Today, I'm pleased to present a guest article from one of my favorite money bloggers of all time: Jacob Lund Fisker. Fisker founded Early Retirement Extreme in 2007. It quickly became an influential voice for the nascent FIRE movement. In fact, I think it's fair to say that FIRE wouldn't be what it is today with his work.
Fisker retired from blogging in 2011. Since then, he and I have exchanged long emails on sometimes arcane subjects. Occasionally I ask him for advice. Recently, I asked him if he'd be willing to update people on where he's been and what he's been doing for the past decade. He agreed.
Here, then, is Fisker's story of life after Early Retirement Extreme (and extreme early retirement). Be warned: His story is not short.
What happens when a great opportunity comes along, but you don't quite have the resources to take advantage of it? That's what Greg wants to know. He and his wife have found their Dream House. They think they can buy the place — but only if they're willing to take on some short-term debt in addition to the mortgage. Greg wants to know if this is a smart move. Here's his story:
My wife and I are in our late twenties, no kids (yet), both safely employed and living very comfortably with a combined monthly income of around $5,000 after taxes. We currently have about $28,000 in student loans, and plan to pay them all off within the year. The original amount was $37,000 six months ago, so we've been making quick progress with them. One loan is in deferment while my wife is in school, another requires $80 a month for the payments, and the one we are aggressively paying off has no monthly payment due until 2014 because of our extra payments. Basically, we only need $80 a month to satisfy our loans for the next two years. We have no car payments, credit card debt, or anything other than the student loans.
Everything was going as planned until two weeks ago we found a house we absolutely loved. We've checked it out, and aside from minor cosmetic things, its move-in ready. It's a foreclosure with an asking price around $136,000 (houses are cheap in the Houston area!). We'd plan to stay in the area a minimum of ten years, if not longer.
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Long-time readers of Get Rich Slowly know that I've been waging an ongoing battle against Stuff — the clutter and crap I managed to collect during 20 years of wanton spending and debt. Though I've managed to curb my spending (and have slowed the influx of Stuff), I'm still surrounded by constant reminders of my old habits.
Last week, Colleen wrote to ask for an update on this seemingly-endless war:
I was wondering if you would update us soon on your battle with "Stuff". I, along with others I'm sure, struggle with this, and reading your blog has been a great help. I'm curious how you've progressed since the last post when you decided to clean the workshop.
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Thanks for your interest in sharing a guest post with the Get Rich Slowly audience. Here are some things to consider.
There are no length requirements for GRS articles. I always say an article should be as long as it needs to be -- but no longer. If your piece is 500 words, great. If it's 5000 words, that's fine too.
There are no topic requirements for GRS articles. It should probably be related to money, but I'm fine with running anything that helps readers improve their lives.
Though I don't share all of your complaints, I do think some of you made an excellent point: Just as money is more about mind than it is about math, so too a rewarding career is more about personal fulfillment than it is about raking in big bucks. I agree that I'd rather work at a low-paying job that I loved than make $100,000 a year at a job I hated. I'd rather be happy than rich.
In response to FMF's post on Thursday, Mike wrote to share his predicament. He's hoping GRS readers can help him decide what to do:
This is a guest-post from Tim Ellis, author of Seattle Bubble, a blog and forum dedicated to discussing real estate market conditions in the Seattle area. Tim is a long-time GRS reader. During my last trip to Europe, he shared a controversial article on renting vs. buying.
Starting a new chapter of your life in a fresh locale can be an exciting and memorable time, but it can also be rough on your personal finances. Many of the expenses associated with a major move are unavoidable, but there's one major mistake that is easy to avoid: buying a home immediately upon arriving.
Sitting on my desk as I write this is an application I should have filled out months ago. Twenty-two months ago, to be exact.
It was then that I left my 40-hour-a-week office job, which included a convenient 401(k), dependable health care plan and, most refreshingly, a kind and understanding boss. It was tough to leave that job, but I wanted to pursue a career in freelance writing.
The entire experience was overwhelming. Details of that are for another post, perhaps, but the point is: what I found most overwhelming was dealing with my own finances. Administratively speaking, my employer had taken care of my retirement plan, taxes and health insurance. It was great.
Advertising is powerful. Avoiding it — in print, on radio, on television — is one of the best ways to control your urge to spend. When you willingly expose yourself to commercial pitches, you risk spending more than you intend. I've posted two articles recently about how marketing manipulates us to buy things. Allow me to belabor this point one last time before I move on. It's important.
Corporations manipulate us in subtle ways. We know television commercials are designed to sell us things, but how many really understand that their power is felt primarily at a subconscious level, beneath awareness? It's not that a Taco Bell commercial makes you go buy a chalupa now; it's that weeks later you'll find yourself pulling into a drive-thru when you could have been home in a few minutes preparing a salad.
The other day I wrote that people who watch the Super Bowl just for the commercials may be sabotaging themselves. But it's not just television — marketers target us constantly. I could just as easily write about my own foolish choices. Every time Steve Jobs gives a keynote address, for example, I follow the live text updates. When the speech is over, I download the video. I willingly expose myself to these marketing machinations. And wouldn't you know it? My life is filled with Apple products. (My mind is working overtime trying to find a way to rationalize an iPhone.)
It's been quiet around here for the past few months. Generally when things go dormant at Get Rich Slowly, that's not a good sign. It usually means that I've sunk into the depths of depression, the pit of despair.
I'm pleased to report that in this case, that's not the issue. In this case, the opposite has happened. Lately, life is grand. During the past three months, I've been diligently working to eliminate the net negatives from my life while also emphasizing those things that are essential. To that end, I've:
Recorded, edited, and published nearly 50 YouTube videos. These are rough, and I know it, but I'm learning from them — and having fun.
Given up alcohol. And recently, I've given up pot. I'm experimenting with complete sobriety for a while.
Lost nearly twenty pounds through simple, sensible eating (and calorie counting). This morning, I weighed in at 186.8, down 17.4 pounds since I started on July 28th.
Cleaned and organized nearly every space in my life, "editing" my belongings in an attempt to cut back to the essentials.
Worked hard in the yard. I've built a fence with one neighbor and am starting another fence with a second neighbor. Plus, I've continued our landscaping projects.
Begun reading again for pleasure. Yay!
And much, much more.
I've had a busy three months. And while, yes, I've had a few bouts of depression, they've been minor and brief. Mostly, I've been happy and productive.
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A few weeks ago, I wrote about how my husband and I are moving to be closer to his new job. Well, it's been a whirlwind of chaos and uncertainty ever since. Since I wrote that post, we put our house on the market and began the search for a new home. And despite the fact that we're excited for the opportunity to move on with our lives, it hasn't been pleasant.
First of all, something happened that we never expected. Our house sold for almost full asking price in 13 days.Yes, you read that right.Thirteen days. This was great, of course, because we were able to put that part of the move behind us. And anyone who has sold their home knows how big of a pain it is to keep their house in prime condition, especially with small kids. Regardless, the fact that our home sold so quickly meant that we needed to find a new home….and fast. Plus, the fact that the buyers of our home wanted possession in 45 days meant that we had 45 days to make an offer on a home, negotiate a price, and close the deal.Gulp.
Searching for Our Dream Home
So we started our home search by making a list of the features we wanted in our new house. Fortunately, we were mostly on the same page. My main concern for our new home was price. Since selling our current home meant that we would have almost 100K for a down payment, I wanted to find a home that was as inexpensive as possible. One of our dreams is to be debt free (including our mortgage) as soon as humanly possible; so the more we burden ourselves with debt, the further we'll be from reaching that goal.
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but how many really understand that their power is felt primarily at a subconscious level, beneath awareness? It's not that a Taco Bell commercial makes you go buy a chalupa now; it's that weeks later you'll find yourself pulling into a drive-thru when you could have been home in a few minutes preparing a salad.
