I'm starting a new series today! On my random forays around the Internet, I occasionally run across people who have already retired early or are financially independent. Since that's what we're all working towards, I find it inspirational to read details on how they achieved their goals!
That being said, let me introduce Sonya from Meowtel.com! At age 27, after a mere 5 years in the corporate world, she left the cube farm to create her own business. Meowtel began with the hope of providing cat owners with a resource to find kitty care and bills itself as the “internet's premier cat sitting website”. Cat sitters are reference checked before being listed on the site, so you know the person looking after your fur baby will do a good job! All you have to do is enter the dates you're going to be gone and a number of profiles will pop up. All you do is pick a sitter and voila! You're good to go. As the proud
slave owner of a kitty, I fully appreciate having a trusted sitter available to look after my furry overlord friend when I have to go out of town.
Meowtel also has animal shelters in mind through its exclusive Shelter Incentive Program. Any non-profit animal organization is allowed to sign up and post listings for cats in need of forever homes. When a homeless cat is fostered out or adopted, Meowtel offers financial incentives to these shelters in order to cover operating costs and lighten the burden. A purrfect win-win for everyone! Even though I got a purebred cat, I fully support shelters and think this is an excellent way for them to get some addtional funding.
(Small disclaimer: I am in no way associated with her site, I just think it's a really cool idea).
So, grab some coffee, pull up a chair, sit back and enjoy the Q&A session with Sonya!
1) Tell me about your background (education, former industry, what you originally wanted to be when you grew up, etc)
I received my B.S. in Business Administration from UC Berkeley and then went on to work in sales for a CPG (Consumer Packaged Good) company. I was promoted and relocated three times during my 5-year tenure at the company, resulting in me being set me up to truly be financially independent within two years of getting out of school. Hmm…what did I want to be? I never had one particular profession in mind but oddly enough, I did have notions of wanting to be an entrepreneur and running my own business.
2) Why/When did you decide to start saving up?
I've always had a knack for saving so once I entered the working world, I set my 401K contributions to be at least 5-10% of my paychecks and on top of that, I would put away extra money each month. Once I became a homeowner at 24, my form of saving was paying my mortgage each month and then I also started contributing to one of my mom's rental property mortgages in exchange for equity, making most of my liquid money tied up in property. I hate consuming just to consume so I rarely buy frivolous items – so that makes it super easy to save! Most of my money is spent on experiences and food…I'm a sucker for great food and tasty beer.
3) How long did it take you to save?
To buy my first home, I went with an FHA loan so I only had to put about $6K down which had taken me about a year to save. To get to where I am now (launching a startup and bootstrapping a complex backend system with my own cash), that took me a full 5 years of working in corporate America and making decent property investments to be able to afford the project.
4) Did you have any debt?
I was extremely lucky to come out of school with no debt and then by having a great job right away, I became financially independent in a very short amount of time – by the time I was 23. At the present moment, until my home sells, I'm carrying some significant debt which I plan to pay off once the home sale goes through.
5) How did you come up with a target number (if you had one)?
I did this totally backwards. I consulted with my development team to see how much the entire Meowtel project would cost and then I scrapped together cash and projected funds afterwards. As a result, I've put myself in debt by maxing out my credit cards to pay for the site…with the contingency that I'd be able to pay it all off (with any amounted interest) after the sale. I've gotten on edge because it has taken me significantly longer to sell my home this time around than I had planned. If you plan on quitting your job and launching your own business, make sure you have a generous buffer in case the universe decides to throw you a curveball!
6) How did you get the inspiration to start Meowtel?
My kitty best friend of 17 years passed away last January and it was terribly sad…more so than I would have anticipated, especially living alone. All I wanted was some sort of “cat share” or easy way to find cats to take care of since I couldn't commit to a new forever cat at the time. There was nothing of the sorts, so I decided to take the leap of faith and create it myself! I ran the numbers and did my due diligence before just jumping into the project in order to make sure that it was a feasible model and could generate revenue in the long-term. Once I realized the cat care segment of the pet industry was a $4 billion market, I knew I could potentially be on to something.
7) How did you feel when you quit your job and opened your own business?
This was terrifying and quite an emotional rollercoaster even for someone who walks with confidence each and every day. I constantly questioned myself if I had made the right decision and I would have mental arguments with my conscience about why it was the right choice to make. I quit on July 27th and almost 5 months later, I feel assured that I definitely made the right choice and that this road less traveled will open up opportunities for me that I never even could have dreamed of.
8) What's one of the best things about being financially independent?
Definitely getting to enjoy experiences without worrying about your budget. While I've always been closely aware of my spending and income, during my corporate career, I never put a formal budget in place for myself. I was lucky enough to be able to afford all of the activities I wanted to do (mainly trips) without fretting that I'd max out my credit cards.
9) What's one of the worst things?
Stupid spending! What I mean by this is that just because you can afford an extra round of drinks, doesn't mean you need it. Literally, I would spend a third of my paychecks on eating out and bar tabs and when I look back, I'd realize it wasn't worth it or I could have had a much more enjoyable meal at home. As I said above, I don't spend on clothes, shoes, handbags, etc. I'm not a girly girl, so that worked in my favor. But if you're a foodie, definitely be conscious of how much of your paycheck ends up being spent dining out!
10) What is the most important lesson you've learned so far?
Plan for the worst-case scenario. In putting my plan together to quit my job and launch Meowtel, I was planning for the “good” outcome and the furthest I got to the “worst-case” end of the spectrum was still way off in terms of my projections, in fact, about $20K off. If I had planned accordingly, I'd have a little more peace of mind right now and a larger disposable income. Instead, I'm frugally living off dividends paid out of my IRA (I rolled over my 401K to an IRA after quitting) even though they're subject to a 10% early withdrawal penalty. I'm also living back at home and doing odd jobs around town for extra cash to cover my bills in the meantime until my house sells.
11) Has anything surprised you since becoming Financially Independent?
Yes…how you can take it for granted. Working in a corporate environment, you figure everyone lives this way and when you remove yourself from that bubble, you realize a lot of us in our 20s have zero savings, zero retirement funds, and work 2-3 part-time jobs just to make rent each month. Never take your financial independence for granted and if you do decide to do something radically different like spend your savings on a startup and then dip into your IRA to pay for grad school, I'd say do it full-heartedly with no regrets. Spending so much of your savings will be terrifying in the short-run but pay huge dividends in the long-run; you learn so much about yourself, about the people you surround yourself with, and taking risks sets you up to take exciting new journeys which so many people never get to experience.
12) How has your decision been received from your close family/friends?
I'd say the reception has been… “supportive skepticism.” They want me to succeed, and thus are supportive, but they questioned the level of risk I was willing to take in order to pursue something I'm truly passionate about. Valid concerns, but I'm just a more risk tolerant person I suppose. There have definitely been days when those around you try to make you feel guilty for what you did…as if walking away from something that wasn't making you happy is a crime! If there's one piece of advice I wish everyone would follow, it is to find out what makes you happy and then do exactly that.
13) What is your advice to anyone looking at doing the same thing in the future?
Plan, plan, and then create your contingency plan on top of all that planning. I told myself I have essentially 1 year to get Meowtel off the ground and running successfully before I head to grad school. I wouldn't dive head first into such a huge project like launching a startup unless you have a backup plan that can get you right back on your feet if you fall down. Chances are, if you're willing to take the risk, that'll open up a variety of new opportunities that you never even knew existed. From there, you can hopefully choose a new path if that's what you want (or need) to do!
14) Why is your favorite breed a Siberian Forest Cat? What is your favorite cat breed?
Oh gosh…I just love them all! I'm biased since my floofer I had for 17 years was a Himalayan Ragdoll…so, if I had to choose, it would be a Himalayan!
Gwen's thoughts: There is no one way to achieve financial independence. Do what makes sense for your situation and run with it! If your plans don't work out, adjust on the fly and keep going! Especially if one of your rewards is to get to hang out with kitties!
Thanks for allowing me to interview you Sonya! Good luck in your endeavors!