If you could go back in time a decade and tell your younger self anything, what would it be? What advice would you give? What would you do differently, given advance notice?
Back in 2017, I wrote a letter to my younger self, describing why Financial Independence was so important to future me. It was originally published on the Fiery Millennials blog, and it later became a featured story on the Fiology website. It's one the posts I'm most proud of, because it really gets at the “Why of FI”, so I'm republishing it again here. Enjoy!
Hello, twenty-two year old Joel! Greetings from a decade in the future. There’s so much to catch you up on: There’s a new Power Rangers movie! Apple makes cell phones now! And we have electric cars that practically drive themselves!
But there’s a serious matter I want to discuss today: your future happiness. Let me describe two possible futures for you, each a decade away:
Picture this: you graduate from college, move to a new town, and get a high paying software engineering job. You immediately buy a beautiful new house, new furniture, and new cars. You live in a fancy gated community with elaborate fountains and walking trails. Friends and family to come visit, and they marvel at all the nice things you have!
You buy all the newest tech toys every year, and consider yourself an ‘early adopter’ of technology. Sure, you pay a premium for the privilege, but you can afford it with your salary. You’ve always loved the latest computers, gadgets and gizmos. It’s why you got into computers to begin with!
You get married to your high school sweetheart and enjoy an extravagant wedding, a tropical honeymoon, weekly dinners at 5-star restaurants, and monthly massages at the spa. You are also quite the jet-setter: you travel nearly every other weekend, all across the U.S., visiting friends and family. Your credit card has no limit, and when you think of something you desire, you buy it. This future is high-class living: you blew past the Jones’ years ago.
Picture this: five days a week, your alarm clock wakes you super early, and you stumble from bed groggy from lack of sleep. You get dressed, make coffee, and race out the door to sit in traffic on your drive to work. When you finally arrive, you sit in a cube and write code for hours on end. Same sights, same sounds, day in and day out. Same people, same faces. Same widgets, different day.
You would think a technology job would interest you, but over the years you realize it’s all the same: write yet another version of an already existing widget for a program that is behind schedule and over budget. You’ve tried changing jobs, but it’s no use. New code, new cubicle, same prison sentence. The fluorescent lights flicker above you glance down at your smart watch and notice it’s 73 degrees and perfect outside. Your legs ache to run outside and enjoy it, but you can’t: you are too behind on your milestones. You are always behind, actually. You’ve tried coming in earlier, staying later, working through lunch. Nothing works.
You check the clock every ten minutes, hoping time would move faster. All you want to do is go home. Tick, tick, tick, tick. The watch hand moves so slowly. When the day is done you still haven’t completed your milestones, but you are happy to leave. You get back into your car and sit in traffic on the commute home, driving past all the same sights and sounds. You do some mental math and realize you’ve driven this route over twenty five hundred times. You’ve seen all these same sights and sounds over twenty five hundred times. You’ve gone home and vegged out in front of the TV to clear your stressed out mind over twenty five hundred times! You’re in an infinite loop, and in just a few hours, you’ll be waking up at the crack of dawn to do it all again.
Your health is not what it once was. You don’t have enough time to exercise regularly. Hell, you don’t even have time to go on walks anymore. You don’t have enough time to cook healthy, either. You can actually feel your health slowly slipping away. It’s gradual, and it sneaks up on you over the years. Your mind isn’t as sharp as it once was. You look in the mirror and you realize you aren’t quite the person you remember. You notice all the grey hairs starting to come in. You think about the email you received from your department administrator earlier in the week, breaking the news that one of your coworkers passed away over the weekend. He was only in his early sixties, just a few years away from retirement. It’s the third email like it this year.
OK. Which future do you choose? Hint: It’s a trap!
These two future scenarios are exactly the same! The bleak life you live in the second is simply the price you must pay to ‘enjoy’ all of the fancy things in the first. All of your free time is spent working, the fun part of your life has been on hold indefinitely, and you rarely have free time to enjoy the shiny things you purchased in future 1. Somehow, this is a normal and accepted part of becoming an adult! Let me be crystal clear here: IT IS NOT WORTH IT!
Here’s the thing: all those luxuries in future 1 are superficial. The new house and cars, the fancy furniture, it’s all a sham. None of it actually brings you any long-term happiness. After a few months, the shininess fades, and you are back to square one. It’s called the hedonic treadmill. The things you are sacrificing for those luxuries though- your music projects, the ability to control your own schedule, having free time to spend with friends and family- these things really did contribute to your happiness, back when you had time for them.
Even if you think you want all those luxuries in future 1, you can still have them. Just not now. You have to wait until the time is right. When is that? When the purchases you want to make are only a small fraction of your overall net worth.
For example: Your net worth is currently around $100. Don’t pretend like it isn’t- I remember being 22. I’m you- remember? Let’s say you want to buy a $400 pair of designer sunglasses. That purchase is 400% of your net worth. (Not good, but with a positive net worth, you’re already doing better than half of the U.S. It’s a low bar.) Now, let’s say you wait six years, work hard and save a large portion of your income, and get your net worth up to $400,000.00. (I know it looks like a large number, but it doesn’t take as long as you’d think to save it.) Now, you buy that same pair of sunglasses. But this time, that $400 purchase is a mere 0.1% of your net worth. A tenth of a percent doesn’t even move the needle. You can comfortably afford it now.
Ironically though, even though you can, you won’t want waste your money on such a frivolous purchase. Because when you finally get good at saving money, you start to respect it more. You learn how valuable it is, and how much freedom it can buy you. Not to mention: you don’t have fancy sunglasses right now, and your life is still pretty great.
You’ve Already Got It Good
Actually, your life is freakin’ awesome. You have it so good right now, and you don’t even know it! Your ‘workday’ consists of classes and homework that average out to about 5 hours per day of work, including travel time. That’s the equivalent of a 25 hour workweek, bud. Your workday never begins before 10:30am. Ever. You enjoy breaks in spring, winter, and summer, as well as two weeks off between semesters. If you add it all up, that’s the equivalent of almost 8 weeks of vacation per year. (You haven’t realized this yet, but even the most generous U.S. companies give only 4 to 5 weeks paid vacation per year. Not 8.)
You walk all over campus, nearly 5 miles per day and it is great for your health! You’re constantly bombarded with exciting new sights and sounds, and you get to spend time with friends every single day. You take it all for granted. It’s just everyday life for you right now. You have so much free time. If you look at the ratio of free time to work time, you’d see that only 30% of your waking hours were spent ‘working.’ That leaves 70% of your time to enjoy family and friends, write music, and start other creative endeavors.
Compare this with you from the bleak future, where you spend more than twice as much time working, get half the vacation time, and rarely have time to spend with friends and family. A few months from now, when you purchase all that shiny new stuff, you unknowingly make a decision to put the good parts of your life on hold for over a decade.
What Can You Do?
It doesn’t have to be this way! You, young Joel, are in the perfect position to change this! Google ‘financial independence’. Start saving more than half of your income from day one at your first job. It’s easy: as soon as you start your first job just set your 401(k) contributions to 50% (or more if you are feeling adventurous)! You’ll never see that money– it comes out before your pay check- but it is still yours, and working hard to buy you your freedom. Don’t worry- your paycheck will still feel large: you have nothing to compare it to. Seriously, you only have $187 in your checking account right now. Any paycheck will feel substantial.
You’ll only have to work about a decade. Maybe less. That’s right- you could be DONE with your working career forever by your 30th birthday if you want. I know that sounds crazy right now, but trust me, you can. Want to shorten it even more? Stop blowing your grant money on a fancy two bedroom apartment! Stop blowing your internship money on fancy restaurants! Take some of your free time and learn to cook for Pete’s sake!
You don’t need a car on campus, and you take for granted how nice it is not having to sit in traffic every day. Walking and biking are massive life enhancers! When it comes time to move, don’t buy a fancy house 12 miles from work. Instead, rent a cozy little apartment within a mile or two of your employer, and walk or bike every day, like you do now! Location is key. Skip the car, gas, and toll expenses, and simultaneously skip the traffic. If you must, buy a reliable four years young Honda for $5k and drive it sparsely for a decade!
I can see your eyes glazing over, Joel. You aren’t paying attention. I forgot how stubborn you were at that age… how stubborn I was. You know what they say: some people can learn from other’s mistakes. Others need to make their own. I guess you fall into the latter camp. Sigh. Not all is lost, Joel. You’ll realize what I know now around your 30th birthday, and you’ll do a quite dramatic financial 180. It will be a wild ride, and you’ll kick yourself for not listening earlier. Once you get there, once you have your freedom back- hold onto it tight, and don’t ever let it go.
Until we meet again, a few words of advice: Time moves much faster than you think. Be careful not to obsess over money: make sure it works for you, and not the other way around. Pay attention to your wife: she’s been right about this stuff all along. Don’t let any job eat away at your morals. And visit mom and dad more often. While you’re there, play with your childhood pets a few more times. Some things don’t wait around forever, you know.
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! Ready? Start here.