Tag Archives: financial independence

Simple Money, Rich Life: How One Couple Dumped Debt and Became Financially Free

Learn how one couple came together to pay off $400k of debt, become financially free, and give over $1 million!

Simple Money, Rich Life

Let’s start off with some good news: You don’t need a complicated plan to achieve financial independence or freedom. 

In fact, that’s probably either slowing down your progress or keeping you from even starting.

I’ve seen and personal experiences how a simple plan can be an effective way to keep you moving in the right direction. 

Bob and Linda Lotich are on the show today to explain how. They’re the creators of SeedTime and the authors of Simple Money, Rich Life: Achieve True Financial Freedom and Design a Life of Eternal Impact

Linda and Bob are coming on the podcast to discuss how families can reset things and have a rich life.

I had a chance to read their book and loved how it had s money great takeaways. 

I thought Bob and Linda did a really good job of balancing the head and the heart with this. You have this story of getting out of debt and showing the bits and pieces, but more importantly, those conversations they were having about the purpose behind this journey.

Besides working towards financial freedom, the book also examines doing something meaningful with the money, especially on the giving side. 

In this episode, we get into:

  • how Bob and Linda synced up with their finances and goals
  • tactics and strategies they used and recommend to pursue financial freedom
  • creating an easy to manage financial system that allows them to live debt-free and be generous givers

Hope you enjoy!

Resources for Families Interested in Financial Independence

If you're looking to get ahead with your finances as a family, here are some resources to check out!

Don't forget we have the free course 5 Days to $5K. It's a week-long email course designed to help you find, save, and earn extra cash so you can reach your family and financial goals faster!

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union! If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today.

As a credit union, Coastal serves its members first including an annual loyalty bonus. We've been members for years and love their service and competitive rates on checking and savings accounts!

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Syncing Up on Money and More

Elle Martinez: In case you miss Bob on an earlier episode, discussing forming new habits. Here's a quick overview of how he started his financial journey with Linda. Those initial conversations, not only began setting the tone for their money but their marriage.

Bob and Linda: I think we need to start with the shoe box. All right. So we would explain the shoe box. It was kind of our first money conversation. I'm not great at setting up systems or organizing things, right?

Or spreadsheets. I I'm bored by it. I get lost in it. I get distracted easily by shiny objects. My filing system was a, well, it was actually like a file folder that I had in a drawer. That was not meant for filing.

Once that got overloaded and about yay thick, I would start putting things in a shoe box and then that would go in my closet. That was my official filing system.

So we are engaged and it is what it is. I know, but it's helpful because we're not like this anymore and it's valuable people were there. So we were engaged. We're not like this. I'm still like that around so much. So we're engaged and we get to that point where it's like, all right, let's have the money talk.

Where we both kind of like show our cards and reveal what's on the table and, Come and tell her, I was like, all right, I've had a lot of credit card debt, but I'm working to pay it off. I'm making some progress. I got a plan, blah, blah, blah. Then I say, all right, so show me yours. What's going on?

Then she takes a shoe box and just slides it across the table. I'm like, oh, what's this? I pop it open and we'll tell her to test. A lot of credit card on envelopes in there may be some of them on opened. Hadn't been looking at that is why at that point, you're getting calls from debt collectors in your parents' house while you're living there.

It wasn't a great start. So, yeah, so that was her start. I mean.

I was in a similar situation, does about three months ahead where I was living off of a credit card, living off a macaroni and cheese, you know, I had nothing else. And I had just kind of come to my financial head where I was just realizing I was a complete mess.

So we didn't have great beginnings, you know, and we came from middle-class homes and, you know, just buried ourselves in debt and doing silly things but that's where the journey began for us.

Talking About Money (without the Judgement)

Elle Martinez: I can definitely relate. When we had our first chat about money. I also, after we got engaged. It was an eye opener and to be honest, a bit awkward. Part of it is you're coming at it from a perspective of. This way of handling money makes total sense. But your other half is also thinking that.

What's interesting and encouraging from reading Bob and Linda story is how they felt comfortable enough to open up about finances because so many couples who are married or getting married. They have the shame and a lot of guilt and that stops them from really opening up and getting on the same page.

Uh, having a judgment free space where you can go over more than just the numbers. I can be a game changer. And this may be a new thing for one or both of you.

Bob and Linda: I mean, for me, honestly, I didn't grow up in a judgment free zone so it took me a little time. He was not judgmental. He wasn't trying to put shame or guilt on me for the mistakes that I had made in the poor decisions that I had made, but it did take me a while to get that off of me, because that was something that I grew up with.

It was like, well, you just kind of hide all this stuff. If you don't want anybody to know, you just hide it. And I think part of this is just growing in my relationship with the Lord where he doesn't put that on us and he doesn't want us to feel ashamed in front of him.

And Honestly, that was kind of the journey that I went on and I, a big part of it for sure was Bob not trying to put any of that on me.

I think just walking through all of that. I think it really came down to what was already in my heart. I don't know if you've ever heard that analogy. It's like, if a glass is full, here we go. This glass has a chai latte in it. If Bob bumps into it, chai latte is going to come out. If I'm already filled with shame and guilt and, tension around a subject, what's going to come out.

I think is helpful for me growing in this whole thing, because we got into this and again, I'm the spreadsheet guy. I'm the math guy and So I'm looking at the numbers. I'm like, all right, this is right. It's like, this is very black and white, you know?

This is a quantitative thing. It's like, this is right. This is the answer. This is the thing, what you are doing the way you're spending money, whatever, like that's wrong, that's wrong filing system, whatever the thing is.

The thing that I grew to realize that helped me a lot and helped our marriage a lot and I think bring a lot of healthy balanced is that she isn't wrong. And that I'm not necessarily right. This, honestly, this is really funny, but helped me just kind of understand that God creates people differently.

He wires people differently, and everybody has different strengths and weaknesses, and they're oftentimes offsetting and corresponding, with the person you're marrying. I was able to, and I'm really thankful, but I start to get an understanding for some of the value that she brought to the table and how I needed it.

I needed what she brought to the table, instead of just assuming that her way is wrong, my way is right, because I have the numbers, you know. That I think a lot with all of this and with our marriage health when it comes to money.

Yeah and that also gave me confidence to say, I actually do have something to say, I actually have value to add. Instead of, for a long time, I just thought, well, he knows what he's doing and I don't so I'm just going to do whatever he tells me to do.

I started going well, instead of coming out at well, like, wait a second, I'm going to do I want to do it this way? I didn't have to come at it from an anger point of view. I could come at it like, actually, what if we did it this way? Have you ever thought about that? You know, because he was treating me with so much respect in this area.

Simplify Your Money with this Framework

Elle Martinez: I'd love the honesty about the give and take with working with one another respectfully. Because sometimes it is difficult when you have such different approaches. After working on this foundation. Linda and Bob were able to get some real momentum with getting out of debt and building up their finances.

A huge help was systemizing things with what Bob likes to refer to as the straight a approach. Attention. Automate adjust an accountability.

Bob and Linda: One of the things I'm always trying to do with money, and I've been in this world now for over 20 years from banking to financial services to now being a whatever online blogger podcast or all that stuff, just talking about money for so long. I'm always obsessed with trying to simplify things and like trying to pull them out of the complexities and make them digestible and put them in a little package.

That was a big part of what we tried to do in this book. As I was taking this big picture perspective of right. How would I start over now, knowing everything I've known, everything I've learned from these last couple of decades, how would I start over now? How would I talk to myself in my mess and say, all right, this is the simple little path you can follow to get out of that and to get on a firm footing?

So the first one, like you mentioned is paying attention. This is something that I think, for people like you and I, and honestly, probably a lot of people are listening to a financial podcast, probably already do this, but most of the world doesn't.

We have to actually pay attention to what's going on with the money. This is the same thing what'd you hear with nutritionists? Have you ever been a nutritionist and you go talk to them and say, all right, I want you to write down everything you eat every day. Let's do a food journal and see what you're eating, see where the problem spots are and whatever. Simply by writing everything down, you suddenly start eating better.

It's like, you don't even have to try to eat better. You literally just write everything down and because you see clearly what's actually going what what's actually happening. Like, you'd get your behaviors begin to shift and change.

You know this, but it's the same way with money. Like when we actually see what's going on, when we actually are paying attention and some people do write everything down and that's a great exercise. It works well, but, but even simply using a tool like mint or personal capital just to actually be able to look back and say, all right, the last 30 days we've spent this much on groceries, or we spent this much on eating out because so many people, like Starbucks have no idea how much they're actually spending.

Right. So to be able to do that, like, it's just such a headstart for so many people. I don't know how you really succeed with your finances. If you're not paying attention to what's going on. You know what I mean?

Elle Martinez: I think most people will be shocked by certain areas with their budget. Like, you know, there are certain ones where you look at and you go, okay, that makes sense. And then there's always one where you're just completely surprised.

Bob and Linda: Something's wrong. Somebody hacked my

Elle Martinez: that's not right.

Bob and Linda: yeah,

Elle Martinez: It seems small, but just being aware of how your money is being used. Can shift things in a better direction. Another key way to get more control over your finances is by automation.

The Power (and Ease) of Automating Your Money

Bob and Linda: I remember reading probably four or five different books that just talked about automating, saving for retirement, building up savings, emergency fund or giving or whatever the thing is. Okay. Like, I'm like, oh yeah, that's fine. That'll probably help a little bit.

I'll get to that eventually and I just kept on putting it off and, and I don't know why it's like a five minute thing. It takes like no time. But I kept on putting it off, but if I trace back my trajectory like there is a clear inflection point from the day. I decided I'm going to automate this to not because again, so many of us depend on our willpower.

That's the thing that financially successful people like they don't have more willpower than everybody else they just learned to automate. Like, it's just that simple. They automate the things that are most important that they know they need to do. They don't depend on waiting till the end of the month to see if there's enough money to see if they remember if they feel like it, whatever any of those things.

And so automation is such an important key and it's the way to like set it and forget it and make your life easier. So you don't have to think about it. Like it's just a no brainer. This is super important for people like me who want to have it together, but just don't is it's like you just make it so that you don't have to ever think about it again.

You think about it once and then you're done. Yeah. Yeah, cause for me, there's no way I could remember, or it just wouldn't happen for one reason or another. Yeah.

Elle Martinez: Automation has always been helpful for us, but in all honesty, These last two years with everything going on. It's been a huge time saver.

During the pandemic, we were taking care of things: switching the kids to remote learning work, had shifted for both of us, and then my mom in the middle of the pandemic wanted to move closer to us. So we had a lot on our plate. What gave us some peace of mind is that we knew that our system was mostly automated.

All we had to do was check in with it once a week, just to make sure everything was paid off.

So you might think of it as a small thing, but it can have a huge impact. It can help you have the space to focus on the more important things instead of stressing over the bills. Again we're trying to go with a effective yet simple plan.

Keeping One Another Accountable

Bob and Linda: That's the thing it's like, so many of these things are just quick and simple. It's a one-time decision that you make that will pay dividends. I mean, literally and figuratively, you know, for years and years to come.

Elle Martinez: I definitely appreciated how Bob and Linda also covered adjusting things. You have to have a flexible financial system. Life happens and you need to be able to change. And switch numbers as needed, or as you were getting more comfortable with your new budget. You might find ways to further optimize.

And then of course, accountability, which is kind of built in when you're married, you're encouraging one another. You have someone you're accountable to.

Now I know sometimes people hear accountability and they think this is another word for the blame game. But Bob and Linda have a different approach with that.

Bob and Linda: I think the thing I would add to that is just again, like I'm always looking to systematize things as much as possible because it's how I roll. With that accountability, it's like yeah, we do have an accountability factor with each of us, but at the same time, like we both need external accountability.

This is where having a budget that actually will hold you accountable is so important because I think, you know, one of the things that we struggled with for so long was we were using budgeting tools. The extent of the accountability was that the number on the screen would turn red and it would let us know.

And it's like, is that really, at least in our case that did not keep us from going over it. Didn't like, it's just, now we're just like, well, we'll fix it next month. We just keep on kicking the can down the road in any way. We just found that wasn't holding us accountable financially. It wasn't giving us a wall to actually bump up against.

So finding that finding tools that actually help you stay accountable are just really, really important.

Staying Balanced with Financial Independence

Elle Martinez: between how they communicated and the system they built, Bob and Linda were hitting some major goals, including financial freedom and independence. Many people get excited about this part.

This idea of, I don't have to work again. I'm free. I can appreciate that, especially if you're not happy with work and how things are handled at your company or in the industry you're in. However with financial independence. There's so much more to that.

One of the things I appreciate about the journey.

Is how it helps you become more aware. It can also nudge you to prioritize your goals and start shifting your habits so that you can reach them. This framework can be a game changer, but as Bob and Linda noted in their book, There's a balance to keep.

You have to be careful that this path to financial independence is not just focused on the numbers and optimizations. I've seen conversations online, hearing from others about how it's all focused on getting to a million dollars or whatever that number is. Or trying to get to this number as fast as possible.

There's no mention of quality of life, maybe shifting your work schedule so you can have more time with the family and no discussion of what you're actually working towards. It's simply getting out of the rat race.

I thought Bob and Linda had some fantastic thoughts about that.

Bob and Linda: A lot of people forget, and I know that I forgot this or never realized it and it's so common sense, but you have to be wary when you have moving goalposts.

Oftentimes with a lot of these financial goals, especially when it's an arbitrary number or whatever. It's like when I have a million dollars in the bank, then I will do X or Y. Then it will be at peace. Then I will be comfortable. Then I will give more whatever the thing is.

Those goalposts it's just always move and so this was one of those things.

Giving has always been a really important part of our journey and just something that has always been done in our heart and how it's been the big motivator for us to actually try to earn more. It's been that. And within that, even though we had that kind of desire, We still have the desire to spend too much money on ourselves and to whatever. Like, so both of those desires are there. They kind of fight against each other.

One of the things that we began doing that has helped this a lot, was we at age 31, we began giving basically giving our age. So we've been given a 31% at age 30, one of an increase in that a 1% every year when we turn we're the same age, you know?

That has been so great for us because it's forced us to grow in the direction that we want to grow. Our giving is automatically growing. Presumably our income will hopefully continue going up as well. And and it just puts us in a position where we're doing the thing kind of automatically, that is most important to us.

We found that to be really, really helpful to kind of handle tension of not getting too hung up on whatever the financial goal is at the moment and keeping first things first, you know what I mean?

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How to Easily Create a Flexible Financial System

How are you feeling about your progress this year with your financial goals? Are you frustrated because you're not hitting them as fast as you had hoped? Do you feel like managing money is a chore? Believe it or not, these problems are connected.

Today, I'm going to break down and show you how to build a flexible financial system that will get you to your goals faster!

Keeping Your Budget Flexible and Fun

Recently I had a chat with rich Jones for the  Paychecks and Balances Podcast.

The theme of our discussion was managing finances when undergoing a life transition, but it quickly widen out and scope. After my chat with Rich, our discussion stuck with me.

Having written about personal finance for 12 years and podcasting, a little over half that time, I noticed a certain rhythm with people in their interests and finances.

Beginning of the year, it's all about setting up these big goals, paying off X amount of debt, saving up for a huge house down payment. And for some, it truly is the beginning of an awesome year. They get these new habits set up. They have their systems in place.

But others though, they're already having a hard time keeping up those habits, part of it is life shifts.

Between January and to about April when I look on my side of things with site traffic, And Google searches, that's when people are most interested in their finances.

Further into the year, no matter what camp you're in the seasons change and life rolls on.

With September zooming by and the last quarter coming up. I find it's another point in the year where we reflect. We have this many awareness that the year's wrapping up. We're reviewing how much we've accomplished.

Now on top of the regular seasonal changes in the year. We still have the COVID pandemic that we're dealing with.

Rather than fight the seasonal shifts or craft these perfect on paper budgets, but they fall apart during real life pivots, we have to address a fundamental issue -building a sustainable and flexible system for handling your finances so that you can live your life. And if something happens adjust as needed.

Instead of chasing money as the target or the goal really should be using it as a tool.

In this episode, we're going to break that down so that you can create a financial system that is easy to maintain and adjust and have a sustainable budget that's flexible and fun.

Are you ready? Let's get started!

Handy Tools to Build Your Financial System Quickly and Easily

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union! If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today.

We’ve been Coastal members for a few years have been happy with their services.

They have wonderful customer service along with competitive rates to make saving easier!

Support the Podcast!

Thank you so much for listening to the podcast! If you enjoyed this episode and found it helpful, here are some ways to support it.

  • Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
  • Leave a review. Honest feedback and reviews make a big difference and gets the word out about the podcast. Leave your rating and review on Apple Podcasts.
  • Grab a copy of Jumpstart Your Marriage and Your MoneyMy book is designed for a busy couple to set up their finances in 4 weeks. Get tips and tools that have worked for other couples on their journey of building their marriage and wealth together!

Choose Your Own (FI) Adventure

Want more options and time to do more for the people and projects you love? Learn how to create a path to financial independence that is flexible and fun!

Finding the Right Pace and Path to Financial Independence

As a kid, one of my favorite kinds of books to read were those choose your own adventure stories.

Do you remember those? No, it's pretty much began the same, but based on the choices you made you could go on so many different adventures.

Some of them had dozens of different endings. You could discover buried treasure, time travel, go to space, whatever the adventure was.

Fast forward a few years and now my favorite type of video game to play include RPGs. Why? Because you have some room to craft out your own adventures.

I feel like financial independence is like those books and games. You decide how you're going to go through it.

Yes, there is an end point, which is when you hit financial independence or financial freedom but in the middle, you have flexibility not just the goal but also the journey .You want it to make it work for you and your family.

It doesn't always feel that way though. There's this narrative that gets pushed, that there's a certain type of way to fi- specifically as fast as possible.

Yes, sorry, but no thanks.

I think that the journey is just as valuable as the destination. If you've been turned off by that segment of fi, or you just want to have more flexibility with your plan, I think you'll enjoy today's episode.

To help me out is Diania Merriam. She's the founder of EconMe who knows firsthand the joys and challenges of carving out your own FI path.

In this episode, we're going to jump into:

  • how Deanna paid off. $30,000 of debt and jump-started her FI path
  • how working towards financial independence opened up more options and allowed her to take risks to pivot her career plus more
  • we're going to get into how you can create a plan that fits you and your family.

Are you ready? Let's get started.

Handy Tools to Start Your FI Journey

If you’re looking to get ahead with your finances as a family and look at pursuing financial independence, here are some resources to check out:

Want to be a part of EconMe this year? Sign up for your ticket!

Because you're a listener, Diania was kind enough to pass on a discount code. Type in SIMPLIFYENJOY to save 10% on your ticket!

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union! If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today.

We’ve been Coastal members for a few years have been happy with their services.

They have wonderful services and accounts to make saving easier including their competitive money market accounts. Check out their rates here!

Financial Independence is About More Options

Elle Martinez: One of the joys to me about financial independence is that flexibility and freedom you have, but it's also a little confusing when you're first coming into the space.

There are certain voices that may be more popular or louder. So if you don't mind, could we kind of jump into what exactly does financial independence mean to you?

Diania Merriam: Financial independence to me is really about creating options. It's about having that financial security for you to explore what you want.

I think some people approach financial independence because, they know that they want a homestead, right? We were just talking about Frugalwoods.

That's the reason why they did everything that they did, or they know that they want to reach financial independence so that they can have kids and stay home with their kids. Some people have very specific goals of why they're doing it.

Other people I think – I fall into this camp – is like, maybe we don't know what we ultimately want. Maybe we're looking for financial bandwidth to explore.

I like to think of it as it's creating options. I'm very attracted to the idea of having full autonomy over my time.

And not really having to subscribe to the whole nine to five until you're 65. That's really exciting for me. Yeah, I think that that pretty much sums it up the way that I look.

Elle Martinez: I feel the same way. That was the initial draw for that. I know the idea of never having to work again is a pull for some people, but for my husband and I, it was like you said, having this bandwidth there, having these options available to us to see, Hey, is this something we want to do or explore.

Discovering Financial Independence and Dumping $30K of Debt

Elle Martinez: I want it go a little bit back in time, because I was looking at your journey and, the amazing accomplishments you had, especially paying off like $30,000 a debt in less than a year.

How did you, first of all, initially find out about financial independence and discover that?

Diania Merriam: Yeah. So it was the fall of 2015 and I was 28 at the time I'm approaching my 30th birthday, like it's looming.

I think 30 is one of those really reflective years where you're just like, what am I doing with my life? I actually ran a credit report on myself during that time.

It was the first time that I've ever done that because I knew I had debt, but I was just kind of paying the minimums on my credit cards and I had some student loans.

I never actually looked at my collective debt. That was like the real eye opening moment for me that oh, wow. I'm in $30,000 of debt.

I didn't realize like that just kind of slipped under the radar for me. I was trying to wrap my head around what to do about this.

A friend of mine had sent me a post from Mr. Money Mustache. It may have been the one where like your debt is an emergency. You got to treat this like your hair is on fire, but it really impacted me.

I think up until finding that blog, most of what I read about personal finance had this tone of struggle to it.

Like this is going to be so hard for you get to get out of debt. It's going to feel like deprivation to reduce your expenses.

When I read Mr. Money Mustache, there's just this tone of optimism to it. This kind of realization that I am so privileged and I really wasting my privilege. That's what really struck me.

You know, making my lunch every day to bring to work, that is not a hardship. That's actually a first world problem. I have a food, I have a roof over my head.

It made me really grateful for the things that I had and, and also to recognize that money is an incredible resource that can open up a lot of options.

Revaluating Priorities and Spending

Diania Merriam: I used to think that I was going to figure out my debt when I was making more money.

Right. I think the realization that I didn't have so much of an income problem, some people do, right. Some people really do need to increase their income.

I don't think that was my situation. I think my problem was the wasteful spending and being completely mindless about it. Recognizing that this isn't something that's going to get solved by increasing my income.

This is a money management issue. I had this realization that if I can't manage a thousand dollars, what makes me think I'm going to be able to manage a million dollars. Right?

Money management is a lot about habits and behaviors and so I really wanted to dive into that. At that point in my life, and I would say Mr money mustache really inspired me in that.

Elle Martinez: Yeah. I remember reading that article as well. It's funny how you say there's this undertone of optimism.

I would agree because on the surface level, though, he's very like blunt and direct and how he feels about certain situation, very strong feelings like, ‘Hey, your debt is like your hair's on fire, get rid of it. ‘

Kind of want to break it down a little bit further, especially like you said, $30,000 of debt. Was that like student loans, credit cards or a mix of everything?

Diania Merriam: So half of it was student loans, which doesn't sound too bad, right? Like $15,000 in student loans is nothing. However, I went to college on a full academic scholarship.

I should have had no loans, but the student loans were offered to me for living expenses. No one explained to me, you don't have to take this money.

I just thought like, oh, What I do, you know, like I'm just taking out these loans and so, yeah, that was half of my debt. The other half was credit card debt just from living beyond my means.

Again, I thought it was something that I would solve when I was making more money and I just didn't really worry about it too much in my twenties.

Getting Creative and Optimizing Budgets

Elle Martinez: Yes. Want to talk about that, how behind, you know, paying off that debt. Everyone has the choices that they make. Like where do I cut back?

You mentioned it wasn't an income problem. It was more your expenses with that financial independence mindset. When you were reviewing your budget, what were some changes that you made? So you're able to one, tackle that and then two, start making progress towards your FI goals?

Diania Merriam: Yeah. I would say probably my biggest area that I cut back on was going out. Like I was partying a lot in my twenties. I was going out nearly every night, spending money on meals out and drinking and partying with my friends. Right. So that was probably the biggest area that I cut back on.

I did adopt this kind of process, whenever I was thinking about spending money. So if I wanted to buy something, I would kind of pause and have a moment to think, is this a want, or is it a need? That's probably the hardest question, right? Because a lot of us think that we really need something when it's actually much more of a want.

So really meditating on that was like a whole new way of looking at spending for me. So I spent a lot of time thinking about that kind of stuff. Then I would ask myself, okay, if this is an actual need, Is there a more resourceful way for me to meet this need?

Can I borrow something from a friend? Can I repurpose something that I already have? If I'm going to buy it, can I buy it used at a lower cost? I would go through this mental process and then ultimately, we'll get to if I was going to spend money or not. I think that really helped open up my creativity and resourcefulness in a way that I had never experienced before.

For example we all have clothing needs, right? We need to close ourselves. During the time that I was getting out of debt, I wasn't spending any money on clothing, but what I did is I would host these clothing exchanges with my friends.

So we'd all clear out our clothes. We'd spend an afternoon in my apartment, like drinking mimosas, listening to music and trying on each other's clothes.

I walked away from that with like a full closet of more fashionable clothes than I would have ever bought for myself. Not only was that a more resourceful way of getting my needs met and that I wasn't actually spending any money, I would say that that solution was far superior than mindlessly swiping a credit card. It was more fun.

I got to spend time with people. I walked away with clothes that I probably wouldn't have thought to buy for myself. And I had a lot of experiences like that.

Example, I had a new neighbor that moved in the apartment below me and, I just see them passing in the hallway. I welcomed them.

They said, we're waiting, we're trying to get our internet set up. Do you mind if we just use yours for like a couple of days until they come and, and get our internet installed?

I said, sure, just figured, Hey, if they abuse it, I could change the password. Like no big deal. Right? So I give him the password to my internet. They lived right below me.

I just noticed that it didn't affect the functionality of the internet for me at all. It didn't slow it down for me. It was like, I didn't even notice that they were using it.

So I said to them, Why don't we just split my bill? Like, why don't you just stay on this? Don't get your own. Let's cut that bill in half for both of us, you know? That is probably not something I would ever think to do if I didn't discover financial independence in this mindset of really being mindful about spending and figuring out ways to cut back.

Exploring Options Because of FI

Elle Martinez: Yeah, I love that because the examples you've given, I think also speak beyond the financial benefits of looking at the FI lifestyle, which is one being more mindful and conscious of any spending that we're doing and then too, like you mentioned, with that clothing exchange, it's beneficial for the environment.

We're not producing, more goods. We're reusing in the best way, what we already have so I'd love that.

I know for different people, financial independence opens up opportunities either professionally or personally. You've paid off the dead and saving up like 60% of your income.

Yeah. Significant amount. What changes or opportunities now became available that you took advantage?

Diania Merriam: Oh, my gosh, my life looks completely different than when I was in debt. So a big motivator for me is that when I started this process is I really wanted to walk the Camino for my 30th birthday. And the Camino is a 500 mile Trek across Spain.

It was something way outside my comfort zone. Not only was that trip kind of intimidating, then the financial aspect of it was really intimidating, but wanting to do that trip kind of propelled me to figure this stuff out.

I was able to negotiate with my employer to take a leave of absence, to take a sabbatical that was unpaid. So I didn't get paid for two months. Plus I had to fund that trip. It, it probably cost me around six or seven grand to be able to go and do that.

But that was an incredible life experience that I wouldn't trade for the world. So that was kind of like my initial opening up an option that I don't know that I would have ever had the courage to even ask for that if I didn't have a financial safety net.

I like to say that if they would have denied my request for a leave of absence, that, I would have just gone anyway. Who knows if that was true, but I told myself at the time that my financial resources and the savings that I was doing would have made that option possible if I wanted to exercise that option.

So not only asked for the two months off, but I also asked for a remote working arrangement, which was not the norm. This was in 2017.

So now let the pandemic, it's a lot more common to look for opportunities to work remotely but I was in New York city and I just felt like I wanted to try something else.

I felt like, look, I had no debt, no man, no kids. I had the kind of freedom that people dream about and I wanted to go explore and do something with this.

I had a friend who I was really close to in New York and she went to school in Cincinnati and then ended up moving back to Cincinnati.

I visited her like three times in 2016, and I just really liked it. Cincinnati is obviously a much smaller city, but to me it has all of the benefits of a big city with like none of the downsides.

It just felt like time slowed down when I got here and not in that maddening way that new Yorkers hate where there's no sense of urgency. Like it wasn't like that. It was like a good slowing down.

I just thought I want to try this. So I negotiated with my employer to let me work remotely. So let me take the two months off. Then after I got back from the Camino. Working from home allowed me to I've always wanted a dog, you know? And so I adopted my best friend. He's like the love of my life dog named, buddy.

And I also bought a house, which is something I never thought that I would do.

Led to funding my own business, which I know we'll talk a little bit about the economy conference and ultimately this year I actually quit my job in January. I quit my full-time job without being financially independent.

I think that FI opens up a lot of doors when you're separating, like your need for your livelihood to come from your work. That is like the ultimate right. To reach FI.

But I actually think there's a lot of freedom that opens up along the way that I don't think is talked about enough.

I think at a certain level of savings so I reached coast fi which means that I have enough money in my retirement vehicles that I no longer need to save for traditional retirement. That's a level of opening up a level of the game, I guess you could say.

I also have something I like to call peace out money for the polite among us, which means that I personally have two years of living expenses, liquid that I could easily access.

So I've got a year in cash and a year in an after tax brokerage. When I came to this crossroads with my employer, it was like, okay, I still need to work, but I no longer need to work somewhere.

That's not ideal. Yeah. That is an option that is opened up to me even though I'm not yet FI.

I like to talk about this because I don't think enough people do that. I think people are waiting for five. Oh yeah. Take these risks. Right. Or to walk away from a job that no longer serves them, which I don't know that we necessarily have to wait that long.

Elle Martinez: I completely agree. I know again, there's like different flavors and they come up with different names, you know, in the five space, a slow where I believe I was talking Brad from ChooseFI about this. Like it's not an off on switch.

I think that's the misconception is like, okay, when I reached this, then all this opens up.

It's like, no when the debts paid off, you have a little bit of freedom here. You've built up that savings.

The FI Community and EconoMe

Elle Martinez: I want to talk to you a little bit about your business, because comes from this space of financial independence and spreading it.

Starting any business is a lot of work. Live events are like another layer up for me the way I see all the logistics and then to run a conference. First of all, why did you start economy and what was your reason behind it? What do you hope people can get from it?

Diania Merriam: Sure. Well, economy originated from me dreaming up, like what would I want to do with my time if I no longer needed to work for money?

I mean, When people would ask me, like, what is your, why for five? And like, what are you going to do when you reach five? I used to say, I'm going to create this party about money. Like, that's what I thought that I would do. I just got so excited about it that I couldn't wait.

That's why I did it sooner, but I'm actually really glad that I didn't wait because I think starting a business has a lot of risks to it.

There were a lot of things that I couldn't anticipate like a global pandemic. And so I ended up taking a huge loss on the business in the first year. And I think if I didn't have my 60% savings rate and my good income. It would have probably been too much of a risk for me to handle if I didn't have that.

I was able to really kind of self fund this startup phase because I had an income while I was building this.

I would say really what inspired me is I love to go to in-person events. There's this one event that I go to every year called the world domination summit, which sounds crazy right?

Like who produces that pinky and the brain, but, but actually Mr. Money mustache spoke at it one year and that's how I found out about.

For someone that's as frugal, as I had learned to become through getting out of debt, you know, a ticket to a world domination summit is like $700. I will tell you that it is worth every penny.

I don't think the pursuit of FI is about right. Not spending money or spending as little as possible. I think it's spending it on things where you get the most value and just being very critical about where those dollars are going.

Every time I would go to world domination summit, I would leave feeling like my life is so full of possibility. I would meet these incredible people that were living very unconventional lives and being surrounded by that energy. Just, it has an effect on you and you start to like, think more expansively about what, what you could do with your time.

I wanted to create something that gave that feeling to other people, but about their money. That was really exciting to me.

I think economy and what people get out of it. Now as far as tactics and how to manage your money and how to pursue fire, there are so much many blogs, podcasts. There's so much out there for free that, that you can learn how to do this. Like you don't need to go to a live event for that.

I think the live event is much more about inspiration and community. One of my favorite quotes is if you look at your inner circle and you're not inspired, then you don't have a circle. You have a cage.

I think a lot of people feel this way on their pursuit to FI. They can't talk to their friends and families about this. People don't understand them.

When I was first getting into this, I was making my own facewash and laundry detergent. Like people thought it was so weird. Right? And so to be able to connect with other people that have a similar interest on this taboo topic, I think is really important for the journey.

I look at the people that I've met from going to like camp fire, camp mustache, and even world domination summit, like my social circle today, or like all people that are pursuing fi and there are some of the smartest, most generous people I've ever met. And I just feel like my journey is richer because of the people that I've surrounded myself with.

First of all, if I could say like, there's any kind of dream for EconoMe, I would love for someone to meet their spouse there, honestly, like that would just thrill me that like either someone met their best friend or their spouse at economy, that would be so much fun.

But yeah, we have main stage speakers that are talking about FI from the tactical side of things. What do you do about student loan debt? How do you approach credit card hacking? What do you do when you get a big medical bill?

There's those kinds of tactical topics, but then there's also a lot of inspiration, like the most popular speech. The first economy, which was last year, one week before everything shut down was from Jackie Cummings Koskie and she was a single black mother who found the fire movement at 38 and she never made six figures and she was able to retire before.

She did it in like a decade and her presentation was called the real numbers behind firing and she showed all of her numbers. Like she showed specifically how she did it.

I think it was really inspirational for people because fire can feel unattainable for a lot of us, but when you see people that maybe have similar circumstances to you doing it and succeeding and thriving in how they're able to save and invest, it just makes it feel more possible.

So yeah, all of that and more at the economy conference. Wow.

Elle Martinez: I know there's going to be those listening. They're like, I am ready to go plus after this year that we've had, they're ready to connect. So if they wanted to learn more, what's the best way they can do that?

Diania Merriam: Yeah. So if you go to economy, conference.com and that's economy with an M E not an M Y I, if you look at the spelling of that, Name you'll notice that I, I really enjoy misspelled words.

So anyway, economy with an Emmy. There you can check out the speaker lineup. You can buy tickets. They're on sale.

Now the event is actually happening at the university of Cincinnati on November 13th and 14th of this year.

You can also go to just search for economy conference on YouTube. And all of the speeches from last year, I put up there for free. I've got professional videography, just like Ted talks where you can watch a Ted talk on, on YouTube.

It's a similar idea. So yeah, you can check out the speeches from last year and kind of get a feel for the vibe.

Support the Podcast!

Thank you so much for listening to the podcast! If you enjoyed this episode and found it helpful, here are some ways to support it.

  • Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
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Which Financial Independence Path is Right for Your Family?

Financial independence is a hot topic, but with so many different paths (FIRE, leanFI, FatFIRE, slowFI, etc), it can be difficult to figure out what's the best path for you. 

Today we dive into some of the most popular ‘flavors' of financial independence and weigh the pros and cons of them. We’ll also get into how you can begin to calculate your FI number! 

Is Financial Independence a Smart Path for Your Family? 

Be honest with me, what do you think of when you hear the term financial independence? 

Do you think of a certain number, maybe when you’d like to be retired by? Maybe travel on your own schedule not having to worry about a 9-5 again? 

Do you think of it as the ultimate security blanket – an amount you have tucked away in investments or some income stream where you don’t have to worry about the bills or maintaining a certain lifestyle? 

Do you see a family with very good income living a life where they’re depriving themselves of vacations, eating out, and having fun just to retire faster? 

Talk to different people and you’ll get different answers. 

What I'm curious about is how young families can take key principles from the financial independence space and use them to reach the goals that matter to them personally. 

Sure, maybe it’s retiring or maybe it’s making sure the essentials are taken care of so you can spend more time with your family. 

Two components to figuring out how it could work for you is know first off how much you need to be financially independent and what is the timeline you're looking for.  

In this episode, we’ll go into that. We’ll jump into:

  • The different paths to financial independence
  • How to begin figuring out how much you need to retire
  • Choose an FI path That fits Your family

Let’s get started!

Handy Resources for Families Looking at Financial Independence

Thank You to Our Sponsor Coastal!

Support for this podcast comes from Coastal Credit Union!

If you live in the Triangle area of North Carolina and you’d like someone to work with you on your goals, you really want to check out Coastal’s Wealth Management team.

They’d love to help you start investing for retirement and more!

How Much Do We Need to Retire? 

One of the things I get to see writing about personal finance and my site are some of the questions people have about money. 

Over the years certain topics may come in, depending on if there’s a shift in the big picture like a recession or maybe it’s a certain time of year – summer where you get people asking about getting a good deal on a family vacation. 

And then there are topics that perennial – year in, year out different families with of different sizes, backgrounds, and incomes type into google to get an answer to a question that’s weighing on them. 

One of those questions is ‘How Much Do We Need to Retire’?

Now there are some solid back of the napkin calculators, but can you really use them for your family’s financial future? 

I decided to chat with Drew Snider who’s part of Coastal Credit Union's Wealth management team to see what families need to consider when figuring out how much they need to retire. 

More Than One Way to FI

Let’s define financial independence because even that gets mixed up with a related idea, FIRE.

Financial Independence: Financial is where you have enough money saved and invested that you can cover all of your expenses with.

FIRE: The difference with FIRE is there is a focus of leaving or retiring from your work. I’ve noticed that many in the community do point out how FI is the root, however, the RE is what’s the hook. 

  • LeanFIRE: You have enough stashed away to take care of your essential expenses.
  • FatFIRE: ”It's a level where you get to live your life at the same level as your highest-earning years, while not having to work a day job.” – Financial Samurai
  • SlowFI: As you move towards financial independence you make adjustments for more quality of life choices even if it slows you down towards your FI date. – The Fioneers
  • CoastFI: With CoastFI, you've reach a threshold where you have enough to retire at a traditional age. You can now use this ‘leverage' to align your lifestyle towards what you want during your FI years. We're at this point and love the options that have opened up for us.
  • Barista FI: With health expenses being a concern for many, I’ve seen a take on FI where you maintain a part-time job you enjoy for the insurance benefits. 

As you can probably guess from the podcast name Simplify & Enjoy, FatFIRE isn’t really a priority for us.

I recently came across an article online about one family in their thirties looking at financial independence

One sentence stuck out to me –  

Your “FIRE number” can be an age, date, or net-worth amount when you reach financial independence and no longer have to work if you don’t want to.

And I think that can be so helpful when you're deciding on your path – what do you consider to be your FI number?

Choose a FI Path That Fits Your Family

So I’ll let you in on a secret- when I was working out the site name, I was sure I didn’t want financial independence in it.

The reason is even though how we manage our finances qualify as taking a financially independent path, it’s not the end goal. It’s simply the tool. 

The principles of financial independence that I appreciate include: 

  • Define Your Essentials and Must-Haves 
  • Cut Out Noise and Status Symbol Spending
  • Pursuing More Options, Typically Fewer or No Debts
  • Work Optional (Type/Flexibility)

Next Week's Episode: Kids and Financial Independence

Speaking of aligning your money with who and what matters most to you, next week we’re seeing how kids fit in with financial independence. 

Matt Miner, a financial advisor and father, shares his take and some practical advice on designing and weaving more options when it comes to finances and advice. 

So if you haven’t already, make sure you’re subscribed. You don’t want to miss that episode. We’re on iTunes and wherever you get your podcast from! 

Our music today was from Lee Rosevere and Music for Makers. 

And thank you for your support!

If you have any questions or ideas for the show, please email me or join our free and private facebook group Thriving Families. We’re all about encouraging one another with our goals.

I hope you have a wonderful week, take care! 

Why Simplifying Your Finances Matters

Simplifying your finances can be incredibly fulfilling and powerful.

Not joking.

Benefits of Simplifying Finances

When you simplify your finances (and your life), you can gain so much more than positive cash flow.

You also gain:

  • More Options: We don't have control over most things, but if you've simplified your life, you tend to give yourself more options. Laid off from your job? Having some savings tucked away gives you time to explore and find the next job/career that fits you.
  • More Time: With less stuff around the house, you need less time to maintain, organize, and store them.
  • Less Distractions and Stress: Life can be difficult already so it's smart to remove needless stress. Some of the most successful people have found reducing their wardrobe a boost to their day and gives them energy for more important endeavors.
  • Financial Independence: As you remove useless expenses you also lower your needed living expenses. Quite a few people have mastered living below their means and used that to retire early and/or becoming financially independent.

The Foundation of Simplifying Finances

It's a process where you shed the useless and shift your money towards what matters most to you.

Who doesn't want that?

I think most peoples' hangup (including us) is how boring the process can seem.

I've been writing about personal finance for about a decade and very few people get excited about breaking things down and filling up a spreadsheet.

But I've also learned the secret to getting people who are numbers adverse to start not only tracking their money, but changing their spending.

Here it is –

Defining their WHY and Keeping Reminder of It

I've talked about defining your why and picturing what you want before, so you can check those out if you want to get all the fun details.

Thoughts on Simplifying Finances

I'd love to get your take. How has simplifying your finances affected your life? How did you make the transition?

Why Simplify and Enjoy? :A Quick Intro

Hello; thanks for visiting me here on Simplify and Enjoy!

I'm Elle 🙂

Since 2009, I've been writing about marriage and money over at Couple Money.

I originally started Couple Money because we needed it. Back when we engaged we quickly found out we had different approaches to money.

Trying to find solutions, I hopped online and found some great personal finance blog, but there wasn't much that specifically addressed how married couples can work together to tackle their financial goals.

Marriage and money is so layered because you have two people with different backgrounds coming together. Pretty much all I saw at the time was focused on individuals.

So started documenting our debt free journey as well as wins and disagreements.

It's something I love, but today I'm starting a side project that I'm thrilled about sharing – Simplify and Enjoy.

I guess the best way to start is to explain the why behind the site.

Why ‘Simplify and Enjoy'?

I do believe the goal financial independence is not about the money, but about the freedom.

To save enough to ‘retire' or where work is optional takes a big chunk of money.

(Not as much as some of those retirement calculators like to recommend, but even if you want to live off of $30,000/year, you'd need around $750,000)

That means making choices about where and how you're spending your money now.

We've found the process of simplifying to be the best, most sustainable way for us to reach our goals.

Reviewing regularly what matters most to us and minimizing what doesn't helps us move forward and closer to what matters.

It also means that we enjoy the journey of becoming financially free and eventually independent while raising our kids.

Are You Hard Core FIer?

Not really.

Which may seem weird, but we're really focused less on the numbers now.

When we were paying off $35,000 of debt, we tracked our progress fairly regularly. That made a huge difference.

But now that we have built that financial muscle (and also automated our money), we have more time to focus on the kids plus our projects.

Now that's not to say we're not savers. Last time I checked, our average savings rate was around 45% range.

If you'd compare to the average American family, then we'd most likely be considered hardcore savers.

What Are You Going to Cover on Simplify and Enjoy?

Basically, we'll share a bit of how we're raising our kids while trying to simplify our finances, home, and lives.

I'd love to share some of our discussions about balancing saving more versus enjoying the season of life we're in.

So while we'll get into the path we're taking towards financial independence, the real focus will be on the journey.

I'll share projects around the home we're working on. Some of them we'll do ourselves and gain some new skills. Other projects we're going to outsource.

You'll get to see how we design our yard to make it better suited for us.

I'm learning about using permaculture principles to grow more of our own food and work with what we have.

We're looking to creating spaces for the kids to play, us to relax, friends to visit and , and grow our own food.