Welcome to the Late Starter to FI series!
I am a Late Starter – I discovered the FIRE (Financial Independence Retire Early) movement when I was 47. This was way later, I thought than others who seem to have it all together in their 20s and 30s.
Since I started to write about my own journey, I have discovered there are many more Late Starters like me, yay! It’s such a relief knowing I’m not alone.
I want to share our stories, our unique perspectives and show that it is absolutely not too late for us.
So in this series, I particularly highlight those of us who start our FI journeys in our 40s, 50s and 60s. And explore questions such as ‘where do we start’, ‘can we still retire early(ish)’, ‘what are the specific challenges for us late starters’. We look at our past, not to castigate ourselves but so that you can learn from us.
Please join in the conversation in the comments below. I encourage you to share your story if you fit the profile of a late starter. You absolutely don’t have to be a blogger or podcaster to share your story.
If you’ve missed any of the previous stories, you can catch up here – Late Starter to FI series
And if you can’t wait to start on your own FIRE journey, check out my step by step ultimate starter guide, Late Starter to FIRE Action Plan.
Our latest Late Starter is Mr Chaos from Cutting Through Chaos where he and Mrs Chaos blog about finance and family life – very witty and funny writing 🙂
I’d first come across the Chaos (what’s the plural?!) in this article that Mrs Chaos wrote – about her reluctance to attend Chautauqua, a famous FI conference.
And it was only recently when I read Mr Chaos’ article on why he didn’t discover FI earlier in life that I realised they were fellow late starters.
I’m very glad that Mr Chaos agreed to share their story, for it brings yet another perspective on the Late Starter to FI narrative.
You can also connect with the Chaos on Twitter – @CuttingChaos
So, over to Mr Chaos …
A little about us
My wife and I are in our 40s, have four kids (ages 5 to 9) and live in Spain. Our story is like many others up until I turned 40. We were living in Scotland and I worked a regular corporate job in finance. But we were restless and wanted to feel like we were contributing to society.
Then came the opportunity to work for a small healthcare NGO in Zambia. What felt like an opportunity for us looked like a midlife crisis to our friends. But we went and had five amazing years in Zambia.
As our time in Zambia came to an end, we were not ready to return to Scotland. We also wanted to find a way to have more time as a family. Some friends suggested taking a sabbatical in a new country … which is how we ended up in Spain.
I’d asked him for podcast recommendations for side hustles in response to some upcoming financial commitments, like college education for our kids, helping out parents financially if required, and setting enough aside for retirement.
My wife and I have always been frugal and avoided debt (other than a mortgage). We had a period when we had no kids and a double income and made it a point to live on one of our incomes. But embarrassingly for a finance professional, I was an incompetent investor.
Our biggest ‘investment’ was our house in Scotland, which we were renting out after moving to Zambia. It returned about 4% per annum. And that includes both rent and appreciation. I’d dabbled with individual stocks and peer to peer lending with mixed success.
For us, the discovery of FI was like finding a framework for our finances and our frugality. We could calculate how much was ‘enough’, and we could see money as a tool to help us achieve our goals.
It has given us the insight to look at our finances in a different way and realize we have a lot of flexibility.
We’ve made the decision to focus on what really matters to us. That is spending more time with our kids whilst they are young and helping them become positive contributors to society. We think society will thank us.
And if that delays our retirement, we are okay with that.
First steps on the path to FI
The first step after my light bulb moment was to tell Mrs C about this movement. I tend to dive headfirst into topics I find interesting, and she assumed this was just another one of those. She had no interest in reading about personal finance, and still doesn’t, but she could see that I was passionate about this.
Alongside speaking with Mrs C, I shifted the investments in our retirement accounts to broad based global index funds and started to make plans to sell the house we owned in Scotland.
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How far along the path to FI are we now?
The most difficult question for me to answer is how far along the journey we are. Not because I don’t know how to multiply by 25, but because we don’t know where we’ll end up living. And we have seen firsthand how much living expenses can vary from country to country.
Having said that, assuming we don’t end up in a high cost of living location, then we’re probably over 50% of the way there.
Thoughts on early retirement
We are not sprinting for the FI finish line as we want to have more time for our kids. FI is not binary, and we’ve given ourselves permission to slow down and take frequent breaks along the way via sabbaticals or working part time.
I also don’t think that we’ll ever RE if that means lying on a beach somewhere. We have too many projects we love getting involved in. Our experience working and volunteering in the developing world has also shown us that there are so many ways we can make a genuine impact on the lives of those less fortunate than ourselves.
How my relationship with money has changed
My relationship with money has not changed much with the discovery of FI. Spending less than I earn has always been normal for me, though I am more intentional on my gadget spending these days.
One area where I was falling short was in relation to investing. If I were starting my career again, I’d be shovelling as much as I could into index funds from day one.
The biggest change in my attitude towards money happened during my sabbatical, rather than with the discovery of FI. I really struggled to step away from the rat race and accept that I would not have an income during our sabbatical. That made me feel extremely uncomfortable, and I nearly aborted the sabbatical at the last minute.
The sabbatical has shown me that I value flexibility of time more than the security of an income. That means that post sabbatical I have not looked for traditional employment and have started freelancing instead.
Specific challenges or advantages of starting late
To invest enough for retirement, you either need a lot of time and to save a little, or to save a lot over a shorter timeframe. If you start late in life, you no longer have the choice – you must save a lot.
But if 20-year-olds can save enough to retire by the time they are in their 30s, that tells us that it’s still possible for someone starting later in life to get there.
The big advantage of starting late is that you are most likely in your peak earning years and earning significantly more than you did earlier in your career.
The challenge is that you often have additional financial commitments in the form of kids or parents that require financial support.
COVID interrupted our sabbatical year and meant lots of cancelled visits from family and friends. It also meant we had to put our exploration of Spain on hold.
So, we made the decision to extend our time in Spain for at least a couple of years. Our family is settled, and our kids enjoy their school. At some point we’d like to do more international travel as a family and world school our kids along the way.
In the meantime, I’ve started doing some remote freelance work with the aim of covering our living expenses.
Back to Latestarterfire
Thank you for sharing your family’s story with us, Mr Chaos.
And showing us that having a sabbatical and living a Slow FI lifestyle is possible as a late starter.
“The sabbatical has shown me that I value flexibility of time more than the security of an income.”
I love that you are living a life that is aligned with your values on the way to being financially independent, that you are not waiting until you reach FI to live that life.
What an amazing example you’ve set your children!