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One Reader’s Remarkable Journey Towards FIRE

Dec 12, 2020


Many stories of those pursuing financial independence come from people who have always been pretty good with money.

This can lead newbies to assume that the FIRE movement is only open to a select few financial wizards.

But this is not the case at all!  And that’s why I’m so excited about today’s guest.

He’s a 40 year-old guy from Canberra who… well, I don’t want to spoil it!  His story is inspirational and that’s why I’ve invited him here to share it with you.  So I’ll let him explain in his own words.  Hope you enjoy it!

(by the way, he’s using a nickname for privacy, which some of you might recognise from the forum PropertyChat)

 

Introduction

I am Orangestreet and I have just turned 40 and on the path to FIRE like many of you.  Everything about my story is unremarkable; just like me.  Also, spoiler alert – I am not financially independent yet.  In fact, I am not even close.

As you will find with my story, unlike most of the prominent voices within the FIRE community, I was not born with a naturally frugal mindset and neither did I start investing until I was past 30.

I have shared my story in the hope that there must be others like me with average intelligence and median incomes who can in just over a decade put themselves on the path towards unimagined wealth and freedom to live life on their terms.

The beauty of FIRE is breathtaking in its simplicity and there is literally no downside to achieving it.  By following a well-trodden path, it is nearly impossible to not end up wealthy simply because it is underpinned by the iron-clad laws of arithmetic.

 

The student years (mid 2000s)

Being an international student in Australia, especially for one coming from middle class developing country households is a brutal existence.  There is no HECS/HELP, no handouts from Centrelink and the mark-up on tuition fees is eye watering.

I had taken out a huge loan to pay for tuition. By the end of the 2 years of studies, through extreme frugality and dint of hard work, I not only managed to complete my post-graduation, I got my permanent residency and a full-time job as well.

I did not know it then, but it made an indelible mark on my psyche that I did not need a lot of money to be happy and that I could save heaps (and repay loans) by living like few others are prepared to.

 

Full time employment – (2007 -10)

It took me less than a week after beginning work to realise that I was not going to be the hotshot I thought I was going to be.  Workplaces have a fine-tuned system to cut graduates with an exaggerated sense of self-importance down to size.

Full time work was such a shock to the system as in just a matter of few days, I went from having pretty much all my time to myself to living on the margins of the week.  It felt like there was simply no respite from the torrent of work days coming at me like a conveyor belt from hell.

I used to do laps around the office building in the afternoon to shake off the mind numbing ennui and the crushing migraines that I would get.  I would often look outside my office window wistfully at the bright blue sky and leafy streets and contrast it to fluorescent lighting and vinyl office furniture and wonder how I got it all so wrong.

I tried everything from taking sick days to going on annual leave.  Nothing worked because work always won in the end by the sheer quantum of working days a year has.

I learnt it the hard way that you cannot outrun a working life by distraction.  The unrelenting beast that is a full-time work week had me in its vice like grip and released its claws only during the weekend so that I could gasp for air.

Whist my starting salary was just north of $40K, I quickly picked up spending habits from my colleagues.  I started using the escapism of travel and consumer purchases to smother the pain of being chained to my desk.

I usually had a coffee in the morning, food court at lunch and sometimes takeaway at night.  My previously acquired frugality from my student days was quickly forgotten. It was not so much rewarding myself for having ‘arrived’ but a coping mechanism for having a boss dictate how I spent most of my waking hours.

In a sequence of dumb decisions, I found myself in front of a bank manager who offered me a personal loan for $10K. I was so flattered that I accepted it with no questions asked.  To make matters worse, I bought a new car (100% financed!) and the loans kept mounting.

By the time 2010 arrived, I had $48K in personal loans.  To my eternal shame, I compelled my newlywed wife, (who I met in 2007 and subsequently married in 2009) to part with $4000 she had diligently saved in her short career so that I could stay on top of the ever mounting loan repayments.

It got so absurd at one stage that I was drawing money out of my credit card to make loan repayments and meet short-term commitments.

Then suddenly, against the run of play, my life turned on a dime through a series of fortuitous events in 2010.  I found investing and FIRE (only I did not know it was a thing then).

It was like meeting somebody and then realising they were exactly what you were searching for all your life but you never knew existed.

 

The pivot – 2010 onwards

When me and my wife joined finances in 2010, I found some respite from the crushing loan repayments through economies of scale of two people earning and living together.

In the meanwhile, I had started a new job and in just over 12 months, my salary nearly doubled.  Living with a wife who had decent job herself, managing loans become a bit easier.

While I had not given up on my unhealthy lifestyle of unintentional spending and eating out 3 times a week (albeit at nicer restaurants), the crazy excesses of my single life was over.

In March 2010 during a work day, when I was looking at my credit card statements that something possessed me to copy each line item to a spreadsheet to see where my money was going.  I also categorised the spending into different streams.

What I saw was stomach-turning.  The sheer scale of wastage was nausea-inducing even by my own wanton standards.

If there is one life hack that I can attribute my financial turnaround to, this would be it.

Once I could measure what was being frivolously ****** up the wall spent, cutting back on areas that did not give me joy was a no brainer.

In another serendipitous happenstance in late 2010, while browsing property magazines at the newsagents, I came across an article titled “how to have a million dollars in the bank.”

There was a case study about how with just buying 2 properties, one could have a million dollars in the bank.  I remember being transfixed by that article for days because the path mentioned seemed completely achievable.

To my mind, having a million dollars was for lotto winners.  It had not once occurred to me that it could be achieved through sensible investing (I wasn’t kidding about the lack of intelligence).

One thing led to another and I got myself a copy of Steve McKnight’s book.  In the book, he had a paragraph which nearly made me cry.

I am paraphrasing but it went along the lines of, “Working in a full-time job is like bonded labour.  I have seen my supervisors work so hard for such little reward and so much stress that I have asked myself is this all there is to it?”

All my life I had been told how lucky was have a job and I was somehow ungrateful to have fantasies about escaping the clutches of work.

But here was a guy, who for the first time in my life was giving me the vocabulary I needed to articulate my deep frustrations and to put together a plausible plan to escape the prison of full-time work.

 

Consolidating the gains

Whilst it is hard to encapsulate in a few paragraphs how the change happened, the two examples above went a long way in course correction.

Soon enough my loans were gone and late in 2011, we saved enough for a house deposit and bought our modest PPOR (home).

Every single dollar spent was tracked and the simple spreadsheet to capture expenses became a sophisticated behemoth that tracked every aspect of my financial life to the last cent.

I devoured financial books, joined forums and made intentional spending decisions.

In 2012, with a savings rate of nearly 50%, we bought our first investment property. In the ensuing years, we bought two more.  We were on track to buy up to 6 properties (even with APRA restrictions) before we changed strategies and shifted to shares.

The power of a high savings rate is so all conquering that leading up to 2018, in spite of shelling out $57K over 4 years of childcare (we had our daughter in 2012) we still managed to save enough to buy three investment properties, recycle all of our PPOR debt and build a decent share portfolio balance.

In between, we managed to go on numerous holidays, multiple visits to our home country and a life of incredible abundance.

 

Key lessons

It has now been a decade since I started the FIRE journey.  Whilst I jumped on the bandwagon for money and freedom, I have stayed on for the vastly improved life that the pursuit of FIRE has bestowed upon me.

Below are some of the key takeaways from my journey so far.

  • The difference in lifestyle between spending money unintentionally versus a more considered spending approach is minimal.  I hardly felt like I could buy anything and everything during my profligate years and neither do I now feel like I am leading a life of deprivation.  We hardly feel like we have lacked much (if anything) and we have had plenty of rich experiences.
  • Learning to do one aspect of life well (like taking control of your finances) has positive echoes in different spheres of your life.  I have now used the living-intentionally approach towards my health and the pay-off has been enormous.  I am healthier and fitter now than when I was 18!
  • Frugality is a keystone habit and has made my mind much more organised, disciplined and self-aware.  Joining the dots by connecting finance, behavioural traits, economics and politics has greatly enhanced my understanding of the world.  It has also made me question aspects of my life which I had taken for granted.  For example, I had always assumed that eating out once a week or overseas holidays were mandatory “experiences” that one absolutely must do to have a “meaningful life.”  Nothing is further from the truth.
  • It is important to choose your life-partner well.  Without my wife completely rejecting the zeitgeist of ‘rewarding’ ourselves with overseas holidays at resorts with infinity pools, living in a trophy home and buying ‘nice’ things to feel good, I would have no hope in hell of achieving FIRE.  Also, knowing myself, I am aware of the fault lines where I have stumbled in the past.  I am far more confident of reaching FIRE due to having a wife who refuses to get distracted from achieving our goals.  While it was my vision, enterprise and enthusiasm that propelled us on this path, it will be her steadfastness, equanimity and wisdom that will see us through.
  • It takes just over a decade for compound interest to start paying off.  I feel like I am now reaping everything I sowed over the decade from 2000 – 2010 (i.e. nothing).  Therefore, I have no passive income (at least not enough to meaningfully reduce or quit work).  But the hard work from 2010 to 2020 will start to pay off from around 2030 onwards.  And the dollars we invest in this current decade, we will be truly thankful for in 2040s and so on.
  • You don’t need to cross the finish line to enjoy the benefits of FIRE.  A bad day at work – no worries.  I just have to remember my financial trajectory and I can regain my perspective of what is truly important.  Whilst life is not perfect, I am happier than I have been at any other stage of my life.  Being on the path to freedom has made me appreciate how lucky I am to have the job I have.  I have found at times, astonishingly, even liking it and deriving meaning from it.

 

Where to from here

We are at a stage in our life where our finances are on auto pilot.  With a savings rate pushing 70%, we just have to resist taking our eyes off the ball and we will coast to FIRE.

If things go to plan, we will have passive income (from shares alone) well in excess of anything we have ever spent.  We also need to continue taking steps to mitigate a few key risks (loss of income/health/death through insurances).

At my best estimate, we have another 5 years left to become financially independent (all yearly expenses met by passive income).  I will be in my mid-40s and my wife in her early 40s.

Because we believe in what is known in FIRE circles as ‘front loading the sacrifice,” we plan on accumulating a bit more than what we will need.  All up, I expect to be retired early by my late 40s (wife mid-40s).

It is highly unlikely that I will be in paid work after I reach FIRE.  For me, retiring early is just as important as financial independence.  Even a job that involves lying on a beach all day will be tedious to me because it is exactly that – a job.

Thankfully I have a curious mind.  I will let my mind wander to explore where it wants to go next and I will provide the time and resources to pursue those interests.

Most importantly, I want to spend the rest of my life serving my wife and daughter in helping them chase their dreams lead their best lives.

 

Dave’s final thoughts…

What a story!  While there are tons of great points, some of the following parts were my favourite…

  • At the start, our reader was heading in the complete opposite direction to FI!  Many of us start on roughly the right path financially, and ramp up our efforts from there, so it was amazing to hear such a turnaround.
  • He’s completely relaxed about the whole retirement thing and wants to see where life takes him by simply following his interests and curiosities.  That’s kind of the attitude I took too.  For some people, planning is better, but if you know yourself well and can’t imagine being bored, then approaching retirement as an adventure might be ideal.
  • He’s actually happier now than ever before, despite spending much less.  Many people think this FIRE stuff means sacrifice and pain now for a future benefit.  But that’s not the case at all!
  • His partner is playing a crucial role in terms of keeping them focused and committed, despite FIRE being his idea.  Fantastic stuff.

I want to thank Orangestreet for sharing his personal journey with us.  I really hope you enjoyed it, and as always, thanks for reading!

What did you take away from Orangestreet’s story?  Do you have any questions for him?  Leave your questions and feedback in the comments below and he may pop by to answer you 🙂

51 Comments

51 Replies to “One Reader’s Remarkable Journey Towards FIRE”

  1. I really enjoyed reading this.
    Like you, I’m taking the attitude that retirement will be an adventure. I have plenty of hobbies, dogs and travel goals, so I know I won’t be bored.
    Anyway, I’ll find out in a week’s time, when I walk out of my school for the last time…!

    1. So exciting! It’s such a weird feeling. I think I was in shock for the first week or two – initially, it feels wrong or almost naughty that you don’t have to go to work anymore. Haha.

    2. Hi Frogdancer Jones

      Thank you for your comments. Also, thank you for the hours of enjoyment and learning you have provided through your blog and your podcast interviews. I have enjoyed reading about your journey and stories about the “best house in Melbourne”. All the best for your next chapter. Will look forward to reading all about it.

      Regards
      Orangestreet

  2. What a great story! All the very best to you Orangestreet and your family. It’s so important that one’s partner is ‘on the same page’ if one is serious about the FIRE journey. I learnt that one the hard way… I am curious about your current job situation and the satisfaction (or not) you get from it. Is it another soul-destroying job or is it something else? Have you or are you considering changing jobs? Oh, and a 70% savings rate (with children) is very impressive…

    1. Hi Jeff

      Thank you for your best wishes.

      My current role (that I have been doing since 2013) is extremely meaningful and makes a tangible impact on some of the most marginalised people in our country. I take a lot of pride in what I do and like most of my colleagues, go over and beyond what is required of us.

      So while the job itself is not soul destroying, it still manages to destroy my soul regardless. I have come to ruefully understand this because it is not so much the nature of my role but who I am as a person intrinsically. Due to the sheer relentlessness of working for a living, the corporate structure, the lack of control, the sheer repetitiveness of working 40+ hours a week makes it hard for me to lead my best life. So it might have been enjoyable if I was doing it for a few hours of the week of my choosing, doing it Monday to Friday, week in, week out, years on end has left me jaded.

      The best I have heard it described somewhere was that this is the ‘fog of work’ at play. A state of mind where you are so depleted of life energy that you have very little time for creative or meaningful pursuits. So when my daughter asks me to spend time with her before school bell, I declined. When she wants me to read a second or a third book before bed, or wants me to jump on the trampoline, I resist. In all these cases, it is well outside work hours but the fog of work is doing its thing.

      Regarding savings rate, I hope I have not oversimplified it a bit too much. It is only this year that we have managed to reach 70% with the average being somewhere between 50 – 60% over the last decade. For us to consistently achieve 70%+, a lot will have to go right and our investment properties will need to have very few major maintenance issues. A big ask. But I think if you can achieve 70% + in 5 years out of a 15 year FIRE journey , you would have done very well.

      Thanks again.

      Regards
      Orangestreet.

      1. The fog of work… a state of mind I can totally relate to, and unfortunately my own kids experience this without ever having deserved it. Its omnipresent, soul-crushing nature is exactly why I relentlessly pursue FI.

        Thank you for sharing your story so eloquently!

    1. G’day to my people!!! ,

      Great journey Orangestreet ( should change to yellow brick road 😎) ….the road paved with gold !! ) …

      As Peter Thornhill preaches ….Saver & Saver = Nirvana !!!! ….that indeed. Should you be fortunate enough to have a partner with the same mindset , well life is your oyster!!!

      After Good health , nothing beats financial freedom on your terms !!! …and hey we all are getting older but having that chocolate icing on that chocolate cake , will make it all that sweeter ….take care……cheers 😁🙏

      1. Thanks Jimmy

        A lot of what Peter Thornhill says makes a lot of sense from life-mastery point of view. Whether we invest exactly as how he advocates is besides the point. Much to learn from him, not in the least the decency in which he conducts himself is worthy of emulation.

        Thank you for taking the time out to comment.

  3. Great story! I am on my mid 40’s and have just started my journey to FIRE! Stories like this is so motivating! I always look forward to your podcasts with Pat, and your emails.
    Thank you!

  4. Aarghh another PC member who hides his profile so I can’t see it or search any of his content.. what are these guys trying to hide

    1. Hi Mak

      I had no idea that I could even hide my profile on PC. I will look into it.

      Regards
      Orangestreet.

  5. Well Sir I am very much inspired! As a late firestarter myself who certainly did not make the most appropriate financial decisions in my younger days, I draw inspiration, motivation, direction and hope from this man’s story. We are all unique and don’t have to fit into somebody else’s rigid formula of circumstances and outcomes. In my case, ”retire early” is likely not applicable since I’m already 56 years old and I don’t think I ever could or would completely stop hustling for a buck. More like slow down a little with an acceptable level of financial independence and security. But with that having been said I am very much encouraged and directed by the collective experience and wisdom of people like yourself Dave and your guest, Mr. Orangestreet.
    Thanks guys great read.
    The Late Firestarter.

    1. Thank you Late Firestarter.

      Like you rightly say, we are all different have our own journeys and destinies to meet. The beauty of FIRE is that allows each of us to design our lives as how we see fit and lead it on the terms of our choosing. The more control one has over their lives, the better the outcomes (including flirting with that elusive and fleeting glimpses of happiness).

      Thanks again and all the best.

  6. Likewise, all the best to yourself and your family Mr Orangestreet.
    Perhaps when your ready to quit your job you could look at some form of business or self employment as I have done. At least in this case you are your own boss and if a customer is really intolerable you can get rid of that customer, not the entire business. That’s what works for me.
    Cheers and keep believing in yourself and your destiny!
    From The Late Firestarter!

  7. Wow amazing story Orangestreet. I truly loved this post and your mindset is incredible. If you’d ever love to share your story to a North American crowd, we’d love to have you on as part of our FIRE Communitiy Guest Interview Series. Cheers!

    1. Thank you Court for your comments.

      I would love to talk more. I have left my contact details in a message to you on your website. Look forward to hearing from you.

      Regards
      Orangestreet

  8. Very inspirational story, thanks for sharing. The part at the end about wanting to serve your wife and daughter was especially lovely.

  9. “To my mind, having a million dollars was for lotto winners. It had not once occurred to me that it could be achieved through sensible investing (I wasn’t kidding about the lack of intelligence).”

    It’s not lack of intelligence, it’s lack of information/education with a solid helping of upbringing. I felt the same way for most of my life until I discovered FIRE via the Barefoot Investor community a couple of years ago. A small but disastrous foray into sharemarket investing at age 20 (only a couple of months prior to Black Monday) scared me away from investing for three decades. It’s only through BFI and FIRE bloggers like Dave that I’ve realised that investing doesn’t have to be a leap into the dark.

    I think your story is inspiring, Orangestreet – thanks for sharing, and thanks Dave for introducing another FIRE voice.

    1. Thank you Fire for One.

      Your comments are spot on.

      Looking back now, I understand why James Clear in his excellent book Atomic Habits speaks so strongly about identity and how changing habits is truly about changing your identity. Once I adopted the identity of a person who saves and invests and a person who is on the way to becoming a multi-millionaire through good money management, my habits followed.

      Regards
      Orangestreet

    2. Great to have helped, and you’re welcome, always happy to share great stories like this one 🙂

    1. Thank you Jordan.

      Your website looks very inviting. Look forward to going through it in much greater detail over the next few days.

      Regards
      Orangestreet

  10. Your story is very inspirational, I am in my early forties and have just started my journey to FIRE. I can relate to your story very well, I was on the same journey to work hard, earn more, and spend more. It feels truly like a rat race. Would you be able to give some details on your asset diversification? What % in Property and What % in stocks?

    1. Thank you Leonie.

      The portfolio is still largely skewed towards property. It is roughly 60% (investment property), 25% shares and 15% super. I expect the shares and super to grow bigger over the years and we will most likely sell down properties closer to retirement.

      1. Thanks mate, if you have to do this again what would you change? Hindsight is a wonderful thing. Would you still have gone with IP and Shares or would you do something different?

        1. Hi Leonie

          Knowing what I know now, no way would I have ever bought an investment property in my life. I would have saved myself heaps of transaction costs, maintenance headaches and opportunity cost in terms of life energy wasted on a 100 things that looking after an IP has brought about.

          I feel a twinge of sadness that in 2011 when I was about to start off, I used to listen to a Melbourne based podcast from Scott Pape (the Barefoot Investor) and he repeatedly said “owning quality business and holding them for the long term is how you get truly wealthy.” He even recommended buying shares in AFIC and ARGO and said he made no money from those recommendations but they were trusted companies which have a history of looking after their clients. I remember going to those websites back then but I am not sure why I did not act on it. I really wish I did – I would have been in a much better position. More importantly, I would not have had to take on the kind of risks that I have now have with debt on those investment properties.

          Hope that answers your question.

          Regards
          Orangestreet

          1. I reckon I know why you didn’t act on it. The same reason I didn’t. Because investing in a low cost diversified basket of shares in a stodgy old investment company (AFIC, Argo), buying every single month and reinvesting the dividends, is boring as hell when compared to the excitement (and possible jackpot) of using mega leverage to invest in property lol.

            It’s funny how most of us come to the same conclusions given enough time. In reality, we’d also be better off today having never invested in property. But people probably look at us and think ‘Aha, they started in property, that must be the way to do it!’… 😉

          2. Thanks mate,

            Really appreciate your response, I asked that question as I am creating my investment strategy, I have a PPOR and IP, I was on a path to buy a second IP when I came across this FIRE community. I even have a pre-approval for buying an IP, now I am more inclined to invest the deposit of 100K into ETF rather than IP. I am catching up with an independent paid financial adviser as I create my plan.

  11. Fantastic story, and great inspo. Really resonated with that part about how having a plan and being on the way to achieving it really does put a different cast on a bad work day. Btw, I think you might underestimate your intelligence – just from your writing you come across as packing a not too shabby IQ and EQ. But I love the message, it’s so true that we don’t need to be exceptional to achieve FI.

    1. Hey Jack

      Of course I do! I remember our private conversations extremely well.

      I have often thought about you and your spectacular journey towards financial freedom at such a young age. Would love to talk more. Send me a DM on PC and lets reconnect.

      Regards
      Orangestreet.

  12. A three word summary about what is required:

    Strong Financial Discipline.

    That is all which is necessary in my view.

    1. Thank you StayKing,

      Your wisdom and your ability to break things down to their most basic truths have been very useful in my journey. Thank you for all your contributions on PC.

    1. Hi Elena
      Thank you for your comment.

      Unlikely that I will ever have my own blog. I get plenty of enrichment and enjoyment consuming all sorts of FIRE and non-FIRE content (books, podcasts etc.). The idea of producing content myself is not something that excites me. If I ever write, it will be for my own self-reflection and understanding.

      Thanks again.

      1. Well we’re glad you decided to try your hand at writing this time 😀
        Maybe another guest-post down the track would be a good idea? I’m sure everyone would love to know how you’ve been getting on!

        1. Hi Dave

          Absolutely! It has been fun collaborating with you and would love to do so again sometime in the future.

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