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FI-losophy: Don’t expect results.

One of my favorite Buddhist teachings is a collection of pithy slogans called the Lojong (meaning “mind trainings”). The idea with short slogans like these is that you reflect on them over and over again so that they come to mind when you find yourself heading in the wrong mental direction. One of my favorites of these slogans is: “Give up all hope of results.”

The idea behind this slogan is that we spend so much time and energy trying to manufacture certain results, rather than enjoying and being present to what is directly in front of us. This causes us to suffer. For me, this often manifests as “I’ll be happy when…” thoughts. As persistent as these thoughts are, they are a lie. There is no arrangement of external circumstances that will provide lasting happiness. That isn’t how things work. For one thing, nothing lasts. For another, my mood is only tangentially connected to what is going on outside of me. Observing my moods over time has absolutely convinced me of this.

While I certainly see a lot of value in taking a FIRE approach to work and finance, it is challenging to do so while not getting overly attached to results. We have our FI number which, if we’re not careful, can easily become an “I’ll be happy when…” number. We predict rates of return and calculate safe withdrawal rates. All of this is, inevitably, a form of expecting results.

Does that mean we shouldn’t do these things? To me, no. As a layperson (i.e. not a monk), my goal is to be in this world but not of this world. What I mean by this is that I recognize that I’m living in the “worldly” world — I have a job, expenses and retirement savings. To not do any planning in these areas would be incompatible with trying to live an intentional life. At the same time, I need to remember that these things are not, ultimately, a source of lasting happiness. They are not the point.

What does this mean, in practical terms? For me, it means (as best I’m able) trying to hold onto all of these target numbers loosely. It means accepting the fundamentally uncertainty of predicting the future. It also means not sacrificing my quality of life today for hypothetical results tomorrow.

To put it another way, it means remember that the numbers are not the point. The goal of all of this isn’t hitting our FI number as quickly as possible, or getting a 99% success rate on cFIREsim, or whatever. The goal is having the freedom to live the life we want, right now.

In concrete terms: for me, this has meant no side gigs. I’ve never wanted to work any more than 40 hours a week, even though that would have enabled us to save more, faster. It also meant that my wife took two years of unpaid leave (plus a semester of paid leave) when our daughter was born. We would have made more money if she’d been working, but that wasn’t the point. And, finally, it meant moving to Canada, even though it meant my wife would be quitting her job at a time when my own job had become a bit more precarious. We want to set our family up for the best life now, as well as we can, while also preparing for the future.

As usual, the answer is trying to find the middle way. How can I plan and prepare for retirement (even an early one) without obsessing over it? For me, the answer is often that I do obsess over it, and I have to very intentionally (and repeatedly) remind myself to let it go, that it is ultimately out of my control. I have to accept that I am doing my best with the information I have at hand today, that it won’t be perfect, and that’s OK. And then I have to turn off my computer and go play with my kid.

What about you? How do you balance the tension between preparing for retirement and enjoying the present moment?

Reading recommendation: If you’re interested in learning more about the Lojong slogans, two books I really like are The Practice of Lojong by Traleg Kyabgon and The Great Path of Awakening by Jamgon Kongtrul.

What does your spending look like? (Nov 2021)

I must confess — before we moved to Canada (in July 2020) I never tracked our spending. I used Mint to aggregate our investments, and I usually added credit cards there as well, but I never cleaned up or looked at the data. I’ve always felt that one of the perks of living within well within your means is not having to track expenses or make a budget.

I changed my tune when we moved because I thought we were near our FI number. To be sure, though, I had to pin down what our spending was. I had a rough idea of our spending in the US, but since we were in a new country I decided to bite the bullet and track it.

I’m using a tool called GnuCash. I’m only using a fraction of it’s functionality — it’s a full accounting suite, but I’m only using it to track spending. I chose it for a few reasons.

  1. It’s free.
  2. It’s located on my PC (rather than cloud-based). I’ve increasingly moved away from “free” apps or websites where I’m providing them with a lot of personal data.
  3. It learns — as I classify expenses each month, it makes better guesses as to how to classify them in future months.

I thought, when I started doing this, that handling multiple currency (CAD and USD) was going to be a priority for me (which GnuCash can also do) but to get the results I want (a single view of my expenses) it’s easier to just convert my few USD expenses into CAD each month.

Here’s how our average monthly expenses broke down for the last 13 months. This is all in Canadian dollars.

Mortgage$1,142principal and interest
Home Repair / Maintenance$931having house (interior) painted
having the garage / attic finished with aspenite
service for our pellet stove and HVAC
every trip to the hardware store
Taxes$857
Groceries$775vegetarian, mostly whole foods, CSA / farmer’s markets, decent amount of organic
Household$716another catchall — if I was looking to cut expenses I might dig into this one
Auto (gas, parking, insurance)$215doesn’t include the purchase price of our used Subaru Outback
Utilities$195doesn’t include pellets (which appear under home repair / maintenance).
Clothes$190mostly winter, shoes / boots, and skates / sporting goods
Spiritual Health$188retreats and classes w/ our meditation group in Florida
Phone$133currently 2 US, 1 Canada.
Gifts$126
Education (school lunches and summer camp)$125
Dining$104
Insurance (home)$81
Dental$66
Professional Expenses$65
Entertainment$59
Other / Miscellaneous$590
TOTAL$6558

There are undoubtedly places we could trim our spending. I also suspect that this first year in Canada will be a bit higher than subsequent years. My goal in this exercise, though, is to understand our spending, in order to get a sense of where we stand in terms of financial independence. And, based on these numbers, we look to be in pretty good shape.

Our current portfolio sits at about $1.3 million USD. Using the 4% rule (an imperfect but reasonable quick and dirty estimate), that should enable spending at about $52,000 USD (or $65,000 CAD) per year. Our current spending is just under $78,700 CAD (or ~$62,000 USD). This is very similar to what we were spending in the US.

If we were to fully retire, some of these expenses (including our taxes) would reduce, and we’d get an increase in some benefits (like the Canadian Child Benefit) as well. If, for example, we were drawing down so that my wife and I both had $20,000 CAD in income, we’d pay less in taxes and get almost $6000 in CCB, which would put us very close to the ~$65,000 CAD spending target.

Regardless, my wife is currently working part time (and really likes her job) and my plan is to go down to part-time next year (I think). We’ll do that for a few years and see where things stand. Plus, I’d like to pay off our mortgage when it opens up in a little under 4 years, which would significantly reduce our monthly spend.

All in all, I was happy to see, after this first year, that our spending in Canada wasn’t too far off our spending in the US. What about you? How carefully do you track your spending? And what tools do you use?

What are you doing with your short term savings? (Oct. 2021)

Ever since we moved to Canada, we’ve been keeping a lot more cash. This is due to a combination of factors.

  • I changed jobs to facilitate our move (my new job allowed me to work from home in Canada) and my new job is less stable than my previous one. Plus, it is in a very COVID-impacted industry, and there were lots of layoffs in my company.
  • My wife quit her job when we moved, although she ended up being able to work remotely in her old job for a while because of COVID.
  • Initially, I was being paid in USD and wanted a bit of a cash cushion to avoid having to exchange currency at inopportune times.

As we transition to part-time work / coastFIRE, this larger cash holding likely will continue. My current plan is to keep about 2 years worth of cash (mostly in CAD) in order to avoid having to sell investments when things are really low, or to convert currency when the rates are bad.

Finally, I’m increasingly leaning towards paying off our house when our mortgage comes up for renewal in summer 2025, so I’m accumulating a bit more cash than usual with that in mind. We have a 5-year fixed-rate mortgage that’s amortized for 25 years. We can pay off an extra 10%, but it’s a closed mortgage, which means there is a penalty if we want to pay it off completely ahead of schedule. (For the Americans out there, all of this is normal in Canada.) Thus, I’m thinking we’ll pay it off when we hit that 5 year maturity mark in a little under 4 years. This would knock 20-25% off our spending, which I really like the sound of.

EQ Bank

I’m currently using two places for these 2-4 year cash holdings. The first is EQ Bank (referral link). EQ Bank is an online only bank here in Canada that has “high” interest savings accounts for both CAD and USD. As of October 2021, the interest rate for CAD is 1.25%, and 1.00% for USD. To transfer in USD, I have to first move it to a US dollar account at a Canadian bank (I use TD for that) but it has been very fast and easy to move money around.

I-Bonds

The second thing I’m doing is buying US Series I Bonds via TreasuryDirect. The current rate is 3.54%, and it’s going up to 7.12% next month (November, for at least 6 months).  I’ve never held I-Bonds before, but they’re tied to inflation and the rates are set for 6 months at a time.  You can’t withdraw for a year, and if you withdraw within the first 5 years you lose 3 months of interest.  You’re limited to $10K per person per calendar year, so I’ve done $20K (for my wife and I) and I’ll do another $20K in January. Depending on where rates are in January 2023, I might do another $20K then as well. This won’t be enough to pay off our house (we’ll owe ~$179K CAD if we don’t make early payments) but it will put a dent in it.

If, like me, you aren’t familiar with I-bonds, here is a good article on how to buy them.

What about you? Where are you currently keeping money you’ll need in the not-too-distant future?

How much optimization should you do?

It’s tempting, of course, to say “as much as possible”. Optimization comes with costs, though. Time, if nothing else. And, for me, it often costs in mood and anxiety as well. If I obsess about optimizing something, it doesn’t make me happy, regardless of the ultimate results of my optimization. Furthermore, in most if not all areas, optimization is a process of diminishing returns.

I tend to be a big believer in the Pareto Principle – namely that you get 80% of the results for 20% of the work. And I think this applies to optimization many times as well. I can get 80% of the way to optimized in a given area with 20% of the work. And to get that last 20%, it can take a lot more work. I have a clear memory of a moment of realization after a particularly grueling bout of middle school perfectionism — I could do like 10% of the work and aim for B+’s and A-‘s, or I could keep killing myself trying to get 100% on everything and never look back. For better or worse, I kept that philosophy all the way through my schooling, a consistent 3.6 student who didn’t work very hard at all.

Three Types of Millionaires

In Quit Like a Millionaire, Kristy Chen proposes that there are three types of millionaires – hustlers (who focus on increasing their income), investors (who focus on maximizing their investment performance), and optimizers (who focus on maximizing their savings). Another way of articulating this would be to say that millionaires tend to try to optimize either their income, their investments, or their savings / expenses. And, in her model, each of these types of people tends to neglect the other two financial areas — so hustlers tend to pay little attention to investment performance and savings, etc. While I recognize that all models are imperfect, I do find this to be a useful approximation of the dominant schools of thought I’ve encountered in the world of personal finance. It also got me thinking about where I fit on this.

What I’m NOT is easy. I am definitely not a hustler. I bristle when dealing with salespeople, and find entrepreneurs unrelatable. Early in my adult life, while teaching English in Taiwan, many of my friends opened schools or taught lots of (high-priced) private lessons. I did neither — I taught my classes, and earned plenty of money, but certainly not as much as I could have. And I knew that, if I were the business owner, I’d be thinking about that business all the time, and I didn’t want that. I wanted to clock in and clock out, and that hasn’t changed. And as my career progressed, I certainly did not always make the choices that would lead to the highest salary. I chose majoring in English over majoring in computer science, and then got into education on top of that. I’ve taken some opportunities over the years, and earn good money (relative to where I started, certainly) but I’ve also turned down opportunities because they felt like they weren’t a good fit, even though they paid better.

I’m also not so focused on investment performance, although I do have a bit of experience with that. In my early investing days I tried picking stocks, and also picking actively managed funds, but I ultimately came to believe the research that says that this is very hard to do reliably. Once my focus had shifted to index funds, I certainly tried to get my fees to be as low as possible. I have also kept an aggressive asset allocation (90/10) throughout. And, over the years, I’ve flirted with taking a more aggressive factor-based approach (which I’ve so far resisted). So, while I wouldn’t describe myself as someone who spends a lot of time researching investments to maximize performance, I do try to optimize my investments in a few simple ways: use tax-sheltered space, minimize fees, and focus on equities rather than bonds. I think this simple approach falls well within a Pareto approach to investment optimization.

Similarly, I don’t know that I’m super-focused on optimizing my savings. My wife might disagree on this one, but one of the biggest arguments against my being a big savings optimizer is that, until we moved to Canada, I have never tracked our spending. Not even a little bit. And I only started after we moved because I had a sense that we were very close to our FI number and I wanted to check. All along, though, one of the big benefits of living well within our means is not having to track where every single dollar goes. This is not how optimizers think. At the same time, I will confess that I am a very reluctant shopper and will spend a lot of time hemming and hawing over purchases. I’m also very willing to spend time travel hacking. Again, I think this falls within the 20% work for 80% reward portion of savings optimization, although the truth is probably more like 50% work for 85% reward.

The Pareto Millionaire

So perhaps there’s a fourth type of millionaire — a Pareto millionaire, who does 20% of the work in all three of these areas (income, investment, savings) which, at least in certain countries nowadays, is enough to get you there. To be clear, I’m not coming out against optimization. If it makes you happy, do it. I definitely get much more joy out of collecting credit card bonuses or re-balancing our investments than many other people would. At the same time, though, when it doesn’t bring you joy, recognize that perfect optimization is impossible, and that good enough is good enough.

What is geoarbitrage?

In brief, geoarbitrage is the practice of living somewhere cheaper in order to accelerate your journey to financial independence. It can be done in the accumulation phase, for example by living in employer provided housing or in a low tax country while earning, or in the decumulation phase, moving somewhere that allows for a lower cost of living.

In terms of my personal experience, I’ve never practiced geoarbitrage specifically for financial reasons, but I have certainly seen the impact that living in different places can have on spending and saving. I lived in Taiwan for 5 years in my 20’s. During this time, I earned about $24,000 USD per year, and I saved about half. At the same time, I lived quite well, traveling around South East Asia, eating out every lunch and dinner at restaurants, and so forth. I didn’t pick Taiwan for economic reasons, but it is kind of in the sweet spot as far as earning potential vs. cost of living.

Later, I lived in China for a year. I was working in a smallish city in central China, and my salary was quite low. I earned about $5500 USD per year. Still, because my employer provided housing and some food, I managed to save about $3000 USD, and that’s with taking two month-long biking and camping trips. Again, my goal in China was not primarily to earn money, but clearly the cost of living there can be dramatically lower. At the same time, I returned to China a few years later for a business trip while working for a US university. I was put up in hotels costing $200 USD per night. It was a side of China I hadn’t even known existed. It really drove home to me that, even within a particular country, there can be a tremendous range of both costs and earning potential.

And then, in 2020, we moved from the US to Canada. Again, this wasn’t a financial decision, but it still had financial impacts. Our taxes went up, but our house was a bit cheaper. I was able to take my job with me, so my salary didn’t change, but when my wife found work in Canada her salary was slightly lower. However, as we transition to part-time work or full retirement, we won’t need to worry about paying for health insurance, which can be quite expensive in the US.

In the future, I think it’s possible that we might live overseas again. I suspect we’ll wait until our daughter is in college (which will be a while) but considering both my wife and I have backgrounds as English language teachers, it wouldn’t surprise me if we spent some of our early retirement living in different countries. I don’t anticipate these decisions to be primarily financially motivated, but it’s good to know that if something unexpected happens and our savings are dramatically reduced, there are plenty of nice places around the world where we would still be able to meet the costs of living. Some places I’m personally particularly interested in are Bhutan, Thailand, Chile and Croatia.

What experience do you have with geoarbitrage? What are some of your favorite places to live?

How do you develop discipline?

This may seem like a strange question for a blog about financial independence. What I’m attempting to get at here is the idea that my first impulse when facing many of the “good for me” things that I need to do in life (financial and otherwise) is to NOT want to do them. I know I should, but I don’t want to, at least not initially.

Take exercise, for example. I exercise almost every day before lunch, typically either running, doing TRX, or using a spin bike. I like exercising, but if I’m honest, many days I don’t feel like it. When it’s time, I think “I could just make lunch and watch something on TV” or something like that. And yet, I almost never skip a workout. How is that?

1. Just do it.

I don’t try to think my way into wanting to do something, I just start doing it. In other words, when I have that thought of not wanting to exercise, I don’t try to think my way to wanting to exercise. Instead, I just put on my sneakers and my exercise clothes and walk downstairs. The whole time, I might be thinking that I don’t want to exercise. I don’t get into an argument with myself about it. I just take the next action towards making it happen.

On a very small scale, I do the same thing with the telephone. I don’t really like to talk on the telephone. So when I have a phone call to make, I don’t try to think my way to wanting to make it. I just start dialing, knowing that when the person picks up, I’ll talk to them.

2. Count it, no matter what.

Another trick I use is to count the thing as long as I start it. I encountered this idea in an article about running — a run counts as long as I lace up my shoes and step outside. I continue to count workouts that same way. Some days, it is much easier to say “well, I’m just going to start and see what happens” than to commit to a full workout. And, if I’m honest, I finish the vast majority of the workouts I start.

I take the same approach with meditation. I often have a voice in my head saying that I don’t have time, or that there’s something else I should be doing, but I just start the timer and sit down, regardless of what my thinking is saying. And I count the session as long as my butt hits the bench.

3. Set yourself up for success, don’t rely on will power.

I don’t think my will power is particularly strong, so I try to make it as easy as possible for me to do the right thing. If I’m trying to exercise, I set up a routine where I do it at the same time every day, and I lower the barriers as much as I can. For me, that means doing it at home (or from home, when I run outside). For others, that might mean joining a group, or committing to a membership.

Similarly, if there’s a behavior that I’m trying to avoid, I make it harder to do. If I’m finding a website to be distracting, I block it. This isn’t irreversible, but it works because it interrupts that first impulse. If I want to eat less ice cream, I don’t keep it in the freezer. If it isn’t in the house, I eat it a lot less.

So what does this have to do with personal finance? I take the same approach there. When I need to cut my spending, or invest more, or rebalance more often, or tune out some bad investment advice, I use the above methods. I don’t try to think my way to wanting to do these things, I just do them, and I set myself up for success (and make failure harder) in whatever ways I can. This can mean automating my contributions to an investment account, automating rebalancing, blocking sites that hype questionable investment or offer tempting purchase, and so on. Perhaps most importantly, it means realizing that I don’t need to listen to the voice in my head. I can hear that voice, whatever it is saying at the time, and still take the appropriate action regardless.

In a way, I regard discipline and willpower in the same way I understand courage. Courage isn’t the absence of fear, but taking the action in spite of the fear. Similarly, discipline isn’t always wanting to do the right action, it’s taking the action even when you feel like not doing it.

As I said, I don’t consider myself to be any great shakes when it comes to discipline or will power. I think folks around me would consider me to be pretty disciplined, though, because of what it looks like from the outside. I use these techniques to get me there.

What works for you? Please let us know in the comments!

Canadian Financial Summit – 2021

The Canadian Financial Summit for 2021 has just started, and all the talks are free for the first 72 hours. I haven’t listened to much yet, but I’m currently listening to the panel discussion on FAQs and Misconceptions about DIY Investing. The initial conversation about the psychological impacts of some of the new mobile-first investing platforms (something I have no experience with) is really interesting.

Check it out, and if you find any other interesting talks please share them in the comments. Thanks!

How do you determine your financial independence (FI) number?

The 4% Rule

If you’re interested in FIRE, one of the first things you’ll likely do is try to determine what your target FI number is. The short answer to this question is to follow the 4% rule. The 4% rule was created in the 90s by financial advisor William Bengen. He looked at historical market returns and determined that, if you withdraw just 4% per year, there was no historical case where this would last less than 33 years. The percentage you can safely withdraw each year is often called your safe withdrawal rate (SWR).

Following this approach, the way to get this number is to take your annual expenses (including taxes, of course) and multiply it by 25. So if you need $50,000 per year, your FI number would be $1.25 million.

Other Opinions

Within the FIRE community, you’ll see some debate around this. Some people think a 4% SWR is too high, believing that the stock market won’t do as well over the next several decades as it has historically. Other people think the 25x expenses target is too conservative, because it ignores the fact that many (if not most) early retirees will continue to earn at least some income during some of the years. It also ignores the fact that, for most people, following the 4% rule will mean ending up with more money than you started with. Sometimes you’ll see people argue that, because of your potential to both reduce spending and earn future income, you can safely “retire” when you hit a certain percentage (say 75%) of your FI number.

I don’t have a particularly strong opinion about any of this positions. Determining your FI number (much like your asset allocation) is a combination of art and science. The science part is basic math, but no one can claim to know exactly what that number should be. And the art part is your comfort with risk. If you’re comfortable with risk, and confident in your ability to either adjust your spending and / or earn more money, retiring with a higher SWR seems totally reasonable. If, on the other hand, you’re risk averse, you may be more comfortable targeting a lower rate.

If you have guaranteed income sources (like social security, CPP or OAS), you can subtract these from your expenses to lower your FI number. Personally, I don’t do this, though. Ignoring these future likely but not guaranteed sources of income is a way to build a bit of a safety net into my plan.

Another area where you’ll find some disagreement is around exactly what you’re taking 4% of. Some people, for example, include the equity in their house. Personally, I don’t do this. When I’m looking at my FI number (or even my net worth, honestly) I ignore home equity. Again, this adds a bit of a cushion to things if it turns out my expenses in retirement were higher than expected, or if market returns were lower than historical averages.

One final note — a 4% SWR is predicated on a certain asset allocation (typically 50% stocks, 50% bonds). If your asset allocation is more conservative (meaning more bonds) you’d have to adjust your withdrawal rate accordingly. Personally, I have always had an aggressive asset allocation (90% stocks / 10% bonds) and I plan to continue leaning in this direction in retirement.

Uncertainty

The important thing to bear in mind with the 4% rule (or whatever metric you use to determine your FI number) is that it is a rough estimate. This is not written in stone. There is a fundamental uncertainty that undergirds all planning, financial and otherwise. And that uncertainty grows the longer term the planning is. So if I’m trying to determine a dollar amount that is “enough” for several decades, it is impossible to avoid a significant amount of uncertainty. For this reason, I wouldn’t worry too much about getting your FI number exactly right. And, from my POV, the 4% rule seems like as good a way as any to get that initial estimate.

How do you buy clothes?

Full disclosure — I am a man who does not care about fashion. That being said, I’m not afraid to spend money buying practical clothes. Here are my favorite ways to get clothes, in order of priority.

In general, I think my attitude towards clothes is similar to my attitude towards other consumables — I don’t want to spend a lot of time thinking about that. I don’t want clothes to add to my cognitive load. Some people deal with this by wearing the same outfit every day. This has always seemed like more trouble than it’s worth to me. I find it very easy to just put on whatever shirt I grab from the closet with whatever pants are most appropriate for the weather. I tend to buy stuff that all matches (earth tones, jeans, etc.).

And my thinking is that I’ll make a series of posts like this, sharing how I approach various aspects of consumption.

Buy Nothing Group / Freecycle

My wife has been an avid user of local Buy Nothing Groups for years, both in the US and in Canada. Buy Nothing Groups are great because they are hyper local and encourage both frugality and environmental responsibility. They typically use Facebook to post items available. If you Google “Buy Nothing” and your town name, you’ll likely find one. In our small town in Nova Scotia (~10,000 people) I see that there was three posts in our Buy Nothing Group today, with 83 this month. There are 245 members. Even in a group this small, we’ve gotten some good stuff, and given away a bunch of stuff. In terms of clothing, my wife got me a garbage bag full of sweaters when we were in Florida, in preparation of our move to Canada. And here in Nova Scotia, she got me a great lined raincoat. Buy Nothing is often particularly good for kids clothes, as they outgrow stuff so often. And it’s also a great way to get rid of things you’re no longer wearing.

Thrift

We have lots of thrift stores here in Nova Scotia, and they are a great place to get shirts. For whatever reason, I have a hard time finding pants at thrift stores, with the exception of athletic shorts. I’m generally able to get all my shirts there, though. When working from home, I like linen shirts or cotton polos for warm days, and sweaters or cotton long-sleeved shirts on cooler days. All of these are readily available at thrift stores.

Gifts

What do you get for the man who wants nothing? I’m a terrible gift recipient. I don’t generally want anything, and if I do want something, I want a very specific version of that thing, which takes all the fun out of picking it out (or so I am told). Because of that, socks, underwear and t-shirts tend to be frequent gifts for me, which is great. For t-shirts, I tend to get solid color shirts that could be warm either as a shirt or as an undershirt, rather than dedicated white undershirts.

Shopping

Sometimes, I need something that I can’t readily get through one of the aforementioned methods.

  • Work Clothes – While in Florida, there was a store at the mall (K&G Superstore) that had a brand of work pants I liked for ~$30 a pair. I’d buy a couple a year. Now that I work from home, I’ve got about 6 pairs that will probably last me until I die since I’ll only use them for work trips. Similarly, there was a Dillard’s Clearance store at that same mall that had a brand of work shirts I liked that, if memory serves, cost less than $10 each. Now in Canada, I can get my shirts and sweaters at thrift stores, and wear more casual pants for work (since I work from home).
  • Shorts and Pants – For whatever reason, I have a hard time getting pants at thrift stores — I range between a 32 to a 34 waist, depending on the fit. Just like with my work clothes, I typically find a type I like and buy them in a few different colors / styles. In Canada, I buy Wrangler jeans and cargo shorts at Walmart, and I also really like their fleece-lined cargo pant for cold days. I have a couple of pairs of each, each probably costing $20-$30CAD, and I replace them as needed.
  • Winter Gear – Moving from Florida to Canada, this was something I needed to buy a bit of in my first year. My approach was to go slow, see what I really needed, and look for deals. In terms of boots, I got a good pair on sale at Canadian Tire. I had an OK winter coat when we moved, but I bought a better one at the end of our first winter, on clearance. In Nova Scotia, you don’t need crazy gear — it’s more about layering and staying dry. We did splurge on ice skates (again from Canadian Tire) but that has been really fun. We do a lot of hiking, but it’s family style hiking, so I don’t need a lot of high performance tactical gear.

Shoes

I’m giving shoes their own section. I spend money on shoes. I don’t spend money on shoes because I particularly like them or care about how they look. I spend money on them because I don’t want my feet to hurt. And, in the long run, I don’t feel that I actually spend THAT much money on them, because the shoes I buy tend to last a really long time.

I like to run, and about a decade ago I got plantar fasciitis. I was lucky, it wasn’t too bad. It was never debilitating, but it took a long time to recover (like 2 to 3 years). Since then, I kind of baby my feet. I also have extremely wide feet (4E) which has made me very loyal to the few brands who make shoes I can actually wear.

In terms of everyday shoes, I’m very much a Birkenstock man. I bought a pair of Birkenstock sandals that I wear as a house shoe. They probably cost $110, but I’ve had them for like 7 years. Similarly, I bought two pair of Birkenstock work shoes (Corvallis and something else, one black, one brown). They cost ~$120 each, but now that I work from home they will probably last me until I die. Oh, and when we moved to Nova Scotia I bought a pair of Birkenstock Chelsea boots that cost ~$300CAD and I expect to have for a decade or more. Everyone here has Blundstones for the muddy spring but they’re too narrow for me.

In terms of running shoes, I overpronate, and I’ve sworn by Brooks for years. I typically buy a pair a year, and they cost ~$120. I switched from Beast to Addiction a few years back, which made them a little cheaper (but certainly not cheap). They were a bit cheaper in America, but this is one area where I’m (mostly) OK not being so frugal in.

In terms hiking boots, I’ve had very good luck with Hi-Tec (an inexpensive brand) and I just got a brand new pair of waterproof Ravus boots for $39 CAD. If I were doing crazier hiking, though, I might need a fancier shoe. I’ve worn them on weeklong backpacking trips, though, and been totally fine.

What is FIRE?

FIRE, as you almost certainly know, stands for Financial Independence / Retire Early. However, I think that definition can be kind of misleading.

In the textbook FIRE model, someone would work, presumably full-time, perhaps also with one or more side-gigs, until they hit their FI number, at which point in time they would stop working forever.

Despite this being the textbook definition, I actually don’t think this is a very common approach to FIRE. Many of the FIRE’d folks that I’m aware of continue to earn money in one way or another. Some are landlords or bloggers. Others sell books or online courses. Still others have hobbies that they have monetized in some way. Please understand — I am not trying to be the retirement police here. I’m not criticizing the behavior, I’m highlighting what seems to me to be a shortcoming in the definition itself.

You may have heard people talk about CoastFIRE or BaristaFIRE. I’ve also seen it referred to as downshifting. Basically, this means working (again full-time, perhaps with side-gigs) until you hit a (lower) FI number. This FI number would be enough so that if you left these savings alone until your full retirement age, you would have enough money. Thus, for the remaining years until full retirement, you just need to coast — earning enough to break even — working a less stressful, less time consuming, or more stimulating job. Despite the fact that this is often treated as a sub-category of FIRE, the sense I get is that most people who “retire” in the FIRE community are actually doing something more like this.

I originally (like, starting in high school) thought my goal was to quit working completely as quickly as possible, but as we’ve reached our (admittedly somewhat arbitrary) FI number, both my wife and I have realized that we want to keep working part-time. We like the intellectual stimulation and the community. And, personally, I tend to do lousy with large swaths of unstructured free-time (even though the voice in my head still tells me that’s what I want). I tend to isolate and get depressed. So I want to ease into it, keeping the structure of work as I figure out other ways to support my mental health.

Plus, I don’t remotely hate my job. I read a lot of stories about people dreading Mondays or feeling stressed out or disrespected. I never feel that way. In fact, if I’m totally honest, I sometimes find myself looking forward to Mondays, because work is a context where I know how to handle most of what comes up and often feel useful. I also have a great boss and really like the people I work with. I also get paid decently (by my fairly modest standards) and am able to work from home.

So here’s how I’m thinking about things:

I’ve been working full-time for almost 15 years. We probably have enough invested now that I could just stop working, but I don’t really want to do that. Instead, I’m thinking about ways I could work differently in order to bring even more work / life balance into my life. At this point, I’m not sure what this looks like.

Possibility 1: Stay in the same (or similar position) but work less hours, either by having a day or two off per week, or alternating weeks on / off.

Possibility 2: Find a different job, perhaps even working full-time, doing something that I was more passionate about.

What it really comes down to is the freedom to choose. I’ve been focused for so long on simply hitting a particular number, that I hadn’t really thought about “what next”. Now that we’re there, I want to make sure I’m transitioning to something, not just away from something. And, again, my point here certainly isn’t to criticize what FIRE looks like for anyone, or to suggest that there is a right way and a wrong way. I don’t even know that for myself yet, let along for anyone else.