The profoundly important value of finding community

By nature, we humans are drawn to tribalism and community – that is, we like to gather in groups around shared interests. I’m not even an amateur sociologist so I’ll leave it at that. But I doubt anyone reading this will disagree with my statement. Some associations are incredibly close, such as those with our families, partners, and our closest friends. Others are rather casual and fun – fans supporting the same sports team and enjoying each other’s company, even if only briefly at a bar or a stadium. Most of the groups in which we find ourselves are somewhere on the spectrum between those two extremes.

When it comes to financial independence, retire early (FIRE), it can be difficult to find people with whom you can talk with full disclosure. The ideals of this path are rather foreign to some, and often merely suggesting your interest in FIRE to somebody can be met with confusion, derision, or even complete disgust. My YouTube show partner, Eric, and I have talked about this in several episodes on our channel (here, here, and here). Of course your spouse or partner is an active participant in the journey so they are a valued confidant. And perhaps you’re lucky enough to have a good friend on the journey like I do – these days, but I didn’t earlier on. But many people don’t have any of these. Where to turn?

The internet can be a positive place for discourse…right?

As one who’s been online since the early days of what we now collectively term as the internet, I’m the last person to claim that it’s a wondrous land of only positive interactions. But it’s also difficult to argue with the fact that there are topical communities of all kinds, across a breadth of platforms, where one can find like-minded folks. Groups of people with similar interests congregate in forums, in groups on Reddit or Facebook, on chat rooms + servers, in the comments sections of blogs and YouTube videos, and the list goes on. There’s certainly no shortage of options. But what is actually useful?

I think all of the above have their place. FIRE-themed blogs and YouTube channels tend to be very high quality content, since many creators not only have first-hand experience, but also generally take the time to research and perhaps even reference their content. So even from a purely informational source, there’s plenty of value. I would assert that similarly themed forums and groups are also pretty useful, while being less formal in nature. But the bar to content creation is much lower in these platforms, so you get the benefit of a diversity of experiences and a much higher volume of materials to take in. This can also lead to signal to noise issues, of course.

All of the above forms of content creation generally have a social aspect to them as well, in the form of comment sections and otherwise providing an ability to reply and engage with others using the resources in question. The quality of experience here differs by the specific group or forum, as well as based on what the topic is. Trolls can of course raise their heads anywhere, though there is often moderation in place to manage this. There’s also the challenge of those lesser informed or simply who have an axe to grind to disrupt otherwise productive discourse. There are good reasons why some people say “never read the comments” – though of course doing so means potentially missing out on really valuable – and personal exchange.

Enter Discord, and the benefits of live community engagement

I extensively used (and still do to a lesser degree) all of the above resources on my path to FIRE. In fact, I discovered that FIRE “was a thing” via the very same, after years of saving towards early retirement before realizing others had similar goals and a framework to get there! But once I achieved financial independence and left my career at 47, I found I was craving something more. When I posted on those forums I sometimes received appreciative responses from those earlier on their journeys, but it wasn’t very engaging. The experience was often rather one-way. But one day I stumbled across a Reddit post about a Discord server dedicated to FIRE (What is Discord? for more info). I’d used this chat service in an app coding class before, and my teen sure used it a lot to talk with her friends. But how would it be useful to me now? I was certainly intrigued!

It turns out it’s been really great for me in several ways. First and foremost, this community is filled with a diverse group of several hundred people, all of whom have one very important thing in common: they’re all on a FIRE journey. Some are still in the early exploratory stages, while a few are out the other side, post-RE. Most are very actively working towards achieving FI. That makes it a really safe space to talk openly about a topic that can be challenging to discuss with others not on the path. Some of these people haven’t yet shared their aspirations with close friends or families, yet here they can talk openly – and completely anonymously if that’s their preference. Importantly, it’s also an incredibly supportive and largely very thoughtful group of people.

I particularly appreciate that there’s a broad range of ages represented among participants, as well as a diversity of geographic locations. Admittedly, there aren’t too many 40-somethings on the server – yet (Discord being much more popular with younger people) but I was happy to see another “old guy” online yesterday. There’s also a much broader gender diversity than I typically find among the other resources I listed above. Not to put too fine a point on it, but nearly all of the most popular FIRE-themed blogs and YouTube channels are led by men, and those are largely white Americans in their late 30s to mid-40s. That’s definitely not the case on this server, which is hugely beneficial in my opinion. I learn so much by engaging with a more diverse group of people (hint: diversity and inclusion has real value).

Where I find value in participating

One thing I truly appreciate is the open exchange on the server. Because the platform allows one to be as anonymous as they like, information is shared with a huge degree of freedom. Many on this server share their full financial pictures, their goals, as well as their successes and challenges along the way. This is so valuable for others on the path who may have had no good reference points prior to joining the server. I sure wish I had so much data available, along with an ability to ask questions in real time when I was much earlier in my own journey! It’s impossible to overstate the value of that in providing education and actionable information to help you develop and refine your own FIRE plans.

Due to the channel infrastructure used on Discord (configurable by server) it’s also super easy to focus on (or ignore) topics that are (or not) of interest to you. Cryptocurrency not your thing? Mute that channel or don’t spend time there. Want to ask questions about your portfolio? Head on over to #investing and see what people think about your asset allocation. There are also wholly social channels to talk about hobbies, cooking, or travel – just to name a few. It’s pretty handy to have a “one stop shop” all under one roof and some use it more socially than others – it’s a personal preference. You can also DM with people.

I’d be remiss if I didn’t point out the incredibly valuable feedback I’ve gotten from our server’s community on my own content creation. I know that whenever I share an article or a new video, I’m going to hear from at least a few of the folks I interact with most often. And their input is so helpful to me – and I probably don’t thank them enough (thank you!). True, comments on the blog and on YouTube come with increasing regularity, and those are also useful (thank you, too!). But there’s just something different about getting input from people you know a bit better – and understand their viewpoints more. I’m honestly so thankful for their willingness to help me improve my content.

Go find your people!

I believe we all need to find community, and also that it can take a variety of forms. For those on the FIRE path or who are interested in learning more about it, you have many options at your disposal. Personally, I still consume content from all of the different sources listed in this post. Of late, I’m certainly finding some of the most value in this FIRE Discord server. If it sounds like something you’d like to check out, this link is your personal invite! It’s a free service and (sadly) I get no kickbacks for referring you. I’m just happy to share a great resource! If you do stop by, please be sure to say hi to me when I’m on:

PS – I’ll take this post as a reminder that I really need to make a good Resources page for this blog so I can share all my favorite blogs, subreddits, etc. with you!

image source: Photo by Hannah Busing on Unsplash

Post-FIRE spending, tracking, and budgeting, oh my!

About 16 months ago, I left behind my 23-year biotech career and started writing this blog, and later started making videos with my friend Eric at Two Sides of FI. After I began talking more openly about my FIRE journey via these outlets, I quickly learned that a few questions came up very frequently. Some of the most common include:

What are you going to do next?”

Aren’t you bored?”

“How is living on a budget going?”

I’ve spoken to the first two questions in previous posts and videos but haven’t spent much time on the last. Perhaps it’s because it’s a rather mechanical question and I didn’t really think it was terribly interesting to write about. But as it’s come up repeatedly it seemed a good topic for an article.

Looking back: “The old days”

I’ve never been someone who was terribly interested in budgeting at home (unlike at work where it was required). But I have always analyzed our spending. Until the last few years, I tracked expenses in Excel or Google Sheets with the support of Mint.com. It always kept my mind at ease to know what money was coming in and going out. But I certainly didn’t have a detailed monthly budget of $X for groceries, $Y for utilities, etc. where I monitored our spending against each category and actively managed those funds.

Rather, pretty early in my work life, I began a strategy of “paying ourselves first”. In that sense, I first made sure we could meet our fixed and other essential expenses – rent or mortgage, utility bills, groceries, etc. Then, keeping our variable expenses in mind, next made sure we were meeting all our aggressive savings targets – contributions to our 401(k), IRAs, 529, and later on a taxable brokerage account. Over time, we steadily increased the savings goals in alignment with our income. We had a goal to retire early (RE) and that approach worked for us. All money remaining after that was for us to spend how we wished. So we didn’t really tightly control that spending at all. Surely this would have to change once I stopped working, right?

Pre-FIRE planning: “The goal is in sight”

About two years before my last day at work, Lorri and I got more specific about trying to nail down our “FI number” i.e. the assets required to achieve financial independence. We needed to improve the level of detail in projecting our annual expenses going forward. Using all the data we had accumulated over the years, we did just that. We made decisions about what was in or out. And then we started to zero in on the trickier aspects of post-career finances: how much would we like to spend on vacations each year? What will our healthcare costs be? Where will we live? Are there other expenses we haven’t thought much about to date that we now need to plan for? This wasn’t one conversation, but rather a series of them. Over time, we refined that model. But it was still just that: an untested model for our future budget.

I next entered our new budget into software form using You Need a Budget or YNAB (affiliate link – get a free month!), a popular budgeting package. I created a series of budget line items to correspond to all our expenses, and grouped these into high level categories:

Several category names censored here because I’m a nice guy and this is a family program!

For example, within “Entertain Me” you’ll find all the recurring subscriptions: things like Netflix, Hulu, and annual software licenses. Our emergency fund’s name reminds us that there is always money in the Banana Stand (SPOILER: Arrested Development)! Finally, “Coffee is for Closers” (NSFW audio) is where we capture our side hustle and other part time work income and expenses – more on that below. Since YNAB connects to our credit cards and bank accounts (similar to Mint), all our expenses are automatically categorized and “charged to” the correct budget items each month. It’s pretty simple, really.

This framework made it easy to make our expenses visible, and iteratively test and refine our assumptions. That also included the use of “sinking funds” for categories like our vacation savings (under “Quality of Life”), or our computer replacement fund (“Future Sh*tstorms”) to which we allocate money each month. This allows us to “save” for planned / likely expenses without having lumpy withdrawals later on – potentially at times when you wouldn’t want to take distributions, for example. This process went well, and we ended up with nearly 15 months of data prior to me stopping work. This really gave us a lot of confidence that we’d be stepping into early “retirement” with a good system in place.

Post-RE: “Where the rubber meets the road”

As soon as my last paycheck was deposited in the bank, the reality of the situation was upon us: We were drawing down and no longer saving. Our monthly “paycheck” was now an automated transfer from our brokerage Money Market account to our checking account. We’d been testing the budget for nearly fifteen months but was that enough data? With the YNAB system in place, we’d certainly have clear visibility on it.

Early in RE year one, I developed a practice of reconciling our expenses weekly. That took about 10-15 minutes once I got comfortable with the process. I ensured things were categorized correctly (like Mint you basically “train” the software), and paid any bills due that weren’t already on autopay. If we overspent in any categories, I moved money around in the budget and adjusted spending elsewhere if needed. This wasn’t super rigorous, but was rather a useful exercise to retrain our brains about spending and making good choices. Lorri is wholly uninterested in a regular “budget meeting”, and at this stage it’s not really necessary. We just check in with each other if there are decisions to be taken.

Earlier I mentioned that we have a small amount of employment income: Lorri does some tutoring and works one day a week at a brewery. I work one day a week at a winery tasting room. We don’t plan for that optional income in the budget as it’s not assured and our FI number didn’t contemplate it. Rather, we treat that money as a sort of “slush fund” in the budget, and mostly spend it on fun stuff outside our discretionary funding in the main budget – for entertainment, wine, special occasion dinners out, etc. Do we need to use that money because we can’t possibly ever go over our budget? Definitely not. We just view it as being responsible, particularly in these earliest years post-RE where the Sequence of Returns Risk (SRR) is highest (more on that in a future post!).

Beyond the mechanical: “How does it really feel?”

OK so the operational stuff is pretty basic. But how did it truly go? Well, early on I will freely admit I was a little anxious at times. I was scrutinizing expenses more than I needed to, occasionally to the irritation of Lorri. I didn’t mean to come across like I was micromanaging the budget, but I know it felt that way. My motivation was just to ensure I knew what we were spending to confirm that our budget was accounting for all our true needs and desires. Mapping unclear expenses (I’m looking at you, Venmo, PayPal, etc) to categories helped me understand our spending a lot better.

There were times were I worried that our discretionary spending was growing and that our optional “fun jobs” were at risk of becoming mandatory, because we wouldn’t want to curb spending back to purely budgetary levels. I’m keeping an eye on it but I don’t believe it’s a real issue. While we’re both enjoying the extra money we are bringing in, we know it’s not required. Our current withdrawal rate (WR) is below 3% given market performance. So we could certainly elect to increase that amount if we need to, as my target max WR is 3.5% presently. But as I mentioned earlier, it also gives me a lot of comfort knowing that in these first 3-5 years where SRR is highest, we are acting more conservatively.

Have there been any surprises? Not too many, thankfully. Our out-of-pocket healthcare expenses are higher than forecasted in 2021 vs. 2H20. It’s not a huge deal, but I have increased our monthly transfer a little to ensure we can pay these bills without dipping into emergency funds or cutting back in other areas. We’re still well within the guard rails around our withdrawal rate. We’ll soon be shopping for an ACA plan for 2022 as our COBRA runs out. I expect a little lower premium (but a higher deductible) based on last year’s research, so that will also help add some funds for OOP costs and perhaps we’ll lower our WR back down.

Current status + future plans

Largely, I’m feeling good about the budget at the present time. I’m a bit looser now about how I think about our expenses and I find myself asking very few questions of the family at this point. I definitely still think more about spending than I did pre-RE and I know that’s a good thing. Importantly, we have ample “fun money” and other discretionary funds available and that’s working out well. We don’t feel overly constrained like some of the folks in a recent Two Sides of FI video do!

The YouTube channel is also starting to earn a little money at this point given our channel’s growth. If that continues, it could lead us to further reduce our WR due to the additional income – or perhaps we’ll allocate more funds to travel. Both of those sound like pretty good options to me. I’m also definitely feeling more comfortable about increasing WR after a few more years, though this will depend on market conditions.

Will I keep budgeting? Honestly, my current approach is far closer to tracking expenses than it is to budgeting. I suspect that trend will continue and I see it as good benefit for little work. Will I feel as confident in the midst of an inevitable market downturn as I do now? Perhaps not, but the systems we have in place will certainly benefit us during those times. In addition, the asset allocation strategy we have in place is absolutely intended to ensure we can properly weather those storms.

To wrap up: while it’s still early days for us, tracking + budgeting is working well and helps me feel confident. The transition from saving to spending has largely gone pretty well, with only a bit of tension or concern at times along the way. YNAB has been a really great tool to help me organize and make our expenses visible. I’m looking forward to see how I feel a year from now about all this!

Validation isn’t the goal but it sure feels good

When my friend, Eric, and I set out to develop our Two Sides of FI channel on YouTube, I wasn’t sure what to expect – in so many ways. Eric is a very experienced YouTuber, and his business channel has nearly 900K subscribers. On the other hand, I had no experience in content creation. So I have certainly leaned heavily on him on this journey in quite a few ways given his expertise, and I’m thankful for all his help along the way. One thing Eric has been consistent about is the value in keeping true to our “why” – that is, the reasons we were undertaking this project and what we hoped to gain from it. I’m more convinced than ever that this is the best guidance for anyone undertaking similar work.

Starting out on our YouTube journey

How did this project get started? If memory serves me right, we’d already been having conversations about FIRE (Financial Independence, Retire Early) for a year or so. Eric had discovered the FIRE path through conversations with me, after which he dove in head-first. During one of those chats, he raised the idea of us doing a YouTube channel together, to capture and share the kinds of conversations we were already having. That would be great for us of course, but we earnestly hoped others would find value in it too. We didn’t see any channels like ours out there, so this seemed to be a good opportunity.

We certainly didn’t set out on this project as a business venture in which we hoped to earn lots of money. Sure, we know that once we crossed YouTube’s magical threshold (currently: 1,000 subscribers and 4,000 watch hours), our channel would be eligible for monetization via advertisements. But this was definitely a “nice to have”, and if it got to the point where a bit of ad revenue would pay for our podcast / website hosting and other associated fees, that would be great.

Rather, our goal was first and foremost, education. That is, sharing what we had learned: our mistakes, our successes, and our many (many) questions we still had about all things personal finance, retirement, etc. We do not claim to know everything, but with our pre-FIRE + post-FIRE perspectives, we thought we would offer valuable information and opinions. In the best case, this content would help other FIRE aspirants be better informed, hopefully avoiding some of our missteps, and be better equipped to ask great questions and take good decisions for themselves. Personally, I also hoped this would include building a community around our channel, one with whom we could engage and from whom we and others could learn.

Finding and engaging with an audience

I knew full well that putting yourself out there on a forum like YouTube means that you are open to feedback of all kinds: some earnest and thoughtful, while others would be negative or even downright nasty (don’t feed the trolls!). I’d been through this before both personally, and in the workplace where I’d played an active role in company social media. But I still hoped that this one-to-many video (and podcast) format would lead to productive 1:1 engagement.

Why? I guess it’s for a few reasons. First, that kind of interaction is fascinating to me. People are interesting and all of us are unique despite our many similarities. I truly love learning about the lives of others. Next, it can be very gratifying. Getting the feedback that someone else values the work you’re doing, and finds merit in it such that they take some of their precious time to connect with you, is really powerful. And lastly, it’s validating. Positive engagement is a measure that your time is being well spent, and that you are having the impact you desired.

Slow and steady wins the race

Given the time it takes to build an audience and for the almighty and mysterious YouTube algorithm to figure out to whom it should best serve your videos, I knew this wouldn’t be fast. And Eric has always been really honest about that with me, in efforts to temper my expectations. While he has made it super clear that our channel had actually grown fairly quickly relatively speaking, it felt rather slow until just a few weeks ago. We generally received few comments or likes, and our subscription rate seemed to be just “ok” to me.

Please don’t be mistaken – personally, I felt really great about what Eric and I were doing. I’ve always looked forward to our weekly filming calls, as I get so much out of our conversations. I also love how much I’ve learned about podcast production, video editing, and all the backend work required to run a YouTube channel. I’ve grown a ton since Eric has pushed me to improve my skills! And many times I have earnestly said that I’d still be making these videos with him even if we didn’t have any audience at all. I’ve truly enjoyed it and found the work personally very rewarding. This is the most important thing I’ve done since leaving the workplace, and I value this project tremendously.

Surprise!

And then over the last few weeks, things started to change. As one who watches the metrics more than I should – despite Eric’s clear and consistent guidance not to, I saw something different one day. Just like he and others had told me would happen, one of our recent videos started getting a lot more views than usual – a trend that then extended to all our episodes, and from there the ball really got rolling. All the metrics started climbing: views, likes, subscribers – and for me very importantly, viewer comments. As I write this we now have nearly 6,000 subscribers and 200K views. Small potatoes in the grand scheme, but pretty exciting for our little channel!

Suddenly, we were getting hundreds of comments. It’s been such a pleasure reading (nearly) all of them and responding. It’s so gratifying seeing what content resonates with viewers along with the questions our episodes raise. In addition, we get to learn from the experience of those who view our content and then share their own stories. This was exactly what I was hoping for – and it seemingly came from out of nowhere. Sure, we’ve had to ban a few trolls as well, but that comes with the territory. But this experience has been overwhelmingly positive.

Importantly, I know there’s no guarantee this trend will continue. In fact, I fully expect this crazy pace of growth to slow down. But in all honesty, it doesn’t matter one bit. We’ve got a great thing going, have started to build a strong community, and that feels really good. Eric and I have a ton of future show ideas (and are getting many more from our audience!) in addition to those we’ve already put out or have recorded but not yet aired. And I feel better than ever about the return I’m getting on the time we spend together working on this show.

Looking ahead and reflecting

What comes next for the channel? I have no idea. Eric and I talk often about other things we can bring to bear, modifications of what we’re doing now, and so on. Above all, it’s going to be fun, no doubt. And this work has already inspired an idea for at least one solo project for me. If nothing else, our experience to date reminds me that change is certain and it comes when you least expect it. Today I watched an outtakes clip from a recent episode where we talked about making this show. It’s super interesting for me to see what I was thinking about then. Much hasn’t changed over a few months, but some definitely has.

One of my favorite things about this project is we don’t need to do it. It’s not an assigned work project with deadlines nor will it be part of any future performance review. Put simply, Eric and I make Two Sides of FI because we love it. And it’s a decent amount of work – particularly for him, as he’s still running his business and bears the burden of nearly all of the video editing, which is the real heavy lifting of the channel.

We are proud of what we are doing with this project and that is the ultimate validation. As Eric and I recently discussed, it feels really great to produce this show. We are so thankful that others value it too, and are humbled by their kind words. Thank you all for your support and engagement to help make what we are doing even better. We appreciate you all tremendously.

Here’s to whatever comes next!