A few years back, my wife and I were presented with an interesting opportunity. A family member, let's call him Mike for this article, wanted to retire to Florida to take advantage of the amazing housing prices here. At the bottom of the market, homes had dropped 60%-70% in value from their 2007 peaks.
The problem was that Mike was still over a year away from retirement. He offered us the opportunity to live in his new house rent free, as long as we maintained the property and paid the utilities. He sold us on the fact that we could then rent out the townhouse we lived in at the time to help increase cash flow and pay down our horrible upside down mortgage.
I mulled over the idea for a few weeks. I wasn’t particularly crazy with the location of his property. It was far in the outskirts of town… too far for city water even. Instead, it had a well in the front yard and an aerobic septic tank and drainfield in the back. There were no sidewalks in this area, let alone bike paths or crosswalks. Moving here was going to be a big step out of my comfort zone, especially since I’d be leaving my cushy townhouse in its well manicured gated community.
I was hesitant, but my wife insisted, so we moved a few weeks later. We did rent our townhouse out shortly after, but the rental income wasn’t enough to pay the mortgage, let alone the expensive HOA. Still, it was better than nothing, and the extra cash did help accelerate our mortgage payoff. Months later, when we discovered MMM and began our financial 180, we decided that we’d do everything we could to pay off that mortgage as quickly as possible. This is when we increased our savings rate to over 80%. For you Dave Ramsey fans, we were going full on gazelle.
While we were successful in paying off the mortgage in less than two years, we made ourselves miserable in the process. Here’s what we still had to learn, the hard way.
Location, Location, Location
The primary problem with our house-sitting plan was the location. This house was a 40 minute commute to the office, and 15 to 20 minutes of driving just to reach civilization. As MMM face punched us through the computer screen, I convinced my wife that we should stop using the car on weekends.
I missed the big picture though: we needed to live closer to work to drive less, not punish ourselves with isolation on weekends. We couldn't walk or bike anywhere interesting, so we spent most of our weekends sitting at home. Alone. Friends didn’t even want to come visit because we were so far away. After a few months, my wife had enough.
I glanced over to her. I could tell she was frustrated with our situation.
“I’m getting cabin fever.”
I knew she was at the end of her rope… but we were so close! At this point we had roughly a year left on the mortgage, and I wanted it done. So we decided to double down. We cut out every expense we could think of. We stopped eating at restaurants completely. We pushed ourselves to limit. And then, Mike moved in.
Fully Out Of My Comfort Zone
It all happened very suddenly. One weekend, we received a text from Mike saying he was moving down to Florida. We didn’t have time to make any move out plans. The very next weekend he was here, along with a full house of possessions.
I have a confession to make. I'm a bit of a control freak. My wife can attest to this. I get feedback at work reiterating the same. I’ve actually gotten better over the years, but living with Mike was a true test for me. Don’t get me wrong- he’s a nice guy, and I enjoy his company (and he may be reading this blog!). But there are some things I just don’t handle well.
Leaving doors open, for example. I have two cats, who are part-time escape artists, and leaving doors open is an invitation for them to run out. It’s also an invitation for flies to come inside. So. Many. Flies. In the kitchen. In the sinks. In the refrigerator. In my bedroom. Where did all the flies come from?!
Not to mention, this is Florida, where the A/C runs almost non-stop in the summer. I try to keep my thermostat around 80, which is not comfortable but still tolerable. Keeping the doors open does NOT help with this. I was also still paying the electric bill, remember.
My other pet peeve was dirty floors and sticky counter tops. With Mike's eyesight not what it once was, the floors and countertops in the kitchen were always in a superposition of both sticky and dirty. At first I would clean them religiously, but then, as I wore down, I just stopped. This was his house, after all. If he wanted to leave the doors open and the floors dirty, it wasn’t my place to complain.
We could have moved. We should have moved. But greed took hold of me. “Less than a year left on the mortgage… we can do this!” I reassured my wife, and myself. I was obsessed with increasing our savings rate. Every day, I wanted to come up with something new to bring our savings rate up. I sure as hell didn’t want it to go backwards by moving out of a free house. I just convinced myself I was strengthening my money mustache and practicing tolerance.
My House, My Rules
But then, other things started to bubble up. Mike was living a very different life than we were. The wife and I both worked 10+ hour days and liked to go to bed early. Mike preferred to stay up into the late hours of the night conversing with us. We liked to stay home and cook, but Mike preferred we join him at fancy restaurants multiple times per week. This is an expensive hobby.
The Wife and I also enjoyed working out in our home gym. Mike would poke fun and encourage us to skip the gym to go shopping with him. When we pushed back, he’d go out on his own, coming home in the wee hours of the night. It was like we had a teenager in the house.
But unlike living with a teenager, this was his house, his rules. The harder we pushed back, the more he asserted his position. Our marriage was beginning to strain with the stress of the situation. And our relationship with Mike was deteriorating. We needed out.
Not a Moment Too Soon
Perhaps we were ungrateful. Maybe we just expected different things from one another. But one thing is certain: moving into our own house was an immediate boost to our sanity. Our lives were instantly better. Our 40 minute commute turned into a 10 minute commute. Our marriage improved. And our relationship with Mike improved, as well. Joining him for a dinner out once a month now is a pleasure when we get to go back to our own homes afterwards. We simply needed our own space.
The truth is, we should have moved out much sooner. All this stress over a few hundred dollars per month. Who cares if it added a few extra months on to our mortgage payoff plans? A few months is a small price to pay for sanity and happiness.
Had we moved sooner, home prices would have been cheaper, too. We waited so long to move that we completely missed the buyers market in our county, and bought back in just in time for a small local housing bubble. We made mistakes for sure, but we also learned a few valuable lessons.
First, it is perfectly OK to spend money on the things that actually make you happy. The original plan was only to house sit for Mike until he was ready to move in, but I got greedy. I was penny wise, pound foolish. Not to mention I didn't consider the gasoline and time savings of living closer to work. Mustachianism is about reducing spending in areas that don’t bring you happiness so you have more money to spend things that do. Living close to work, in a house that we own and make the rules for, brings us real happiness.
The next lesson I learned is that it's actually a great exercise to go outside of your comfort zone. You don’t know what's valuable to you until you go without it. I learned that I truly value sidewalks in a community, while at the same time realizing well water isn’t so bad with proper treatment equipment. I learned that location is absolutely the most important variable when choosing where to live, while amenities like entry gates and fancy fountains are overrated. And I learned that relationships with family members improve when everyone has space to live the way they please*.
Finally, I learned that there is such a thing as pushing frugality to the extreme, and it’s not healthy. While my threshold may be different than yours, it’s important to acknowledge that you can get so obsessed with savings that it lowers the quality of your life and your relationships with family and friends. I’m not the first to go through this… apparently it is somewhat common here in the FIRE community. The Mad Fientist went through this in a story that seems eerily familiar. Just as I did, he made himself (and his wife) miserable for small increases in savings rate. He couldn't see the forest for the trees.
While I wish we would have moved sooner, I’m still happy I tested my limits. I feel like I know myself better, and am better prepared to handle similar situations in the future. I also have more respect for familial relationships, and doing what is necessary to keep well-defined boundaries. These experiences have helped me become a less obsessive control freak, and a more laid back guy in general.
Most importantly, I’ve realized that you need to be happy on your journey to financial independence in order to be happy when you reach the finish line. Life is a series of habits and routines, and other FI bloggers have reiterated the importance of the journey! If you're a stressed out, unhappy mess now, stopping full time work won’t magically make everything better. Solve these problems along the way and discover your true self now.
Enjoy the ride, even if it takes a little longer to get there. It’s so worth it.
*Ironically, a month after we moved out, Mike put his ‘retirement’ house on the market to take advantage of the mini bubble in the county. He sold and tripled his money. Mike has always been a shrewd investor.
Interested in starting your own Financial 180? You've come to the right place. The math is easy: create a gap between what you earn, and what you spend. If you can save half your income, your working career will only be around a decade long! Want to shorten it even more? Read on to see exactly what expenses the wife and I cut from month to month. Track your progress against the milestones of FI, and gradually build up your own savings snowball. Check out the books and links in our resources section and jump-start your journey to FI. The you ten years from now will be glad you did!