Financial Independence Interview-Our Next Life
It’s time for another fun filled adventure in our financial independence interview series and today we have Our Next Life. The more I read about ONL, the more I love their site, from the design to the articles to when they favorite a tweet on my Twitter page.
I’m not here to ruin the interview or anything but I like to pay very close attention to those in the final stages of retirement and to me 2 years away is just around the corner. I also need to check out the book they recommended and they forced me to google what an R-Pod is. I relate very much to Our Next Life as I am in my 30’s with plans to use rental real estate as part of my financial independence plan, finally someone else is out there doing it too!!!! With all of that award winning introduction, I give to you Our Next Life.
Who are you and tell me about your reason for setting a goal of FI?
Hi Even Steven! Thanks for having us! We’re Mr. and Ms. ONL, a mid-30s married couple living in the west who is on track to retire in just over two years. We moved from the big city to the mountains to indulge our outdoorsy passions, though while we’re still working, we don’t have nearly enough time to really enjoy them.
We both defaulted into high-pressure jobs pretty much right after college, and have been in them ever since. Somewhere along the line, we both realized that we couldn’t go at this pace forever, but given that we’re paid more than we need to get by, we decided to aim for FI instead of finding different career paths. We figured out that, nice as the trappings of money and success can be, we don’t need them, and what we DO want from life isn’t something we can do while holding down full-time jobs — namely, climbing lots of mountains and going on extended adventures.
Who got you started and who motivates you on your Financial Independence journey?
Some of it we figured out on our own, though our plans were heavily informed by Robert and Robin Charlton, and their great book How to Retire Early, one of the best, unheralded resources on FI that’s out there. We’re not frugal by nature (we call our 20s our “baller years”), and have had to change our ways, ultimately settling on a strategy of paying ourselves first that’s about as multifaceted as can be, but works incredibly well for us.
The ticking clock is our motivation to hurry up and retire already. So much of what we want to do in early retirement is stuff we won’t be able to do forever — climb high altitude peaks, cycle long distances, ski big lines… all stuff we need to be able-bodied to do — so we’re fighting hard against aging. Working the way we do now, with tons of travel and work often consuming part of every weekend and most evenings, makes it super hard to stay as active as we’d like to be. Whenever a day passes when we haven’t gotten our heart rates up, we regret it. But we let that regret motivate us to work that much harder to save up for FI!
What is your Why?
This great big beautiful world of ours. There’s so much of the world we want to explore, especially those out-of-the-way spots that require a several day trek to see them. Even retiring by ~40, we know we won’t be able to see everything we want to see — it’s a long list!
Do you have any debt? If so do you have a plan to pay this off before FI?
We’ve had debt in the past, but now our only debt is the mortgage on our home and the mortgage on our rental property. Both are super low-interest rate 15-year mortgages, and we make just the standard payments on the rental. But we do plan to pay off the house before we retire early, for two reasons: 1. We want the psychic boost of having our house paid off as we head into retirement, 2. We have crunched all the numbers, and would rather trade a small and negligible tax write-off on the mortgage interest for the much larger benefits we’ll get by not having to have that much income in retirement, namely much lower income tax and much larger Obamacare subsidies.
What planned income streams are you working on towards FI and Early Retirement?
Short answer: Taxable index fund investments through Vanguard, rental income and 401(k) investments. Long answer: We’ve got a pretty detailed plan that maps out how we’ll rely on different income streams more and less at different times. We plan to live a little more cheaply for the first ~20 years or so of FI, when we can handle crappy travel accommodations like hostels, and don’t mind camping, climbing and skiing like dirtbags. Then, at age 59 ½, when we can access our 401(k)s, which are in great shape, we’ll be able to live a little more comfortably. The first ~10 years will be all about the index funds, plus any fun part-time work we do on the side. Then, after the rental property is paid off, our rental income will play a much bigger role, and the index fund income will drop a bit. Once we hit 59 ½, we’ll shift to 401(k)s. Here’s a breakdown, with health insurance sources included:
What are your plans during early retirement? (Travel, special projects, part-time work)
Our plans do not involve work! The one exception is “fun work,” jobs like ski patrolling that would give us free ski passes, or doing special projects that we enjoy for friends’ businesses. Our standard is asking ourselves, “Would we do that work for free?” If the answer is yes, then it’s fair game in retirement, but not otherwise. In addition to all the mountain and travel stuff we’ve already mentioned, we want to keep writing our blog, Our Next Life, and we’ll make it a lot more personal once we no longer require anonymity to keep our jobs. We’d like to write a book or two, and we have a million ideas for that. We plan to buy a small travel trailer like an R-Pod and use it to visit every national park in the U.S. and Canada, as well as spend a summer in Alaska, drive the full length of North America and South America. We love skiing and plan to do at least one “endless winter,” chasing powder around the western hemisphere for a year or more. But it’s not all travel — we want to spend lots of time enjoying our incredible mountain range and become experts on all of our local trails and waterways. Even though we don’t want to have to work for money ever again, we plan to spend lots of time helping out the nonprofits in our small mountain town — we do that a little now, but don’t have time to help them as much as we’d like to!
This might sound trite, but a big to do item for us in early retirement is actually to figure out what we want to do when we grow up. We have plenty of things to keep us occupied, but we’re also totally open to the fact that we might discover some as-yet-undiscovered passion or calling once we don’t have work thoughts clogging our brains and quashing our creativity all the time. We don’t want to plan so much in early retirement that we don’t give ourselves the time and space to figure this out.
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