This is another great story about starting small, staying consistent, and making it happen! With just a little bit of knowledge and work, you can make a huge difference in your personal finances. I hope you enjoy this enlisted success story!
Getting Started on the Road to FIRE
This is a story about how my family got started on the road to FIRE. There are a lot of mistakes in the making of a success story. You’ll see a few of them below. Don’t think you have to be perfect, and don’t think people who have already achieved financial independence did it without making any mistakes.
I don’t know who said (maybe Brandon?), but it’s good advice. “Experience is cheap if you are smart enough to get it secondhand!” I was smart enough to get it secondhand and if you are reading this blog then so are you.
A Slow Start in the Air Force
My first 10 years in the Air Force I didn’t save a whole lot. I had car loans and credit card debt, but thought I was doing just fine because I always paid them on time. Eventually I took some advice from one of the old guys at work and finally started investing enough to max out a Roth IRA in 2011 and then spent the rest.
Finding the Mr. Money Mustache Blog
Now, I thought I was doing really good by planning for a retirement date at the ripe old age of 67. I figured everyone worked till their late 60s, so why would I be any different? Fast forward a few years to 2016, when a really smart friend of mine just happened to share a Mr. Money Mustache blog post on Facebook about early retirement and financial independence. I just happened to read it. (Mainly because he almost never posted anything, so I knew it must be important.) That led me to read the entire MMM blog within a month or so.
These were concepts I had never thought of or had exposure to. I had no idea that regular people could achieve this so I wanted to see if we could do it. My wife and I were about to have our first child, so we decided to make some huge changes to how we spent money. We decided she would be a stay-at-home mom, so we had to figure this all out on an E-6 budget.
Taking FIRE and Frugality to the Extreme
At first, we went too far into deprivation. We sold the truck and car and went down to one small hatchback shared between us. This ended up being a big mistake because the seats were uncomfortable for longer road trips, and the car seat would only fit if the front seat was moved all the way forward, cramming your legs into the dash!
We sold the hatchback and paid cash for an 8-year-old, great-condition midsize SUV. It wasn’t good on gas, but we minimized our vehicle usage by saving all our errands to just one day a week.
Tracking and Cutting Expenses
We also began tracking all of our expenses so we would know where our money was going. This allowed us to highlight where we wanted to cut spending that wasn’t all that important to us.
We shopped around for cheaper insurance with the same coverage. We started playing the credit card rewards game (paying the balance in full each month). We spent time evaluating our true needs versus our wants. And most importantly, we ran the numbers and determined it would be possible to retire much earlier than the average person.
Starting the Investment Machine
Through streamlining our spending and eliminating recurring monthly expenses that weren’t important to us, we were able to invest more money than I ever thought possible on a single income. It turns out that if you don’t have a lot of bills and debt, you can take that extra money and plow it into your taxable brokerage account once your IRA is maxed. (We did eventually start using my TSP, but this is a story about how we got started.)
Making Adjustments and Staying on the Same Page
This is really just the beginning of the first year of our success story. We have been at it since 2016. We’ve continued to be consistent with investing but have backslid a few times into over consumption and spending frivolously. Each time we notice spending getting out of hand, we have a reset, talk it over, and get back on track.
It’s EXTREMELY important to have your spouse on board with your financial plans so you can have open dialog and set the same goals. I hope this short story can pique some interest among the readers and will encourage you to get started on your path to financial independence!
***Break***
Enlisted Money Response
Thanks so much for sharing! I love how you share the bumps in the road along your journey! It felt discouraging early on because everything felt so difficult on a limited salary. When we really started to get serious, it felt even more limiting because we were on one income most of the time due to childcare, PCS moves, or other issues keeping my wife from finding steady employment.
However, like you said, you just have to get on the same page and get back on track when you encounter a setback.
Starting Small and Building Up
Your initial goal of maxing your IRA is a great place to start! I wish I’d learned about my Roth IRA much sooner. However, I was lucky enough to get compound interest going in my favor anyway.
I would definitely consider using a Roth IRA or Roth TSP if you’re in the military. Our total compensation is already low-tax. Roth accounts have many other “hidden” benefits besides the basic argument of taxes now vs taxes later.
Experience is Cheap
The quote you mentioned, “Experience is cheap if you are smart enough to get it secondhand!” is one of my all-time favorites. It’s literally the premise behind my blog. I’m just trying to create the content I wish I’d read and applied when I was 18-years-old.
I actually had a similar beginning with a different blog, Get Rich Slowly. In a cool “full-circle moment,” I actually got to meet J.D. Roth at FinCon and tell him the impact his blog had on me face to face. I even got to take a picture with him and give him one of my Enlisted Money poker chips.
Regardless, learning from others is a fantastic way to shortcut the learning process. I will say that there are some lessons and experiences you just have to go through yourself. If I can get a lifetime of knowledge from one book or blog, you better believe I’m going to pay attention!
Getting on the Same Page as Your Spouse
I verbally shouted, “Amen!” when I read the last paragraph of this story. You absolutely, positively, without a doubt, have to get your spouse on board when it comes to your finances. If you’re both not on the same page, it will just cause issues.
In fact, this is one of the biggest struggles my wife and I still have today. We’re on the same page about 90% of the time now, but it’s taken work to get there. I’m a very natural spender, and my wife is a natural saver. It’s like oil and water sometimes, but we always find a way to “emulsify” things and get on the same page.
The Bottom Line
The biggest takeaway from this success story is that you can start small and adjust as needed. It’s okay to dream a little bit and “upgrade” your dreams later on. I talked a little about this in my article on Dynamic Contentment, but you have the ability to create new goals as long as they serve your values.
Go start your own journey to financial stability and independence!