The Basics Of FU
Those in the Financial Independence crowd are not new to the topic of FU money. The more I talk to people the more I forget how many people have not only never heard of the term but have no clue what I am talking about. I’m not entirely sure where or who the term was first coined by. The first time I heard it was through Jl Collins post called Why you need F-you money. At that point, my curiosity got a hold of me like a kid getting that new shiny iPad.
Everyone has a little bit different view of FU money and there is nothing wrong with that. To me, FU money is a sum of money that you can access for living expenses in the scenario you have to tell your boss or company to fu** off. Think of it as an emergency fund on steroids.
What FU Money Is Not
It’s not money in a retirement account or other accounts I would not touch today. That means it’s not money in my 401K, IRA, HSA, 529’s, and so on. Some people count money in these accounts as part of their FU money. I personally don’t see the point in that because I would never quit my job knowing I had to touch an account that is meant for the future. Now in dire need would I touch these accounts? Of course, I would but by no means would I advocate for someone to go up to their boss and say FU I quite. Then have to withdraw money meant for their retirement. At best that is putting yourself in a FU**** position.
Benefits Of FU Money
1) It allows you to speak up more at work. I have noticed that I now will speak up more at work when I see something not right. I also tend to be more willing to speak up on better ways to streamline things at work as well. It has opened up a new door for me at work that seems to be paying off with my superiors.
2) It allows you to take on more risk. I have started to take on much more risk after finding FU money in my journey. I have taken on more risk at work doing new tasks I typically would not want to take on. It has allowed me to take on more risk by volunteering to take on new roles at work. I even take more risk in my investing strategy now that I have FU money. I might even say that I’m more confident in taking a risk in relationships due to my FU money.
Does FU Money Make You An AssHole?
Now I want to be clear here FU money has not turned me into an asshole. I am a very firm believer that money in general only amplifies who we are. FU money is no different. If you are an asshole you are one whether you are broke or wealthy. If you are a stand-up person you will be whether you are broke or wealthy. The stigma that money somehow changes you as a person is foolish at best and plain out ignorant at worst. It’s typically those with a victim’s mindset that have these feelings and opinions. Which in any case I am sure we have all seen them before. Having FU money I have been able to ignore these people as I have never seen any value in this type of mindset. In fact, because I have FU money I am able to help more people and take on more risk.
How Much Money Do You Need To Say FU?
This is very much tied to your personal situation. Remember it’s enough money to quit your job and not worry about bills and expenses till you find your next job. How much is that depends on family size, location, career field, debt, and cost of living just to name a few items to consider. Got too much debt? Read my Debt 101 Blueprint. So really I could not give you a cookie-cutter answer here. For me I want it to be two years of expenses that I can touch outside of retirement vehicles. For me currently, that is right around $2,500 a month. Now, this is me living on the beach in San Diego and not changing any spending habits. I could easily cut this back a bit If I wanted too. So my total for 24 months would be $60,000.
Expenses per month – $2,500
FU Money = Expenses x 24 = $60,000
Current FU Money Goals
I actually want to grow my FU money pot in 2018. My bare-bones goal is two years of living expenses in FU Money. I actually have that now in 2020 and some to spare. Currently, I have about $100,000 in my taxable account or about three years of living expenses. Remember this is living on the beach in San Diego. We could easily cut these expenses if we wanted. Of course, this number will keep growing so follow the progress on my Monthly Net Worth Update.
To be frank, I keep going back and forth on having a bigger cash pile or having that money invested working for me. Why because I keep thinking a good REI deal will pop up lol.
Expenses per month – $2,500
FU Money = Expenses x 24 = $60,000
My FU Money
FU Stash 1 – I have $14,000 cash in my money market account. (Again keep thinking of investing a good chunk of this)
FU Stash 2 – $94,169 in a taxable account at Vanguard. Currently invested in VTSAX.
FU Stash 3 – $8,000 Vanguard money market account. This is money I had saved for a possible downpayment on a rental. I have been slowly investing it down in the taxable account.
How Did I Create My FU Stash?
I created this FU stash in about 5 years. Crazy to think as until 2019 I never made more than $55K in a year. My plan was simple yet impactful I would try to hit a high savings rate and invest as much as I can as often as I can. I like to think that plan was executed flawlessly but of course, no one is perfect. Yet my results have been epic, to say the least. I actually just started using M1 Finance (signing up with this link gets you $10) for their fractional share options as this is a great platform for those that don’t have a ton of money to invest. Also, check out my Investing 101 Blueprint. I kept to my plan no matter what was going on around me. When social media, friends, and the news would say sell because the world is ending… I kept to my guns and pushed forward. Remember focus on what you can control not what you can’t.
Remember buy and hold is the winning strategy.
How Does FU Money Feel?
I can’t explain how great it feels to have over 24 months of FU money right now that I can access outside of retirement vehicles. It’s a game-changer in my journey and day to day living. No longer do I have to worry about losing my career even though my career is pretty solid. Mind you it would suck to lose as I am 4 years away from a pension that will cover 100% of my expenses and health insurance for about $58 a month for the rest of my life. It’s a pretty sweet deal.
But for some crazy reason if I did get fired from the military or quite before that pension and we decided not to stay in San Diego we could also move to Guatemala into one of my wife’s paid off Tropical Vacation houses and my FU stash would probably last I don’t know 10 years or so.
FU Money gives me a powerful position in life.
- Don’t like your job? FU
- Hate your dumb boss? FU
- Tired of that dumb project? FU** It
- Want to travel the world for a year? FU** It
- Want to move to another state? FU** It
- Want to quite W2 work and try freelance work? F** It
- Does the wife want to stay home with the kids for 2 years? FU** It
FU Money reminds me of the Hulk It just Smashes everything in it’s way.
FU money has had one of the biggest impacts on me. There is nothing bad I can say about it. If you don’t have it start a plan to get it. If you have it you know the feeling.
Would FU money change your day to day outlook?
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