Bloggers on FIRE – Financial Independence Ireland
In our Bloggers on FIRE series, we interview European FI bloggers to find out what makes them tick. Our aim is to build up a “who’s who” directory for the European FI blogging world. We hope you enjoy the series and discover some new blogs to follow. You can find a full list of our Bloggers on FIRE interviews here.
Please briefly introduce yourself to FIREhub.eu readers
I am an Irish woman of undisclosed age (sorry folks, I am a bit secretive about my age). I blog at Financial Independence Ireland. I am currently single with no kids. I work in financial services in Dublin. My roots are in a close-knit family in the heart of rural Ireland of the 1980s, but my life’s path changed the day that my parents decided to take a leap of faith and leave that life behind forever, taking their young family to a new life in Germany.
They eventually returned to live in our capital city at the beginning of the Celtic Tiger era of the 90s. Too young still to legally live independently of a parent or guardian I reluctantly returned with my family. However, having lived such a different life for a number of years, I did not see myself staying here long term, and I informed my parents that I would be leaving again once I finished school.
This is exactly what I did, leaving again at age 18 to move to the UK for university. At this stage, I have lived in a number of different countries in my life. I consider myself to be a global citizen, most comfortable in the company of other global citizens!
What’s your backstory?
Without wanting to be melodramatic, I realised a number of years ago that I could not rely on anyone but myself. Not family, not the man I was in a relationship with, not the company that I had worked for for a number of years.
I returned to Ireland after having lived abroad for a number of years. I transferred back through the company I had been working with overseas, but subsequently went through a redundancy. I had returned to Ireland as part of a couple, expecting the guy I had been in a relationship with to follow me. The relationship did not survive the move, and I found myself renting a large luxurious apartment by myself.
My Mother had died a number of years previously, and my Father helpfully informed me that he would rather not have me move back into the family home since apparently I did not get on with the woman he was dating. I had returned to Ireland with a warm and fuzzy feeling of nostalgia for my childhood roots, thinking that I would get my own home here and start the next chapter of my life surrounded with support structures which I subsequently realised existed only in my memory.
It was a pretty dramatic realisation, and I felt myself very alone as I struggled with job insecurity and without the circle of friends that I had enjoyed while living abroad. I battled on, eventually achieving both my masters and purchasing my own home. As a goal oriented person, I found myself wondering, what next? I stumbled across an article about a couple who had retired in their 30s and all the rest is history…
Why do you want to reach Financial Independence?
It is about security and freedom of choice for me, and not having to compromise. Even if you love your job right now and cannot foresee any reason why you would not want to do it indefinitely, you are only one restructure, one redundancy or one change of manager away from all of that being shattered in my experience. I think that most people truly have no idea of how precarious our status as employees really is. Whoever said that “change is the new normal” was not joking!
I experienced this first hand, and remember finding myself in a situation which was making me very unhappy and anxious, and wishing that there was some alternative to putting one foot in front of the other and forcing myself in there every day.
Imagine in the midst of all of this one day discovering that financial independence not only existed, but was possible for ordinary people doing middle class jobs! Jim Collins writing on “F U” money spoke to me personally in that situation!
I want to reach financial independence in order to provide myself with freedom of choice. I think that we all have the same needs, which are pretty much as Maslow has described them in his hierarchy. FI should allow our basic needs (food, security, shelter. etc.) to be met, which should allow us to then focus on our higher order needs (kinship, self-actualisation etc.). If we get stuck at the level of constantly struggling to have those basic needs met, we risk never achieving our full potential and meeting those higher order needs.
My values are probably quite humble. I am not looking to travel the world in my yacht sipping champagne. Basic security and healthcare for myself and those closest to me will suffice! Freedom from financial worry. The ability to choose to say no.
How much is your “enough“?
This is a difficult one. A million is the nice round number that is bandied about often in the FI community. Currently my annual expenses would require a portfolio of this size, but, bearing in mind that about 60% of that expense is mortgages, I would argue that much less will be needed once the mortgages are paid off. With a couple of paid off properties generating cash flow, a couple of hundred thousand may be enough to support my basic expenses.
I think an important point for people on the path to FI to be aware of is that other factors come into play as well, notably how flexible we are willing to be. For example, if I were to throw geographic arbitrage into the mix, maybe I could quit my job now.
If anything I feel that I have deflated my lifestyle in in recent years. I don’t need a sports car, (or indeed any car), a holiday home (isn’t that why they invented Airbnb?), or even €100 nights out. In fact, when a guy tells me he has a sports car, I think “fair enough if it makes you happy (but do you know how many additional years you will have to work to pay for it, or what that money could make for you if invested instead?)”
Where are you on the road to Financial Independence?
We are probably all closer than we think! I would have said “very early stages”. However, a “back of an envelope” calculation this week told me that, if I proceed with my current plan to construct a self-contained unit for rent in my garden and rent a room in my home, and continue to rent out my rental property, these activities could cover most of my expenses.
This leaves some food for thought. I will need to properly rework these calculations, but this may mean that most of my job related income can be funnelled into investments and paying off mortgage debt for a couple of years, and that may suffice to meet my basic needs.
What do you want to do with your life once you reach Financial Independence?
This is the big question. I note advice from those of you who are already there to consider this question in more depth, and I agree it deserves consideration. I am at a stage currently where I have become a bit caught up in the minutiae of day-to-day life in the corporate hierarchy, and on some days, it is difficult to think beyond strategies to emancipate myself from this.
I recently met a man who is FI. He quit his job after building a property portfolio. His advice to me was to remember my social life and needs. Now that he is FI, I get the impression with him that he wishes he had someone to share it with. He explained to me that he turned down a number of social invitations from friends during his accumulation phase, preferring to funnel the €100 that the night out would have cost him towards mortgage repayments. He told me that he regrets that now, and advised me not to neglect this side of my life. He told me that he regrets now not having someone to travel with, etc.
The reality is I have a lot of mental energy, which I will probably need to harness. I think it is likely that I will continue to be active in some form or another, but the honest answer is I don’t have a full picture of this yet. I know that I am very bad with unstructured free time. That’s when I tend to get too much inside my own head. There are a lot of known unknowns, such as whether I will be single or with a partner, whether I will have a family, etc.
What is your strategy for reaching Financial Independence?
Workplace pension combined with rental property. I invest in my workplace pension as a preference over having a taxable investment account at the moment because of the tax saving for doing so. I have one rental property, as well as my own home which I also see an income-generating asset. I have on occasion rented one or two rooms in my own home.
I may consider reallocating a portion of my cash to peer-to-peer lending soon. If I opt to change jobs to earn more money, I may have a need to look beyond this to invest my surplus income. At that stage I may consider additionally opening a taxable investment account with a broker.
What will be your financial strategy after reaching FI?
At present I imagine it will be a combination of real estate and SWR from pensions. This would be the strategy for having basic expenses met. Beyond that I would be very surprised if I did not end up earning money in some other capacity, doing something that interests me and which hopefully adds value to society. I would be the first to admit that I don’t have all the answers, and that my involvement in this community has more to do with trying to learn from others than imparting wisdom myself!
What was your biggest financial mistake?
Not investing in workplace pension, and cashing out of workplace pensions from several jobs. Not saving a reasonable portion of my salary from the beginning. With a little bit of conscious living I could have saved some of my salary while also maintaining a good social life.
Really not living consciously at all. Having no understanding of money. Not taking time out to think about what I want from my life, this job, these friendships, this relationship… Not having an emergency fund. Not making a life and financial plan and reviewing and adjusting it from time to time.
Not having counselling when my mother died. This is financial, because it was a blocking point for me in terms of investing in a pension – I thought, “Why would I invest in this? It will be a loss if I die before I reach the age where I can cash it in”.
What advice you would give to your younger self?
Maximise pension contributions and DO NOT cash them in when you leave your job. Live more consciously. Read Mr. Money Mustache. Work 17 years, invest 50% and then be done! Make your own plan and do not feel the need to follow the crowd. Get parents to open an investment account for you when you were 13 and got your first paper round!
Think outside the box in terms of career and self-development. Who is to say that running a property portfolio is not just as valid a pursuit as going in and out to an office every day?!
Align yourself to people from whom you can learn and try not to spend time only with hedonistic people who haven’t really worked out yet what they want from life!
What’s your wildest dream?
The pursuit of FI is a selfish activity primarily. Once we get there, what would be great would be if we could harness our skills for non-selfish activity. Do good for others, #FIforimpact!
If FI means no compromise, imagine the impact that a whole community of financially independent uncompromising people together or individually could have in the world! We could push the environmental agenda for one, bring financial teachings into primary school for another.
What impact would bringing “the shockingly simple math” to primary school children have on our society in future? Imagine if they left school with this in mind as a blueprint. The knowledge that they can work a certain amount, and then check out and be free to use the rest of their lives pursuing whatever they like. How powerful would having this knowledge right from the beginning be!
What’s your favourite just-for-fun activity that brings you joy?
Reading biographies. For some reason this has been a fun activity for me from my teens onwards. Before we had internet I used to have to get books from the library or buy them. Now we have a host of TV and internet documentaries, and Wikipedia to back it all up. For some reason I have always loved reading about other peoples’ lives. We all write our own story, so it is nice to take some inspiration from other peoples’ lives along the way!