I’m writing this post from beautiful St. Simons Island, relaxing in the sun and enjoying a much-needed vacation away from work. A vacation which, interestingly enough, wouldn’t have happened if I didn’t leverage the power of FU money.
The concept is that when you have enough money saved up, you can leverage that nest egg in a way that brings you more negotiating power, more confidence to do what’s right, and the courage to stand up to the frequent BS policies that many employers force on their employees.
Perhaps you’re tired of going to daily standup meetings that you know are a waste of everyone’s time? Stop going! Upset your company revoked flexible work hours mere months after introducing them? Continue working that flexible schedule. Bummed that your boss just told you to cancel your family's Memorial Day vacation plans to work through the weekend?
You can see where I’m going with this. I don’t take nicely to demands. And neither should you! Now, I’m not saying to be flippant and storm out of work in a blaze of glory (although I have had such daydreams). You can still be respectful to your boss and colleagues, while simultaneously respecting yourself more. What most people don’t realize is that everything is negotiable, particularly when you have the confidence to walk away from your employer should the need arise. I put all this to the test last week at work, and here I am, enjoying my vacation. And yes, I’m still employed. 🙂
A little over a week ago, my boss interrupted my morning status meeting to inform the software team that we’d all be working Memorial Day weekend to catch up on our schedule. As the team lead, I decided to push back a bit, trying to stand up for my already over-worked team. “What about those of us with travel plans?” I asked. “Plans need to be canceled” my boss said forcefully. “Everyone needs to commit to bringing our program back on schedule.”
At this point, I had a choice. I could publicly obey, and perhaps take the issue offline with my boss, hoping for some special treatment. Or, I could simply say ‘no’. It’s a perfectly valid, underrated option. “Sorry, I won’t be able to work that weekend” I said, knowing perfectly well that I had to be ready to accept the consequences of my disobedience. “I’ve had travel plans since January, and I’m not canceling them. I can provide support over email, however.”
My boss was not happy with my response. “This is not a request” he said sharply. He stared directly into my eyes. Now, this is the very point where most people slither into compliance, afraid of what would happen if they lost their job. And trust me, employers know this well. But the “will I be able to pay my bills if I lose my job” worry never even crossed my mind. I was ready and willing to fight for my hard-earned holiday and weekend time.
“Everything is a request” I answered back promptly. “I’m sorry, but I won’t be coming to work that weekend.” Clearly irritated by his inability to shake me into submission, my boss played the only card he had left. “You are all exempt employees, and you’ll be working the hours we tell you to work!” he exclaimed, running out of patience. It was unfortunate that things escalated so quickly, and I wasn’t thrilled about saying what I said next in front of the team, but it needed to be said.
“Let me be clear.” I spoke calmly but firmly, being sure to maintain eye contact as I spoke. “I’m happy to put in some extra overtime, but I will not be coming into work next weekend, or the Monday holiday. If you’d like me to come back after my vacation, I’ll be ready to work. If not, that’s fine as well. The choice is yours.” His expression changed. He had no more leverage. There was nothing he could threaten me with- I already told him I was OK with finding another job, and I made it clear it wasn't a bluff. What more could he say? He left the meeting, shaken.
An Unexpected Turn
My encounter may have been a bit harsh, and probably should have happened in private, instead of in front of the entire engineering team. But it was my genuine reaction to a wildly inappropriate attempt at management. You don’t get what you want by making demands.
Imagine, instead, if he came in and said: “Is anyone willing to put in some over time this week to help us meet this deadline? We could really use all the help we can get. I don’t want anyone to have to work the holiday, and if we really buckle down this week I think we can pull it together.” But he didn’t ask. He demanded. This is the sign of a novice in management.
A few days later, one of the VPs from corporate paid a visit to our facility. “Are you Joel?” He said, entering my office. “That's me” I responded, surprised to finally meet the face behind the name that most of us already knew. “I hear you’re not working on Memorial Day” he said in a playful tone. “You’ve heard correctly” I replied. “I’m taking my family on vacation to St. Simons Island that weekend.”
What ensued was a constructive, hour-long discussion about the program I’m a part of, the schedule trouble it’s gotten into, and what could actually be done to fix it. He immediately understood that the problems we were having weren’t going to be solved by a weekend of unpaid overtime. There were deeper underlying issues. We were understaffed. We had unrealistic milestones. He could see my passion for the program, and my frustration when I told him that management had ignored our warnings for months.
We brainstormed for a while longer, and came up with an actual, achievable plan to move forward. As he was getting ready to leave, he reassured me that I did the right thing. “Nobody’s going to fire you for taking your holiday. When you get back, you’ll have an additional engineer to help with the workload. And if you notice things getting out of hand again, please, call me directly. Have fun in St. Simons.”
You Don't Need to Be FI to Say FU
What a roller coaster! I had a feeling things would work out alright, because we were short-staffed, and losing me would have only put the already small team into even further jeopardy. But I was fully prepared to walk away from this job if that’s what it took to make things right. That’s the magic behind FU money: you can take more risk and enjoy more potential reward, while simultaneously hedging yourself against the worst case scenario.
Even though everything turned out well for me, I still feel for my coworkers. Most of them are working this weekend, even though they needed the break as much as I did. Some of them will likely burn out, moving on to other companies or even other careers. Some will stay right where they are, putting up with whatever BS management dishes out for another three or four decades.
But hopefully, some will discover the FI movement, and start saving the majority of their dollars. And in a few years, when the boss wants them to do something unreasonable, they’ll push back too, knowing with full confidence that they can weather any financial storm that may ensue for doing so.
You don’t need to be fully financially independent to enjoy the power of FU money. In his first podcast interview with the Mad Fientist, Mr. Collins described saving his first five thousand dollars at a summer job, and putting in his two weeks notice when they denied him time off for a month-long vacation overseas. Stunned that he’d actually walk away, they decided to keep him on payroll and re-assured him that his job would be waiting for him when he returned. More often than not, those who are willing to take the risk enjoy the reward, and that was certainly true in this case.
The Piece of Mind of No Debt
All you need to start enjoying this super power for yourself is a few months worth of savings. The lower your debt, the lower your monthly bills, and the quicker you can save this money up. Once you start demolishing your interest payments, you create a snowball effect that is quite powerful. You don’t need to pay everything off to start enjoying the benefits of FU money, but let me tell you first hand- it sure feels good to be debt free!
This month, the wife and I completed the final piece of this puzzle for ourselves by paying off our last piece of debt. In our last post, we discussed the sale of our rental property from hell, but we didn’t say what we did with the proceeds. After some deliberation, we decided to use this money to pay off the mortgage on our current house, and I’m happy to say that we are now completely debt free.
I know there’s a heated debate in the FI community about the pros and cons of paying off mortgage debt. I’m well aware of the ‘power of leverage’ and the standard adage of making more by investing the money instead. But in our particular case, the math was in our favor. Paying off our mortgage was the right decision for us, not just financially, but also psychologically. You may find that like me, you’re much more likely take risk when you know you have a paid off place to sleep every night.
I’d like to show you the math behind the decision-making, but it’s significantly more complex than just comparing interest rates. There are many variables: the amount you have free to invest each month, the amount of your mortgage payment, the timeframe of your payoff, the list goes on. And since I’m on vacation, I’ll save these juicy details for a future post. One that shows why I’ve never believed in the phrase “good debt.”
Having enough money saved up to put yourself first is priceless. Being able to stand up for what's right and push back against corporate BS is just one of the many perks of having FU money. Forget financial independence for a moment- FU money is something I would recommend for everyone, regardless of your goals or retirement plans. It's the first (and most essential) step on the ladder to FI.
With a large pile of money already saved up, paying off our mortgage was just icing on the FU cake. The wife and I can now rest easy knowing that no person, or bank for that matter, has any financial leverage over us. I can raise the deductible on my homeowners insurance as high as I’d like, for example. Or get rid of that insurance entirely if I see fit! And I'm no longer paying interest on something I can afford not to pay interest on. Every single one of my dollars is free to work for me now.
And soon, the same will be true about my hours. When I pull the FI trigger, I'll no longer be giving any corporation the majority of my free time. I'll get back those precious 50 hours a week, and they can once again work for me, for the first time since summer vacation after high school. After some updated number crunching, it turns out that the wife and I are closer to FI than we originally thought! I’m excited to share our latest projections, and our countdown to FI… on the next Financial 180!
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.