Interview with Our Financial Path

I’m busy slack­ing off recov­er­ing from a stress­ful two weeks at work, so today’s post is an inter­view with Mr. and Mrs. XYZ of Our Finan­cial Path. They very gra­cious­ly agreed to trade inter­views with me! You can find my inter­view on their site. It’s full of fas­ci­nat­ing infor­ma­tion and fun tid­bits you might not know about me. Hap­py reading!

Who are you and what do you do? What is your story? Where did you start, where in the journey are you, and where do you ultimately want to end up?

I am Xyz, one-half of Our Finan­cial Path. I write with my wife about our jour­ney towards ear­ly retire­ment, trav­els, and life expe­ri­ences through this all this. We are Cana­di­ans that inspire to live a ful­fill­ing, plen­ti­ful, and hap­py, life all while sav­ing for ear­ly retire­ment. We have cur­rent­ly saved about one-fifth of our FI goal and are aim­ing to retire before 35.

How did you get started on the path to financial independence?

I start­ed my jour­ney at 23 when I start­ed invest­ing a large part of my income sim­ply because I want­ed to buy stocks. I saw the appeal of own­ing com­pa­nies I liked such as Apple, Tes­la, Face­book but I did not have any long-term plan or vision. After a while, we start­ed shop­ping for a house so we saved aggres­sive­ly for a down pay­ment and after that, we sim­ply con­tin­ued sav­ing with­out a pre­cise goal in mind. We then found Mr. Mon­ey Mus­tache’s blog and were hooked! We read a bunch of FI blogs and real­ly start­ed sav­ing towards retir­ing early.

What does FI really mean to you?

For us, finan­cial free­dom is the oppor­tu­ni­ty to choose. We don’t know if we will have kids by then but retir­ing ear­ly is defin­i­tive­ly a great oppor­tu­ni­ty to spend time with your kids. We may work part-time or just do side-gigs we real­ly enjoy. The great thing about FI is that it gives you those options.

In terms of trav­el­ing the world, we are not wait­ing until retire­ment to enjoy this pas­sion. We trav­el mul­ti­ple times a year and real­ly enjoy dis­cov­er­ing new cul­tures. You can read about our lat­est trip here.

What is your criteria for saying you are FI?

Being FI means free­dom. Once we have enough to pay our bills with a decent lee­way, then we will be ready to hang the tow­el. We plan to fol­low the 4% rule into retire­ment even if some pre­fer the safer 3.5% or 3%. We are very flex­i­ble and have no issue going back to work part-time if things get real­ly tight.

Would you say you are more inclined to the not-working-anymore part of FI or the freedom part of FI?

Work is not our pas­sion, we are not worka­holics. For us, not work­ing is defin­i­tive­ly the moti­va­tion to have the free­dom to do what­ev­er we want. We always had side-hus­tles and always plan to con­tin­ue work­ing on those (apps, blog, shar­ing econ­o­my) even once FI.

What is your preferred way to invest? Do you have a preferred asset class in particular or asset allocation?

We fol­low a fair­ly sim­ple 3 fund port­fo­lio as our base hold­ings. We invest through Van­guard main­ly into the US Total Mar­ket (VTI), All Cap Cana­di­an Index (VCN), and Inter­na­tion­al Index­es (VWO)(VEA). You can see our exact hold­ings and asset allo­ca­tion in our Open Book series.

Do you invest automatically on every paycheck?

Yes. This is one of the keys to expand­ing wealth. Sav­ing mind­less­ly every sin­gle week and not look­ing at your bal­ances too often is the best advice I could give you.

What are your favorite financial tools?

The tools we always use are Mint and FIRE­calc. We track all of our spend­ing through Mint since it works great with all our Cana­di­an banks and cred­it cards and use FIRE­calc to test out dif­fer­ent sce­nar­ios. It back­tracks invest­ment sce­nar­ios and allows us to test asset allo­ca­tions, spend­ing sce­nar­ios, and dif­fer­ent timelines.

What are your thoughts on house ownership vs. renting?

We own a house in the sub­urbs. We went through all of the cal­cu­la­tions and sce­nar­ios and it sim­ply made sense for us. Depend­ing on your loca­tion and cost of liv­ing, rent­ing can be bet­ter than own­ing. One can real­ly get ahead if he (or she) invests instead of spend­ing con­sid­er­ably on a home but it all depends on your per­son­al situation.

What is the worst financial decision you have ever made?

Our biggest mis­take was to buy stocks with­out know­ing any­thing about them and try to day trade. The very first year I start­ed invest­ing, I blind­ly bought stocks on hopes of good earn­ings announce­ments but, hon­est­ly, I didn’t even know what the com­pa­nies were sell­ing. After a few months, I had one bad day where I lost $2000 in a sin­gle day. After that, I stopped trad­ing with­out research and stopped day trad­ing for good. We now invest in index funds and if you would like to learn all about those; we high­ly rec­om­mend JL Collins’ stock series.

What is the best financial decision you have ever made?

To fol­low-up on our pre­vi­ous answer, our best finan­cial deci­sion was to start invest­ing in low-fee index funds. This diver­si­fied our port­fo­lio and keeps the fees to the bare min­i­mum. Anoth­er great deci­sion I made was to mar­ry my wife. Hav­ing a great part­ner who fol­lows com­mon goals and strat­e­gy is a great way to build wealth.

What are your plans once you retire?

For now, we want to slow-trav­el. Go to coun­tries for 3 or 4 months at a time and take the time to learn their cul­tures. If we have kids, we defin­i­tive­ly want to be there for them.

What is the best advice you can give a millennial starting out?

If you are start­ing out, the best advice we can give you is; start now. Com­pound­ing returns are mag­ic and are the best tool to build great for­tunes on aver­age salaries.

It’s always fun to get to know oth­er FIRE blog­gers! Any oth­er burn­ing ques­tions for Our Finan­cial Path?