Walking The Path

Knowing how to build wealth is relatively common knowledge. It doesn’t take a rocket scientist to figure out that spending less than you earn and investing the difference will lead to substantial assets over time. However, there is a significant difference between having this knowledge and knowing the path before you, and actually walking that path.

I’ll give you a quick rundown on what an average weekday looks like for yours truly.

The alarm buzzes louder than I’d like it to at 6:15 a.m. I promptly smash it to pieces before begrudgingly, and slowly, rising from bed. I get myself ready in about 20 minutes. I do the normal bathroom stuff and get dressed and use a generous amount of water to the face to wake myself.

I eat a small bowl of cereal, as I find this one of the cheapest and healthiest forms of breakfast. I then quickly pack my lunch for work. It usually consists of a can of beverage du jour- usually Pepsi or Coke and a small frozen meal. I used to pack ramen noodles everyday, but I have since moved on.

After my backpack is loaded with lunch, an umbrella and a flashlight I walk down to the bus stop. The stop is located just a short walk from my apartment, as I specifically moved here to be close to public transportation. It’s 6:55 a.m. and the bus is swinging by to pick me up, unless it’s late in which case I’ll hop on my super frugaltastic scooter. It’s a 25 minute ride to work. The bus drops me off right in front of my employer’s building. I unpack my frozen lunch and pop it in the freezer and clock in. My day starts at 7:30 a.m.

I work until 6:00 p.m. It’s a long and grueling day, but my job in the auto industry provides me the income I need to continue propelling my Freedom Fund along with fresh capital. In addition to this 5-day Mon-Fri schedule, I also work every third Saturday for 5 hours, which provides a little boost to the paycheck. My job involves working with very wealthy clientele on a daily basis, which provides a little humor in the contrast of their lifestyles compared to mine. They can be difficult to please, which makes the 50-hour workweeks more difficult than they have to be.

I walk across the street and arrive at 6:04, just in time for the bus to scoop me up and take me home. It’s another 25-minute ride home. I arrive at 6:30, just in time to make a couple sandwiches for dinner. I scarf these down while researching stocks and investment opportunities, taking time to catch up on market moves, company news and commentary. I take the time to update my blog, respond to comments and also read other blogs.

I then change into some snazzy workout gear and hustle down to the gym, which is located right next door to my apartment complex. The gym is located across the street from a grocery store and shopping complex. Hmm, so most of the things I need are located within walking distance, and I live right behind a bus stop? I guess it’s good I don’t own a car! After working out for an hour I jog back home.

It’s now about 8:30 p.m. Where has the time gone? I typically try to shower at about 9:30, so I only have an hour to relax or otherwise do as I want. It’s a busy day, but I suppose the lack of free time allows me to save over 50% of my net income every single month. My weekends are, for the most part, less structured and more fun. I look forward to Friday night with gusto.

So, what’s the point of all of this? The point is that it’s easy to read a few books and claim Eureka! It’s truly not difficult to achieve financial independence at a relatively young age in modern America. Wealth is extremely abundant here in the 21st century, and expenses are easy to control if you have a little willpower. I’m not properly educated to try and comment on other people’s willpower, but I will tell you that the above day-to-day schedule is difficult to maintain.

It’s not easy to pull 10-hour days in a facility that pits me against angry wealthy people with broken down luxury cars. It’s not easy to come home, eat very unluxurious food while scanning investment opportunities and running a blog. It’s not easy to then throw on a change of clothes and hit the gym for an hour, only to come back and have very limited time to cool off and contemplate the next day. But, nothing worth having ever is easy.

I put a plan together at the beginning of my journey a little over two years ago, when I first started walking the path towards financial independence. After realizing this path wasn’t all that difficult to navigate, but which just required patience, willpower and determination, I was compelled to walk all the way to the end. Nothing but the finish line will now satisfy me. I have stuck to my plan almost exclusively.

What’s financial independence worth to you? What is your time worth? How much of your time are you willing to trade away before putting a plan together to have complete control over your time and destiny?

Are you walking the path?

Thanks for reading.

Photo Credit: FreeDigitalPhotos.net

Comments

  1. says

    DM,

    What an inspirational story, thanks for sharing! It is too easy for someone to just read a book, or blog and think, “what’s so difficult about achieving FI?” The formula is simple enough: earn money, followed by saving more than you spend. But to achieve FI usually involves a lot of personal sacrifice, like you illustrated.

    Your story resonates with my own experience, especially during my early years working when I tried to balance full time work + grad school. So, I can totally understand where you are coming from.

    For the longest time, I used to think, “is my life just destined to flash by in the blink of an instant?” It’s no fun to wake up in the morning, work your ass off all day, only to come home and have an hour or less spare time to yourself. After awhile, you do start to wonder if it’s all worth it. FI is the perfect path for those of us who answered that question with an emphatic “NO!”.

    Best wishes!

    • says

      FI Fighter,

      I definitely answered the question you posed with a “NO!” as well.

      The days go by with a blur, and it really saddens me. But what would REALLY SADDEN ME is if all this was in vain….if I was just busy working and coming home with limited free time with no end in sight. Rather, due to my dedication to achieving financial independence, there is an end in sight. This hard work will not be in vain, as I’ll be smiling in less than 10 years when I no longer have to get up at the crack of dawn and use up my whole day with little to show for it.

      Some people may read this article and say “Why don’t you just go get a job that only forces you to be there for 40 hours a week and isn’t so disagreeable?”. I’d ask “Why would I want any job that forces me to be anywhere for any length of time at all?”.

      Best regards!

    • says

      Amen to that! Even Kings would conscript their people that they ruled over to go off and die in wars for their goals. While the FI, minimalist monks whom where not dependent on the king to live, would wonder away, anywhere they pleased outside of the king’s grasp.

  2. says

    Hey cool, I’m 26 and basically do the same thing. I save 50%+ of my income and live extremely frugal. I don’t necessarily want to retire when I’m 40. But a goal of mine that I havent really seen you mention is I want to continue my saving rate of 50% even in retirement, so I can continue to give myself raises every year.

    Anyways I also believe in holding companies for an extremely long time, until I feel the company has lost its sight. With that said in my spread sheet I have how far my 20 stocks are from their 52 week highs and every month I basically inject capital into whatever stock that is, since I want to hold these stocks for life anyways, might as well get the one that’s furthest from where it’s been. That said I will not allocate more than 15% into any one stock so if one stock is at 15% and the lowest from its 52 week high I will move to the next one. I’ve attached my spreadsheet. Please feel free to look and comment. I think you will see a lot of conventional DGI names there but I’ve added a couple that I think in the next 5 years have great things in store for their dividend such as IBM and NKE, I am also looking at SBUX as they are aggressively growing their dividend but they are a little expensive right now for my liking.

    Here’s my portfolio:
    https://docs.google.com/spreadsheet/ccc?key=0Aif2VgoDdk9edEpHdk1XNzNZUGpYNnlHSnZHVGRvOGc&pli=1#gid=0

    • says

      Took2Summit,

      Nice portfolio there. I see a few names I own, and a few I’d still like to buy like GIS, MMM, CAT, TGT and maybe even GE. SBUX is growing the dividend substantially now. The valuation is a little high, as you mention, so for now I’m passing. Interesting play, however. Another expensive stock that is growing the dividend substantially is V. High quality company, but the valuation is too high right now.

      I don’t really plan on still saving 50% of my income in retirement. I plan on living off the dividends almost fully and truly living life. I’ll be reaping the rewards of the hard work I listed above. I wouldn’t mind still being able to keep a budget surplus and not requiring all my dividends to live on..as I suspect the growth of my dividend income will far surpass the growth of my expenses through inflation. So, my wealth may continue to snowball even if I don’t inherently plan for it.

      Thanks for posting your portfolio. I always enjoy peeking at other investors portfolio for ideas and insight.

      Best wishes!

    • says

      oh I thought I should mention I don’t know if it was obvious but DIA is my benchmark that I base my dividend analysis and % from 52 week high and what not on. I don’t own any DIA :)

    • says

      ~Took2Summit…Nice portfolio. You should consider adding a column in your portfolio to calculate “earnings yield”. Basically, it is (1/PE). Earnings yield will provide you insight as to how much (earning per share each share you purchase will earn). As an owner in each company, one must remember that their dividend earnings is a fraction of their earnings per share…both must continue to increase. It is insightful to multiply your shares owned by the EPS and then your shares owned by dividend per share to see how your ownership shares are allocated…some for the company to keep and grow the business…and some for you (dividends) to keep or reinvest. What you may realize, is regardless of how far off the current market share price is from its peak…your new dollars may be better allocated in another investment with a higher “earnings yield”. After all, the #1 golden rule is: When you invest your money, your job is to buy the most profit you can. It doesn’t matter if $1 in profit comes from advertising, as in the case of Google, or from selling roasted coffee beans in a little cart at the county fair. It doesn’t matter if the dollar comes from an “exciting” business, like a Hollywood movie studio, or a “boring” business like a water treatment plant. A dollar spends the same regardless of how it was generated.”

      cheers Jason

  3. says

    I think there are too many lazy people in this country. I admire your persistence.
    This is a quote from Calvin Coolidge I like :

    “Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful people with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. The slogan “press on” has solved and always will solve the problems of the human race”

    • says

      austinbroker,

      I like that quote. Thanks for sharing.

      I agree that persistence is where it’s at. I think even with sub par investment returns and only moderate savings rates one can achieve a relatively large sum of money in a couple decades if they’re persistent about it.

      I know personally that I’m not aiming for knockout investment returns. I try to target attractively valued businesses that reward me as a shareholder with rising dividends, but in the end even if I overpay I believe my persistence will outpace those who lack it.

      Thanks for stopping by!

      Take care.

  4. Steve says

    DM,

    One of the reasons I follow your blog is to “keep me on the path.” It’s like going to the gym when you really don’t feel like working out but everyone else is so you get pumped and start the exercises.

    I manage about a 50% savings rate but unfortunately,I have started much later than you in my aggressive savings plan. I’m 43. I have always been pretty frugal but for my 1st 20 years of work, I listened to the “experts” and plowed money into my 401k and my house. Boy what I wouldn’t give to have that $150,000 401k money in dividend stocks instead of mutual funds. But, unfortunately that money is now locked into my 401k until I’m 59 1/2. Now I only contribute enough to get my employer’s match. The rest of my savings goes into my taxable account to buy dividend stock, and to pay down my mortgage. Once the house is done (2014!) that money goes to the taxable account and my portfolio should really take off.

    Thanks for your constant encouragement and challenge to stay on the path. As you said, it’s not always easy but it sure helps to have like minded cyber friends to encourage along the way.

    Take care!

    Steve

    • says

      See i really question media finance articles, almost to the point of doing the opposite, and most of them say to put the max in 401k. Yeah that’s great if you want to retire when your 62+, and buy a huge house, etc.

      But there’s a better idea which you have hinted at. Invest in a taxable account to be FI at age 35-40. THEN any excess money you may make in your freetime doing the things you love to do, you can contribute to a 401k if you desire in the slightest, and keep your income tax at $0 until the age of 59.5 when you can access it.

    • says

      Steve,

      So glad you find inspiration here to keep you on your path. That’s really why I continue to write. The knowledge that others lives are touched really keeps me mutually inspired! So, thank you for that.

      Common knowledge like plowing money into a 401K is probably correct for most, because the plan that some of us are on requires a certain degree of being extreme that mainstream America really isn’t ready for. Different strokes for different folks, but if you can now switch gears and build up your own Freedom Fund while the 401 compounds..well that would be fantastic.

      Best wishes!

  5. says

    DM, This is what I needed to hear. I have veered off the path to FI since returning home and I really need to get focused again. I’m hoping to have things settled by the years end so I can start 2013 on a strong foot. I admire your perseverance and discipline. Keep at it!

    • says

      The Stoic,

      Glad you liked the post!

      I can understand where you’re coming from. Transitioning like you have can be difficult, financially and otherwise so I can see how saving money has been difficult. But, you had a great summer off and that’s really priceless!

      I hope you get off to a strong 2013 as well! I’m really looking forward to what next year brings us. I know I’ve been really blessed over the last few years, although I let 2012 slip away from me just a tiny bit. I’ll be ready to redouble my efforts for ’13.

      Best regards.

  6. says

    Wild day, DM. Very impressive that you keep such a rigorous schedule. The light at the end of the tunnel gets brighter everyday, which I’m sure helps you stay on track.

    Keep it up!

    • says

      Headed Home,

      That tunnel that gets ever so slightly brighter every single day is definitely what keeps me going.

      The crazy thing is that there are millions of people out there with means better than me that work even harder with no end in sight. That’s what’s really crazy.

      Take it another step further and imagine all the people out there with no means who work even harder and don’t really have the luck/chance of ever getting ahead. I’m blessed so I feel compelled to make the most of it.

      Take care!

    • says

      Dev,

      Thanks for stopping by, and I appreciate the support!

      I wish you the best of luck with respects to your journey as well. May you reap the rewards of your hard work.

      Best regards!

    • dziuniek says

      I know some car mechanics* in CT that make at least $30.00/hr. So $100k / year doesn’t seem completely improbable. With a lot of OT, I see it happening.

    • says

      Everyday Freethought,

      I suppose some of that depends on your market, and where you live/work.

      My dealership pays our technicians somewhere around $22/hr. on average. Some make more, some make less. These technicians are on flat rate, which means the quicker they complete a repair, the more money they’ll make. I’d say the average technician is paid 50 flat rate hours on average. So, that’s somewhere around $1,100 a week. I’ve seen some technicians who can barely hit 30 hours a week reliably, and I knew at least one who routinely hit 80 hours a week. It all depends on your skill level.

      I hope that helps. This is all just based on my personal experience.

      Best wishes!

  7. says

    Hey DM, do you ever confide in your wealthy customers the fact you run your own very succesful financial blog site? I wonder what their reaction would be to reading this? I set a goal this year of saving 50% of my takehome pay, but will end the year at 25% of net, which is still a great improvement. The 50% rate was just too tough, lol. So congrats on being able to save so much. You deserve a pat on the back—and a vacation:}.

    • says

      HYS,

      There was one customer that I talked to about investing and saving, and I can’t even remember how that conversation got started. It was really interesting, and I quite enjoyed it. This situation is very rare, for obvious reasons.

      Saving 25% is still pretty great. That’s way above average, and you also deserve a pat on the back. Keep up the great work!

      Best wishes.

    • Steve says

      Soldier,

      Considering the average savings rate of most Americans is zero or less, 25% is great! I understand your frustration, with a family comes expenses so maintaining a 50% savings rate is difficult for me as well. I cheat a little though and count the principle portion of my mortgage payment each month because it builds equity into my house and adds to my overall net worth. I count it as adding to my bottom line. If you are in a similar situation, does that increase your %?

      Keep pluggin along. Every month you’re able to save something you’ve taken more ground from the enemy!

      Steve

    • says

      Refers to stocks lol but I am in an Artillery BN, in the Guard, but I am just a truck driver, I deliver the ammo, but dont really know much about it. The funny thing is whenever we go overseas, they usually send us over as grunts, not arty.

  8. Anonymous says

    My average day looks like,
    02.00 kids wake me up with a scream since one is sick, peed in bed or fell out of said bed.
    05.30 smallest kid wake up and needs a new diaper plus food. I put him in front of the telly and try to steal a few more minutes of sleep. Bus leaves at 06.43, before that breakfast and desperate struggle to find clothes in decent shape=Fast ironing in the laundry. Running from the bus to catch the 06,56 train. Trying to get some work done with laptop on my knee before arriving 7.35ish in Stockholm. Struggle with loads of people while walking to the subway. Two stations and then a short walk before clocking in to work at 8. Work until 17 with 30 mins to eat the food I brought and 60 mins running, workout or squash. Same travel going home as in the morning arriving at 18.30ish. Eat dinner alone unless smallest kid has a second seating which he normally has, yes he is bigger than the other 2 year olds at daycare=). Kids hopefully sleep at 20.00 after the regular fight on toothbrushing and washing. I fall asleep at 21.00 and start over. I leave the kids at daycare once a week and pick then up once. That means arriving at work 09.00 or leaving at 15.00 to pick them up at 16.30 and then try to fix a familj dinner during hell hour. Weekends are much slower and I try to spend as much time with my family as possible. Life is very different to what I had before kids but I like it. I like work and training but miss spending time with friends and hate being tired all of the time.
    I don’t manage to save 50% like you but I manage to put away 1k$ and strive for the same goal. Don’t know if I want to stop working, for me its more the freedom of being able to choose if I want to.
    I love your blog, keep up the good work and stick to the path.

    /Marcus

    • says

      Marcus,

      That’s a pretty busy day! Makes mine look like a cakewalk. Having children would make my time infinitely harder to manage.

      I hear you on the freedom aspect. Who knows what my attitude on paid employment 10 years from now will be, but having the freedom to choose what to do with my time either way is invaluable. I’m saving for an unknown future and delaying gratification, but I do believe my future self will be very thankful for it due to the choices I’ll be allowed.

      Best wishes!

  9. says

    i would like to point out something that would pay dividends down the road. i used to be like you very focus on savings and growing the monetary portion.

    i am also a gym nut only thing i do it at home with home exercise which is more fun and cheap. there are many youtube videos with crazy workouts that make life interesting.

    however the major point i have is packing food for lunch and your breakfast. while it is good to look for cheap solutions, eating processed food that are cheap and not knowing your body could result in compounding health problems.

    i know that first hand since i am spending roughly 250 per month on medical bills and i am only 32 years old. the result? probably focusing on cheap fried foods when i was young, which is the fastest shortest queue.

    it is important to learn about health such as gluten free diet, paleo diet and how you can eliminate bad food habits.

    • says

      Drizzt,

      I agree with you. My diet could use improvement, and as a former competitive bodybuilder I’m well aware of that.

      I do think, however, that diet is just one part of one’s lifestyle. If you eat like crap, sit around all day and live a very sedentary lifestyle along with a lot of stress then I’m sure your health is going to suffer.

      If you have a slightly shitty diet, but work out consistently and have an optimistic look at life, don’t engage in risky behavior like drinking alcohol heavily and smoking then I believe your health will likely be well above average.

      One thing I need to do is learn how to cook. One of the reasons I eat so much processed food is because of my lack of desire to learn how to cook, actually cook and take the time to cook. If I had an open mind about making my own food then I’d probably be better off. One must also consider the time savings here.

      When I’m actually financially independent and have much more time on my hands then taking the time to cook meals may become more interesting and feasible.

      Best regards.

    • says

      yes you are right. cookie is a big downer. but its probably just procastination. watch more youtube videos.

      but what i am saying is that as you get busier diet is better to tune it as a habit to get more efficient and healthier as u dun think of eating crap food anymore.

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