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Creating Freedom Through Financial Independence

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Podcast: Starting the FI Journey From Zero Today

March 8, 2022


In this episode…

This week on FIRE & Chill we do a thought experiment.

What if we woke up as 18 year old’s and had to start our wealth-building journeys all over again?  What first steps would we take?  What would we do differently?

This is a big discussion, and I think you’ll get lots out of it.

 

Listen to the show…


(or download the mp3 file here)

 

Discussion points…

  • Intro chat  (01:10)
  • Would we study or start work immediately?  (05:32)
  • Would we try to earn extra income?  (13:36)
  • Buying vs renting for us starting now  (18:50)
  • Our expected living expenses, savings rate and timeframe to FI  (26:02)
  • Would we be more frugal than we are now?  (36:24)
  • Semi-retirement or full FI?  (41:12)
  • How would we invest?  (45:48)
  • Would we put extra into super?  (52:32)
  • What if we started at age 40 instead?  (55:20)
  • What if we were single?  (1:05:46)
  • Overall, would it be easier or harder?  (1:09:37)

Resources and stuff mentioned…

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Have something to add to this discussion?  Share your thoughts in the comments below.

11 Comments

11 Replies to “Podcast: Starting the FI Journey From Zero Today”

  1. Nice one!

    Especially liked the starting again 40 bit – as I discovered fire at the ripe age of 41 (a year ago). Luckily not a start from zero, though.

    Starting in my forties I am definitely leaning towards semi-fi so interesting that you guys might do something similar in my position.

    Actually I have already started semi retiring by dropping a day a week of work… I figure although this might delay the time it takes to save enough to retire, I am working the same number of days in total. Eg 5 years @ 4 days a week is the same amount of work as 4 years at 5 days a week.

    Anyway, thanks for the podcast.

    1. Cheers Matt, glad you liked the pod! Yeah I thought we better throw the ‘starting at 40’ bit in there since we’d get that question afterwards anyway 🙂

      Definitely, semi-FI is way way more attractive to those starting later like yourself. I can’t imagine wanting to slog it out to 55 (for example) after already working 20+ years if I’m in my 40s.

      I really like your approach at levelling down your days. Depending on the workplace arrangements, that can be a really great option.

  2. Loving the content, keep it up!

    If I was starting again today I wouldn’t invested in Australia’s favourite investment (real estate). Having only discovered ETFs last year we have been switching over so its not all doom and gloom!

    Secondly my wife and I have been putting extra into super for the last 10 years. which we have now stopped. We are still 25 years away from our preservation age so that extra income would of been handy if I had found FIRE alot earlier in life.

    Keep up the good work 👍

    1. Thanks Damien! And appreciate you sharing your experience on what you’d do differently. Always great to hear how others are seeing it 🙂

  3. Hi Dave, Great Podcast. I was wondering, If you were to do the journey again. Would you prefer your website and blog to be anonymous like Aussie Firebug or would you prefer people to know you are?

    1. Cheers mate! That’s a really interesting question. In general, I’m quite private so in some ways even now I would prefer to remain anonymous (zero interest in any kind of fame). But I also feel there’s some value in showing there’s a real person behind the blog and people feeling like they know me a bit more since they can see who I am.

      And it would probably also depend on whether I was sharing net worth numbers. If so, I might prefer to remain anonymous, just because then it gets extremely open and personal. But otherwise I don’t mind that much. Do you feel either option is more beneficial to the audience? Anonymous is more mysterious and maybe even more intriguing haha, but showing yourself maybe seems more real?

  4. This was a truly excellent thought provoking episode. I’m in my mid forties and a few years from full FI. I have young adult children now and love talking to them and their friends about making good decisions now, about what I would have done differently if I was in their position (with the knowledge and wisdom of age).
    For the record I recommend all young adults get crystal clear on what their long term financial goals are. Know how the maths works to get to that goal. Then as you go through life, measure your decisions against this goal.
    Save and invest index funds from the very beginning of your working life, and keep doing it as a habit. You’ll get to your number (eventually depending on how aggressive your savings rate is).
    Don’t concern yourself with the Joneses, don’t worry what job you have (just that is pays an above average income), don’t buy too much house, don’t buy too much car, and marry a partner with similar outlook. (most of the stuff my parents told me, but I dismissed because it wasn’t ‘sophisticated’ financial advice).
    Some of these lessons I learned the hard way. But in the end they probably just delayed me from getting to FI sooner, and some of my worst decisions motivated me to get my act together, which honestly supercharged my sprint to FI over the last 10 years.

    1. Fantastic advice Brad, thanks for sharing your experience and your thoughts 🙂

      It’s probably inevitable that many young people dismiss seemingly simple principles (I did too) as it doesn’t sound exciting enough to achieve an exciting result. But hopefully we can get them on board with more of this stuff earlier than they would’ve picked up otherwise!

  5. Hi Dave,

    While I haven’t listened to the podcast (they are not my thing) some of the above comments are interesting. As to myself, due to being irritated by the usual comments made elsewhere about timing, blah, blah, blah, I decided to create a spreadsheet to re-affirm what I’ve always known deep down but wanted to place into a visual form rather than charts or percentages.

    The premise it was based on was what would be the outcome if someone had the smarts and purchased 100 units of STW on the first business day of each month starting in January 2002. Later I did the same for VAS and VGS from when they were first listed. It wasn’t a difficult or arduous task and took probably a couple of hours at most.

    The results:

    STW: Total income (excluding franking and all that) over the period to end FY 2021 was $494,626. For FY 2021 income was $43,000. For FY 2002 to Jan 2022 distribution, $36,300. Total number of units held to March 2022, 24,300.

    VAS from May 2009: Total income (excluding franking and all that) over the period to end FY 2021 was $260,183. For FY 2021 income was $32,854. For FY 2002 to Jan 2022 distribution, $31,595. Total number of units held to March 2022, 15,500.

    VGS from December 2014: Total income over the period to end FY 2021 was $47,974. For FY 2021 income was $14,181. For FY 2002 to Jan 2022 distribution, $6,475. Total number of units held to March 2022, 8,800.

    Of course not many have that amount to invest each month but even adjusting to a smaller number of units per month or investment period to, say, quarterly, or mixing the asset allocation, the outcome from an income perspective is encouraging in my view and re-enforces the idea of staying invested as well as always invest despite the circumstances. I believe the world’s normal state is one of turmoil sadly. In my lifetime I’ve never known it to be otherwise.

    1. Hey SK, thanks for sharing your finding and your thoughts with us 🙂

      The magic of regular investment and reinvesting dividends is amazing yet so incredibly boring at the same time, making it hard to excite people with at the same time. Seeing how the income gets bigger each year due to regular buying is pretty exciting I find. I might have to see if I can make a blog post re-hashing this type of info.

      Cheers mate, hope you’re doing well!

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