Welcome to the Late Starter to FI series.
I love reading stories of how people discover the FIRE (Financial Independent Retire Early) concept and the steps they are taking on the FI journey.
In this series, I want to particularly highlight stories of Late Starters – those of us who discover and start the FIRE way of life in our 40s, 50s and 60s.
I want to explore questions such as ‘are we too late?’, ‘where do we start?’, ‘what are the specific challenges starting on the FIRE journey later in life?’ and more.
My hope is that we learn from each other and support one another; that in sharing our struggles and wins, we inspire and motivate each other to persevere in the sometimes difficult journey to FI. And to know we are not alone.
If you would like to share your story, please email me at info@latestarterfire.com – you absolutely do not have to be a blogger or podcaster.
Disclosure: Please note that I may benefit from purchases made through my affiliate links below, at no cost to you
Today, I want to share Shaun’s story. I first met Shaun on Twitter when he was kind enough to reach out to a newbie. And ever since, I have appreciated Shaun’s generous, joyful spirit and benefited from his sense of community – thank you for all those #FollowFridays 🙂
He blogs at Project Palm Tree which is “all about the wonderful realisation that the mid-life we imagined for ourselves in our teens simply won’t be happening – that the universe actually has something much better in store for us. Together, we unlock the secrets which allow us to stop worrying about the future, replacing our 9-5 income and living a life we love – by sharing the wisdom, stories and contagious enthusiasm of the folk I meet under the Palm Trees!”
And was nominated for The Sunshine Blogger Award earlier this year! How cool is that?
If you would like to connect with Shaun on social media, you can find him via @shaunhasablog on Twitter, and @project_palmtree on Instagram
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A bit about me
I live in Sydney, Australia.
In 2019 I will turn the same age as Herbie the Love Bug’s Racing car number! (53), which is 2 years shy of the age my father was when he retired – 55.
I am a commercial architect, a career that I guess began at the age of 17 when I went off to study architecture for 5 years, and I have worked in this profession ever since.
I really enjoy keeping fit, that is to say I either practice yoga or hit the gym 6 out of 7 days, every week. I love both.
I also really enjoy food and my life seems to be structured around getting up early each and every day to meditate, after which I yoga or gym. And then plan my day around a succession of pre-planned snacks and meals with architecture and blogging related work slotted in, all around consuming those snacks and meals.
(for example, I just paused writing this interview to serve up leftover pancakes from breakfast and some morning tea for me and my partner, the Soccer Player)
Looking back ...
I had a big set back as a result of ending a long term relationship and nearly a decade of stagnated investing after that.
In 2004, I ended a seven year relationship. Nothing terrible, but after two years of living a long-distance relationship, we realised that we were more friends than life partners. Friends who owned three properties together.
Fast forward two years, and my credit card debt from servicing these three properties which were all negatively geared, was close to $40K. Luckily, one property was in Perth, and a second in Cairns, both of which suddenly had massive property booms. Both had doubled in value in 5 and 4 years respectively.
We sold both, but after paying capital gains tax, paying off the mortgages and the credit card debt, there wasn’t a great deal left.
In 2007 I moved from Brisbane back to Perth for work. We were still renting out the Brisbane apartment ( I got half the proceeds), and I was renting an entire apartment in Perth (it was so cheap). I was concerned that I wasn’t living in an apartment that I owned, or that I only owned half of an investment property to offset my full rent in Perth.
Since it was the GFC, the stock market was cheap. I upped my Superannuation payments by a further 10% of my salary for 18 months. When the stock market picked up, so did my super balance. Finally I was well over $100K. That will tell you how bad my super was before that!
When I moved to Sydney in 2009, I realised that the money I had was not going to be a great deposit for even a basic apartment. So we sold the final property, for not much more than we paid for it. Luckily it was deemed to be our principal place of residence, and we paid no capital gains tax.
A year after moving to Sydney, I bought a small 1 bed apartment, with a 20% deposit to avoid mortgage insurance. It wasn’t mind crushingly expensive, but I could only afford to pay interest only off the mortgage for the first three years, because I was working in a job that didn’t pay very well.
But I was credit card debt free, and car loan free (no car). And for the first time I had a mortgage on a property that was 100% mine.
That’s a lot better place to be in than a lot of people that age, and I felt I was on my way to paying off an apartment under my own steam, but I knew I had less than the full 30 years to pay it off, and I had to double down.
It still wasn’t a solid financial plan though.
Turning the big 50 ... the lightbulb moment?
Not long before turning 50, a friend of mine in his early 60s was working on being able to be in a financial position to retire at age 65.
He had reasonably good employer contribution superannuation, one third of the proceeds of selling the family home after his father died the year before, and a hundred thousand dollars or so in savings. He didn’t own his own home.
I realised that although I was doing all the (base minimum) ‘right things’, I didn’t know if I would be in a position to retire even at age 65, and continue to live in the style to which I wanted to become accustomed.
Not only that, but I had just read the Tim Ferriss book ‘The Four Hour Work Week’. I was now committed to retiring well before age 65, so I would have the physical ability to do all the fun things I dreamt about when I had time for such indulgences.
Approaching 50, I was lucky enough to have no debt except for my mortgage.
I had only paid off about 10% of the 6 year mortgage, since being in the ‘interest only’ payment loop for the first 3 years of that mortgage. After I landed a job that paid an appropriate salary, I was able to not only pay off principal and interest, but pay 50% more than the prescribed amount in an attempt to ‘catch up’.
However, due to long periods of consulting, where my ‘employer’ (me) failed to pay superannuation contributions, together with poorly performing funds, my superannuation balance was in the low $100K.
No emergency funds. No investments.
So in January and February of 2016 I interviewed a few financial planners, picked one, and got underway.
Problem was, I was turning 50 at the end of that year, and we had planned an amazing round the world trip to visit friends and celebrate my mid-century landmark birthday. Not a cheap exercise.
Suddenly we were focused on saving for the holiday, but also getting our finances in order.
It has set the scene for a bit of a recurring theme – saving for the future now, so we don’t have to survive on cat food when I retire, without having to survive on cat food now.
After we got back from the holiday, we actually had enough money left over to buy new furniture to replace all of the furniture that I had owned for close to 20 years as ‘temporary’ furniture which was now falling apart. We spent less than $3000 on the living room and about $1000 on a new dining table (very good knock off of a design icon) – and all of it at the sales (I hate paying full price) – we paid just over half price for all of it!
Our place now looks AMAZING – we won’t need to upgrade for at least another 20 years!
Discovering FIRE community on Twitter
After that, I did a course on how to start an online ebusiness – not a great course but part of the course involved getting on to Twitter. It was on Twitter that I found a great community of folk, including the FIRE community. It wasn’t an immediate thing.
Project Palm Tree was all about middle age people who hated their jobs due to stress, long hours, low pay, etc and what opportunities there were for them with the online world.
What I discovered was that the stress I was feeling had nothing to do about hating my job – I loved my job. What I hated was the feeling of not being in control of my finances, and going to work because I had to, not because I wanted to.
What I liked about the FIRE movement was feeling I was in a community that valued planning for your financial future and financial freedom, and shared what they know with everyone in the community – knowledge, skills, encouragement and accountability.
Project Palm Tree has a subheading that says:
‘Reduce Stress, Replace Income, Live the Life you Love’
It turns out that this is the very basis of the FI movement.
I just didn’t know that when I wrote it
Taking steps on the FI path
I think that our FI journey began when we engaged our Financial Planner at the beginning of 2016, although I didn’t call it FI – I just wanted to have a plan to make retirement at 60 a possibility.
Starting Project Palm Tree in early 2018 was when I first started playing with the idea of FI, in an attempt to start a passive income stream on line.
It turns out that being Debt Free with Passive Income is the FI framework.
We recently met with our Financial Planner for our annual check in – she was less than pleased with our saving efforts over the past 12 months.
I realised that it was time to really focus and kill the mortgage if I had any chance of retiring by age 65, let alone 60.
Before going in to the meeting, I went through all the material that she had presented to us during the 2018 Annual Check-in, and realised that I didn’t understand most of it.
I also realised that talking about her financial plan for us, combined with my financial ignorance, really stressed me out.
It always felt easier to trust that what she had planned for us was in our interest, and that we were going to ‘get there’.
I think there was always something in the back of my mind that said since we were paying her so much money, we had less responsibility in the journey than we might if we were driving the process more.
I decided that it was time I got educated about the world of personal finance.
Step 1 – I read ‘The Barefoot Investor’ by Scott Pape.
As part of our focus on paying off the mortgage ASAP, we went about reviewing our expenses, how we could cut them out and committing to accelerated payments against the mortgage in order to get rid of it by the end of 2022. Big ask but we think that it is doable.
We made our first cost savings in two ways:
1. Return to our cap of $80 each for weekend spends – coffees, drinks, meals out, and
2. I cancelled my personal trainer to save $100 / week or nearly $5000 per year.
I will now be training myself in the gym of our apartment building, with a choice of training programs supplied by my trainer (at no cost). I feel very lucky.
Reflections on starting late on the FI journey
There are a few challenges when starting late on the FI journey.
Existing spending habits and behaviours that ‘define’ who we are – we have had decades to develop ‘lifestyle creep’ as our incomes grow. It can feel harder to live more basically at age 50 than someone just starting out in the workforce. I mean I haven’t lived in a house share since I was 29.
If you are middle aged, financially illiterate and financially behind, fear of what the future holds for you can make you either do nothing, or worse, do things that say ‘I don’t care’ I will manage (put your head in the sand) and make things worse.
In middle age you are no longer in the high risk / high gains investment phase of life when you were younger. Everything you do financially has to lead to growth. You don’t have the luxury of time for cycles to correct.
What's next?
At age 52, I am on track to reach FI by age 60. But I am not sure that I will want to retire then. I just want to be financially independent and work if I still want to, not because I have no other choice.
That still feels a little scary since a lot could happen between now and then. I am still worried that the economy could go belly up; I end up unemployed and I no longer have that income, and I am not placed to do something else – like my own streams of ‘passive income’.
I no longer look at money as something for now. Instead I look at every dollar I have as being something I need for the future.
When I was younger and we had two investment properties, I felt that they would be the lifeline to being financially independent, despite the fact that we were haemorrhaging cash every year.
Between the time we sold the investment properties and buying my flat in Sydney, my finances essentially stalled. Nearly 7 years. That’s a long time to stall. I would do that time over again for sure.
I am now excited about truly embracing the FI principles of being debt free coupled with passive income and even additional income streams.
I really want to focus on educating myself about personal finance and reaching FI. I am really serious about mastering my finances, optimising my returns and feeling like I am in control, rather than just being on auto-pilot and trusting things might turn out the way I hope (whatever that is).
Project Palm Tree will really start to focus on that process, what I am learning, what I am implementing and what I am achieving.
I want to surround myself with others who are in the same position, starting on the journey to FI later in life.
Latestarterfire's comments
Thank you, Shaun for sharing your story. I love that despite setbacks such as stalling investment (super and outside of super), you have a strategy moving forward. And that commitment to correcting the course shines through, loud and clear.
I think your observations about our challenges as late starters are spot on. We have the trifecta of being used to a certain lifestyle, fearful of the future and worried that there is not enough time to correct our financial mistakes.
But we got this! Here’s to being debt free in 2022 and not eating cat food now while saving for the future 🙂
Turning the big 5-0 certainly makes you focus on the future!
I enjoyed reading this very much. That trip overseas sounds EPIC!
Hi FDJ.
So glad you liked my story. I agree that turning the big 5-0 can make you focus on the future – and more specifically the future that you want. It’s good to see examples of what happens when you don’t think about these things earlier (like my friend), and what can happen when you prioritise these things (like Latestarterfire and yourself).
I accidentally found this community and am so happy that I have.
Shaun
I love EPIC travel too so fully understand that you would prioritise that for your big 5-0 celebration 🙂 Wishing you another opportunity for EPIC travel to celebrate reaching FI at 60!
Amazing stuff Shaun, thanks so much for sharing! It’s so great to hear other people’s journeys and I must say it’s so much “braver” to start this journey when you have than a teenager in college. The change you have been through is absolutely amazing considering how many habits you must of had to “unlearn”.
You should be super proud of yourself, because many people wouldn’t have the strength to do what you’ve done…
It would just be… “it’s only another 15 years and then I can retire anyway, I’ll worry about that later”
I can’t wait to see where you’re at this time in 2 years, I’m sure you’re about to have great things happen!
Mike
Thanks, Mike
To be honest, making some of these changes is a struggle, and reverting to bad habits is easy, and annoying.
I think that if we don’t embrace change, it will happen anyway, so we may as well be in control of our future, and not just end up wherever.
I know I bang in about it, but I think having not only great role models but people like you who are happy to share your knowledge, experience and enthusiasm is invaluable, so thankyou.
I am also looking forward to seeing where all of us are in 2 years time.
Shaun
I fully agree with Mike! It is much harder to pursue FI now, after a lifetime of bad habits. Agree with you too, Shaun that change is inevitable and we may as well embrace it and be in charge of our future. So glad we can all share our experiences and encourage one another.
I love that you are saving to give yourself the option to retire early even if you don’t actually retire early because you are still having fun at work. That to me is financial freedom. FI to me, as you also eluded to, is having enough money so that money does not dictate what you have to do. Instead you have enough money to decide the direction you want to go if circumstances change. It lets you take opportunities or walk through doors that might otherwise be closed.
Hi Bonnie
I agree with you. I think that the first step in planning for FI is what you want your life to be once you have actually attained FI.
Carl from the Blog ‘1500days’ says you need to look at your life pre FI.
If you are spending your weekend watching TV and eating potato chips, that’s what life is likely to look like after achieving FI.
I think that you need a MAGNIFICENT goal (is that the right word) to strive for, to give (and keep) some massive momentum in your journey to FI.
The third branch of Project Palm Tree is ‘Live a Life you Love”.
My biggest struggle after working out my finances will be to define THAT – quite difficult for someone whose passion and career has been one and the same for a number of decades.
Perhaps, as you say, achieving FI, will allow the possibility to tweak (overhaul) the current situation without the financial constraints and considerations.
Either way, it’s all very exciting.
I love following you and the way you choose to Live the Life you Love.
Shaun
Pursuing FI even if you don’t know what you want to do after you reach FI is still a good start, I think. Reaching FI will give us so many more options to explore. And we can explore all these options without worrying about money – how exciting is that? And freeing! We can start exploring some of the options now, knowing we will reach FI eventually.
I love Bonnie’s story too – now you get to live a life you want – I love that. Gives us hope, for those of us still on the road to FI
I was most struck by your mention of your 6-year mortgage?! In the US it’s 30.
It’s certainly easy to stick our heads in the sands regarding our retirement. It seems that focusing on retirement requires the proper education as well as mindset. Being a late starter means you can’t take advantage of compound interest in the same way, but being in your prime earning years helps offset that!
Despite my education in finance, we had a late start also. The good news is that we have developed a solid plan. We’re not sure it’s a beachfront Mai tai plan, but it’s otherwise solid!
Thanks for sharing your journey!
Hi Tony
By 6 year mortgage, I meant that I was 6 years into the mortgage.
I am now 9 years in and trying to clear it out in no more than 7 (age 60). Although sone of the advice that I am getting is saying you are better off paying the mortgage off slowly, investing wisely, and then paying off the mortgage slowly in retirement using the dividends. That’s a mindset that goes against what most of us have been told is a milestone of success!
An interesting idea though. Worth workshopping?
I am glad you have a solid plan in place – well done!
What is it they say about plumbers always having dripping taps at home?
I too am a Mai Tai on the Beach dreamer, when I am not exploring Europe on foot, of course….
Thanks for commenting and sharing.
Shaun
Hmm … I am in the camp of paying off your mortgage before retirement – it’s just another stressor out of the way. I want the security of knowing I have a roof over my head and that no one can kick me out. It takes a lot of investment to generate enough dividends to live on. In saying that, I would definitely invest and pay off debt at the same time. Maybe contribute the maximum to super? We will be be able to access it soon, unlike the young ones who have to wait decades.
Tony, it is ‘comforting’ to know that even the professionals in finance may have a late start 🙂 But still have a solid retirement plan – that gives us non finance professionals hope. Thank you for commenting and sharing
I agree with you, Latestarterfire – I like the idea of no mortgage in retirement! Having a paid off home is kind of like having bonds (in my opinion), if something goes wrong. If the stock market crashes or you lose your income, you’ve got a paid-for house and don’t have to take drastic measures to make ends meet because housing is taken care of. And housing is one of our biggest expenses, so a paid for home can provide a lot of room in the budget and plenty of peace of mind.
Well said! I definitely like the peace of mind 🙂
Great story, Shaun. I enjoyed reading it and a lot resonated with me. I too found FI a bit later. The point about having decades to settle into lifestyle creep is a big one. It’s so easy to just slowly spend more and more without even realizing it! On the flip side, it also allowed us to create extra savings as we unwound it.
Congratulations on turning it around!
Hi Ed
I am so glad you enjoyed the article – LatestarterFIRE is doing a great job of bringing together those pursuing FI later in Life. It seems that there are more of us, and certainly the news seems to be full of stories saying that many in our generation will never be able to achieve FI if we don’t adopt this lifestyle.
As you say – Lifestyle creep is a massive one, but also an easy one to wind back.
We have already wound back considerably – we live in the city, in a 1-bed apartment. We can walk or train/bus in short time to everything we need so we dont need a car. There is a free gym in the building so we save money there too. and we live across the road from a beautiful park (think Grand Central park with an emphasis on central, not so much the grand). We thought there was not much to wind back – but we just culled the personal trainer.
The hairdresser is looking a tad precarious right now. Netflix Next?
Lucky our favourite (expensive) restaurant had to move because their building was sold to a developer, and they re-opened miles away so that ‘overhead’ got removed.
How have you managed to turn around your own lifestyle creep?
Shaun
Thanks, Shaun – there are certainly more of us late starters out there!
Lifestyle creep … that’s a bad one for me too. Over time, I start buying better brands and spending more money for convenience and ease of lifestyle. When really I need to examine why I am exhausted all the time and have no energy to clean, necessitating a cleaner once a fortnight.
I share personal training session with a friend so we go halves. It is more fun to train with a friend too. Culled Netflix because I didn’t have time to watch it anyway. And will just sign up for a month and binge watch something I specifically want to watch. Good for January.
Great read. I don’t believe it’s ever too late to pursue FI. Like it’s never too late to start taking better care of yourself. It’s wonderful that you’re making changes now while you’re healthy and working. And there’s lots of support in the FIRE community. You got this!
Thanks for sharing.
Hi Ana
Thanks for commenting.
I agree – never too late to work to get ahead while you still have the energy, motivation and marketability in the workplace.
You sound like you are a seasoned FIRE person!
Thanks for your support.
Shaun
It is overwhelming to start at any age 🙂 but when time is against you as well …. But it’s never too late, I wholeheartedly agree. The mental wellbeing when your finances is in order is priceless
This is wonderful, Shaun! I’m so glad you’ve taken the time to share your story about how you have turned your finances around, because you’ve shown others that it can be done!
As you know, I believe it’s never too late to start saving for retirement. Any amount that we start saving now will help to make our future life better.
I didn’t start saving for retirement until I was in my 50s, but I’m catching-up! It is possible to catch-up retirement savings, even after a late start. Sharing stories with examples of how people have done this gives other late savers hope and motivation to take action.
Thanks, Kathy.
Even in these short 3 months, we have made some huge leaps and bounds. Looking forward to sharing some of our wins on the blog starting in a just 1 week (geez – it crept up on me pretty quick.)
I am glad that I am surrounded by shining examples like you and LSF to keep me motivated, as well as the other guest bloggers that LSF is interviewing here. Such a great idea and so glad that she is doing it.
Loving the series so far and can’t wait to hear from her future guest bloggers.
Shaun
Looking forward to your posts, Shaun! And yes, it is NEVER too late 🙂