\r\n
1. Can you give us a little background of who you are, what you do, and how you became interested\u00a0in personal finance? How did you discover the idea of financial independence?<\/strong><\/p>\r\n I am a 42 year old female, married and live just outside of Toronto, Ontario. I currently work in the\u00a0public sector (last 11 years) but also worked in the private sector (IT industry) for 9 years. I\u00a0immigrated to Canada with my family when I was 10 years old and all we had to our names were a\u00a0few suitcases. My parents struggled to learn English and adjust to a new country, and as a result\u00a0had low income paying jobs until they retired at 65. Now that I think back, we would probably be\u00a0considered borderline poor by today\u2019s standards but at the time I was clueless to this fact and had a\u00a0happy childhood as an active kid playing sports. My interest in finance started in my late teens but it\u00a0was geared towards owning real estate. Although I didn\u2019t have any guidance from my parents, I was\u00a0a very inquisitive teenager and sought out information on my own.<\/p>\r\n I learned about the value of money early on in my life when I got my first job at age 12 delivering\u00a0flyers so that I could pay for a week long tennis camp. Unfortunately, the concept of financial\u00a0independence didn\u2019t enter my mind until my mid-30s. This is about the time that the FIRE movement\u00a0hit mainstream media and I stumbled upon the Mr. Money Mustache blog. The FI spark ignited in my\u00a0brain when I read The Shockingly Simple Math Behind Early Retirement<\/a> blog post. After binge\u00a0reading all of his blog articles over a few days, I started thinking differently about money. I shifted my\u00a0thinking from viewing money as a survival tool to viewing it as a freedom attaining tool.<\/p>\r\n 2. When in your journey did you realize financial independence\u00a0was actually possible?\u00a0 Was that the\u00a0original goal at the beginning?<\/strong>\u00a0<\/p>\r\n I realized that FI was actually possible when I learned about the 4% rule and ran my numbers in my early 30s. Although I don\u2019t plan to implement this particular strategy in my early retirement, I think it\u2019s a great starting point to get an idea of how much one has to save and have. Because I am a very frugal person, I was very surprised at how little I needed to have. Once I gained more knowledge about FI, I focused my efforts on getting my expenses down as opposed to increasing my salary. Because of my frugal lifestyle, I predict my yearly expenses in retirement to be anywhere between $21,000-$23,000 (to keep things simple, I won\u2019t include my wife\u2019s numbers as we keep our finances separate for the most part but our FIRE life will be mainly funded my stash of various investments).<\/p>\r\n 3. To help put things into context; if you are comfortable sharing some numbers, what is your<\/strong>\u00a0savings rate, FIRE number, net worth, salary, how many hours a week do you work, etc?<\/strong><\/p>\r\n Love sharing my numbers as long as I stay anonymous \ud83d\ude09 and again these numbers do not include my wife\u2019s savings\/investments.<\/p>\r\n My savings rate is not a simple answer because I support my retired parents by paying the mortgage\u00a0on the house that they live in (and have done so for the last 11 years) as well as a few other\u00a0expenses that they cannot cover. I also bought them cars in the past and cover any major expenses\u00a0that come with home ownership. So considering that, I am still able to save 44% of my net income\u00a0(salary only, excludes dividend income).<\/p>\r\n Based on my vaguely predicted expenses in retirement of $23,000\/year, my FIRE number is $575,000.\u00a0Although I surpassed this amount several years ago, I still plan on working at my full time job for the\u00a0next 6 years because I have too many unknowns in my future when it comes to the cost of supporting\u00a0my parents and I like my job. My net worth is approximately $1.24 million. This includes two real estate properties (approximately 42% of my net worth) which will be sold when I quit my job, my work pension (approximately 23% of my net worth) which I plan on cashing out, stock investments (approximately 29% of my net worth) and cash (approximately 6% of my net worth). As shown, most of my net worth was attained through real estate. I love renovating homes to increase their value and have sold 4 homes in the past. I was also very lucky to have owned several homes in Toronto over the last 18 years and as you know, that real estate market went sky high; I greatly benefited from that. But over the last 5 years, I shifted some of my real estate money into the stock market. It\u2019s become impossible to get any good deals in the GTA, and my renovation expert side-kick (my dad) is in his 80\u2019s and retired from swinging the hammer.<\/p>\r\n Yearly salary (gross) is $115,000<\/p>\r\n Yearly dividend income is approximately $16,050<\/p>\r\n I currently have a challenging but very fulfilling job that provides great health benefits, a defined benefit pension plan, a 7am-3pm, Monday-Friday schedule and lots of vacation time. I work 35hrs\/week and have the option to work overtime (which I mostly turn down these days because living a balanced life is more important to me then a bigger paycheck).<\/p>\r\n 4. Do you feel deprived?\u00a0 Do you feel like you are sacrificing and missing out on life?\u00a0 How would\u00a0you say your mindset has shifted throughout your FI journey?<\/strong><\/p>\r\n I definitely don\u2019t feel deprived, in fact most times I feel spoiled. I\u2019m in good health because I have the time to be very active, and eat healthy. I prepare\/cook 95% our meals at home and participate in activities that relieve stress. Luckily for me, a lot of the activities that bring me joy are either free or cost very little such as hiking, biking, back country camping, canoeing, tennis, X-Country\/downhill skiing, gardening, building stuff\/renovations and traveling. Most of our travel is done by utilizing our SUV as sleeping quarters or camping instead of renting expensive hotel rooms as most of our time is spent exploring the outdoors. We are both nature lovers and prefer to spend majority of our time playing in sun or snow (we\u2019re not picky).<\/p>\r\n Since 2014, my mindset became primarily focused on accumulating and investing as much money as\u00a0I could to reach FIRE as soon as possible (I didn\u2019t have my dream job back then). I still have this\u00a0mindset today but not to reach FIRE (because I already have) but more to challenge myself to\u00a0achieve personal\/financial goals. I like to set goals because I enjoy chasing the carrot and catching it;\u00a0I get a sense of accomplishment and can move onto the next challenge in life.<\/p>\r\n 5. What do you spend your money on and what don’t you spend your money on? Do you use a\u00a0budget?\u00a0 Do you track your expenses?<\/strong><\/p>\r\n There are so many things that I don\u2019t spend my money on that the list would be too long to mention\u00a0but I guess some of the \u201cnormal\u201d things that most people spend their money on that I\/we don\u2019t are:\u00a0makeup\/beauty products, jewellery, cable TV\/landline phone, eating out, meat (we are both\u00a0vegetarians), brand new fancy cars, professional sporting events, all-inclusive vacations and\u00a0essentially any trendy\/brand name items (we stick to the generic\/no name brands).<\/p>\r\n Most of my materialistic and foolish spending was done in my 20\u2019s and over the years I accumulated\u00a0all of the sporting and camping equipment that a sporty\/nature loving girl like myself can dream off. I\u00a0also have enough clothes\/shoes to last me the next two decades (no I am not kidding) and aside from\u00a0spending extra money on our 2 dogs, most of our expenses are for day-to-day living costs.<\/p>\r\n I don\u2019t use a budget and never have, I also don\u2019t track expenses because it\u2019s too tedious for me and\u00a0since my expenses are mainly fixed, there is no need to track them. I am a natural saver and\u00a0generally dislike shopping so over spending is never an issue for me. I always pay myself first by\u00a0putting away $1200\/month into my investment portfolios and any extra cash that is left over for the\u00a0month, I put aside in hopes that the market will crash at some point and I will be able to pounce on\u00a0the deals.<\/p>\r\n 6. What is your investment strategy? Do you invest in mutual funds, index funds, dividend growth\u00a0stocks, real estate, other businesses, etc.?\u00a0 Has your investment strategy changed over the\u00a0years?<\/strong><\/p>\r\n Aside from my real estate investments, my stock investment strategy changed over the years. This is\u00a0due to losing a lot of money after I started to day trade hoping to make a quick buck or $10,000.\u00a0Back in my mid-20s when I was a na\u00efve and an inexperienced investor, I jumped two feet into day\u00a0trading because I made some money on a few risky trades. But the market wasted no time in\u00a0chewing me up and spitting me out when I started investing in mining companies, oil, and trending,\u00a0one product companies like GoPro and Digital Ally. Needless to say, I lost money, a lot of money\u00a0(over $100k in just a few years, no I did not accidentally type an extra zero, I wish). But despite my\u00a0big losses, I never gave up on the stock market; instead I hit the books, watched a lot of YouTube\u00a0videos and read a lot of finance blogs to educate myself on how to successfully invest for the long\u00a0run.<\/p>\r\n Today, the bulk of my stock market investments are in dividend paying stocks both US and Canadian\u00a0companies with a sprinkle of 2 US ETFs. I hold no bonds, mutual funds or GICs currently.\u00a0<\/p>\r\n My strategy for generating money when I\u2019m retired is purely from dividend payouts. I love this\u00a0strategy for 5 main reasons.<\/p>\r\n 6. If you could go back in time and change things, what would you have done differently?<\/strong><\/p>\r\n Oh boy where do I start? How about staying away from day trading when I knew nothing about the\u00a0complexities of the stock market. I also should have held onto my AAPL, FB and MSFT shares when\u00a0I bought those about 6 years ago and sold them way too early for a tiny profit. Unfortunately I\u2019m not\u00a0a very patient person and struggle with just sitting on the side lines and waiting for growth. As I get\u00a0older though and hopefully wiser, I\u2019m learning that some things require time to grow and I see that in\u00a0my dividend stock investing strategy. I still consider myself an active investor though and love to\u00a0research and carefully pick undervalued individual stocks for my portfolios on a regular basis. I check\u00a0the markets daily and always look for buying and selling opportunities.<\/p>\r\n If I could change only ONE thing, I would start investing in the stock market at a much younger age\u00a0because the greatest wealth creating strategy is compounding and the main factor in that strategy is\u00a0time<\/a>.<\/p>\r\n 7. Has discovering financial independence changed how you view your job and life overall?\u00a0<\/strong><\/p>\r\n Discovering FI has not changed how I view my job or life overall but REACHING FI has definitely allowed me to be more relaxed at work and in life because I no longer have the stress of being stuck\u00a0somewhere that I may not want to be at and I know that I can easily take care of my loved ones. My\u00a0ultimate goal in life is to have freedom because that is what truly brings me happiness and peace.\u00a0Being FI gives me that freedom and there is no better feeling then having choices and opportunities\u00a0just because I have \u201cmoney in the bank\u201d.<\/p>\r\n 8. Do you take advantage of tax advantaged accounts offered to you?\u00a0 If so, which ones and how\u00a0so?\u00a0 Do you have a game plan to be able to withdraw from these funds without getting hit with a\u00a0penalty?<\/strong><\/p>\r\n Living in Canada, I definitely use ALL of the tax advantage accounts that the country has to offer.\u00a0Here is a breakdown of what I keep in each account (and why):<\/p>\r\n My game plan is to live off my dividends from my non-registered and TFSA accounts indefinitely. As\u00a0for RRSP, I will slowly withdraw the funds starting at 65 but take out small amounts each year to\u00a0minimize my taxes. Due to having a pension plan, my RRSP contribution limits are much lower than\u00a0the $26,500 limit for 2019. I will only have about $130K in my RRSP account at age of 65 so\u00a0withdrawing that amount over 20+ years shouldn\u2019t affect my tax rate too much.<\/p>\r\n 9. As a Canadian pursuing FIRE, what are your post-FIRE thoughts\/plans regarding health<\/strong>\u00a0coverage?\u00a0 As a reference, what do you currently pay annually or monthly for health related<\/strong>\u00a0costs? What do you estimate your post-FIRE health costs to be per year?<\/strong><\/p>\r\n Luckily for us, the Canadian health care system was built around the principle that ALL citizens are\u00a0guaranteed access to hospital and physician services \u201cfree\u201d<\/em> of charge because\u00a0our health care\u00a0system\u00a0is publicly financed through taxes. Because the health care system does not cover “supplementary” benefits, like dental care, most vision care and drug coverage, these are the future\u00a0expenses I only have to worry about (note at as a Senior citizen, some of the supplementary benefits\u00a0and drugs are covered).<\/p>\r\n My approach regarding health coverage for these supplementary benefits is a non-conventional one.\u00a0First, I pro-actively want to minimize the chance of future health issues by exercising, eating healthy\u00a0and living a healthy lifestyle. Second, I plan to put aside a small amount of money now while I have a\u00a0company sponsored health plan for the next 6 years, then use that stash of money to either cover a\u00a0supplementary benefit expense (if need be) OR use that money to purchase a private health plan\u00a0when I hit 55. Currently my work covers all health related expenses including all of the\u00a0supplementary benefits. This is another reason why I want to work for another 6 years. I haven\u2019t\u00a0looked into the costs of a private plan yet as the numbers will definitely change in the next 10-15 years.<\/p>\r\n 10. Where do you see yourself in the next year, 5 years,10 years?<\/strong><\/p>\r\n I don\u2019t see much changing in the next 5 years as I truly enjoy where I\/we are in our lives right now. In\u00a010 years though, we hope to be living in British Columbia somewhere in the mountains that will allow us to have a big piece of land with a small custom designed house (perhaps a house build out of\u00a0shipping containers that uses solar power). It\u2019s important to us to be surrounded by nature where we\u00a0can easily enjoy all of our outdoor activities with our dogs. I would love to volunteer at an animal\u00a0shelter or better yet be a foster home to abandoned dogs\/cats.<\/p>\r\n 11. Have you come out of the FIRE closet yet? Meaning, do your friends, family, co-workers etc. know\u00a0about your financial independence goals?\u00a0 If so, how did you bring it up and what were their\u00a0reactions?\u00a0 If not, why not?\u00a0 Why do you struggle with this conversation and why do you feel that\u00a0money such a taboo topic?\u00a0\u00a0<\/strong><\/p>\r\n I have not, partly because I am a very private person but mainly because when I do start talking about\u00a0what FIRE is and that I\u2019m trying to reach it (I don\u2019t tell that I already have and that I\u2019m a closet\u00a0millionaire), I get looks like I\u2019m going to miss out on life and get the argument that it\u2019s impossible to\u00a0save money in today\u2019s world. Just to put things in perspective, I\u2019m surrounded by co-workers that go\u00a0out for lunch every single day and often have takeout for dinner and when I told them that I ride my\u00a0bike to the local library on a regular basis they looked at me like I was from another planet. As for my\u00a0friends, which I love dearly, some spend their money because of FOMO (fear of missing out on life),\u00a0others spend their money to keep up with the neighbours and some like to spend their money on the\u00a0new shiny things. Although, there is absolutely nothing wrong with any of these spending habits, they\u00a0are all opposite of what I believe in and value. Surprisingly, this completely different way of thinking\u00a0has not created any friction between my co-workers or friends and I; perhaps because I\/we live in our\u00a0own little FIRE bubble and don\u2019t care how others chose to spend their hard earned money.<\/p>\r\n 12. What pieces of advice would you suggest to someone who is just starting out or someone who is\u00a0working toward reaching financial independence?\u00a0<\/strong><\/p>\r\n I can\u2019t say this often enough but start saving and investing as early as possible, even if it\u2019s just $20 a\u00a0month, compounding will take care of you in the long run. Secondly, knowledge is power! With all\u00a0the free content that is available on the internet and libraries, there is NO excuse for not educating\u00a0yourself about finance and other things. Lastly, the path to FI may seem long, daunting and\u00a0unreachable initially but once the ball gets rolling, things pickup quickly due to the snowball effect.\u00a0Don\u2019t get brainwashed by societal norms\/expectations or what others around you are doing; instead\u00a0figure out what is important to you and your family and focus on that.<\/p>\r\n 13. What has been your greatest accomplishment to date?<\/strong><\/p>\r\n My greatest accomplishment thus far is that I attained a financial position that allows me to support\u00a0my parents monetarily. My parents (especially my mom, the rock of the family) sacrificed a lot to give\u00a0me a better life. Not once did she complain about her life (which wasn\u2019t easy) and if it wasn\u2019t for their\u00a0hard work and perseverance, I wouldn\u2019t be where I am today. I\u2019m also blessed to have a lot of free\u00a0time to spend with them because time is something that no money in the world can buy.<\/p>\r\n Another amazing interview in the books! \u00a0How’s that for our first Canadian interview? \u00a0For those new here, Martina is essentially my sister from another mister. \u00a0We are pretty much on the exact same wavelength (and oddly enough we have a lot of the same furniture\/decor in our homes), except she and her wife have 2 dogs and we have a little human monster. \u00a0We constantly chat about properties in BC, tiny house companies we’re digging, and a grand master idyllic Walden-esque plan to start a tiny house community someday in a forested area in BC where like minded individuals could call home (one can dream!). We are very excited to finally meet Martina and her wife when they head out west to Calgary in March \ud83d\ude42 Let’s go over some highlights:<\/p>\r\n <\/p>\r\n","protected":false},"excerpt":{"rendered":" Welcome back FImily to the next installment of the FIRE Community Interview Series! For anyone new here, this interview series will cover people within the …<\/p>\n\r\n
![\"\"](\"https:\/\/i0.wp.com\/modernfimily.com\/wp-content\/uploads\/2019\/12\/Screen-Shot-2019-12-08-at-9.00.25-AM.png?resize=563%2C436&ssl=1\")
<\/li>\r\n![\"\"](\"https:\/\/i0.wp.com\/modernfimily.com\/wp-content\/uploads\/2019\/12\/Screen-Shot-2019-12-08-at-9.03.02-AM.png?resize=566%2C363&ssl=1\")
<\/li>\r\n<\/ol>\r\n\r\n
\r\n
\r\n
\r\n
\r\n\r\n
\r\n