It may be a bold statement to say that we are ‘financially successful’. Given that we will likely leave the 9-to-5 world before age 50 with a paid off house, absolutely no debt, and a net-worth north of $2 million – I’m going to consider that a financial success.
We certainly didn’t avoid financial mistakes getting to this point. Some lifestyle creep has probably been our largest financial obstacle in reaching Financial Independence (FI). However, I’m still amazed that Mrs. Need2Save and I should have the ability to stop working in around four years and live a very comfortable life.
How did we get here?
It all started with me yearning for a car when I was 14 years old. It was clear that my parents (more on them in a bit) weren’t going to help me with purchasing the independence machinery I so longed for. A friend of mine had just gotten a job at a nearby pizza place and suggested I stop by to fill out an application. And so began my employment journey – it was 1987 and I was making $3.35 an hour to answer phones and make pizzas. I’ve never stopped working since.
Although working hard isn’t a guarantee of financial success, it has certainly helped us. Mrs. Need2Save and I both worked through high school and college. Even in these basic part-time jobs (pizza place, movie theater, restaurants), we developed a strong work ethic. In our professional careers we’ve always strived to exceed expectations and over-deliver.
I also consider continuous curiosity and learning a component of hard work. As an electrical and software engineer, I’ve seen some engineers rely on “how things have always been done”. They don’t enhance their skills and quickly get left behind. It’s easier than ever to learn new skills and technologies; you just need to commit some of your time.
Hard work is only going to take you so far. We’ve certainly had a dose of good luck along the way.
I graduated college in 1994 with an Electrical Engineering degree. I had full intentions of being a ‘hardware engineer’ but had some difficulty finding a hardware engineering job (I also wasn’t too patient). I ended up taking a product engineering job at a small company, which pretty much meant I needed to handle everything – hardware, software, and system design. After a couple of years at my first employer, I moved onto a software position at my current employer.
It was 1997, a few years before the .com bubble and the explosion of the Internet. I was trained in school as an electrical engineer and had software development experience as well. A perfect recipe for the past 20 years!
Along the way, I’ve lucked out with with opportunities at work. A few years into my current employer, a senior engineer disagreed with the technical direction our product line was taking. He was so opposed, that he left the company. Although I didn’t have the skill set that this senior engineer had, I was approached (after others turned down) with an offer to takeover his role. Along with luck, sometimes you need to take some calculated risks. I could have crashed and burned taking on a role that was beyond my current abilities, but I was willing to take the chance in order to reap the benefits of being successful.
Some parents are good financial role models… mine, not so much. Actually, my mother has always been quite frugal, whereas my father has been a bit of a spender. I still don’t understand what inspired him to buy an organ from Jordan Kitt’s music when I was a kid.
My parents rarely argued when I was growing up, but when they did, it was about debt – credit cards in particular. Hearing them stressed about debt influenced me more than they probably realize. I can’t remember the last time we paid credit card interest… thanks Mom and Dad!
One thing I did learn from them was to be financially self sufficient. As I mentioned earlier, they made it clear that if I wanted things that were beyond the basics, then I was on my own. This certainly instilled a sense of financial responsibility on my part.
Mrs. Need2Save had similar experiences growing up, although her parents divorced when she was still in elementary school. Her mom has been a great influence and you can more about her here. She too learned a lot by watching the examples of her parents. To be honest, credit wasn’t as easy to come by when we were growing up. We learned quickly what struggling to pay basic bills would do to a family dynamic and the effort it requires to keep one’s head above the water.
Delayed gratification – it can be hard to resist temptations. If you are familiar with the Marshmallow Experiment you known that delaying gratification can pay dividends in your success.
Of course we want to take multiple vacations per year, eat fine meals every night, drink the best wine, and play with the latest gadgets. But I want financial independence even more. The ability to work on whatever interests me and to work when I want to, is very appealing to me.
We’ve always been good at ‘paying ourselves’ first. That has included retirement savings through 401(k) accounts, automatic monthly savings, and automatic monthly investments. The 401(k) contributions are the easiest as they come directly out of our paychecks. For the monthly savings and investments, we just treat them like any other bill; they need to get paid every month before we get to our discretionary spending. Also, when a big purchase presented itself, like needing new furniture or a big appliance, or fixing the roof, we made sure we had savings set aside or waited until we had the money rather than use debt.
In addition to the luck I mentioned above, I sure got lucky finding Mrs. Need2Save :-). Even at the tender age of 23 when we got married, we seemed to have a similar attitude towards money. We were both willing to work hard to advance ourselves professionally and personally in our young marriage and then later in parenthood. Over our 20+ years of marriage, we’ve always openly discussed our finances and financial goals. We don’t sweat the small stuff, but large purchases are always a joint decision.
Being on the FIRE track over the past few years has helped us fine tune and accelerate our goals. My original idea of ‘early retirement’ was to leave the workforce at age 58. I used to call it Project 58. With us working together on this common FIRE goal with diligence and a little time, I am happy to say that Project 58 will likely become Project 49.5.
I hope you weren’t expecting something magical or a short-cut to our financial success. This path has worked well for us, although I wouldn’t bank on too much luck; but when opportunity presents itself, you sometimes need to take a chance and go for it.
What has led to your financial success?