@ckl wrote:I have some money at WealthSimple as well and some at Questrade. Personally, I like Questrade better because it is not totally hands off like WealthSimple. Believe it or not, I actually enjoy looking at the dividends/distributions generated every month. Also, the purchasing ETF's are commission free there as well so that is a bonus.
Nice, yeah, if I wasn't so into making things as passive and automated as possible, I would totally go with Questrade. I've heard good things, and the no-fee purchasing of ETFs is a huge plus, especially for somone like me who contributes every two weeks 
@ckl wrote:
Well, it looks like you have it covered. If you can obtain a house with cash that really indicates your investments are paying off! That said, would you care to divulge what ETF's you have invested in? I have some in VGRO and would like to put money into something else that pays a higher distribution.
Thanks for the question, @ckl!
Currently I'm mainly invested in XIC, VTI, XEF, VUS, IEMG, XSH, and ZFM. I also have some PDF, PHR, and ZHY. I hold all of these through Wealthsimple, so it's 100% automated. They do all the managing (trading, rebalancing, tax-loss harvesting, etc.), so I don't ever have to think about investments or even press a button. It's truly passive investing.
The return of my portfolio will basically be identical to VGRO. Sorry, no exciting returns to let you know about 
I'm definitely not an investment expert, and I don't chase high returns. The reason I was able to save so much is just by sheer volume: every 2 weeks (every paycheque), $2K is automatically transferred from my chequing account to Wealthsimple. When agressively saving over a short timeframe, the volume matters more than the return.
I've shielded myself from the ups and downs of the stockmarket by buying in every 2 weeks, which dollar-cost averages everything for me. I also keep 2 yrs worth of expenses in a HISA and 3 yrs in a balanced portfolio rather than growth. So I'll never have to sell stocks when the market crashes or is low, making me immune to stock market crashes. But I only need to do this because I'm retiring next year. If I weren't needing to withdraw income in the next 5 to 10 years, I would just go full on growth and never sell.
VGRO is basically identical to my main portfolio, and it's definitely what I would be investing in if I weren't with Wealthsimple
@Anonymous wrote:What a remarkable topic.
I agree with will13am. You (not you) scrimp and save and deny yourself pleasures and happiness and accumulate all your money for that early retirement and then...bam...truck plows into you. Or cancer takes you at 40.
Thanks for your comment, @Anonymous!
I don't believe I'm denying myself pleasures and happiness. If cancer takes me at 40, I would much rather have spent the 5 previous years living life to the fullest full-time rather than working.
Even as I save, I'm living my life and not sacrificing any happiness. I took two overseas trips last year for a month each, I spend time eating and drinking and bonding with family and friends, I buy healthy and high quality food, I stay fit, I create music with friends. I don't feel like there's anything I'm missing out on by saving. The average American (and probably Canadian) spends over 3 times more than needed, and from experience I'd say most middle class people wouldn't even sacrifice any happiness by reducing their spending by two thirds.
@Anonymous wrote:Or you slide off a slippery road into an embankment in that cheap old piece of crap car you got. Either death or disfigurement severely alters that life plan.
I don't drive a cheap old piece of crap car. And I think death and disfigurement would severely alter anyone's life plan. I don't think people who have a lot saved up are at any disadvantage in this case.
@Anonymous wrote:The single largest oversight of the path I ended up on was not to have a job that provides a solid pension.
A solid pension is passive income. That's exactly what I've given myself.
I totally don't expect you to share my perspective, and I respect your choice to live your life how you see fit. I don't expect you to FIRE, and I don't think there's anything wrong with people who don't FIRE. I was just seeing if there were any other people in the FIRE movement on this forum and answering questions from people who are curious.
hi, @will13am! thanks for commenting
I very much agree with your thoughts, and it's nice to meet someone on here who also wants to be financially independent and retire early!
@will13am wrote:@ooakosiryan, you definitely sound like you have a greater control of expenditures than the average consumer. That said, we are all different and we attain happiness in different ways. For you savings results in the ultimate happiness. It may sound hard to understand, spending may be how others attain happiness.
Yes, I agree that we all attain happiness in different ways. I don't expect anyone to do exactly what I'm doing and maximize their happiness that way. I'm just doing what works for my own personal happiness.
While everyone's journey to happiness will look different, there's plenty of happiness research out there that has found some things that are basically universal to humans. Things like time affluence and healthier practices (exercise, sleep) as well as gratitude, trust, helping others, nurturing relationships, and mindfulness. No research I know of has identified spending as a universal contributer to long-term happiness. Daniel Kahneman, a Nobel prize winning psychologist and happiness researcher, found that people become less and less happy as income increases over $70K/year. There will be exceptions, so there will be some people who find long-term happiness by spending more than they need to.
Just to clarify, I don't find happiness in saving. I find it in the time affluence and freedom. Freedom to nurture relationships, spend time with loved ones, learn new languages, immerse myself in creative pursuits, etc. Saving is a way that I can do these things full time instead of on evenings and weekends.
@will13am wrote:To me balance is important. I do want to be financially independent and retire early. In the mean time while racing towards that finish line, I do want to live life. Ideas like paying cash for a home purchase, well maybe in a downsizing effort to pull equity out of the existing home. I don't know where you live, but here in the GTA a detached home cost around $1M and up. For the people in the GVA, the numbers are even less favorable. I want to buy a home in my 30s, not 80s. Opportunity cost assessment suggest that I should forgo some savings and let the evil banks make interest on lending me some money so I can aquire assets at a more opportune time. In retrospect, buying a home wasn't such a bad move; it is more "FIRE rated" than any other expense.
Absolutely agree. @ckl was asking about my personal situation, so I answered by giving details about what I am personally doing. I definitely do not think that everyone planning to FIRE should buy a house in cash. That's just something that would work well for my wife and me and our partilcular circumstances. Even Mr. Money Mustache himself bought a house with a mortgage in his 20s. Buying a house with a mortgage is absolutely FIRE-friendly.
Personally, without being tied to work, my wife and I don't have to live in GTA or GVA. We'd probably want to live close to relatives that we want to spend time with. In my current city, my cousin bought a house a few years ago for $430K, and it's much more than what my wife and I would personally want. Also, housing prices have gone down since then. So if my wife and I buy a house for $375K, it would only be $187.5K each. Since our net worth is increasing faster than we can spend it, it won't be too long until we each have $187.5K above and beyond what we need to sustain double our living expenses, so it doesn't make sense for us to get a mortgage when we have the extra cash. That's our personal situation, and I don't expect others to do the same. I agree that oportunity cost suggests that buying a house with a mortgage can be the right move financially for many people. It's definitely FIRE-friendly, like a forced savings plan. I fully support others buying houses on a mortage as part of FIRE, because that works best for many people.
@will13am wrote:I can go on and on, but at the end of the day we must keep perspective that you can't take it with you. You only live once, so don't sacrifice the opportunity just because it cost a bit of money.
I completely agree that we can't take anything with us, we only live once, and we don't want to sacrifice opportunity.
Work is limiting my time affluence, so it just makes sense for me to FIRE quite early. And I don't feel that I'm sacrificing happiness or opportunity for it. If others would rather work and spend to avoid sacrificing things, then that's what makes sense for them. I'm not trying to convert anyone here. I was just looking for other FIREers, and I'm happy to answer questions from non-FIREers who are curious. I've spent most of my life as a non-FIREer, so I understand where they're coming from and there's nothing wrong with their perspectives or what they're doing.
It's also great to meet someone on here who is also planning to reach financial independence and retire early. I fully do not expect you to do it the same way I'm doing it, and I fully support you in your journey.
@will13am wrote:
@Anonymous wrote:What a remarkable topic.
I agree with will13am. You (not you) scrimp and save and deny yourself pleasures and happiness and accumulate all your money for that early retirement and then...bam...truck plows into you. Or cancer takes you at 40. Or you slide off a slippery road into an embankment in that cheap old piece of crap car you got. Either death or disfigurement severely alters that life plan.
The single largest oversight of the path I ended up on was not to have a job that provides a solid pension.
Play a mulligan.
I need one of those time machines people keep implying they have by stating dates in the future 🙂
@Anonymous wrote:What a remarkable topic.
I agree with will13am. You (not you) scrimp and save and deny yourself pleasures and happiness and accumulate all your money for that early retirement and then...bam...truck plows into you. Or cancer takes you at 40. Or you slide off a slippery road into an embankment in that cheap old piece of crap car you got. Either death or disfigurement severely alters that life plan.
The single largest oversight of the path I ended up on was not to have a job that provides a solid pension.
Play a mulligan. 
Hi, @ckl! Thanks for continuing the conversation
@ckl wrote:I applaud your financial strategy and your ability to stick with your savings plan. Most people would not be able to do this because when they start to make more money, their lifestyle also changes. More disposable income = more spending.
You're exactly right about people tending to spend more when they make more. That's why my first tip (see my second post on this thread) is about mindset. Every dollar spent on something that doesn't increase long-term happiness is a wasted dollar. So when people start to make more money, if they have this mindset, they're not tempted to increase spending, because aquiring more stuff, driving new cars, and living in big houses isn't what makes people happy. People with this mindset will FIRE fairly early in life without sacrificing any happiness. Actually, they'll likely be a lot happier, because studies show that time affluence (the perception that you have the time to do the things you want to do) is a major co.... And people who FIRE spend all their time doing what they want to do.
@ckl wrote:Based on your scenario, if I were in your shoes, I'd be careful. The two most financially expensive activities, in an average person's life, are the two activities you have not gone through yet. That is, owning a house and having kids!
I think most people, including myself, have been held back from the FIRE movement simply because of these two things. A mortgage takes up a significant amount of your income and the kid's financial needs (ie. diapers, formula, daycare, "keep busy" activities (like gymnastics, skating, swimming, martial arts), RESPs, etc. etc. etc. etc. etc. etc. (yes, that's alot of etc's because it just keeps going and going), as well as insuring yourself (because you now have dependants) leaves very little disposable income left to contribute to the FIRE plan.
This is why I asked where you live and what your situation is. If you said you lived in Vancouver and/or Toronto (or would like to buy a house and settle there), even with a six figure income it would be difficult given the significantly large mortgage that is required. That is, even if you manage to qualify for a mortgage for that house! I don't know what the housing situation is in the large cities in Alberta, but if you don't have to live in the city, I suggest you don't... suburbs are okay too.
Since I've gone through one of these activities (owning a house and paying off the mortgage) and still going through the other (raising kids, they're still dependants), I'd be happy to answer any questions you have regarding this.
My advice is that if you intend to retire next year and purchase a house and have kids, make sure you have a backup plan just in case you realize your income from your savings is not going to cut it going forward.
PS> Just for kicks, here's a website I found that outlines what you need to earn to live in a chosen area in Vancouver:
https://doodles.mountainmath.ca/blog/2017/09/18/zoned-for-who/
I appreciate your words of caution. I've thought about those situations, which is why I'm saving enough that I can double my current expenses for the rest of my life (adjusting for inflation) and still not be able to outspend my passive income, and still be a multimillionare in my older years. That's ultra-conservative because I don't see myself doubling my expenses any time soon.
At first it might seem absurd that my wealth will be growing even if I stop contributing to it. But the fact is that our money can work harder than we can, and the FIRE movement takes advantage of that. Even after I quit my job, I'll still be making much more money than I need to live, but it's not me doing the work, it's my money doing the work. Investing in index funds means people are working for me. In a literal sense, I'm part owner of over 13,000 companies, and there are millions of people working to grow my money.
So don't think of it as me being unemployed and I have to be careful about expenses that come up because they'll chip away at my savings and I'll run out of money (which is the vibe I'm getting from your comments). A more accurate way to think of it is that I'm continuing to make an income that is more than enough to cover all my expenses by having people work for me. It's a shift from worker to owner. A worker who is living paycheque to paycheque while working long hours isn't growing their net worth at all, while a passive owner who is spending less than their passive income is increasing their net worth while not having to do anything. It sounds unfair, but it's a weird quirk of capitalism. I'm in this system whether I like it or not, and I'd rather be a passive owner than a worker.
I've mastered my finances, and buying a house is a big financial decision, so I share your concern in this. We would never do it if it would make us worse off financially. My wife is also oversaving and will FIRE a few years after me. We will never have a mortgage, because if we buy a house we will buy it in cash. And we'd only do that with our extra cash, so we would still have more than enough passive income to cover our expenses. And we might never do it because we don't value owning a house. What matters to us is having access to housing, which renting gives us. We'll only buy a house if it's the better financial decision, which it currently isn't and migtht never be. But if circumstances unfold to make it the better financial decision, we're in a good position to be instant mortgage-free homeowners.
When it comes to kids, that's the main reason I decided to save enough that I could double my expenses without outspending my passive income. And that's being ultra-conservative because the average middle class person probably spends over 3 times more than I do, and that includes spending way more on children than necessary. All the extra spending doesn't actually lead to increased long-term happiness, so I don't see the point. I will likely spend a lot less on kids than the average middle class person, just like I spend a lot less on everything than the average middle class person.
Continuing to work would just make me a millionaire faster and I'd have a lot more money to spend on things I don't need that don't actually make me happier, so there's really no point. I'm extremely flexible. So if situations change and my plans have to change, I'm okay with that. I'm also a skilled person, and I'll be able to find work if I need to, although I will most likely never need to.
Even while I'm not working, my passive income more than covers my expenses, so I'm not worse off than the average working person. At 35 I'll have saved up about triple what the average American saves their entire life (probably similar to Canadians, but I don't have a Canadian data source). I'll never have a mortgage, and I'm oversaving to have kids. I share your view that buying a house and having kids are big financial events, and I think I'm in a better position to deal with these events than the average Canadian.
Thanks again for your comments!!
Hi, @ckl! Thanks for your thoughts and questions
@ckl wrote:I think most people would love to retire early. However, the biggest problem with FIRE is unforeseen expenses and/or catastrophic events. One of these, for example, are health problems. Luckily, in Canada, we have a very good medical and social safety net. But even then, you could face a serious financial burden because our medical system only operates under prescribed procedures. For example, if one got cancer, the treatment under Medicare is chemotherapy. If that does not work, you will have to pay out of pocket for any other "experimental but promising" alternatives that may save your life.
Even things like a car accident or food poisoning while on vacation can be life changing.
The whole point of FIRE is saving up a LOT more than the average consumer out there. If these unforseen expenses or catastrphic events happen to the average person, they will likely have to go in debt to deal with it, and, if able, they'd have to keep working. I think a person who retired early, who has saved up a big stash of money, is in a better place to deal with these types of events. If they have to go back to work, so be it, but that doesn't make them any worse off than the average person who has to work anyways.
And, as @JuniorJunior pointed out, the "25 times annual expenses" rule is pretty conservative. For example, I just met with my bank's financial advisor, and he ran some simulations to come up with a Retirement Income Planning Report for if I retire February 2020 at age 35. I didn't realize how much I was oversaving until he ran the numbers. I overshot my target to the point that if I double my current cost of living (to account for possible lifestyle changes), I still won't be able to spend all my passive income. I'll be a millionaire at age 55, and I'll hit a net worth of $5 million at age 80. His calculations take inflation into account, so I'll be increasing my expenses by the inflation rate every year as my net worth continues to grow. I'd say I'm in a pretty good position if I run into a catastrophic event. I have no debt, and I've saved way more than I needed to. And if I have to go back to work because this event cost me millions of dollars, I'm fine with that too haha
@ckl wrote:If you are able to work, then why not keep working? Maybe not full time but at least part-time at your own pace to keep yourself busy. A person who has retired for several years and faces one of these catastrophic events, overcomes it, but at a financial cost, will no doubt need to re-enter the workforce. Depending on the occupation, not having worked for several years can negatively impact your chances of getting a job.
People who reach FI have the option to quit their 9–5 job, but of course not all of them do. If their job is the best way for them to find happiness and fulfilment, then it would make no sense to quit. For me, I might do some contracting work just for fun. But I'll most likely work on some creative pursuits (e.g., music, writing), learn a language, and visit relatives that live in different cities/countries. My primary concern will be living life to its fullest, and that will definitely include a bit of work and moneymaking, but probably not that much. I'll be doing it for the love, not the money.
@ckl wrote:BTW, you haven't given any specific details on how you were able to achieve such an undertaking (except for the saving 66% of your annual income part).
No one asked haha. If you're interested, I'll answer your questions below. (Note: I'm actually saving over 76% of my income—the 66% in 10 years was just an example)
@ckl wrote:Saving 66% of a minimum wage income, for example, you will not be able to retire in 10 years.
The math actually checks out that if a person is able to live off of 34% of their income (and sustain that level of spending for the rest of their life taking inflation into account), they can retire in 10 years, no matter what their income is. Savings rate is literally the only metric that matters. If a person on minimum wage happens to live off of 34% of their income, their working career is 10 years long. If they can't make 34% work, they could live off of 50% of their income and retire in 16.6 years instead, which is still pretty good. However, I think someone making minimum wage would probably do better focusing on increasing their earnings, and then they can think about FIRE. For people making the median salary in Canada, living off of 34% is definitely doable.
@ckl wrote:You also didn't specify whether you own a house, debts, whether you have dependants (ie. kids), a spouse, where you live, etc.
I don't own a house. We rent a condo. We might buy a house later in life when we figure out where we want to settle down. We would just buy the house in cash, and it would be part of our net worth. Or we might just keep renting if we want to keep moving around. Either option will work well for us.
No debts. I paid off my student loans in 2012.
No kids yet, but plan on having some. That's why I planned to save enough for double my current living expenses.
I'm married. My spouse is also a saver on track to FIRE a few years after me.
I live in one of Alberta's bigger cities.
@ckl wrote:Did you win the lottery? Did you get a huge inheritance? Did you geta degree, get a nice high paying job? Did you play the stock market and made your money there? Did you ride the wave called Bitcoin? Cannabis stocks perhaps?
No lottery.
No inheritance. Started at 0 (actually, in debt after I graduated).
Two degrees (BSc and MSc).
I got a pretty good job. Started at high 50s in 2009, worked up to just barely making six figures now.
I didn't "play" the stock market. I made my money by working and saving part of my income. As specified in my 2nd post, I invest my savings. No stock picking, just plain, vanilla broad-based index funds (ETFs) that only depend on "the world economy in general continuing to exist." But people who FIRE invest in whatever they're most comfortable with, whether it be index funds, rental properties, or something else.
No bitcoins.
No cannabis stocks.
Sorry, I feel like you expected it to be more exciting than that. I literally just worked and save money by not overconsuming.
Thanks again for all your questions!!
@Tiprix wrote:Ooakosiryan how long have you had the FIRE mentality? Retiring next year sounds pretty good.
Hi, @Tiprix! I meant to reply to you earlier, but it got away from me. Sorry for the late reply! I've had the FIRE mentality for 3 years now (I discovered Mr. Money Mustache in March 2016). Before that I was already a saver, so luckily I had quite a head start
Thanks for your comment, @JuniorJunior!
I completely agree that the '25 times annual expenses" rule of thumb is conservative—it's just a rough guideline. It's overly safe because it's based on how much you would need for the money to last the rest of your life without ever contributing to it again, and it'll work even in most worst case scenarios. FIRE will look different for everyone, and most people will continue to make money or work in some form post-FI, so they definitely don't need 25 times their expenses. And like you said, many people will have lower expenses once they've left the 9-to-5, so 25x is an overestimate.
That being said, saving 25 times your annual expenses in 10 years is a goal that's definitely within reach of middle class Canadians. If you start in your 20s, you can retire in your 30s with 25 times your annual expenses. It doesn't hurt to be conservative for peace of mind and so you have a safety margin in case of a black swan event.
What matters is your savings rate: the percentage of your take-home pay that you're saving/investing. To amass 25 times your living expense in 10 years, the math works out to a required savings rate of 66%. So as long as you save/invest 66% of your income and live off of the remaining 34%, your working career is only 10 years long.
Once you shift your mindset and understand that every dollar spent on something that doesn't permanently increase your happiness is a wasted dollar, saving 66% becomes too easy, and you can go for even more. For example, my current savings rate is 76%, in which case it only takes 7.6 years to save 25 times my annual expenses, which is more than I need to last the rest of my life.
In short, I agree that FIRE may be easier than many people think
Thanks for your response! Yeah! I've been living it for the past couple years, so I have lots of tips haha. What in particular are you interested in? Maybe I'll give a few broad, overarching tips, and you can let me know if you'd like me to get into the details of anything.
- Focus on happiness. FIRE is more about mindset than anything else. If you adopt a mindset that focuses on happiness itself—long-term, lasting happiness—FIRE just happens natually. Unnecessary things, luxury, and convenience will lose their appeal, while spending time nurturing relationships, working on hobbies you're passionate about, and fighting for causes you believe in will take the front seat.
- Reduce spending. The average middle class Canadian probably spends 10x more than they need to, and they're probably sacrificing a lot of freedom and happiness to keep up that unnecessary spending. If you're not saving at least half of your take-home pay, consider yourself living beyond your means and make some adjustments. If you can challenge yourself to save 75% of your take-home pay, your working career will only be 7 years long.
- Invest your savings. Your dollars are like workers, and each dollar sitting in a savings account is like a worker lying around doing nothing. Get your money to work for you by investing. When you have a dollar invested in shares of a company, you have thousands of people working to grow that dollar. You can expect a simple portfolio of low-cost stocks/bonds to double every 15 years or so, while every dollar sitting in a savings account will forever be losing value as it can't even keep up with inflation.
- Be confident. You don't need millions of dollars to retire happy. If you have 25x your annual expenses, you can safely stop working. Who knows what the future holds. You might get rich by accident while working on your passions, or stumble across a part-time job that you love and would've done for free. You might lose half of your money somehow, but that's okay because you're a skilled person who will be able to find work if needed. So retire when you can—there's no need to keep working one more year in perpetuity.
Anyways, those are the 4 overarching tips that came to mind. Feel free to let me know if you have any questions about any of them, and I can get into some details 
