My Theory

When it’s right, it’s easy.  

Let me clarify. In my life, I’ve found that when something is right, things get real easy real quick.

This is different from when something feels right, because like my mother used to tell me, “what’s good to ya ain’t always good for ya” (the way she says it makes it rhyme but I can’t insert a Baltimore accent combined with Black mom realness into the written word…I digress, for now just imagine ‘for’ and ‘to’ rhyming). What she meant by this is just because something feels good, doesn’t mean it is actually good for you. 

An example is the colossal piece of cake I ate last night, the actual title of the cake per the Safeway label is ‘Colossal Slice of Birthday Cake’. Now, I know damn well I didn’t need a piece of birthday cake for two reasons, 1. It wasn’t anybody’s birthday, and 2. I’m trying to lose this baby weight. Many of the things that feel right in the moment end up making life harder in the short and long term. Sticking with the cake example, today I have to fast so that my body uses up the excess insulin flowing through my bloodstream. Last night I had a terrible night’s sleep, and I’m currently suffering from a sugar headache. Darn, all that for a slice of cake. But it felt good in the moment. My life is harder today because of that choice. 

So how are you supposed to know when something is actually right for your current and future self? This is where my theory comes in, and although it may only be true for me, I still believe in it enough to share. Since I’m a doctoral student, I know all about theories, and here is mine: when it’s right, it’s easy. I found this to be true with my love life, my career, my education, exercise and eating regimens, friendships, and my FIRE journey. To illustrate, I’ll use my love life as an example. Before meeting my husband, love and relationships were too stressful, difficult, disappointing, and lame to be worth my time and energy. By the age of 22, I’d resigned to a life of romantic lovelessness, I didn’t want to give it or receive it, I was just over it. That is, until I met my husband. From the moment we met, everything became so easy. Loving him is easy, and I’ve learned to let myself be loved by him. My husband restored my faith in love, men, humanity, and myself. Being in love with my husband is just so easy, and I attribute that to my knowing that he is right for me. 

Overall, I just think that when I’m trying something over and over, and it’s not working or it is working and I’m not satisfied, there’s something about it that is not for me. I’m trying to force something that doesn’t belong. I do this often with exercise. I tell myself I will do (insert exercise here) for (insert frequency).When it doesn’t happen, I get all self-blamey, which is a very whack response. I keep trying and failing until something changes, and all of a sudden I’m successful. Before pregnancy, I found it easy to wake up every weekday morning at 4 am to get ready for a 5 am Crossfit class. I loved this routine. I was successful. I was almost able to do a pull-up. It was right for me. Now, my life looks a little different and so I’m back on the search for finding what works for me. 

The FIRE movement just feels right.

So let’s apply my theory to the world of personal finance. On January 2nd, 2021 I learned about FIRE (Financial Independence, Retire Early) for the first time. I was looking for a Youtube video about HSA’s (health savings account), trying to learn more about the benefits offered by my employer. One day before, I’d made a New Year’s Resolution for 2021: Learn about personal finance, come up with a retirement/investment plan. 

There I was, sitting on the couch while pumping, trying to Youtube my way to financial literacy. Eventually, I came across a video published by Our Rich Journey, a Black husband and wife duo, explaining how they used their HSA accounts to help them retire before they turned 40. RETIRE IN YOUR 30’S? WHAT? HOW? I was lost in their sauce, watching video after video, learning about what FIRE meant. I showed my husband one of their videos, knowing that his reaction would decide if this would be just another thing I get really excited about then forget or if this would change our lives. After the video ended I asked, “What’d you think?”, he instantly replied, “I like it, let’s do it”. Moments like this reaffirm why he’s the man for me. He’s smart, open-minded, and a rider. PERIOD. Next, we purchased a book and began reading a chapter a day. 

Starting FIRE was easy 

When it’s right it’s easy, huh? How easy? In less than a month we accomplished the following:

• Learned about this thing called FIRE
• Calculated our monthly and annual spending, and our cost of living
• We made a monthly budget, which we revisit at the end of the month
• Calculated our net worth, which allowed us to get our FIRE number (the amount needed to live off dividends of your investments indefinitely without touching the original principal invested)
• Created a retirement goal/plan using our FIRE number: As of January 5th, we need $1.1 million to retire in 10 years, assumptions are saving 65% of our post-tax income per year, investing 90% in stocks (at a 5% return).
• Found out these things meant: 401k, 503b, 457b, Roth vs. Traditional, IRA, HSA, Low-cost index funds, ETFs vs Mutual Funds, Money Market Accounts, VTSAX
• We created Vanguard accounts, maxed out our contributions to our newly created Vanguard Roth IRAs and traditional IRAs. Each IRA has a maximum yearly contribution of $6,000 as of 2021 for those under 50). = $24k invested
• My husband signed up for 401k contributions at his new job, for the maximum amount allowed (as of 2021 it’s $19,500 for those under the age of 55), his employer matches up to 8% of his salary contributions ($6,800) = $26.3k invested
• I signed up for a 403b account and a 457b account (also known as the unfair advantage for teachers), and maxed contributions to both ($19,500 for the 403b and $19,500 for the 457b) = $39k invested 
• We both opened up individual brokerage accounts with Vanguard. I’ve invested in mine already using money I had sitting in a checking account= $14k invested
• My husband paid off his $9k in car loan debt and $3k in credit card debt, so now the only debt we have is our mortgage (we used our tax refunds for this)
• We launched our side hustle business in the last week of December (mobile notary) and had two signings in January
• We continued contributions of $400 a month to our baby’s 529 account, opened in September. We do not include this in our investment calculations because we believe that this is her money, her investment, not ours.

We have invested a total of $103,000 in less than a month. If I exclude the $14,000 I had in my checking account, that’s $89,300 more than we invested in 2020. 

Here’s the thing. This seems like a lot of work when it’s written out like that. We are first time parents to a 6 month old, we work full time, and I am in a doctoral program. Together we make over $200k a year (before Uncle Sam gets his greedy little paws on our paychecks). We could be satisfied with that, knowing that we make good money, own our house, and have great careers. But, there’s room for something more, if it’s the right thing for us. We have space in our busy lives for more efficiency, more deliberate action, more knowledge, more success.

In less than a month, we found out we didn’t have to come from money, be rich already, or win the lottery to retire before we turn 40. That learning has been life changing. Once we started learning this stuff, we were on FIRE (yup, it’s corny, but I said what I said, and I meant it). In less than a month I’d accomplished one of my major New Year’s resolutions! We now have an automated investment plan that maximizes our money, and our goals. If we do nothing else for our FIRE path this year, we will have accomplished our goal of saving at least 63% of our net income, so we will be 9 years away from retirement this time next year. 

Let me be clear. There are many things I’ve learned about over the years that are of sound reason, yet I never acted on them. Some things I’ve learned over and over again, and still I won’t budge, even when I know I would benefit from transforming this information into action. I get frustrated with myself when I don’t do these things I just know would help improve the quality of my life, my husband’s life, our daughter’s life. If I apply my theory here, it would seem that I don’t act because these things aren’t right for me at that time. My husband and I’s accomplishments in January are evidence that my theory holds true, FIRE is right for us, and thus, it is easy. It was fun learning about all the accounts available to us, and even more thrilling was the satisfaction that came with taking action. Typing all of this out was easy. When it comes time to type out a literature review for my classes this weekend, that’s going to be a whole different story.

I will retire before I turn 40. Just knowing that feels good. And when you’re on the right path for you, and it feels right, and it is right, it just becomes easy.

One last thing

“There is no growth in comfort and no comfort in growth”

– My mom (she says this to me often so I’m giving her quote credit)

Let us not get ‘easy’ conflated with ‘comfortable’. Something can be easy yet uncomfortable. Fasting is easy, but at times it gets a little uncomfortable. Harassing HR at my job to learn more about my 403b and 457b plans was not comfortable, but sending email after email was easy because I was motivated. My theory still applies.

Let me know your thoughts below. I’ll holla.