I am a mid-40’s American who moved to Canada as a permanent resident in 2020 with his wife and daughter. With an investment portfolio of over $1.3 million USD, annual expenses of around $75,000 CAD (~$60K USD), and no debt outside of a $200,000 CAD mortgage (~165K USD), we closing in on financial independence. We never earned particularly large sums of money, nor do we have an extremely frugal lifestyle. Our investing approach doesn’t rely on luck, research, or complexity. In fact, it can be summed up in a sentence: We invest 30-40% of our income in low cost index funds, 90/10 stocks to bonds.
My goal with this site is to do two things. First of all, I want to share about our journey to financial independence, hoping to both demystify the subject and empower others to realize that it is more attainable than you may think. Second, since we’ve moved to Canada, I am now learning a lot about crossborder finance and investing. This does add a certain amount of complexity, but my goal is still to keep things as simple as possible, sharing it here both to check my own understanding, and to hopefully make it a bit more accessible.
How It Started
My mom taught me two very important financial lessons that really got me off on the right track from a young age. First, she instilled in me a passion for investing early and often, with a buy and hold approach. I bought my first mutual fund (I believe it was Fidelity Contrafund) when I was a freshman in high school. The second financial lesson I got from my mother was to pay of my credit card, in full, every month. I got my first credit card at age 16, so I have done that for over 330 months (and counting).
My interest in FIRE (Financial Independence / Retiring Early) also started in high school, well before I was aware of FIRE as a concept. Right around the time I started working, I vividly remember having a flash of insight — every dollar that I didn’t spend was time that I didn’t need to work. The power of that truth has stuck with me to this day.
My initial interest was more on the “retire early” side rather than on the “financial independence” side. Largely because I wanted to avoid full time work, I spent my twenties teaching English in Asia. It was great. I could work 20-25 hours a week, eat out every lunch and dinner, travel around Asia, and still save enough to max out my IRA each year. I wasn’t a diligent record keeper, but I would guess I turned 30 with around $75,000 in investments, mostly in a Roth IRA.
How We Did It
I came back to the States and got more traditional 9-to-5 job just before I turned 32. My initial salary was $40,000 per year, but my department went through a number of changes over the next several years, and after about 5 years I was making over $60,000. During that time, I also go married. My wife had some student loans (around $35,000) and earned about $45,000 per year. In 2020, after 12 years of full-time work, we had over $1.2 million dollars in investments.
So how did we do that? As you can see, we weren’t particularly high earners, and while we are frugal by American standards, we aren’t particularly extreme. We bought an older but turnkey house in a decent neighborhood. We had two cars, most of the time, but we always bought them used, in cash. We ate out a couple of times a week. When our daughter was born, my wife took a two-year unpaid leave of absence. We buy things (especially books and clothes) secondhand when we can, but at the same time we don’t cheap out on things that really matter (like food and shoes).
From my POV, this all seems pretty normal. In other words, I don’t think any of our coworkers thought we lived a particularly unusual lifestyle (at least, not financially) and I suspect almost all of them would be surprised to find out that we were millionaires. And this is one of my main points — financial independence is much more available than most people think. And, honestly, it isn’t that complicated.
One key is that our savings rate was pretty high, particularly when we were both working. Again, I’m not a great record keeper, but I suspect it was in the 40% range in peak years. While that might sound extreme, it would have left us with over $60,000 USD to spend each year. Where we lived, that was plenty. At the same time, I’m sure many of our coworkers spent significantly more than that, on lifestyles that were only marginally different. And a high savings rate is tremendously powerful, functioning as a double-edged sword — the more you save, the lower your cost of living, which means the less money you need to be financially independent.
For the most part, we plowed that savings into tax-advantaged accounts (including IRAs, 403(b)s and 457(b)s), investing in low-cost index funds. Our asset allocation was aggressive, 90/10 stocks and bonds, with the equity allocation more or less mirroring the global distribution. We rebalanced a couple of times a year, kept our cool no matter what the market did, and that’s pretty much it. If that sounds simple and boring, it is. Again, wealth accumulation and financial independence doesn’t have to be complicated.
Two other big things I want to acknowledge. First of all, we (especially me) started from a place of privilege, with parents that both taught me the basics of personal finance and paid for my college education. Add to that the financial good fortune to be born at this time in human history in middle class America, and I definitely had a head-start. In addition, there is a lot of luck involved in finances. Good luck can make reaching financial independence easier, and bad luck can make it harder. At the same time, there is an element of making your own luck in terms of recognizing and seizing on opportunities as they present themselves.
What It’s Like Now
And then, in 2020, as newly minted millionaires, we moved to Canada. All of a sudden, I went from feeling extremely confident in my financial knowledge to being a total beginner. And that’s the second goal I have with this site — I want this site to serve as a repository for the crossborder financial knowledge that I acquire over the coming years. Since I have to learn it anyways, I might as well share it at the same time.
Finally, once I get a better sense of what our annual spending looks like up here, I anticipate that I’ll be transitioning from full-time work to something more flexible. My wife is already working part-time. Despite the fact that, initially, I was very drawn to the “Retire Early” portion of the FIRE concept, I don’t currently have full retirement as my goal. Over the years I’ve learned that, personally, I do much better with some structure to my days. Thus, I expect to continue to work in some form or another for at least the next several years, more for mental health reasons than for financial ones. We’ll see, though, and I look forward to sharing that aspect of the journey here, too.
Thank you for visiting! I hope that you find the information and experience shared here useful. And if you have any questions, please don’t hesitate to contact me!