In my newsletter last week I said “ask me anything”. I got a bunch of thoughtful questions and also stories from people. I should have done this a long time ago.
I got more questions than I can answer in one go, so I’m going to work my way through them roughly by theme. I really enjoyed engaging directly with issues and questions you have curiosity about, so please keep the questions coming. The best way is to email me via the “Send me an email” button on my home page.
I grouped the questions thematically. In this post I’m addressing all of the money-related questions.
Graavy asked: Are you coast- or leanfire, or some hybrid or alternative? Do you maintain an investment portfolio?
Coastfire: earn a moderate stash, and then get a parttime job or gig to cover your expenses while your stash grows and you coast to FI levels.
leanfire: FIRE with a cost of living of $40,000 or less
Short Answer: I was sort of coastFIRE from 2021 until early this year. Now I’m back in an accumulation-to-FI phase. My COL is very low so, yeah, leanFIRE.
Long answer: Between 2021 and the beginning of this year I was ‘semiERE’, which just means that I wasn’t FI but my cost of living was so low that I could afford to spend only a very little amount of effort per year to pay my bills. And I had a buffer of more than five years of liquid savings, and more than that in retirement accounts. I was focused on skill and strategy development, and experiencing the world, and coming down from 12 years of full time stressful employment.
As of the beginning of this year I am back on an accumulate to leanFIRE path, having spun up a business venture that landed in my lap early this year. (I’m doing Revit MEP implementation consulting and asset creation, and if you don’t know what that means, don’t worry about it.) The short version is that I am in the process of solving money for good in as short an amount of time as possible, which by the way is a whole lot easier if you don’t spend very much.
My cost of living is stabilizing at around $10,000/yr. My real ‘lifestyle’ COL is somewhere between $5k and $7k, but I’m still spending money on building materials and other ‘capital’ expense type stuff. If I needed to I’d be able to ramp down much closer to $5k without a major hit to standard of living.
I do maintain an investment portfolio. I run a simple Harry Brown style Permanent Portfolio allocation. That isn’t advice, by the way, just transparency. I’m not adequately financially educated nor smart enough to sleep well at night with anything other than a very conservative indexing portfolio. I’m leaving returns on the table that a more aggressive 90/10 or even 60/40 allocation would (maybe!) get, and I don’t care.
The goal of my portfolio is not to chase returns, it is to avoid ruin. This is the tricky part of consuming investing information as a post-consumer, because most investment writing out there assumes that quality of life scales linearly with wealth. I have decoupled my quality of life from wealth above a certain very low threshold, aka “enough”, and so I have different aims with my portfolio. Conventional wisdom doesn’t apply to the non-conventional.
This question pairs nicely with one of Sarah’s which was:
I know you are about to become FI, but if that side hustle opportunity hadn't come up, do you think you would have indefinitely kept your FU stash rules the same, as you described them in your 'new FU stash rules' episode a while ago? (I'm referring to the 3-7 years of living expenses rule: to only do work you like or want to do, if you have at least that much living expenses)
Short answer: probably, although it’s quite possible I’d have pushed a little harder or more intentionally to develop remunerable streams of income than I initially set out to do.
The episode/post Sarah is referring to. You don’t have to read it, I’ll recap:
I wanted a set of simple rules I could follow that would maintain a comfortable amount of slack in my personal financial system and serve as an early detection warning system, and otherwise to do things that interested me. I assumed that opportunities for remunerable work would crop up serendipitously, and that I would be fine financially.
In other words, I wanted to see financial scarcity coming from miles away, thus having plenty of time to take corrective action without needing to be in a panic about it. Since I was in a state of fluctuating and minimal income, and since I was trying to incidentally earn income from activity I had other reasons to do besides just earn money, the rules I came up with helped me sleep well at night. I could check my accounts and see if all the buckets were within spec, and if they were, I had nothing to worry about. Only if certain low thresholds breached did I need to pay any special attention.
This is the key: it's IF and ONLY IF my FU stash starts to run low that triggers me to go out and seek some efficient means of earning income regardless of whether it's really what I want to do.
Not only were my rules designed to provide slack and early warning, they were designed to make space in my life for serendipity. My plan wasn’t to just scrape by, earning ~ 1 COL/yr with a buffer, for the rest of my life. My ‘plan’ was to chase stoke, be a free (yet responsible) human being, and I suspected that sooner or later my stoke-led pursuits would be throwing off income in enough excess of 1 COL that I’d eventually cross FI thresholds.
That’s not precisely what happened, but it’s close. Serendipity threw me an opportunity to do something I enjoy and am good at, generate efficient cash flow, and potentially solve money for the rest of my life within a couple years. That’s too good to pass up and I’m psyched to be doing what I’m doing right now.
If this opportunity hadn’t popped up, I do think that I would have mostly stuck with the rules. I think that inside of 5 years I’d have landed on an activity or system of activities that threw off incidental cashflow that more than covered my cost of living, and moved me towards financial independence.
The major insight I’ve had from this experience is that it’s one thing to say “I’m not going to think about money, I’ll just let it happen incidentally”, and it’s another thing to actually not think about money. I found that I actually thought about it more than I’d like, and it did influence my decisions. I worried and wondered how I’d put together the cashflow. It was an experiment and I hadn’t proved that it would work out, so I was going on some level of faith. (It bears emphasis that the only reason I thought it wasn’t totally stupid is because my threshold for ‘success’ was making between five and ten thousand dollars a year.)
I really noticed this once I got engaged in my current hustle and started generating real cashflow. All of a sudden, there were several activities in my life that I ‘unclenched’ about. For example, the book I’m writing is a weird premise. It was a blog post that got away from me. If my aim were to make money writing a book, I would write any other book. Hopefully a few people out there get value from it, but the idea that it’ll do well in terms of sales is ridiculous. So from the beginning “earn money” was a purely incidental yield of my book project. I want the book to exist, so I’m writing it, and that’s the end of story.
But once I started making money with my hustle, I noticed my attitude towards the book project changed. I was writing differently. I was making different decisions about what to write about and even having different thoughts about how I might publish and release it. Ruh roh. There goes my theory about purely incidental income generation from otherwise stoke-led activities.
So I learned that it’s not so easy to pretend to not care about money when it isn’t a fully solved problem in your life. Based on this insight, I’m even more motivated to do well with this hustle and solve money for good, because I want to be as decoupled as possible from the conscious and unconscious biases that income exerts on my work and activity in the world. I want to be able to focus totally on building out a cool spot on the flotilla.
Graavy asked: How are you planning for money and healthcare in old age?
Assuming things in the world don't totally go to pieces, I'll have my retirement accounts and I'm fully invested in Social Security and all that. In other words, I plan on having access to all of the standard money and healthcare systems that normal, baseline financially responsible retirees think of as standard for the US middle class.
However, that is just one pillar. One of the main ideas of post-consumer praxis is to have resilient lifestyle systems, meaning, multiple different means and methods of attaining the same goals. So my strategy with respect to health care doesn’t end at conventional wealth management best practices.
I spend, and will continue to spend, an abnormally high level of attention on being and remaining healthy. The least expensive health care plan is "don't get sick", and while I have systems in place for in case I DO get sick, I'd rather not rely on them. So I spend a lot of time on nutrition, exercise, reducing exposure to environmental toxins, maintaining a healthy lifestyle, practices to avoid lifestyle diseases and conditions, low-stress lifestyle, spending time with friends and community, etc.
In the world I live in today, when you get too old to take care of yourself you go through a sequence of something like in-home care, then maybe 24/7 in-home care, then you move into an old folks home where they can keep a closer eye on your needs, and then you might go to hospice, and then you go to the morgue. Depending on how things play out you might skip some of those steps.
That world might not exist when I’m an Old Folk myself. Or the quality of care might be extremely undesirable. It’s possible that my world will look very, very different.
One possible future scenario is that by the time I’m 85, 90, whatever, I’ve been deeply embedded in a close-knit community for decades, a community that has as one of its values and practices elder care. As a member of that community that I’ve been contributing to for decades by that point, I can expect to be cared for by able, younger members of that community, through to the end of my life.
Communities with practices like this already exist, and I suspect they’ll become only more common over the next several decades as people increasingly turn away (or are turned away) from conventional end of life care, so this is not as far-fetched a scenario as it sounds.
However, it must be emphasized that “I’ll be taken care of by a bunch of hippies in my dotage” is NOT my sole Plan A. It is one future scenario. Another, possibly more likely scenario is that I’ll get taken out well before old age by a real pandemic, or a heat index event, or a wildfire, or some warboy will take me out, or whatever. (But now I’m jumping ahead to Sarah’s question about death, so I’ll save it for later.)
Graavy: Does your lean budget translate to a lean diet? Is a nutrient-dense and generally nourishing diet compatible with the liberated lifestyle? I’m food attached and spend so much money on organic local foods, powders, and supplements. Losing food optionality is a major fear in my journey towards lean.
Short Answer: a nutrient-dense, nourishing diet is one of the most important elements of a solid, liberated lifestyle system and ties in to your question about health care and old age. A lean budget does NOT mean a low-quality or low-nutrient diet.
One of the major psychological barriers to a post-consumer lifestyle is the conflation of ‘lean expenses’ with ‘lean resources’, aka scarcity. The radical truth at the core of post-consumerism is that by developing appropriate skills and strategies your life gets more abundant, in all of the ways that really matter to us humans, not less.
The most important concept to hold in mind is that post-consumerism isn't about spending very little money. It's about realizing that there are more ways to solve problems than spending money, and that quality of life is a function of money and 'skill', understood very broadly.
It is easy and convenient to solve the "I want to eat delicious healthy nutrient-dense food" problem 100% with money because that's how our culture works. But, as a thought experiment, imagine that you ate just as good of food as you do now, but you spend $0 at the grocery store/farmers market. What would you have to do to do that? You might have your own garden or plot in a community garden. You might volunteer at local organic farms and get 'paid' in all the produce you can carry. You might have a good friend with chickens in their backyard who gives you some just because you're friends. You might identify all of the publicly accessible trees within walking/biking distance that bear fruit and harvest them. You might volunteer at a community kitchen that gets high quality ingredients donated, and take home surplus as part of the deal. Maybe you hunt and forage.
That all would be a lot of work to get to $0, but the thought experiment helps force you to think of ways you might be able to eat well without spending money. Now, with some of those methods identified, you can start doing some of those activities. You keep eating just as high quality as you do now, but your monthly food bill goes down significantly.
Also: the low hanging fruit for reducing food costs is alcohol and restaurants. Cut or dramatically reduce those and that makes an enormous dent in your cost of living. Then you can focus on optimizing ingredient cost, and then in finding alternative ways to have an abundant, healthy relationship with food without having to be chained to a stressful job, which is a bit counterproductive.
More answers coming
Like I said, you delivered a great set of questions and I’ve got more to do. I’ll have another Answers post in the near future. Send more questions! This is great.