Renewed motivation to push for financial independence

[JenAR]

@Frita

To finish answering your comment,

I also grew up on a ranch/farm. Hunted and slaughtered. Plenty of experience with death, both animal and human. Pretty self-reliant culture. I think this was a benef

Re: "nest labor" - yeah, that's just a word we made up as a catch-all for labor that improves our "nest"--our home(s) and community spaces. Dividing it into two hours of cleaning and two hours of more project-oriented labor per person per week has worked well.

One issue was that we wanted to get some improvement projects done which would make life more pleasant (building shelves/storage solutions, firewood racks, organization, creating systems for dealing with stuff that tends to pile up, better labeling, deep cleaning, maintenance, etc) but instead of doing that, people who liked things to be clean were always stuck trying to keep up with the basic cleaning, and nothing really improved structurally/systemically. And people who did not like to clean often didn't do anything at all or did projects to fulfill their nest labor obligation but then didn't clean up the mess they made while doing them, which made the clean people resentful. The newer, divided system seems to encourage things to move in the right direction. We don't really police the system, although we're experimenting with adding a bit more leadership/management to the nest labor system. It isn't perfect, but everybody's baseline is pretty happy, with the worst thing being an occasional snippy sigh at the state of the kitchen or a "Can we please stop shoving trash on TOP of the trash bag and put it IN the trash bag" during the community business session on Taco Tuesday.

Thanks for the input re: FI before kids. I talked to my partner about it a little and he thinks it's a good idea, and an important priority (we had already discussed and planned to continue living a low-cost, home based lifestyle with our child(ren), and he knows that FI is one of my goals, so it was not a huge leap). He also said he thinks he could live on $150 a month if he buckled down a bit. He finds it easy to live on less than $250 a month. In some ways, he is naturally more frugal than I am (he is not as tempted by hedonic spending), and he has better income opportunities currently (he is doing the videography here, which pays, although not a ton) but is much less savings-oriented than I am, and more willing to spend out on things he finds genuinely improving to himself/valuable to society. He tends to need very little money and spend what he gets on things that he feels are worthwhile (plants, permaculture projects, people doing valuable things, tools, education, etc.). I mentioned to him a few weeks ago that it seemed like he didn't really have any savings goals and so no real motivation to save, and he said a few days ago that he'd been reflecting on that observation and found it really valuable. And when I mentioned the FI before kids thing, he seemed to take that on board, so I suspect we will now both be saving toward that goal, although I will probably be doing it with more focus.

[JenAR]

@mooretrees

I definitely think it helps to be around other people who aren't/aren't trying to be "normal" or cool--especially if you're still trying to internalize a different paradigm. For me these days, I'm genuinely repelled by a lot of "normal" consumer stuff and aesthetics and attracted by simplicity, naturalness, resourcefulness, mastery, genuine quality, grittiness, etc. This is a much better headspace to be in, because instead of feeling deprived of luxury and having to exercise willpower, you feel naturally inclined to move in a helpful direction and find it enjoyable. I am naturally pretty judgmental, which can be a double-edged sword, but I will confess that I kind of look down on the superficiality, obliviousness, and self-indulgence that permeate most people's existences, which makes it easy to avoid temptation to fit in with them! Sometimes I do cultivate empathy and appreciation for the virtues of many of the "normal" people I know, so as not to become a total asshole, but being able to draw on that sense of superiority is great insulation from social pressure.

[JenAR]

+$400

A couple years ago, I gave my mom $7,000 to get her out of debt (which she never managed to dig her way out of after she and my dad divorced when I was 18) so she could retire in peace. I gave it to her outright, but now, having straightened out her finances and having more SS money than she needs to live, she is paying me back at the rate of $400 each month, which is really cool.

[JenAR]

@c_L

I definitely agree that learned helplessness is a strong indicator of low psycho-emotional capital. A growth mindset is probably an indicator of high psycho-emotional capital.

I think "grit" (a la Angela Duckworth) is probably a subset, but not the entirety, of what I mean when I think of psycho-emotional capital.

I also agree that taking on challenges is a huge part of developing this trait. Overcoming them is best, but even failing and having the world not end is pretty helpful.

[horsewoman]

I wonder if psycho-emotional capital is not comparable with the concept of (mental) resilience?
At least "resilient" is what I would call people who exhibit the above mentioned traits.

[guitarplayer]

@Horsewoman I would think the same, and (ego) resilience is a fairly researched topic in psychology. Though ego-resilience is more about being able to quickly bounce back to your normal (presumably high) well being level after a crisis.

Holistic psychology would work very much in accord with the idea of psycho-emotional capital, and generally ERE. In fact, I remember one of my professors bringing up a theory of various resources contributing to well being, 'money', 'relationships', 'health' and so on. I don't remember what theory it was but maybe will try to track it in my dusted notes.

Also, Jacob's book is good for thinking about it, particularly The Renaissance Ideal -> Human Capital and Necessary Personal Assets -> Emotional (but also the other six).

@JenAR thanks for stimulating interesting discussions. Many of the thoughts are sometimes on my mind, but perhaps because of individual differences I don't bring myself to start posts

[7Wannabe5]

I've often wondered why some people seem much more irrationally inclined towards "I will end up a bag lady eating out of a dumpster" anxiety. It almost seems analogous to how some White Suburban American Females of my generation obsess about any fat on their thighs. IOW, it's a specific negative ideation which can drive "positive" compulsive behavior. OTOH, it might just be a sort of "former/possible victimization" cover story for desire for higher-than-socially-acceptable degree of competitiveness towards measurable success. Dunno.

[AxelHeyst]

I also agree that taking on challenges is a huge part of developing this trait. Overcoming them is best, but even failing and having the world not end is pretty helpful.

In relation to the trials and tribulations many people face, climbing is a petty thing, but I've noticed the effect of climbing as a hard thing on the rest of my life. Particularly once I got in to more adventurous and long climbs with higher stakes. Taking on calculated risks 40' above your last piece of protection, with dark clouds on the way (where to stay put or even bail is more dangerous than moving up), with night falling, really changes my attitude towards "risks" taken in my career or relationships. It's sort of like the emotional version of having FU money.

I used to get worried about screwing up at work or in relationships. After having tried and succeeded (or failed, but still made it back home) on the mountain, where the stakes are higher, I just can't get that worked up over "safe-life" circumstances. *And*, I feel that to maintain momentum in my life, I must make a continuous series of calculated-risk moves. Otherwise I'm just sitting there waiting for an objective hazard like lightning or a rock to take me out.

[classical_Liberal]

OTOH, it might just be a sort of "former/possible victimization" cover story for desire for higher-than-socially-acceptable degree of competitiveness towards measurable success. Dunno.

Interesting point. I don't think it's entirely accurate in its specificity, but may have a more generalistic truth to it.

Competitiveness towards measurable success has almost no bounds in the US. Particularly when that measurable success is lots of money and stuff/experiences. I mean, look at social media and who has the most followers. OTOH, more generally, @jenAR brought up a point upthread about how being around people who measure success differently has an impact on feeling "ok" with not fitting into general societal social Overton Window.

Maybe another niche in building psycho-emotional capital wealth (in addition to attempting hard things) is choosing to spend your time and energy with the "right" people. IOW, people with whom you identify, and people who motivate you to aspire towards the life you want for yourself. Spending too much time in FIRE forums lends one towards placing too much faith in financial capital, hence the irrational fear of bag ladyism.

I've mentioned this before. But I think one of the critical factors towards happiness is choosing the "right" social circle. Too many people just "go with the flow"in this realm. I think maybe that "happiness" is directly related to the peace of mind high psycho-emotional capital brings. It's just that choosing the right social circle builds that capital, in addition to the more traditional social capital mentioned around here prior to @JenAR's arrival.

Just to add, I'm very glad JenAR decided to start posting around here. I think the combination of ERE + Permi thinking has already yielded a 1+1=banana in the form of this psycho-emotional capital concept. It's really helpful and I hope it continues to be explored. Also, @7WB5 isn't posting enough lately!

[jacob]

Psychological resilience is the opposite end of the neuroticism/anxiety scale of the Big5/OCEAN test, so you can get a measure of it. Or something.

However, when I asked a couple of years ago on the forum, I was quite surprised to see a normal distribution whereas I was expecting overall low scores presuming that high agency would "take care of it". (There's a thread somewhere.) IOW, I expected low scores but found normal scores. My personal score is 4% and writing the ERE book at a less mature stage (hey, I was only 33ish), I was largely oblivious and also not entirely normal and so just projected my own understanding of myself onto everybody else. However, others have picked it up recognizing its relevance to the human condition.

For example, permaculture considered "spiritual capital" at about the same time as the ERE book was being published, and Chris Martenson later adopted that model in Prosper. Spiritual capital being, of course, just one lens or source/aid of such resilience. There are other lenses. My lens is personal competence. Other lenses are community, religion, and so on. Whatever lends strength. There are many ways.

I get/grok that there are some "cross-training" benefits for resilience from doing hard/risky things in other fields. However, I think one needs to be careful in extrapolating/co-opting too much. Fearlessly riding a Kawasaki Ninja at 100mph doesn't remove the resulting medical bills. In particular, it doesn't pay them off. Analogy-weaknesses aside---you know what I mean.

[classical_Liberal]

@jacob
Yes, I agree trying to put many forms of capital in a box can be counter productive. Where does one end and the other begin, is one the same as the other, ect. I'm guilty of trying to do this in attempts to fully understand flows. This calm state of being and feeling that one can overcome (no matter what its called) does have value though.

My objection to your comment is that hard and risky do not have to correlate. As a matter of fact, they can have negative correlation. Becoming FI is hard, yet it decreases almost all financial risk. Training for a marathon is hard, yet can probably decrease many lifestyle health risks. Yet, attempting and maybe reaching these goals certainly increases psycho-emotional capital.

That's interesting about the Big 5. As I recall, I actually scored middle on the neuroticism as well. I may have to retake it to see what type of questions they're asking, to get a feel for what they're really testing for in that category.

[7Wannabe5]

Low neurotic/conscientious/agreeable. Moderate extroversion. High open-intellectual. I think of myself as being agreeable, but maybe it’s just my highly open/ low neurotic nature lending me a high ability to tolerate the company of wrong-minded individuals? As in “You’re an idiot. Let’s go get some ice cream.”

I am following your journal with some interest due to shared interest in permaculture. I just finished reading a very good semi-fictional memoir about a female rancher, “Half Broke Horses” by Jeanette Walls. Highly recommend.

[JenAR]

One week into August and haven't spent any money so far, so spend-nothing month is on track.

I did, however, use some Amazon points to order the Bodie investment book today, along with a wildflower mix for my plot and a slackline for fun/fitness. One tactic I am using here is to put community expenses on my card and then get reimbursed, which streamlines purchases for the community and gives me Amazon points that I can spend as I will (I pay off my CC balance immediately and don't pay any interest on the money, in case that's not obvious). Sometimes my purchases are practical, sometimes fun, but it's a nice little pressure-release valve. This month we were buying a lot of videography equipment for our passive greenhouse movie project, so I ended up with over $100 worth of Amazon points--way higher than normal.

This week we dehydrated and canned a hundred pounds of split-pit peaches that our friend rescued from being discarded at her organic peach farm. Just tried the jam this morning--so good!

[jacob]

My objection to your comment is that hard and risky do not have to correlate. As a matter of fact, they can have negative correlation. Becoming FI is hard, yet it decreases almost all financial risk. Training for a marathon is hard, yet can probably decrease many lifestyle health risks. Yet, attempting and maybe reaching these goals certainly increases psycho-emotional capital.

Sure, hard and risky are independent dimensions. I meant to comment on the cross-training aspects. There are other dimensions as well like persistence or perseverance. If you already have experience on some axis, the mental lego-blocks developed doing that can be used to build something else.

[JenAR]

Had another talk with my partner about FI/kids, and we agreed that $500 per month would be plenty to support us plus child(ren). We also agreed that while I would like to have my personal expenses covered by investment income, we would be comfortable with the full $500 coming from some combination of investment income/residual income sources/undemanding home-based lifestyle business/farm sales. The sticking point for both of us is that we both want our money-making activities to be home-based, low-stress, and not time-consuming.

Also: I am mostly saying this to provoke people into telling me how incredibly wrong I am so that I can evaluate their objections, but . . . I think that having and raising children will cost, for me, virtually no money.*

*The one real exception would be if I had a complicated pregnancy and/or the child were ill and required medical intervention, in which case I view it the same way as the possibility of catastrophic illness/injury of myself or my partner: it's so potentially (and unpredictably) expensive that I can't see a way to reasonably prepare for it, so if I'm going to have to declare medical bankruptcy after depleting my assets, I guess I'd rather lose $60,000 than $300,000 . . . and I'll probably be glad we've developed some alternative income streams in the form of intellectual property, business income, etc.

[mooretrees]

I've found the biggest expenses with having a child are insurance-not what we actually use just the 'privilege' of having it, and lost income from DH staying home. Most of the stuff people say you need for kids are to make having them slightly easier (swings, bouncers, toys, etc) and they grow out of stuff so fast that you should be able to get by on secondhand stuff. Plus most people buy too much for their kids and then get desperate to get the stuff out of the house and will give it away. Vaccines and well-child check-ups (lead and hemoglobin checks at young ages, eye exams for correctable issues, etc) are free and even birth can be very cheap if you don't get any medications.

I've found the book, Expecting Better by Emily Oster, a well-researched book that works to debunk a lot of myths/fears about pregnancy.

Another reality if there are huge medical hardships is that hospitals have a norm of expecting to forgive some medical expenses due to financial hardships. Just part of the mandate of not being able to refuse to care for someone. So, while I agree that those two situations might be financially tough, it's also possible that the hospital could use the expenses as part of their 'charity care.' I really don't know much more than that, but it's something out there.

[guitarplayer]

I have some experience with 'helpx' (another, maybe more popular, platform is workaway) which is about giving your time in exchange for roof over your head and some / all meals. From what I read it seems to me that your community project is something like helpx+++ because you put in more work that would be required from helpx hosts (they usually ask for 20-30 h/week), but also at some point you end up with a rent free place to stay and tend.

What is interesting for me in your story is that in your analysis you skip the whole part where you exchange work for housing and food, while it could be measured in $. I don't mean to say that it should. On the contrary, sometimes I think that all the $ could be accounted for in something else, maybe energy since $ seems to be a stored energy. All the energy ultimately comes from sun, so maybe a unit of 'Sun' could be invented.

Where I live (a community as well) I pay for my accommodation, services and provisions, but this money never hits my bank account, it is deducted from my pay. The only reminder of the fact that I pay it is my payslip. Skipping these expenses would lead me to notice spending of the order of mostly 0-£200 / couple / month.

On the other hand, I used to do some long term volunteering where I would have 'free' accommodation and food (very high quality all) and would receive a small stipend every month. Back then I was running thought experiments about my hourly rate. I would estimate how much I would pay for living in such a HCOL area and for all the cashew and almond butter and other fancy stuff I would eat through over the month.

I find your reporting a good mental stretching. I sometimes play around with the idea of retiring by cycling from helpx to helpx (or similar alternative lifestyle), and if I carried on with such lifestyle, this would induce your level of spending and require corresponding capital.

[JenAR]

@guitarplayer

What is interesting for me in your story is that in your analysis you skip the whole part where you exchange work for housing and food, while it could be measured in $.

True. I think this is almost purely an artifact of a personal quirk where I find it easy to work but hard to make money.

So experientially, from my perspective, the food and housing feel "free" because the work I exchange for them converts pretty directly and efficiently and is expended doing stuff I would mostly choose to do anyway for learning/enjoyment (although I would configure it somewhat differently if given my druthers). Whereas my normal experience is that I naturally work many hours per day on things that no one will pay me for, and then have to resentfully drag myself to a job or take time to figure out how to make enough actual money to exist, all of which detracts from the work I actually want to be doing. So here, it feels like I am still doing the same amount of interesting unpaid work as always, but now someone is giving me room and board for "free," rather than me having to work a job to pay for them. Not strictly true, but subjectively much nicer.

Also, the educational value of being here is something I'd strongly consider actually paying for, so in some ways I feel that my labor and the instruction I receive are a wash in terms of value, and the room/board/free rent for life thing are bonuses on top of that exchange. That's also one reason I'm not freaked out by the whole, "What if Paul turns out to be secretly a total dick but you didn't notice for two years/the place is hit by a comet/whatever and you put in all that work and then lose your acre?!?!" thing that gets brought up a lot--I'll have gotten a great education and lots of design experience, lived for basically free for a couple of years, eaten lots of (for me) fancy food, gotten to use and develop skill with all kinds of equipment I could never afford to purchase, improved the local ecosystem and made the land more productive and habitable, and developed a lot of new friends and contacts, so . . . oh well? And if it turns out well, I never have to worry about the intermediary "money" step in the "work > money > food and shelter" sequence again, and the "work" step will be vastly reduced and vastly more discretionary after my two years is up.

Personally, I think the transience of perpetual WWOOFing, helpxing, etc. would become trying for me over time, and I like the opportunity to build something lasting and become embedded in a community of people I really like, but I like being able to add that to my list of potential transitional/backup plans should everything go south for me here.

[JenAR]

@mooretrees

Thanks for the input! I will check out that book.

I do not currently have health insurance. I wonder whether I would feel compelled to get it for my child. I think not, but could be wrong. I find that I experience much more resistance to risk-taking when imagining applying it to my child than when applying it to myself. I would also strongly consider home birth, but need to look into that more before saying for sure.

I also suspect that we will be given so much stuff by friends and family that I will never need to purchase anything, even secondhand, and that I could clothe them in old sheets and blankets if I had to and give them nothing but random household objects and whatever they can find outside to play with for their first couple years of life and they'd be fine.

[classical_Liberal]

What is interesting for me in your story is that in your analysis you skip the whole part where you exchange work for housing and food, while it could be measured in $.

This is pretty much the issue I have in trying to advance in ERE, but in reverse. I try to compare everything to dollars. I think this is natural because it's the standard means of transaction in our society. The idea of "sun" or "energy" use is interesting and would probably be a more fair way to transact because it cuts out manipulation. The problem being that social constructs create different value than simply energy used.

Finding a situation in which you are able to do the work you want and in exchange being provided with all but discretionary living needs is really the ultimate goal, even in the FIRE sphere. It's just they use money saved or generated by invested capital as an intermediary to do this. Currency simply makes means of exchange easier. If I no longer want to live in "x" situation, doing "y" work, I can use money to do something different. I would argue, that diversification here is the key. It's a cheap way to hedge. If I have the options of using saved money, or income from capital, or using my value generating skills, or labor, or whatever else, and any of them can independently generate what I need to survive, I'm better off than only having one of them. If I can create a system where each is used to their maximum potential due to valued added flows, and it's in line with my personal human preferences/values, true ERE is achieved.