stayhigh's journal

Where are you and where are you going?
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stayhigh
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stayhigh's journal

Post by stayhigh » Mon Dec 07, 2015 12:27 pm

After months of reading ERE, MMM and similar websites, I finally decided to register here and share my story. Since teenage years I realized there is something wrong. Something wrong with the world and other people. Or with myself. I asked too many questions. I think that I questioned everything! Why work for whole of your life? What people do with their money, if after 30 years of 9 to 5 work they barely manage to survive till the end of the month? Why everything is taxed? Why so many weird rules to follow? Why people do things which they don't want to? Because they should? Because "what others gonna say"? And who is the others by the way? I hardly even know them, so why I have to do something to keep them sweet? Why simple things are so complicated?

I grew up. I'm not a child anymore. Not even a teenager. Then, I discovered so called western world. Yes, I'm from different part of the world. I moved to the "west", to the one of the richest cities in one of the richest countries in the whole world. And then I started asking even more questions, as I had to learn everything from the very beginning. But this time, I was in an adult world, and I was one of them. After 7 years, I stopped asking questions. There is nothing to understand anymore. The world is upside down, and I will never get it fixed, so I just do what I have to do and don't care too much about the rest. Better for me and for them.

I've been frugal since I remember. I never spend money or other resources on useless crap on regular basic. I believe this is the reason why I always sucked at strategy games. I accumulated too much, focusing too much on defense and safety approach, than taking quick steps toward victory. When I started my first proper job, just after 20th birthday, the plan was to work 2-3 months and save for new computer. But I failed. I never get this new, fancy machine. I'm writing this story just now, using same old laptop, which I had back then. As an ex computer wizz, I keep it in great shape in terms of software and hardware and I did some cheap upgrades, so it's still in great condition. Let's back to main story: The next thing was a car. I had a rather basic job, but my savings were growing pretty quick. Same as expectations for my new car. I kept changing my mind: bigger, quicker, fancier. Until I said to myself: What the hell are you doing?! Where you gonna drive it, if you have 10min walk to workplace? What's the point of spending all the money for machine sitting at car park 24/7? So I dropped the idea of having a car. I'm car free for my whole live. And I don't plan to have one at the moment. But when I walk down the street I know that I can afford to get this car just now. And that one as well. And another one. All at the same time. Great feeling.

Then I get another idea. Travel the world. See all these great places. Discover something more than my home country and little bit of Europe. So I booked my first "big" holiday trip to Thailand. That was a big shock. For me and for my wallet. Later on I spend weeks on looking for deals and ideas how to travel for close to nothing. You know, low cost carriers, error fares, shitty hostels, hitchhiking, backpacking and this kind of stuff. By the age of 25 I've visited about 50 countries on 5 continents. I know, it's not about the numbers, but I can't find better way to describe it in one sentence. I've traveled mostly by my own and I learned a lot about world, about people, my comfort zone and crucially - about myself.

During all this time I was saving money. I changed job twice, and now I'm on the limit in terms of salary, as it's getting very hard to find something better without a good degree (too lazy) or good skills (too lazy again). But it doesn't matter that much, as I'm happy where I'm just now. This year I discovered all this early retirement stuff, which was a bit boring for me, as 80% of the stuff is rather obvious. But it help me a lot. That was a great way to systematize my knowledge and put all the things together and direct me to the right way of thinking, as the mindset is crucial.

So, let's add it up:
I'm 27 yo male from Europe, introvert, frugal by nature, non native english speaker, living in UK, having no debt, no mortgage, no kids, no cars, no addictions, one girlfriend (with rather similar values, but still a lot to learn), 75% saving rate and six digit net worth in british pounds, euros, american dollars or any other main currency. I'm ready to retire in 3 years, but as I want to buy a flat/house, and I want to travel round the world for 1-2 years when I show middle finger to my "career", I need to work for another 5 years... I guess :) .

Dave
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Re: stayhigh's journal

Post by Dave » Mon Dec 07, 2015 12:40 pm

Welcome!

Interesting story, and I look forward to following your march towards financial independence.

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cmonkey
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Re: stayhigh's journal

Post by cmonkey » Mon Dec 07, 2015 12:57 pm

stayhigh wrote:This year I discovered all this early retirement stuff, which was a bit boring for me, as 80% of the stuff is rather obvious.
Haha, I love that. Means you are in the right place. ;)

I like all those questions you asked. I asked them too. I think we all did and still do a bit.

Then we all found each other, with jacobs help and the world made a bit more sense. :lol:

Bankai
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Re: stayhigh's journal

Post by Bankai » Mon Dec 07, 2015 2:14 pm

stayhigh wrote:But when I walk down the street I know that I can afford to get this car just now. And that one as well. And another one. All at the same time. Great feeling.
Whenever we walk by a car dealer with my wife, we calculate how many cars we could buy. It allows to put money (and cars) into perspective. Great exercise :)
stayhigh wrote:I want to buy a flat/house
Are you planning to stay in UK, go back home or retire in yet another country? Having first hand experience from 50 countries, where would you say seems like the best place to settle?

Very interesting journal, looking forward for more.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Mon Dec 07, 2015 4:21 pm

cmonkey wrote:Then we all found each other, with jacobs help and the world made a bit more sense. :lol:
That's true. I struggle to find people with similar mindset and goals. I always fell like someone weird, when I say about my idea of retirement to others, so I stopped doing that.

By the way, I'm getting a bit annoyed by people who notice that I'm frugal and don't spend too much. They ask silly questions, like "what are you saving for", "you won't take all this money with you when you pass away", "when you start to live a good life". How do you deal with them? Honest answers doesn't work, silly ones either.
Bankai wrote:Whenever we walk by a car dealer with my wife, we calculate how many cars we could buy. It allows to put money (and cars) into perspective. Great exercise :)
Great exercise is to speak to someone, that you DO NOT need a car at all. I always had a great conversations on this topic.
Bankai wrote:Are you planning to stay in UK, go back home or retire in yet another country? Having first hand experience from 50 countries, where would you say seems like the best place to settle?
I still have about 5 years to think about it. It's a long period. Just try to think where were you and what were you doing 5 years ago. A lot can change, so I'm not decided yet. There is a few options, but I know for sure, that I won't stay in UK forever, and when I become grumpy, annoying old man (pretty soon I guess ;) ) I will come back to home country. What will happen in the middle of that, is the biggest question.

The easy option, is to move for few years to one of the European countries with friendly climate and affordable cost of living, like Greece, Portugal or Canaries. I called it easy, as it's close to home, people have similar mentality and I don't need any permits or visas to stay for long period. At least for now.

The challenging option is to go somewhere further away. It may sounds weird, but options are very limited. To stay in most places I'd need some kind of permanent visa. One of them is "working visa", but I'm not gonna do any paid work there. The other type of visa is one for retired people from developed countries, but in most cases I need to be above 55 and getting some kind of pension. Not for me again. Another way is to move to one of French overseas collectivities, as they are technically territory of EU state, so I can stay there visa free as long as I can. The bad thing is, those places are super expensive and rather boring in long term. One of the few remaining options are Philippines (you can extend your visa indefinitely, it's super cheap, English is widely spoken), Mexico (all you need is to show bank statement with 24k usd for every year you want to stay) and maybe few others.

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cmonkey
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Re: stayhigh's journal

Post by cmonkey » Mon Dec 07, 2015 5:51 pm

To be honest, I haven't had to deal with questions like that from other folks because we have never told anyone IRL about our plans and I don't know if we ever will. I imagine its difficult and downright annoying when people ask those things.

thrifty++
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Re: stayhigh's journal

Post by thrifty++ » Fri Dec 11, 2015 4:07 am

I don't often talk to people about plans for ERE. Very rarely. Actually its only in places where I am anonymous. I don't like people who know me knowing that I have a stash of cash. I think when people think I don't have much money they don't have any expectations about me spending money. Some people give me shit about not having a car and having a crappy cheap mobile phone. But I don't care. I tell them that's why I am so fit and in shape.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Mon Dec 14, 2015 12:19 pm

Well, I don't talk about ERE, (as explaining main principles will take more than a minute, which is too much for most) but some people who know how much I earn (like workmates having similar job to mine) noticed that my lifestyle is way below my means. Other people don't care too much. If I don't have newest iphone, walk everywhere and work overtimes on regular basis, then it means I have no money, right?

Anyway, learning new skills and DIY approach is one of ERE basics. Currently I have a little project:

Image

Internal wall insulation in my bedroom :) . It is quite easy and simple, and highly effective solution to save some money on heating, as I spend here at least 8hrs every night, which is the coldest time. Whole project is ERE oriented - I do it by my own, using leftovers from another, similar job, using borrowed tools, and I biked to DIY store to get necessary bits and pieces. Hope to get it done by the end of this week.

George the original one
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Re: stayhigh's journal

Post by George the original one » Sat Dec 19, 2015 9:06 am

OK, that project might be something I'll undertake, too! Our bedroom is above the unheated garage space and at opposite end of house from the woodstove. A little cooler in the winter and a little warmer in the summer, so extra insulation could be worthwhile to normalize things.

Hankaroundtheworld
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Re: stayhigh's journal

Post by Hankaroundtheworld » Sat Dec 19, 2015 6:54 pm

Great story, and you find freedom very early in life, so much possibilities ahead, what a luxury :-)

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cmonkey
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Re: stayhigh's journal

Post by cmonkey » Sat Dec 19, 2015 7:31 pm

Nice bit of DIY. Insulating can make quite a difference not only for heat but for sound as well. Our house is completely uninsulated yet we still have great energy bills since we switched to geothermal. I'm am thrilled at the thought of reducing it further when we redo all our walls next year.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Thu Feb 25, 2016 2:34 pm

Right, insulation project is done, winter arrived and after few weeks my heating bill is lower than before, so I'm happy enough. Also, I booked (again) few exotic holidays for the rest of the year (11 flight so far), which is not so good for my savings rate, but this is something I just can't give up. I can walk everywhere and eat lentils, but I will travel. And my employer gave me extra 8 days (almost 2 weeks!) of paid holidays per year! Damn! Good thing is I always book discounted flights and cheap hotels, use local transport and cheap/free activities, so it's relatively affordable backpacker-style travel. Next trip is coming, 3 weeks to go :)

Random facts:
1. I recently noticed that my 2015 spending for clothing was ZERO. Without any planning. Will try to do it again this year!
2. Just calculated: My SWR is 6%. Yeah

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Mon May 02, 2016 6:30 pm

Last week I failed "buy no clothes in 2016" challenge. I get a free gift card with nice balance and short expiry date, so I decided to get a nice softshell jacket, so useful up in north (we had snow last weekend...). On the other hand I just sold 7 items on ebay, so I can live with it ;)

It's May now, so it's a year since I started looking after myself a bit more. A year ago I checked my weight and I was shocked a bit, so it was time to do something about it. Since then I lost 8-10kgs. It's maybe not a lot, but please consider that I had BMI of 25-26. Now it's down to 23s. During same time I managed to increase my overall strength and fitness - from heart attack after 0.1 mile sprint to 45min constant run, from 2 pull-ups to 12-15 pull-ups. It wasn't hard at all to archive - I just limited junk food and sweets, stopped eating late at night, replaced soft drinks/juices with water and added some exercises 3 times a week. So I'm pretty happy and I'm looking forward for another 5-10kgs less and further improvements of my strength within next year or so.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Sat Jul 23, 2016 11:45 am

I decided to show you my typical monthly spending in rather expensive part of UK, so you can all compare. All numbers are in British pounds and per person, so double them for couple:

rent 250
council tax + water 46
gas/electricity 30
food 80
household 10?
mobile/internet 15
other 50
Total - just under 500

And on top of this, extra 1000 or so per year to cover holidays. When I finally decide where I want to stay for good, I will buy a house to get rid of rent, so cutting my total expenses by half without any problem.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Thu Dec 15, 2016 7:16 pm

Quick update.

I feel pretty confident about my finances, so I dropped budgeting as numbers are constant month by month. It saves me a lot of effort and to be honest, I don't feel that bad when I have to spend some extra money from time to time. There is no reason to stress about every single penny. I'm on the best way to FI. I also started practicing warrior diet 6 weeks ago. I had only one cheat day in 2nd or 3rd week. Switching was super easy for me. I'm on 18/6 basis + fruit/smoothie, at it suits my current lifestyle. I'll try to get rid off midday fruit and go into 20/4 at some point in the future. No real weight loss so far, but I'm happy anyway, meal planning in so much easier now!

I also spent last few months reading and thinking about investing. The more I know, the more I'm convinced Permanent Portfolio is the best way to go for me.

Ough, and December is "100 push-ups a day no excuses" month!. I started from 7x15 basis, but now 5x20 doesn't seem to be challenging anymore, so maybe I'll try 4x25 next week. I'm more and more amazed by human body!

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Fri Jan 27, 2017 2:36 pm

Hi guys, thanks for many replies above :D , but I really need your help now. Recently I was thinking a lot about my future withdrawal rate, and I'm getting more and more confident with 4% WR, than planned 3%. Why I believe it will be great option for me?

- 3% WR is guaranteed extra time at work to accumulate more money. I'd prefer to spend my young years doing important stuff than mandatory work. At the same time very unlucky 4% scenario can put me back to part-time workforce for 1-3 years to rebuild my portfolio. I'm ok with it. There is a big chance I will make some money anyway during retirement period.
- while still being young (ERE planned at age of 30), and having 25 years of expenses saved, me and my partner will have plenty of time to react, when something go terribly wrong.
- thanks to tyler9000's and others great effort, I'm able to build more reliable and bulletproof portfolio with more stable and potentially higher returns than 100% equities or classic stocks/bonds portfolio, so improving my chances of success
- I believe I will be able to cut my expenses down during very bad years
- at some point in the future (~40 years from now) I will hit social security age, so there is a possibility I will get some money from government. I'm aware it will be super low income, but having ERE spending level, it will definitely boost my budget a bit
- I have no problems to drawn my portfolio down to zero. It means, if I only manage to protected the original inflation-adjusted value of my portfolio for next few decades, I will still get 25 years of expenses. And even if I run out of money as a old man, I can always sell a house to recover few years of expenses and rent a cheap place. I don't need to be the richest man in graveyard.
- being the only child, there is a possibility that I will inherit some assets in next few decades, as my parents have good financial habits

Can you see any flaws in my thinking? What is your opinion?

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Re: stayhigh's journal

Post by George the original one » Fri Jan 27, 2017 4:27 pm

stayhigh wrote:- being the only child, there is a possibility that I will inherit some assets in next few decades, as my parents have good financial habits
Never count on inheritance. At best, you'll likely be 60-70 years old when you collect it unless your parents are significantly older than average or unhealthier than average. At worst, it will be confiscated.

Similarly, never count on government largess. Yes, it will likely be there, but consider it a bonus rather than something you can rely on.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Sat Jan 28, 2017 10:45 am

George the original one wrote:
stayhigh wrote:- being the only child, there is a possibility that I will inherit some assets in next few decades, as my parents have good financial habits
Never count on inheritance. At best, you'll likely be 60-70 years old when you collect it unless your parents are significantly older than average or unhealthier than average. At worst, it will be confiscated.

Similarly, never count on government largess. Yes, it will likely be there, but consider it a bonus rather than something you can rely on.
I don't count on any of these. I don't believe in any government institutions, but they are here so I have to take that into account. This is the reason I marked them as possibilities. Having few of them increase chances at least one of them will work out. Even without them I should be fine.

George the original one
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Re: stayhigh's journal

Post by George the original one » Sat Jan 28, 2017 1:34 pm

Excellent! I figured you knew, just like having it explicit for other readers.

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Re: stayhigh's journal

Post by Jason » Tue Jan 31, 2017 5:13 pm

Very Interesting story. The polar opposite of mine actually.

On Thanksgiving, my mother-in-law was talking about the inheritance she was going to leave us as a guilt offering. This is how I responded (I paraphrase):

There will be no inheritance. You are old and live alone. You will most likely fall on your head (which she did two months later) or stroke out and we will be forced to put you in a nursing home. Said nursing home will take the proceeds of your estate and treat you with care and until your funds are depleted. At that time, and they will rely on medicare for your long term care and therefore, pull back on your treatment, expediting your death, in order that the next old lady with a fully paid off house can sleep in your cot. Now pass me the stuffing.

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Fri Mar 03, 2017 2:04 pm

10 months to ERE

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Tue May 30, 2017 4:21 pm

Due to some events, higher than usual savings and better than average investments returns, I'm luck enough to be currently at 37 years of expenses. Realistically, I also have to consider things like house, marriage, round the world trip and some other smaller one off bits and pieces, but according to my rough calculations it still will be good for 25-30 years or ~3.5% withdrawal rate.

So, it looks like I'm FIREd at age 29, right? I'm really considering leaving workforce this summer. What do you think?

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cmonkey
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Re: stayhigh's journal

Post by cmonkey » Wed May 31, 2017 7:42 am

Is your job holding you back from doing other things you'd rather be doing? If so, then yes absolutely quit! Life is too short to sit in a cubicle doing things you'd rather not be doing. If historical example is any guide, you'll likely earn more money again and at your age your assets will keep growing even if you didn't.

And congrats!

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stayhigh
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Re: stayhigh's journal

Post by stayhigh » Wed May 31, 2017 1:50 pm

cmonkey wrote:
Wed May 31, 2017 7:42 am
Is your job holding you back from doing other things you'd rather be doing?
Obviously I'd be happy to leave my workplace and do my own stuff from tomorrow morning, but it's not holding me back too much just now. I have another 50 years to enjoy myself, so few weeks more or less makes no difference. I work in small family run business and owners helped me a lot in the past, so it wouldn't be appropriate to leave now, just before summer when many key people will be off on holiday. Also, I don't want to burn bridges - you know, just in case. It's also the nicest time of the year to work for me, as I spend most of the day outside the office, getting around city and suburbs. Few extra thousands will help me to visit few more countries or get bit fancier house/car/whatever in the future. Originaly I planed to stay till the end of the year, but I think august/september will be good as well, giving me enough time to sort few things in my life (and head) before pulling the trigger.
cmonkey wrote:
Wed May 31, 2017 7:42 am
you'll likely earn more money again and at your age your assets will keep growing even if you didn't.
I hope future won't be worse than past. And even if it will be worse, I want to do my own stuff just now, when world in general is rather friendly and stable at the moment. I want to spend best days of my life doing stuff I enjoy. Going back to work is an option for me, when shit hits the fan and I'm ok with it. It's not the end of the world, millions of people works whole their lifes. There are worst things than this.
I spend a signifant amount of time playing mostly with portfoliocharts to find out how assets allocation and diversification really works. One of the most valuable lessons was realising that first year or two are crucial - when returns are positive for initial period, there is massive chance that portfolio will perform more than fine and not fail in long term. So the final outcome looks like this: some high yielding REITs, hard assets, little bonds from around the world, broad indexes of fair value - so in general most of the world ex US, some cash on top of it, to get US or other equities when/if they get better valuations. Basicly, I'm getting international, equity weighted Permanent Portfolio, with extra assets, traded on at least three different markets around the globe. And let's face it, even if it fails it's so easy to get some extra income doing odd jobs. I can start another lifestyle/FIRE blog. Or write a book: "How to live like a king and be happy on average income". Sounds good, isn't it :D ? Maybe cut the neighbours grass doing mine at the same time? Or taking care or their dogs, when away on holiday? Baking cakes for others? Selling excess of my own free-range organic eggs? Doing stuff like this doesn't fell like a job, but it cuts required withdrawal rate A LOT when costs of living are at ERE level.

MDFIRE2024
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Re: stayhigh's journal

Post by MDFIRE2024 » Fri Jul 21, 2017 12:54 pm

Congratulations! You are FI if I read correctly. Are you also RE? I really liked to read your journal. It was fastforward from 2015 to FI in 2017. Wish you all the best with FI money, health and partnership. Is she also FIRE'ED?

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