The Math Is the Easy Part

Achieving financial independence is hard in spite of the math being surprisingly easy.

Here’s the math: 

Mr. Money Mustache tells the shockingly simple math behind early retirement much better than I can.

Save 5% of your take home pay and you’ll need to work 66 years; save 20% and you’ll need to work 37 years; save 50% and you’ll need to work 17 years; save 70% and you’ll need to work 8.5 years.  Yep just 8.5 years.

This is a bit simplistic–but close.

I have my retirement mapped out in mind numbing detail.  And you should too.

But for the smarty pants readers of this blog, it’s not too hard, right?

But here’s what’s hard: 

If you want to reach financial independence, you have to be different.  You can’t spend money on things that don’t feed your soul.  And your soul needs to have a reasonable appetite.

I spent most of my life trying to fit in, trying to be like everyone else. 

Because I didn’t come out of childhood with a rock solid self esteem.  I’m not sure why–I had two parents who loved me and did their best for me. I did well in school.  I was reasonably attractive–if you overlook that awkward stage.  I had a few good friends and lots of acquaintances.

But I didn’t have what the other kids had.  And somehow that affected me more than it should have.  Other girls could wear their brother’s hand me down clothes and still appear to have a great self esteem.  Not me.

So when I made my first money–I mean my very first money busing tables at a Mexican restaurant at 13.  I had a friend take me clothes shopping.  And I spent all $150 of it so I could fit in.  And $150 was a ton of money in the late 70’s.

And when I was getting ready to start my first real job at 22, I bought a brand spanking new Toyota Celica.  I was about to earn $22,500 a year and I bought a car for $14,101.

I had no down payment for that car.  So I got two loans–a 12 month loan for the down payment I should have had plus a five year loan for the rest of the car.

In that first year, my car payment was $431 a month.  My take home pay was $1,278.  34% of my income went to that car payment.

Because I wanted to be cool and look successful.  Oh and it was cool–I loved that car.  And the future Mr. Ms. Liz took notice of that cool car–it may be what prompted him to ask me out.

But that big a$$ car payment bugged the crap out of me and that was the start of me making different decisions.

I still have my greenbar budget sheet from 1986 where I mapped out how I could pay extra on that down payment loan.  I paid that twelve month loan off in five months.

Then I started putting an extra $100 a month towards the five year loan.  It was paid off in a little over three years.  And that was my first and last real car payment.  To be fair, I had a payment for my next car–a Lexus but the loan was 0% with the Bank of Mr. Ms. Liz so it doesn’t count . . . right?

And a funny thing happened.  I started to enjoy being a bit different from those who surrounded me. 

By my late 20’s, I was tracking my spending and net worth on Quicken.  I was proud of what I had invested rather than what I wore or drove.  Even though no one else really knew.

I had no debt other than that Bank of Mr. Ms. Liz car payment and our mortgage.  By my early 40’s, I had no debt.

My savings rate went from 20% to over 70% of my take home pay.  And my net worth grew until it could easily support my retirement.

So now I’m different again.

I’m on the pickleball court with my new old friends while people my age are in the office.

I’m a snowbird, migrating to the desert for the winter while people my age are griping about their winter commutes.

I’m the girl who doesn’t worry about money . . . at all.  Because I have plenty for the experiences and things that feed my soul.  For my soul has a reasonable appetite.

Does your soul have a reasonable appetite?

Author: Ms. Liz

A CPA, I retired at 51 and I am helping people create their fantastic futures!

6 thoughts on “The Math Is the Easy Part”

  1. Dear Ms. Liz, I am a long time fan of your blog, but never before a commenter. I love this post! You are right, the math is the easy part! Adjusting your own head (soul 🙂 ) is the hardest part.

    For me, the hardest part are the sideways glance you start to get from your friends and family when you suggest cutting out some previously enjoyed activities. To be sure people are looking out for you. They don’t want something to be wrong. But this well intentioned care turns into peer pressure against saying no. I think that is probably the toughest part of embarking on this route.

    1. Wow HM, you may be my first “fan”! Such a nice comment to wake up to this morning–thank you!

      You are so right–on the beginning of this path, it can feel lonely and like you’re missing out on a bunch of fun stuff. I found it easier to be really open with my friends and family about what I could and couldn’t afford. Some friends peeled off for sure but others jumped on with me. It definitely got easier as time went by. Hate to link to an article in a reply comment but this may give you some ideas that help.

      We spend our lives searching for authentic relationships and being on the path to financial independence is a huge part of who we are–sharing it with others is part of us being authentic. Plus there’s been some discussion on twitter about how we would feel if a friend was on this path and didn’t share it with us. I’m not above being jealous–I’d be more than a bit jealous if a close friend left me behind. A surprising benefit of this blog is the real conversations we’re having when people find out about it.

      So how to feel less lonely and less judged? I suggest being more open with friends and family and being part of the FIRE community that is with you on this ride. It looks to me like you’re doing it right!

  2. This post warmed my soul. Ms. Liz you are so right (of course)! If you want to be different you have to well– BE different. The math is easy, committing to those changes is what will make the difference. It seems that my office mates want to eat out for lunch like 9 days a week, but I am fine with my bowl of homemade soup- mmmmmm good. I have saved a lot of money by cutting down on my dining out.

    1. HH Nothing warms a soul better than homemade soup and nice comments like this! We have to keep our hearts focused on our end goals while we slurp our soup–better both for our net worth and our waistline.

  3. Congratulations, and thanks for being an inspiration. I’m looking forward to learning how to play “pickleball” myself.

    Still having a hard time convincing Mrs. 39 months that we can chuck it and “live like nobody else” – but we will get there.

    Just celebrated 32 months till financial independence!

    Keep up the blogging

    1. Thanks for your kind words Mr. 39!

      I’m fortunate that I didn’t need to convince Mr., we had spreadsheet wars trying to come up with the optimal long term plan. He won and I use his version now :). It would be super scary if you were relying on your spouse to dig into the numbers so be patient with Mrs!

      32 months will be here before you know it, I’d suggest you look into Pickleball now. lists locations and times. It’s a great, frugal sport and fills a lot of our social needs.

      Start dipping your toe into things now that you plan to do in retirement and the transition will be easier. So fun, can’t wait for you to experience it!

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