The Sky Is Falling
Well, everywhere I look I see the sky is falling. It’s kind of crazy that I see it in every financial group I’m part of. Let’s get serious and get honest with this idea that the sky is falling ideology. First thing this is very emotional based and not at all logical. Secondly, those that are claiming this and going nuts seem to have very little education in finance besides the fact that they can post in a group.
Stick To The Plan
I’m literally doing nothing different in these times. As I’m educated enough to fully understand that it’s statistical suicide to think I can time the market. I truly believe every study that has proven over and over again how time in the market is more important to building wealth in the big scheme of things. Has my net worth gone down in the recent downturn of the market? Yes, it has but I’m ok with that because I own the same amount of shares and in fact now I can buy those shares at a cheaper price.
Focus On What We Can Control
Instead, I encourage everyone to focus on things you can control! You can not control how the market will do. Yet you can control your savings rate, your expenses, your debt, and what you invest in. My goal is to build wealth long term so I have the freedom to do what I want when I want. That is accomplished by being very intentional, consistent, and living below your means. This simple advice is boring, easy, slow and that is exactly why most people will not follow it and end up broke living paycheck to paycheck.
Social Media Day Traders
I swear my social media feed is full of a bunch of Wall Street day traders. I see people that have no clue about finances sharing about how the market is down. Want a simple free guide to investing check out my Investing 101 Blueprint. Or how years worth money wiped away in a few weeks. These people have a very unhealthy relationship with money. Yet here they are sharing fear-mongering posts that people who would not know any better might belive and make a dumb financial choice based on a dumb post. The even better ones are the people telling everyone to sell now because it’s going to get worse. Again another person using emotions vs facts to guide them. I’m sure I am not the only one seeing all of this on social media and to be honest, I find it sad. I’d wager that these people will lose money long term, will have to work for many years, and rarely have a financial plan.
The truth is most people don’t have what it takes to build enough wealth and plan to hit FIRE.
Don’t let social media scare you into a bad choice. Don’t just blindly follow what someone says on social media. This is your finances and you should care more about it than anyone else. Don’t take advice from broke people about money as that would be crazy. Instead, put social media away and start creating your future!
This is obvious by everything I see during the small blip in our overall long journey. Most people are just looking to get rich quick. I literally have tons of people messaging me asking me what to invest in now that stocks are cheap. These people will ultimately fail and fail hard. Because they are not planning the long game for their finances. If they where they would not be changing their plans. This slight correction is a great thing. It’s actually a very normal part of our market and happens more often than people think. Actually on average America has seen a recession about every 4 years since the 1900s. On average these last for about 1.5 years. This, of course, is all averages since the 1900s. Could this time be different? Yes, I guess it could be. Yet could it also fall into the average normal occurrence? Yes, it very well could be.
The reality is no one knows how long this will last. The only certainty is we will have another recession someday.
This all has taught me that my plan if fucking bulletproof. At this time I am down over $70K in my net worth. I literally could not give a shit nor does this phase me at all. I am still 100% standing by what I preach. I am still maxing out my TSP (401K), already maxed my Roth IRA out, dumping as much as I can in my taxable account, and have little cash sitting on the sideline. I love using M1 Finance for ease of investing when having less than $3,000 and being able to buy fractional shares! This is the opportunity many of us have been waiting for. I can finally buy great stocks for prices from 2 years ago. This will for sure accelerate my FIRE journey. Once the market bounces back I will have even more shares going up in value increasing my wealth by a Shit Ton! So you see my plan has not changed. I still spend based on what I value. Which ironically has proven to make life even in “HCOL” San Diego incredibly cheap. So I am still able to save most of my income, which I then invest it like it’s going out of style in simple low-cost index funds that match my risk allocation.
Truth be told I don’t need any of my investments to hit FIRE.
Sweet FIRE Hack
Thankfully I decided to stay in my career in the military based on the advantages like the sweet pension and medical benefits. My pension will be about $33K a year if I don’t get promoted from here and health insurance for my family is about $56 a month. My wife and I already spend less than $30K a year living in San Diego so $33K a year is plenty of money. Especially seeing my wife hit FIRE 10 years ago. So you see my investments are just the frosting on the cupcake. Which now talking about cupcakes has me hungry lol. This is what is great about our situation we have made great choices that are paying us dividends and we can see how great it’s working even in the current crisis the world is seeing.
What’s Right For You?
Now, this is why personal finance is well personal. What might be right for me might not be for someone else. My hope is that everyone learns from the current crisis and realizes how to better be prepared for the next one. That their financial future is very important. That having less stuff and more security is always a great safety net. We can’t control everything yet we can control our expenses, savings rate, what we invest in, and how much cash we hold onto. These things are increasingly important in times like these when people are getting laid off. Even high earners are feeling this. The truth is I’m even seeing people in the FI/FIRE community with $100K plus salaries talking about they can only survive a few months on their emergency savings due to their expenses. So even a community built on the core of being different, living on less, having a high savings rate is struggling.
I’m just not sure if these people really ever applied the right foundation to their journey.
Adjust Your Sails In Life
As I type this I am sitting on our table outside our RV and facing the beautiful water understanding how thankful I am for this journey. How I am so amazed by how well my wife has taken all of this. How well we have worked through this crisis even living full-time in such a small space like our RV. How we even got kicked out of one of our spots that we love on the harbor with less than a day’s notice. Yet we adapted to our situation and the other spot we love on Coronado Island let us in and is allowing us to extend past the typical 30 days stay period. The RV lifestyle has still allowed us to be flexible especially in times like this with uncertainty. We could go live in the desert for weeks and have zero issues with this setup. Our finances have allowed us to really take advantage of this situation and allow us flexibility as well. Most importantly our relationship has proven to be unstoppable. Even in times like this, we have done nothing but support each other and still making plans on how to crush future obstacles and planning our exit strategy.
People have been kicking themselves in the ass for missing the 2008 buying opportunity, well now it’s here. Yet it would seem most people, in reality, are not ready for it. They don’t have the foundation they should, they are letting emotions guide them, and fear is paralyzing them. This is the perfect storm for disaster and these choices you make today and tomorrow will have effects on you for years to come.
Take this lesson from this crisis and better prepare your family for your financial future. Pay down your consumer debt that you have put off. Here is a simple Debt 101 Blueprint on how to pay off your debt. Lower your cost of living by getting rid of the extra stuff you want but in reality, it has no long term value and you don’t need it. Downsize your place, cook more at home, get rid of the expensive car for a used cheap reliable vehicle, cut these expenses down. This will free up cash flow that you can then invest, store cash, build wealth and pay down the debt. This is how you build a flexible Independently Wealthy Lifestyle.
Literally, the only issue I have had during this crisis is due to my career and not being able to choose to stay home because I still am trading my time for money. I can’t wait for that to change and I can see the light at the end of the tunnel. There is also the chance of us getting kicked out of this RV park as well. Again the issue is with my career I have to go to work and also with my career even if I put in vacation time we have to stay in the local area. We have a few backup plans for this with other RV places that are not ideal for us due to the location they are not that nice but are cheap. Worse case we can always rent an apartment or motel for a while if it comes to it. Even with that, there are no issues with us being able to afford any of this. Even if I stopped getting paid which won’t happen we would be fine for months if not years.
Fortified Financial Castle
That is because I have built my foundation for my financial journey. I have very little debt that I choose to keep. Our living expenses are very cheap and I don’t see that changing much. Finally, even with the market going down I still have about 6 years worth of investments I could slowly sell-off to live on. All of that is not even considering the nice cash flow that I have every month after all expenses. I have put in place multiple fortified walls to my Kick-Ass Fortified Financial Castle!
You see I have been slowly building this Bad Ass Castle for about 4-5 years. At first, I was not serious about building it, then that all changed at the end of 2016 and I took the journey head-on. It’s been one fucking wild ride, to say the least. I can’t wait to see where these current choices of living-full time in the RV, Investing when everyone is freaking out, and the most important Marrying my wife Pauline takes us in this epic journey. Who by the way is super hot and incredibly smart! She can speak five languages and has a Master’s Degree which is just a few of a plethora of her unique and amazing qualities. She truly is my superpower.
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