Hello folks! I have something special for you today, a FIRE-Side chat with Mr. and Mrs. Groovy from Freedom is Groovy. This is a new interview series I’ve started in order to share the journey toward FIRE (Financial Independence Retiring Early) from others. I’m a believer that personal finance is personal and it is important to find our own path toward FIRE. I think hearing from others is a great way to help us formulate our own ideas and our own path. So without further ado, let’s hear from Mr. and Mrs. Groovy!
First, tell me a little bit about yourself. Who you are and what’s your story?
We’re Mr. and Mrs. Groovy. We live outside of Charlotte, North Carolina. We left New York in 2006 because we got sick of snow, crowds, and taxes. Lucky for us, 2006 was the height of the real estate boom and we walked away from our condo sale with over a quarter of a million dollars.
When did your interest in personal finance begin? Did your parents have an active role in your financial literacy growing up?
It began in 2003 when Mrs. Groovy discovered Dave Ramsey. We didn’t learn personal finance per se, from our parents. But both of our parents lived within their means (Mrs. Groovy’s mother always used the envelope system), worked hard, and had a healthy fear of debt. But money wasn’t really discussed.
At what point did you learn about and begin your FIRE journey?
Oddly enough FIRE was never on our radar until 2012. That was the year I discovered Mr. Money Mustache. At that point we were already saving over 50% of our gross income but we still had no idea that FIRE was within our reach. In fact, I thought I was working until age 67. But thanks to Mr. Money Mustache and Mrs. Groovy, I saw the light. We actually put our three-year FIRE plan in place in 2013. We figured by mid 2016 we’d have over 25 times our annual expenses.
FIRE Journey Questions:
Where are you currently on your path toward FIRE (Financial Independence Retiring Early)? Just starting, retired already, or somewhere in the middle?
We retired October 14th, 2016! It turns out we had the money to retire in 2015 but we wanted to wait for my mini-pension to kick in from my former government job. We’re wimps. We like those monthly direct deposit checks coming in, even though we don’t need them.
If you are already in FIRE (Financial Independence Retiring Early), reflect on your path and if there were any things you would change if you had to do it again? Or conversely, what would you make sure you do again on your journey?
If we could do it all over again we would have started saving in our 20s instead of our 40s. But we got married in our 40s and that’s when we each decided to get our financial act together. The thing I’d make sure to do again is to automate savings. It doesn’t matter if the money goes into a 401K, an IRA, or a brokerage account. Since saving is the number one habit needed to attain FIRE, make sure it’s not left to chance.
Tell me how you would consider your FIRE (Financial Independence Retiring Early) journey to be unique.
- We started late. We got married in our 40s and didn’t even have $10K in savings between the both of us.
- We used geoarbitrage. We moved from high cost New York to low cost North Carolina.
- We stayed under the radar. We never wanted to buy things to show our family, friends and neighbors that we arrived. We were perfectly happy for others to think of us as poor slobs.
Strategizing FIRE Questions:
What has been your primary motivation to reach FIRE (Financial Independence Retiring Early)?
To own our own time and do the things that excite us – not to do the things that make our bosses happy and solve their problems. We know our mental and physical health won’t last forever. And we don’t want to waste the next ten to fifteen years of life on work. We’d rather be hiking at Glacier National Park than be staring at our respective laptops for eight hours a day.
What has been your greatest success in the “engineering” your life path or lifestyle? Or are you more of the “go with the flow” type?
Planning. First, we had a plan to get out of New York that worked flawlessly. Second, we had a plan to save and invest 50% of our income. And third, we had a plan to prioritize experiences over accumulating stuff.
I can’t remember where I heard this first, but I hold dear the advice that it is important to “retire to” something rather than “retiring from” something. What will you be retiring to?
I wrote about this on my blog. I’m going to pick up litter, bake bread, blog, and travel. Mrs. Groovy, on the other hand, will not be picking up litter. She intends to learn the piano, perhaps do some community theater, grow vegetables, do some canning, and travel.
What will your housing situation be like in retirement? Do you plan on moving to a low cost area, to the beach or mountains? Or will you become nomadic, traveling the world more freely?
We want our base to be in the Raleigh, North Carolina, area where my family lives. In 2017, our goal is to buy 2 acres of land and build a small home in the 1,200 to 1,400 square foot ranch. We’re downsizing a little – our current home is 2,000 square feet.
Wealth Creation Questions:
Retiring early is quite an extraordinary feat…and requires some pretty extraordinary behaviors to rapidly create wealth. In your focus on wealth creation, do you tend to gravitate toward making more money or arresting expenses?
Through geoarbitrage our focus was on the expense side. During our last year in New York, our living expenses were $4500 to $4800 a month. When we moved down to North Carolina our expenses were under $2,000 a month. Because Mrs. Groovy kept her New York job, our income didn’t go down that much. Our expenses went down by more than half but our income only went down around 25%. The key is the gap between your income and your expenses. In New York it was around $1,500. In North Carolina it was at least double that amount. That’s twice as much potential savings.
What has been one of your biggest successes in either advancing your career to make more money or taking control on the expense side to progress on your journey toward FIRE (Financial Independence Retiring Early)?
Funny story. Back in 2013, I was dead man walking. My company moved the Charlotte office to Irving, Texas, and I was training the analysts in Irving to learn my job and make me expendable. But I did such a good job of training them that the company didn’t want to lose me. They ended up giving me another position, which turned out to be a promotion.
While controlling expenses are important, you still need to live and enjoy life. What is one or two of your favorite areas to spend money on?
Travel, travel, travel. Prior to FIRE, we budgeted $5,000 a year for travel. Now we’re budgeting $10,000 a year. Also, another luxury is our once a month mini-blizzard at the Dairy Queen. It doesn’t take much to make the Groovies happy.
If you won the lottery or received a large inheritance to the tune of $1 million or so, what would you do with it and why?
With a million we’d take our family on a trip to the Ted Turner Ranch in New Mexico. That would cost us around $40K. Then we would give our five nephews and nieces $10K each. Since we don’t have kids of our own, we want to stay on the good side of the Fab Five. Finally, we would probably buy a cabin in Montana. We love Montana. It’s the prettiest state we’ve visited to date. We would love to spend half the year there and half the year in North Carolina. Other than that, we wouldn’t do much else. Yes, we would give more to charity. But we would still live modestly. We don’t need Cold Stone Creamery and Ruth’s Chris. We’re perfectly happy with Dairy Queen and Sonic.
What is your favorite finance and non-finance related book, podcast, magazine, blog, etc and why?
My favorite finance book is the Total Money Makeover. My favorite non-finance book is Bonfire of the Vanities. Mrs. Groovy’s favorite finance book is The Millionaire Next Door. Her favorite non-finance book is Fountainhead. Our favorite finance podcast is Radical Personal Finance (Stacking Benjamins is a close second.) Our favorite non-Finance podcast is Betty in the Sky with a Suitcase. Our favorite finance blog is RockStar Finance because it’s a great clearinghouse for personal finance articles and blogs. My favorite non-Finance blog is Real Clear Education. I love reading about the trials and tribulations of our educators. It’s also where I get ammo for my warped ideas. For Mrs Groovy, it’s Food Network. She loves discovering new recipes and experimenting.
What advice would you give to folks considering or just starting their journey toward FIRE (Financial Independence Retiring Early)?
Don’t let fear immobilize you. Take one simple step of starting a Roth IRA and contributing $100 a month. That’s all you need to get in the game. From there, be curious and read. The FIRE blogosphere is a great resource.
If you are a fellow blogger, where can I find you?
Thanks for sitting down and chatting, Mr. and Mrs. Groovy! I had a very groovy time!
I hope you give this Groovy couple a follow and check out their blog. Look for more FIRE-Side chats to be featured here in the future. And if you are interested in a FIRE-Side chat yourself, give me a shout.
Thanks for taking a look!
The Green Swan