MadFientist: The Hardest Part of Early Retirement Wasn't the Money

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28:42Welcome back. So first of all, can you quickly summarize the thesis of Die With Zero for the listeners who are unfamiliar with it? It was best summed up, I think, by a quote that I heard when Bill Perkins, the author of Die With Zero, was interviewed on All The Hacks podcast. It's just the question he kept asking Chris was, when's the party? And I keep saying that to myself because it's true. He's like, there's going to be a party eventually. So you're saving up all this money and there's going to be a party. You're either going to die and then it's all going to go to charity and they're going to have a party.

29:12or you're going to give it to your kids and they're going to have a party. But when's the party? It made me realize like, okay, yeah, I could save up all this money and let it grow. And then it'll go to my kids or go to a charity when I die. But it'd be a lot more fun to be part of that party. So thinking about giving to charity now or thinking about how I can make my kids' lives better with the money now than just letting everyone else have this big party after I go. that's the phrase that keeps going through my mind. So in his book, he's saying, you should plan to die with zero. You should plan to either give it all away or give it to your kids or do everything while you're still alive and not just accumulate and accumulate and then just die and not do anything with it.

29:59So that's the main thesis of the book. But the die with zero, that's not what appeals to me. It's more the discussions, like I mentioned before, of how there is a season for everything. And this is the biggest takeaway that I took from the book was you don't maximize for net worth. You should maximize for net fulfillment. Like I mentioned earlier, I missed out on some of those things in my twenties, whatever my net worth was in my twenties, I could probably now have 20 more of those trips or something like that. But for net fulfillment wise, it would have been way better to take one of those trips when I was 20 than to take 20 of them when I'm 40.

30:37So it's just changing what you're optimizing for. And that was the big takeaway for me was my entire life. I've been optimizing for net worth, just chucking money on the pile. And yes, it did give me freedom, which is invaluable. And I am so grateful that I built up enough to have that freedom, but now chucking more money on that pile doesn't make sense. and I should be deprogramming my brain that's so used to optimizing for net worth and instead start optimizing for net fulfillment. And if that means spending some money now, rather than spending 3x that money later, then that makes a lot more sense.

31:19To go back to my mountain example, I could save a bunch of money and have a beautiful mountain house when I'm 50. but I think net fulfillment wise taking a trip every winter that's a month long in a beautiful place with friends and family and my kids and when I'm still active and enjoying all these winter sports I think that's gonna potentially have a lot more net fulfillment and yeah maybe not as great of an investment and maybe my net worth will take a ding because of it but now it's a case of optimizing for something else so those are the main things I took away from the book. And yeah, the phrase that keeps ringing in my head when I make decisions is like, when's the party?

31:56And trying to figure out ways to bring the party into our lives now and to our near future rather than just having a huge party after I go. It was definitely one of the most impactful books I've read. Definitely the most impactful one I've read post-fi. So if you haven't read it and you're like me and you are just on autopilot checking money onto a pile, it's definitely worth a read. I would recommend it. What was it about that philosophy that got through? Because as I'm hearing you talk, I'm thinking about the many, many people over the years who have often said some variation of YOLO or some variation of, you could die tomorrow, you can't take it with you.

32:38I mean, we hear that over and over, but somehow it has always seemed historically, like the YOLO crowd and the fire crowd have been at odds with each other. And I think you really saw this in 2020 during the pandemic when there was a big YOLO crowd that then translated that into Robinhood, YOLO, crypto, AMC, GameStop, meme stonks, right? In the financial world, the YOLO crowd was really going in that direction. The fire crowd was going a different direction. It seemed as though these are now two very different forks, different branches of people interested in personal finance. And then Dive at Zero seemed to be the convergence of these philosophies.

33:24What was it about the restatement of essentially the YOLO philosophy that got through? Yeah, it's an interesting question because yeah, I feel like I'm so far away from the YOLO crowd, even though I'm making progress on the spending front. It feels like a very different idea, but you're right. Effectively, it's pretty similar in the fact that you're just, yeah, you're going to die one day, so you might as well spend it. It's a lot more measured and thought out, I would say, but it was just the messaging that was just like, okay, money, you don't win the game just by having the biggest pile of money at the end of your life.

34:03it's a tool to do stuff with so yes saving it is important because it does buy freedom and things like that but at a certain point you do need to use it in my brain it still seems very different from the yolo thing but that that's interesting you brought that up because it is similar in that sense that yeah you're you're gonna die so you might as well enjoy it maybe since he's a successful investor and he's talking more on the long-term investment side of things like planning for your 40s 50s 60s 70s and like okay yeah in your 70s you may want to have a a travel fund but in your 80s you may not want to and you may want to you're probably not going to use that travel fund so maybe you're going to buy the nicer house and just stay put or it seems like i don't even think that was an example in the book but in the book he was talking more long term so it wasn't like i just blow all your cash now and enjoy it it was more like don't just get on autopilot snap out of your autopilot and actually plan for how you're going to use the money rather than just chucking more money on the pile, which is something me and I know a lot of other five people do because it's what we've done for decades and we're good at it and we get joy from seeing that pile grow.

35:15But it was more just saying, hey, you need to use the pile because the pile is meaningless at the end of the day. I think movements are often defined by their extreme ends. And so in its early days, the FIRE movement was highly defined by early retirement extreme, who for the listeners who are unfamiliar, it was a blog written by a guy by the name of Jacob, who lived on$7 ,000 per year in the United States. In San Francisco. Yeah, in San Francisco. And that was in the early 2000s. So I mean, okay, adjust your$7 ,000 for inflation. But still, even$7 ,000 in the year 2000 in San Francisco is absolutely insane.

36:05But he truly was extreme to the extent that movements are often, especially in their nascency, are often anchored by and moved by the most extreme practitioners. We saw, I think, in the FIRE movement, the iteration from early retirement extreme to Mr. Money Mustache, who is by mainstream standards still very extreme. He lived on, what,$26 ,000 per year. He and his wife combined lived on$26 ,000 per year, and that was in 2010 dollars. Over time, as the movement grew, it sort of grew towards more of the center. And I think if you look at extreme YOLO, you can see countless examples of the Lamborghinis on social media, you see these countless examples of extreme YOLO consumerist credit card debt fueled living.

37:06But in the same way that a movement starts at the extreme end, and then over time matures into people who can practice it in a more moderate and nuanced way, the concept of die with zero might simply be that moderate nuanced approach to YOLO living. Yeah, definitely. I still find value in the extremes because it does snap you out of your default thinking, which I owe everything to early retirement extreme and Jacob just for the math that he provided and the fact that I never thought to use my money to buy freedom. And it never crossed my mind. I thought retirement was an age, not a function. And when I realized it was just a math function that just changed my entire life, I never, ever wanted to live on 7 ,000 a year, especially in San Francisco.

37:54So I think that's the beauty of finding different voices is that you can take the extremes and just pick parts out of it. Just like I don't want to die with zero. I value the security of knowing that I have a chunk of money there. And I want to still have a chunk of money there when I'm on my deathbed, because that'll mean that I haven't worried about unexpected expenses or anything that's cropped up. So I definitely don't want to die with zero. Getting these alternate voices and some of them extreme or more moderate, they help push you and help you adjust your thinking. And, you know, both early retirement stream, die with zero and like Ramit's writing and things like that.

38:36It all helps me form my ideal, which I'm constantly tweaking and adjusting as my life changes and my goals change and my circumstances change. Do you still get joy out of hyper-optimization? I mean, you were for years, Mr. Backdoor Roth conversions, Mr. Here's how to hack your HSA. And when it came to using very, very sophisticated tactics on tax advantaged accounts, right, you were at the forefront of that. Is that still a hobby? Is that still something that brings you joy? No, no, not at all. It's something that I'm actually actively trying to suppress a little bit because I'm optimizing for the wrong thing.

39:20My whole life has been optimizing for efficiency, whereas now I should maybe optimize for something else, which is free time maybe, or I'm with my kids or, you know, a clear mind that I can devote to something else. So I'm actively trying to stop my hyper optimization in all my areas of my life and especially my finances because it's time wasted that doesn't need to be wasted on something like that. But it's hard. Old habits die hard. My brain loves that stuff. So even on my to-do list today, I have a note to switch up one of my investments so that I can get more tax loss harvesting done. And it's still there and it's going to stay on my to-do list and I'm going to eventually do it even though the time it takes to set up a new account and move the money is time wasted, in my opinion, at this stage.

40:12I'm still going to do it because old habits die hard and I need to scratch that itch a little bit. So yes, I still do some of it personally. But yeah, as far as researching ways to really optimize certain aspects, I haven't done anything too interesting recently. Although there's a few things on my list that I have to look into and they may see the light of day as if they do turn out to be interesting. No, I don't have the drive that I had back in early 2010s when I was really diving into this stuff. Wait, what are the things that are on your list that may prove to be interesting? Like estate planning.

40:44Now that I have two kids, I really need to think about where everything's going for when I do kick the bucket and optimizing that. So that still gives me a little bit of interest as far as like actually wanting to do it because then it's not my money anymore. It's charities or my kids or my family. So there's still a desire to optimize a little bit there. So that's one of the big things that's on my plate and on my to-do list to look into. And again, it's for a personal reason. So that's why I'm still into doing it. And hopefully it would end up being a really good Mad Findist article because it's always the ones that I am personally interested in that turn out to be the best.

41:19So that's a big one. The last time that we talked, you said that you were pursuing passion projects that could also provide an income stream, such as music. Can you give us an update on that? Yeah, that was the ultimate dream of FI was to be able to pursue my childhood passion of writing music and releasing music. And just last week was the final thing that I really wanted to tick off, which was to play a live show of all the songs that I wrote with my brother on drums, who's a professional drummer, amazing drummer. He's currently on tour with a traveling Broadway show around the States. Yeah, he was over here after my daughter was born to meet his new niece and uh while he was here i was able to organize a show we played just last week it was amazing uh dream come true just uh yeah playing songs i wrote to a audience that was really enjoying them and uh yeah i had my brother back there on drums so that's still going strong i hope to write and release another album by the end of next year that's something i'm gonna start working on once i realize how to actually get things done with two kids so far we haven't figure that out yet, but hopefully soon.

42:32It's a dream come true, really. It's something that I'd hoped FI would allow me to do, and it has. It's only something that I realized post-FI that it wasn't money that was holding me back prior to FI. It was just a lot of self-doubt and being scared and not wanting my dream to die and not thinking I could do it. So it wasn't actually FI that made it possible, but FI did take away all my other excuses so that I had to actually face all those other challenges. And yeah, it's still my greatest accomplishment because I know how hard it was and how many things I had to battle through and how much I had to learn and so much self-doubt to get through.

43:09So it's not a masterpiece by any means, but to me, it's the thing that I'm maybe most proud of just because I knew what I had to go through to finish it. Being able to play those songs live last week with my brother bashing away on drums was really a dream come true. Wow. Congratulations again. Thanks.

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44:44I want to dig into something that you said. What you reflected, which is I reached FI and then I started pursuing this long-held dream and I realized after I had reached FI that it was never the money that was holding me back. J.D. Roth, the author of Get Rich Slowly, has said exactly the same thing. he has talked about how prior to the age of 35 he was broke he was in credit card debt and he talked about how during those years he always thought that lack of money was the reason that he was overweight because he couldn't afford a gym membership lack of money was the reason that he had a job that kind of sucked or that he wasn't happy in because he had to go to work to pay the bills because he was in credit card debt.

45:36So how could he improve his life when he was just trying to not dig the hole any deeper? And once he got out of all of that, once he started a business, it blew up, it became wildly profitable. It kind of caught him by surprise how profitable it became so quickly. And it allowed him to not just become debt-free, but actually to become a millionaire, a multimillionaire in very, very short order. And when that happened, he took a look at his life and realized, I'm still overweight. I'm still out of shape. None of these problems that I'd previously blamed on money have been solved. Absolutely. It was the biggest shock.

46:19And that's why in recent years, especially last five years when it was only the pandemic that actually allowed me to accomplish this goal because I had weird lockdown. I had nothing else to do. And there are no more excuses because up until that point, I had four years of post-fi life that I did nothing towards the goal. Because again, I had all those same, I was scared and I didn't want to try and fail. Ever since actually trying to pursue this goal since 2020, I've talked about that a lot is, you need to start living your post-fi life pre-fi and you got to do as much of it as you can because it was a shock to me when I had nothing else to blame that I wasn't making progress on this stuff.

47:01And it's tough, especially when money is not a motivating factor anymore for anything to motivate yourself to do these hard things. So I wish so much that I'd started pursuing these things pre-fi. It would have made post-fi transition a lot easier. Post-fi life would have been a lot more fun and I would have accomplished some of this stuff a lot earlier than I did. So yeah, my job was absolutely not the reason I didn't pursue any of that stuff pre-fi. Because if you have time to watch Netflix or if you have time to surf the web, you have time to do those things that you think you're going to do post-fi.

47:36Anyone out there on the journey to financial independence, start living your ideal post-fi life now as much as you can. Because one, you may find out you don't like it, which we also found that out traveling. I thought I was going to travel the world nonstop. I could just be on the road all the time, seeing new places. But we took a three-month trip. And by the end of the third month, I was like, this is tiring. I want to just settle down and get some stuff done or see some friends. It wasn't what it was cracked up to be or what I thought it was going to be. The more you can live your ideal post-fi life pre-fi, I think the better off you'll be.

48:12Let's use travel as an example. To what extent could a person practice that if they have two weeks of vacation a year. I mean, how do you live that post-fi life in the constraints of a nine to five? Sure. Yeah. Obviously you'll be taking your two weeks off and doing it there. I think sabbaticals are a great idea. Like I said earlier, having a nice way to quit is a great way to negotiate a better thing. So if you save up a bunch of money and you can afford a six month trip, use that as your opportunity to nicely quit. No thank you money. Yeah. No thank Thank you money. Use your no thank you money to say no thanks to this job for six months and may surprise you by either letting you work part-time remotely or they may offer you the job back when you get back or say it's waiting for you.

48:59Those are the ways to do it is to either call it a mini retirement or a sabbatical or whatever. If you think travel is what you want to do full-time, then do it for a long time and give it a shot. And you may find out, hey, actually a month is good. And maybe I can organize that with my job to take a month off every year during the summer when things aren't as busy. And now I get the best of both worlds. I get money coming in and I'm not rushing to five, but I'm living the travel lifestyle that is actually ideal for me. Not the thing that I think is ideal for me. And that's drastically different.

49:31There's so many instances of that where going back to my desire to try to spend more on things that improve our lives, getting to five, I definitely deprived myself. So I tested the lower limits, but post-fi I've also tested the upper limits and spent more than even made us happy so now when we don't travel as much and we don't eat out as much it's not that I feel like we're depriving ourselves anymore I feel like actually that's the sweet spot because I know eating out more I just feel nasty and bloated and not healthy traveling more I get bored of it and I don't look forward to the trips as much and I'm not getting that fun anticipation that you get before a fun trip.

50:09So yeah, so testing the upper boundaries of what you think you want to do is great. So yeah, if you're still working, taking little sabbaticals or in between jobs, really try to live that life because you'll probably find it's not as ideal as what your vision of it is because life is often different and we're pretty terrible at knowing what we actually want until we try it. how does a person even know if they want to fi? I'm imagining some subset of people who are listening to this who are perhaps wondering, do I want to retire early or do I simply dislike my current circumstances? Perhaps they're overworked or they're in the wrong profession.

50:55how would a person work through whether or not early retirement is even for them? I think retirement, as far as having money work for you instead of you work for you, is something most of us all need to do because eventually by the time we can't work. So that's obviously standard retirement. I think having your money working for you while you're working is something everyone should strive for. It gives you so much more power to improve your current life, even if you're not interested in retiring in your 30s 40s 50s accumulating money so that it works for you and gives you the power to have choices and make difficult choices and say no to bad situations is invaluable i think so i think it is the goal for everyone whether or not you want to actually call it quits that's a whole other can of worms and i definitely don't recommend it for most people because going from working full-time to not having to work at all is very disorienting.

51:57Something I've struggled with is not having money as a motivating factor in my life anymore because I'm inherently lazy. I'm a productive lazy person, which is why I got into coding. So I'm like, I'll just program the computer to do stuff for me. So I'm not like video game, just sit on the couch lazy. Overall, I'm constantly battling to counteract my laziness and do stuff. So not having money motivate me anymore has made it difficult because money was such a motivating factor in my life. Going from working hard and striving and being productive and trying to accumulate as much money as possible to then not having to do anything or earn anything.

52:39It's still something eight years in, I'm still trying to grapple with and I still struggle with sometimes. That's the additional benefit of actually using my money now rather than just chucking more in the pile is that I'm starting to find more value in money again, which is nice. So it's motivated me to keep my website up and running and keep the web apps working that I wrote back in 2010 or whatever. So if you don't think early retirement is for you, then I agree with you. It's not for everyone, but having that money and having that power is so valuable. So if you aren't happy and you think you want to retire early is because you hate your current job or you're overworked or some of the other things you said, then use that money, use the power of quitting and work your way into something that doesn't have all those downsides and enjoy your life now because sticking out for a decade or more just so you could quit altogether, I don't think is a good solution at all because you have so much power way earlier in your journey.

53:41You should use it. I want to wrap up by completely changing topics to ask you about your thoughts on AI. I am so thankful that I don't have to work for money anymore because who would have thought a software developer? I always said that was always my thing. Like when I was early in my FI journey and people were like, well, what happens if this happens? Or what happens if this happens? you have to go back to work. I'm like, yeah, I'm a software developer. I'll just pick up work. I can work for anyone at any time and anywhere in the world. Of course, I'll just pick up work. And yeah, now with ChatGPT, I still do a lot of coding for just personal projects and for all the web apps that I maintain that I built before.

54:23And I'm 10 times more productive. So if I was still in the office, me with ChatGPT could replace nine developers. If I was relying on that work to survive for the next 30 years, I'd be freaking out right now. And instead, I am on the other side of the coin where I invest in all the companies in America and most of the world, and I'm going to benefit. They're going to be able to do the same thing for a lot lower costs with the help of some of this technology that's coming in. So me as a shareholder, it's good drastically see increased profit margins as this stuff starts getting integrated into the workplace.

55:03I'm still scared of what that means culturally. A lot of people losing their jobs is beneficial as a shareholder because then the profit margins are higher. But for society, I don't know what that means and it's scary. So on a societal level, I'm scared of the changes that are coming. As a shareholder, I'm excited. personally i'm relieved that i was able to work when i did and build up this portfolio that will hopefully allow us to continue our lifestyle as it is without the need for finding work in a new industry potentially so that's my brief summary of it but it has been a lot of fun to use and try out and mess around with on a personal level and it's just it's amazing how much it's progressing so quickly.

55:49So it's going to be a wild decade, I think. What I'm hearing in that answer is that AI perhaps even underscores the importance of financial independence in that it underscores the importance of moving from being an employee to being a shareholder. Absolutely. Yeah. At least being an employee who requires the job in order to eat. Right. Exactly. I am so thankful that I saved up when I did and what I did. Because yeah, a lot's going to change. It's not all doom and gloom. There's going to be some amazing things that come from it, but a lot of things are going to change. And I would have never thought that a software developer job would be something that could be taken away by a machine so easily.

56:31But it has and it is, so it's wild to watch. But I think it makes saving and having that pot of money there even more important. What language do you code in? All the stuff that I wrote for the web is Ruby on Rails. That's what I used at my last job at the university. I loved coding in it because it was so quick. It could just whip up something really quickly and it's so easy to use and it all just really makes sense to me. I don't have my finger on the developer pulse these days, so it's probably considered like an old antique language that nobody uses anymore, but it still allows me to get things done quickly and that's all that matters.

57:08So that's still just what I use because I have no desire to just learn a new technology for the sake of it. If this thing can help me build a web app, then that's all I need it to do. Well, thank you for spending this time with us. Where can people find you if they would like to learn more about you and your work? MattFaintist.com. I'm still on all the social, but I don't really do too much on social these days. So yeah, MattFaintist.com is the main place. And if you want to learn about the music stuff, I think you can go to MattFaintist.com slash album. you can find all the Spotify stuff there, which is really the only thing I care about these days, to be honest, is Spotify followers on the music stuff.

57:47The podcast is still going. I rarely put an episode out when I do. It's usually something I'm really interested in. So yeah, the podcast is still everywhere you find podcasts. And that's just the Financial Independence podcast. And yeah, I think that's it. Mad Scientist, that's a made up word. So it should only be me everywhere on the web. Awesome. And we will link to all of that in the show notes as well, particularly the album. Nice. Thank you. Yes. And hopefully there'll be another one out in 2025. Nice. And happy Guy Fawkes Day. Do you have any Guy Fawkes Day plans? No, it's probably just hoping that the fireworks don't wake up any of the kids.

58:23We'll just be sitting there just hoping that, yeah, that nothing's too noisy. Besides that, I think that's how we'll be celebrating. Nice. So happy Guy Fawkes Day to you too. And thanks for inviting me on this special holiday. Absolutely. We should make this a Guy Fawkes Day tradition. That sounds good. That's our show for today. Happy Guy Fawkes Day to everyone in the UK. For those of us in the US, which is 90 % of this audience, if you are eligible to vote, I hope that you have cast your vote. And I hope that we can unite no matter what happens next, no matter what happens tonight or in the weeks or months to come that we can remain united and not judge one another based on how our friends and neighbors vote.

59:12I hope that we can avoid the vitriol and the name-calling that so often clouds important conversations about the future of our nation. And I hope that we can think and interact more from our prefrontal cortex and less from our amygdala. I hope we get out of our echo chambers and we recognize the validity of the multitude of emotional experiences that people across this nation have. It is hard and messy to have such a big multicultural, multifaceted society. And the American spirit is innovative and optimistic. It's the reason why my family chose to come here. I was not born here. I'm a naturalized citizen.

1:00:05And I firmly believe that my most valuable asset is my U.S. citizenship. There is nothing that I own that is more important than that, because it is the foundation of all the opportunity that has come my way and all the success that I have been able to achieve. And the strength of a democracy comes from its civic participation. So if you are eligible to vote, I hope you do. I plead with everyone, regardless of what happens tonight on election night, and regardless of what happens in the days and weeks and potentially months to come, I hope that we can remain unified and not judge one another based on how we cast our ballots.

1:00:59It is through the reduction of polarization that we will flourish. Thank you for being part of the Afford Anything community, no matter who you are, no matter where you come from, no matter what you believe. We, as a community, believe in the pursuit of financial independence. It is the common thread that unites us all. Well, thank you for being part of this community again. And I'll meet you in the next episode.

1:01:37Silence. Game over.