important.
Great article Dave, thanks for connecting this community.
For people who are getting bored, I would ask them -and this is part of my work-
‘what is your life’s mission?’
‘what do you absolutely love and are inspired to do consistently and spontaneously that you don’t need to be reminded or externally motivated to do?’
It may sound too mystical to some but when you connect with that your life doesn’t have to be boring, engaging in something you love doing doesn’t have to be divorced from your FIRE journey.
I don’t mean a hobby, a passion or side hustle, I do mean Life’s Mission. We all have it, but don’t always take the time to acknowledge it.
Cheers Alex.
I guess the tricky part is that’s too big and intimidating of a concept to approach, without thinking it has to be saving lives, curing cancer or some great hurculean project. A lot of us just want more freedom time to do the things that are important to us. That doesn’t mean life is boring, we simply don’t have enough time for the things we truly value due to the necessities of earning a living and waiting until we reach our financial goals.
And let’s be clear, human happiness is not very complex, which we know from research. You can build an extremely satisfying and meaningful life without changing the world or having a ‘Life Mission’.
I can’t help but notice your obvious bias in this area, looks like you do consulting on helping people find their ‘purpose’. The more I think about it, the more your comment looks like a precisely angled piece of marketing.
….and that goes with you too Phil!!!!
“ Just do it “ !!! ????
Hi Dave – you know what I think about journeys. lol
The thing I found most effective through this middle bit and still use now as we get closer to FI is tracking the growth. Very simple but a powerful way to see progress and keep the wind in your sails. So on the first of every month I break down and record our total wealth in a simple google spreadsheet. I soon became blown away at the amount we were able to put away every month. Some months we’d think “we did pretty crap” only to crunch the numbers and see otherwise. So seeing the small incremental successes is a key motivator in my view.
Haha, mate, I always think of you and try and think of a better word… still yet to come up with one. Path, quest, etc… none of them fit as well as journey does!
That’s an exciting method in a rising market. But remember, at other times, it may be more heartbreaking than anything lol. But if the focus is on your savings input, then that is definitely a great metric to follow and celebrate, since we can’t control the market returns, but we can control how much we save 🙂
I do the same, record the total networth on the first of each month.
For me having a visual graph helps a lot with motivation, I can look back and actually see the progress I’ve made and consequently the crash’s too; it wasn’t much fun recording the networth during March and April last year but it’s important so as to get an overall long-term picture.
So now you can see the huge COVID crash in the graph and then the subsequent rise..
I like having little milestones along the way. You’re generally close to having some round number in your total net worth, or investments in your own name, or superannuation, or your partners superannuation etc.. Admittedly sometimes you will go through it both ways a couple of times due to market fluctuations, but that just lets you tick it off again!
More importantly though you should make sure that you’re comfortable with your life on your journey to FIRE. You probably shouldn’t be spending a fortune on luxury items along the way, but you have to allow yourself some room for spending on things that genuinely bring you happiness otherwise you’ll probably give up on FIRE completely. And so long as you keep that spending reasonable, in most cases it won’t actually make much difference to when you reach FIRE anyway.
Well said mate. And good point about hitting the milestones twice haha, I hadn’t thought of that!
There is too much talk about FIRE = ultimate sacrifice (usually media and other finance people) but when you actually boil it down, pretty much all of us are not going without anything we feel is genuinely worthwhile 🙂
I am almost there and like many wish i understood FIRE a few years earlier. Now i am 54 and all being well will be out of the business in next 12 mths to retire 10 years before the majority.
Life goes so fast . This Rush song says it all . enjoy.
https://www.youtube.com/watch?v=t0YwbAmCwz8
That’s fantastic Paul, congratulations!
Thanks Dave,
Always great food for thought! We’re at within 3 years of FI number we want. We both are in semi retirement working 4 days. Instead of holding that as our exit date we now review where we are at every 6 months or so. Asking – how are we feeling about work ( can we keep doing it? Should we cut down to even less days?) How is our saving going – checking in on reviewing expenses. (we have two teenagers and 3 years will hopefully have then establish their independence and reduce our expenses further). Not being able to travel has greatly increased our savings (travel was a great love of mine) It also means we are re assessing what we would do with more time if not travelling (I know the hours and days will fill) I think making time to talk about this regularly is super important – it’s not set and forget, we change and life changes. Review and re assess is a big part of getting through the boring middle!
Review and re-assess is very important, good one Jo. Often we’ll find that our goals, needs, priorities chance along the way so it’s good to keep evaluating.
I really like your approach – flexible and thoughtful.
Great points Dave, I agree with all of them and specifically applied gratitude and optimising during my journey. However I must confess the time has gone really quickly for me! (I discovered FI in 2015 and made a plan to be FI by Nov 2022). Approaching the final stages of my plan my FI date has moved from Nov 2022 to June 2022 and I find myself increasingly nervous about giving up either/both my main job or side hustle. I never really liked my main job but I have come to realise that the structure, problem solving and social fulfillment I get from work is something I value. My side hustle is not easily scalable or sellable but I enjoy it (90%) and it makes me good money. So for this last pre FI working year, I am taking more days off and scheduling more fun activities. I have worked two jobs for so long (since 2012) that I have essentially forgotten how to switch gears and embrace a more relaxed lifestyle (I realised this during each lockdown). I wouldn’t quite say semi retired but maybe dipping a toe in?!
Having it go fast is a great situation to be in! Sounds like a great plan to me, hope it goes well. Once you do slow things down a little bit and taste freedom, you’ll probably wonder how you could work so much before 😉
Thanks dave this one for me is timely too. The hardest thing I am finding about the middle is seing all the money tied up and not being able to retire yet. Some days i think what such a small amount of dividend from so much capital. As others mentioned just tracking and thinking about the futre possibility does help
Wishing we were getting higher income/returns is universal 😉 And there’s no good way around it. It’s the world we live in. Depending on your situation, you could of course start harvesting some gains now, take a break, maybe work part-time or contract work after that, until accessing super later.
Agree with Natgee. I understand the maths of the 4% withdrawal rate however when I look at the amount of capital vs the tiny amount of dividend I wonder how I will ever get to FIRE!
As others have said, tracking over time has been a big help to keep me motivated. Compounding is an amazing thing and I’ve certainly seen it first hand with my super from age 18 to now 35. If only I could get my hand on that super sooner 🙂
Remember, if dividends are lower, growth is usually higher, and built into the 4% is typically the combinatoin of dividends plus harvesting some gains from the portfolio. And more than anything, with timeframes like 10-20 years, the portfolio is driven by the input (savings added) rather than output (investment returns).
Dividends are only one part of the return, with the other being growth. Where dividends are lower growth is usually higher, and vice versa. And more than anything, with timeframes like 10-20 years, the portfolio and your progress is driven mostly by the input (savings added) rather than output (investment returns).
Speaking of cutting expenses, I’ve noticed that my CBA Smart Access account charges a monthly fee of $4 unless you put $2000 into it every month (which I’m not doing currently). Some banks like ING don’t seem to charge any account fees. Would you recommend switching banks (I don’t have many automatic payments so switching shouldn’t be difficult)? Which bank would you recommend for everyday personal banking, credit cards and savings account (for your emergency fund)? And thanks for another enjoyable read!
Hey Olga. You could ask them to waive the fee or you’ll be leaving. They may do it. Otherwise, there are tons of bank accounts now which offer zero account fees. I just found one from NAB with a quick google search here – NAB Everyday Account
I don’t do credit cards. For emergency funds, either use an offset account or ‘high’ interest savings account – most offer very poor rates these days so for most people it’s not worth jumping from bank to bank unless you have large piles of cash.
This is a great article Dave! It resonated with me deeply. My wife and I have a young family and we were frustrated with working too much, and watching our kids grow too quickly. So now, we are working part time towards FI, to maximise our happiness and time with family now, on the journey to FI and not just saving that for the arrival at the destination. We decided to do this during one of our regular date nights, where we have a ‘state of the union’ and discuss our life, dreams, goals and finances. Its so important to make the time to take stock and review things with your significant other.
One financial principle that we love and hold dear is “Live Rich Now” from David Bach (who’s famous for the Latte Factor). I’m an optimiser by nature, and when I discovered FI, we went a bit overboard on optimising expenses and cutting back on discretionary spending, to the point of deprivation. Looking back, it was a good experiment, but it did actually make me miserable for a short time. Now, we’ve added back in some spending, but focusing on experiences, self actualisation and happiness, and time with family and friends in particular.
Having a daily gratitude practice is so important too! Every time I start feeling blue, I discover I’ve stopped doing my gratitude for a while. Once I get back into this, it’s like negative feelings don’t come back, or at least not as much! Other things that Shawn Achor, the author of the Happiness Advantage recommends, and which I’ve found value in:
1) Medidate
2) Find Something to Look Forward To (holiday, date night, dinner w/ friends)
3) Commit Conscious Acts of Kindness (volunteer, donate to a cause, help someone in need)
4) Infuse Positivity Into Your Surroundings (make your physical space beautiful)
5) Exercise
6) Spend Money, but not on Stuff
7) Exercise a Signature Strength (revisit a talent you haven’t used in a while)
Thanks again for the great article. Looking forward to the next one, and also the next podcast with you and Pat. Your tempered, laid back style and Pat’s hilarious rants always give me a good chuckle and some food for thought. Appreciate all you do for the Aussie FI community. Keep it up mate!
Good post. I am towards the beginning of the journey (time wise) and have started my website to track myself for the middle point.
I will use it as a, “look how far you’ve come”, source to keep motivated. I like options 2. Why walk through hell? Instead run through it! Haha
However, I enjoy the process of this and actually choose to balance both FI and life the best I can. Especially since I have two little ones to share the journey with
Haha ‘why walk through hell’… not bad 😉
Thanks for sharing!
I think that achieve FIRE should be boring. If it is too exciting than the investing site is probably to volatile.
Hi Dave – im looking at swapping brokerage accounts from westpac trading to self wealth, mainly due to the cheaper brokerage. But don’t want to go to the hassle if the extra 10 or something will make a “huge” difference over the long term. Would love to know what your thoughts are on this and what platform you use. Thanks for the content – I find it so encouraging to keep investing no matter what is going on in the world once i read your posts.
Hey North, thanks for reading! Great to hear about your regular investing 🙂
The savings won’t make a huge difference, but at the same time, why pay it if you don’t have to? It’s not hard to change and over time it will eventually amount to thousands of dollars. I have an account with Selfwealth and also one with Pearler – a new broker which I’ve been testing for a while and quite pleased with. Both are good low cost options.
Great article, Dave! We’re right in the thick of the middle part of our FI journey. Currently about 3.5 years into a 10 year plan we put together after discovering FIRE in 2017. After the initial excitement of discovering and implementing the strategy for reaching an early retirement goal, I knew that we would need to keep life interesting in the interim while still in full-time work and building towards our FIRE goal. We went about setting a bunch of shorter-term goals, pursuing new interests and rediscovering old ones and life feels fulfilling while our savings and investments continue to accumulate in the background.
I’m finding that I’m able to enjoy my work more as time goes on. Rather than thinking to myself, “I’ve still got 6.5 years to go”, I’m instead flipping the way I view it by saying, “I’ve only got 6.5 more years to find the best ways to make a meaningful difference in the work I do and enjoying the privilege of earning a salary and receiving the other benefits that come with my job.” This has been a powerful and empowering shift in my viewpoint towards work.
I’m also definitely feeling an increasing sense of peace and calm through this middle period as our money cushion continues to grow more plump over time, knowing that if a job loss were to occur there is no urgency to land a new job straight away. This increasing sense of calm that is linked to our growing financial security is also enabling me to focus more on continued learning and development for betterment of the self which, in turn, is allowing me to cast my mind outward to the larger picture in which we all exist and seeking ways to make my contribution to a healthier planet and society.
I am in the middle part of the journey. I have read all the books I feel I need to. Everything is automated, I just max out my tax advantage accounts and the rest goes into a lazy 3 fund taxable Vanguard account. My lifestyle is adjusted to living on a smaller portion of my income and I am just used to it. Market movements do not get me excited or upset like they used to.
I will use it as a, “look how far you’ve come”, source to keep motivated. I like options 2. Why walk through hell? Instead run through it!
Haha love it! Looking back on progress and showing yourself it’s working is a great approach.