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A short history of my personal FI success

A short history of my personal FI success

My foray into personal finance started when I was 18 and dirt poor & living on my own. In the 90s buying clubs like Columbia House (hah! Remember them?) and Book of the Month Club were all the rage and like a fool, I was a member of both of them. But as fate would have it, one of the books that I received was The Tightwad Gazette (TWG) II. When I got it I read it cover-to-cover and then I read it again. Despite the fact that these mail order clubs were pretty awful, I probably have benefited more financially from stumbling across that book than from anything else that has happened. It lead me down a road of seeing that there was a different way of living and it gave me the power to understand that I had control over my money. Eventually I bought both TWG I & III as well as Your Money or Your Life (YMOYL), which is the book that had the most impact on me during my 20s and 30s.

Before the FIRE (Financial Independence/Retire Early) movement with its stoicism and side hustles by tech-based workers & other high-income adherents, there was Joe and Vicky. Their vision of the for financial independence (FI) movement was one of simple living and community. Their ideas were about resource management not just for the accumulation of cash but also concerned the environment & leaving the planet a better place. It was a vision for a better world and it spoke to me. Although I have enjoyed some of the FIRE blogs over the past 10 years, I have been embedded into the YMOYL vision of FI and have found that the bootstrapping, solitary goal of accumulating money of most FIRE bloggers has struck me as mostly empty. Of course, there are those who have a larger vision but they don’t seem to be the ones screaming the loudest.

Of course, you may be thinking, “Well Tucker, learning about all of this by 20 certainly didn’t help you to retire early! You worked until 3 years ago!” While that is true, it is also missing the larger picture, which is the one of independence, or having the freedom to make different choices. By learning to be good with my money it has given me the option to make decisions that I may not have been able to make had a lot of debt or lived a large lifestyle. Here are some things that FI knowledge has given me:

– After being laid off from my well-paying corporate job I was able to join a government-sponsored small business training program that lead me to owning an eco-friendly cleaning business in my early 30s.
– After listening to my mother, I bought a condo downtown for $115k when I was 24 years old with a $5000 inheritance I received (full disclosure she co-signed the mortgage). After a couple of years I was able to remortgage & used the money to pay off my student loans (the difference was 6.5% a year!).
– After I became a parent, being frugal allowed me to stay home with my kids until they were 2 & 4 years old.
– I went back to work when it looked like Mr. Tucker’s job situation looked tenuous. But we were still able to live off of one salary.
– When I went back to work I was able to take contracts from September – May and stay home with my kids over the summer (I would have worked but student programs generally filled those jobs during those months).
– Going back to work allowed us to spend a month in Puerto Rico in 2014 & not have debt long-term.
– Saving up a huge down payment for our house allowed us to take on a smaller mortgage than we would have. We are now looking to pay this off by 2023.
– When I was diagnosed with Primary Lateral Sclerosis the waiting period for sickness benefits with Employment Insurance was a month & only lasted 12 weeks. The waiting period for my Disability Insurance to kick in was 13 weeks! Having savings & having an emergency budget for when money got tight helped us not use credit to see us through.
– Being disabled can be expensive: having a doctor fill out my forms just to apply for my benefits was $45 each time. I have great medical insurance but it only pays a portion of my mobility device costs.
– Because we wanted to travel when the kids could be pulled out of school and my mobility was still good, we are frugal in our daily lives but have visited many countries, were able to go to Disney (twice!) and Universal and are able to rent cottages with friends in the summer.

All in all, my FI knowledge, ability to switch into a tight budget, and our savings rate have all contributed to our lifestyle. Between graduating from university & my diagnosis I have worked full-time only about 10 years & the rest were part-time or were the years I was a stay-at-home-parent. We don’t have a basement full of stuff (but if you enjoy that kind of thing, more power to you), we only got a car when the eldest was around 1, we cloth diapered, we reused everything, ate a lot of beans, and didn’t buy a lot of things we didn’t need. But we did want to travel, our kid’s university savings accounts are well-funded and our retirement accounts are doing well. We also have a ton of friends in our community and the kids and the adults all have hobbies that they enjoy doing.

Overall, this is the definition of FI success to me. We don’t live life on autopilot but instead make concentrated decisions of how we want to spend our time & money to live the life we want. It’s part luck, part good choices but also making great friends, having the support of our families, and having fun hobbies to sustain us. We have even loftier goals for the next three years but more on that later!

The Three Year Plan

The Three Year Plan

When I was diagnosed everything became about LIVING FOR THE MOMENT. We wanted to do as much as possible while I was still mobile. Since we had not traveled as much as we would have liked we started there. Two years in a row we took whirlwind trips with the kids making sure they had these memories to fall back on should my decline be rapid. I don’t regret the decisions we made & we had the money to cover it so it was a net positive for our family. Two years later and my mobility has only slightly decreased, we are less panicked, and in the midst of the pandemic the smoke has cleared on a lot of our previous behaviours.

Like a lot of people though, we’ve really been able to reflect on things during the pandemic. If there is one thing we’ve become good at seeing, it’s our own patterns of behaviour. Because things have slowed down so significantly we’ve been able to finally see what needs to be changed. One of the things that has really stood out is our feast-or-famine spending style.

When things are going really well at Mr. Tucker’s work his attitude is, “Jeez, I could work here forever!” We tend to let the good times roll & spend a lot more money on extras. Then when he goes through a particularly difficult time at work we remember that if we saved more, he wouldn’t have to work forever. It’s our pattern and it’s been like that for a long time. This feast-or-famine way of managing money has worked because we never overspend but it still has left us spinning our wheels with long-term goals.

So in November we decided to sit down and plan out what we’d like to do & then we came up with a 3-year plan to achieve our goals. Here is what our list looked like:

– Finally do a will and get our estate affairs in order
– Fully fund the kid’s RESPs (Registered Education Savings Program) & buy back the missing years in order to receive the $1000 grant
– Start & catch up with the RDSP (Registered Disability Savings Plan) so to get the full $1000 grant

…and the biggest one of all:

– Live off of my income for everything and put all of Mr. Tucker’s income into his RRSPs (Registered Retirement Savings Plan)

That really is the biggest goal of them all: living on one salary for everything is a huge undertaking for us. It means we are budgeted really tightly down to the dollar with very little wiggle room. It still covers all of our needs (food, shelter, bills), many of our wants (camps, music lessons, entertainment), and all the other savings I mentioned above (and some I didn’t, such as emergency savings). We will still go to the cottage every year on vacation and still keep our hobbies but we will actually have to stop and think of spending now instead of living on autopilot. Spending in one area means that it will have to come from another place so it forces us to make decisions as to what we really want.

So why would we choose to do this? Because if things go well we can pay off our house & Mr. Tucker can retire from paid work if he wants in 3-3.5 years. That’s huge. It doesn’t mean he will retire from paid work, it just gives him the option.

One of the things about being disabled that is always on the forefront of your mind is what your trajectory will be 1, 3, 5 etc…years from now. I don’t know the future but the reality is that every day I have will probably the best day I ever will have. The other reality is that our parents aren’t getting any younger and will probably need more assistance as the years go on. Sure, we have siblings who can help as well but we really didn’t want Mr. Tucker working a high-stress job with long hours, parenting two teenagers, caring for a disabled wife, AND having to go check in on our elderly parents. We wanted to set ourselves up so that if he had to take a leave of absence, he could without having to worry about our finances.

Of course, we don’t expect that our plan won’t be without its hiccoughs but these hiccoughs will happen whether or not we are saving towards our goal. We also fully suspect that we may need to make changes down the line, which is also fine. We are totally flexible and can review how things are going a few months down the road & adjust where necessary. Still, we are both happy to have sorted a lot of our financial life out and are looking forward to seeing how well we can do on our current plan. I will keep you updated!

Meal Planning

Meal Planning

A interesting video series on inflation from PolicyEd The Numbers Game.

Since reading the Tightwad Gazette books starting when I was 18, I have been a huge fan of Amy Dacyczyn. Most of my financial and housekeeping skills have come from her books and I have read and re-read my copies so often that they are yellowed and falling apart. For the most part, she hasn’t steered me wrong (although, she was wrong about computers not becoming a big deal. No one is perfect!).

Because of this, I have been using “The Pantry Principal” my entire life: buying groceries to replenish my pantry as opposed to making a list of meals and then going out to buy the items on the list. The idea is that you only plan dinner for the next day the night before using anything in your fridge that may go bad. It’s sound logic. The problem is that we ultimately would forget to plan the day before and find ourselves staring at the fridge at 5pm wondering what we could possibly make. Inevitably this led to more take-out or crappy beige food. Food waste became an issue and naturally we were bleeding money.

Conversely, I have a friend who meal plans weekly. She uses the stuff they have on hand and then fills in around the edges with a grocery store run every week. All her take-out is planned and she rarely finds herself at 5pm digging for a frozen pizza. Pre-Covid, this worked especially well because she could see what the activity schedule was for the family and plan easier meals; sometimes it was even PB&J and carrot sticks in the back of the car on the way to hockey practice. But it still wasn’t fast food. She also seems to have a lot less food waste.

Of course, with the pandemic we are trying to limit trips to the store which means having to be better planners. Since we can’t just run out whenever we want, we’ve really tried to reduce our trips to one Costco run (medications & bulk), two produce store runs (fresh fruit and veg), one grocery store run (sauces/grains/milk etc), and one pharmacy run a month. This meant that I needed to work around our shopping schedule.

This past year we started buying local meat in bulk. We also started our first garden and canned a lot of food for the winter. This reminded me that The Tightwad Gazette had a really good inventory system to track garden produce so they wouldn’t eat too much of something and run out before garden season ramped back up again. Using that as a guide, I started tracking all of our freezer & canned goods to make sure we would spread their use to get through until the next bulk order was coming through.

So guided by my freezer and pantry inventory I came up with a plan. Every second Saturday I go through the inventory and plan our meals for the following two weeks. Mr. Tucker hits the produce store and buys all the veggies and fruits we need for that time. It may sound like two weeks is a long time and that food would go bad but not if you plan it right.

The key is to organize meals based on the life of the produce. So the first week may have a lot more salads, bean sprouts, green beans, as well as bananas and berries for snacks. The second week will see more apples, oranges, brassicas and root vegetables on the menu because they don’t go bad as quickly. Planning this way allows you a variety of foods in your diets but without the extra grocery trips.

Of course, the best laid plans means that sometimes we have way too many leftovers that not even lunch the next day will take care of. In that case, we just skip a meal. In fact, we didn’t have a Christmas dinner this year because we had too much food leftover from Réveillon! Every Christmas eve our family does small food (hors d’oeuvres such as mini quiches, sausage rolls etc) and a tourtière. Well, this year we miscalculated and ended up with way more food than we could eat in a night. So the next day Mr. Tucker and I decided to skip the ham dinner we had planned and just eat leftovers. We ended up making our huge meal on the 26th instead. So when that happens, you can just push meals off to the next day. At the end of the two weeks you will end up with a> a brassica which will either keep or that you can freeze, b> a root vegetable which keeps a long time, c> or you just move the last meal from this two week period to the first meal of the next two week period.

I know this sounds like much ado about food but honestly, this has been a game-changer for us. We haven’t eaten out since November, we are never left staring at the fridge wondering what to make, we waste less food, we don’t make unnecessary trips and our grocery bill has gone down. In the end, I needed to realize that even the best ideas from people I trust may not be right for me and my family. I wish I had realized sooner that this was a better way to plan meals. I guess like many things we’ve learned over the past year, it only took a pandemic to make me realize that I needed to switch things up.