I discovered FIRE sometime around 2014 at age 48 when I first stumbled across books by William Bernstein (The Intelligent Asset Allocator) and Jim Dahle (The White Coat Investor). I wanted to take over my paper asset portfolio from a private bank that we had allowed to manage it with savings that we allocated annually, “last” (not in a “pay or save yourself first” mentality), or as an after thought around tax time. We believed we were doing the right thing to let others manage our money as we were “too busy” post residency with new jobs, new house, and new twins to manage it ourselves. We had no plan for giving each dollar of our paychecks a job as we suddenly roughly 5x’d our salaries. Neither my wife nor I had had even a rudimentary financial education from our parents or from our industrial aged schooling and higher education. How were we to know that the easiest way to manage our money and investments wan’t the “right way”? Mistake 1.
One day during residency, a friendly neighborhood “financial advisor” showed up to give us our one lecture on financial planning. You guessed it, he was really a representative or salesman from “Young Know Who” Company. Before we could say “Shazam” we were weighed, had blood drawn, and filled out a risk questionnaire, before we were sold a whole life policy like many of our peers. About 7 years later sold our Whole Life Policies because we wanted the equity to “finish” our “Big Doctor House” and again bought Yearly Renewable Term Life Policies from the same agent. A paint job on our first home turned into a passionate “Forever Home” rehab in 2007. You remember what happened then no doubt. We were under water for a few years and then “escaped” our charming, but “expensive-and-more-than-we-needed” house and the high cost of living area for a low cost of living area in geographic arbitrage. But, because we couldn’t find the right nest, we of course built another “Big Doctor House” in the suburbs. Finally we have come to our senses and recently pivoted and downsized to a Goldilocks Home that we love. Mistakes 2-4.
The there were the Cars. I “needed” the fully financed new truck after years of deprivation in a rust bucket during med school and residency. Soon thereafter my wife “needed” a series of leased vehicles as needs changed from sedan to minivan to SUV as the children grew. It was a “Payment to Payment” Mindset. At least I eventually paid off my truck and have only had three cars in my life. It took us many years, however, to drive paid off vehicles and buy with cash. Mistake 5.
We still love Food. Back in the day, eating out, take out, delivery, and expensive restaurants were the norm. We shopped at Whole Foods and Fresh Market and Krogers. Food was an essential “need” and as per usual we had no Budget and just cash flowed it like most everything else. Money in money out. Years later we have discovered stores like Aldi (a shout out to BC Krygowski!) and our grocery bill has dropped by 40-50% as we now eat at home the majority of the time. Mistakes 6-7.
The rest is, as they say is History. We made almost all the big and small mistakes one can make financially until 2014 and we are still here! We took our heads out of the sand, woke up Rip van Winkle style, and began to take over our financial lives instead of letting other people and our money manage them. It is never too late to start and the best day to start your FIjourney is today!
As the CFO of our family, I read and read and read FinLit Blogs and Books of all types and listened and listened and listened to a variety FinLit Podcasts. I even went to the amazing #FinCon19! Along this path, I have made and met many new amazing friends (random shout out to Ryan Inman). I moved our paper assets to Vanguard and set an asset allocation and locations that suited us according to our Investor Policy Statement and have stuck to them while tax loss harvesting and rebalancing (forward with new capital, time fixed, and bands) according to plan as well. We have invested in a Multifamily Real Estate Syndication of a trusted general parter and friend (shout out to Veena Jetti). I plan on developing this blog (PivotPointsMD), Facebook Group (Financial Literacy Project) and a podcast (?PivotPoints Podcast:)) under the PivotPoints banner. Who knows maybe one day in the future, I may even syndicate a deal or two one day. The important thing is that we all need to develop a balanced portfolio stool with 3 or 4 legs including the employment (self and spouse), paper asset, real estate asset, and small business asset classes to avoid unstable concentration risk in our lives with a single legged stool.
FIRE was a stressor that exponentially compounded a multitude of stressors in my life, externally and internally imposed. I am thankfully through to the other side now, but I would not wish large parts of the last 6-9 months of my life on anyone. My wife, kids, and friends are and have always been my rocks. When my pursuits to overcome the demon of fear in my life led to recently jumping out of a plane (with a parachute!, see prior post) they were the ones that brought me safely to Earth. I am only now able to “come out” and publicly reveal my travails, in part due to the voracious pursuit of FIRE after a late arrival “to the party”. It is what it is. It will be what it will be. It is my job to have a plan based, not on a number, but a FIRE range (shout out to Lynn Frair) and an enJOYable balanced journey and process. It is time to give first, listen to my mindful and body, be grateful for all that is and will come to be, learn and let go of the past, be present in the present with a watchful eye on the horizon of the future, financially or otherwise
FIRE is a beast that must be tamed and trained to be your tool and not the other way around. Don’t let yourself get burned by the flames of consumptive FIRE. I am licking my wounds and pivoting as I move ever forward.