Where will you be in 10 years? Uff-da, that's a tough one, but important! It's the start of a new decade and Mrs Frugal Rock and myself decided that we want to build out a 10 year goal for us. Planning long term is important so you do the things that matter most to you in this life. What we have realized in the past 35 years is that life is really short and you only get one shot at it. So here it is, in no particular order.
First, we had to establish where we wanted to be in 10 years, or where we are gearing up to be. We love a simple life and nature. Time is the only true currency (book reference, Your Money or Your Life) and we'd like to spend ours with our close nit family and some forest. We currently live in a wonderful 2 story house on the far stretches of the city. We built a new build because it was actually cheaper and we had time left in our rent. It was are way of getting what we wanted in a house. It's a great place to be while the kiddo grows up, however since we live in a newer neighborhood we have to drive to get anywhere with forest. If we could have exactly what we want, we'd love some acres with some forest and a bit of land for a hobby farm. We have a small plot (10'x10') in our yard at the moment, but we desire more. We want to raise chickens and have berry bushes for days. Living off the land if you will. We decided that we want to target moving to a homestead once Little Rock is done with high school. That gives us about 17 years to become FI and save for a homestead, very doable. Somewhere not too far out so we don't have to drive far to get into the city, but far enough away to not have to deal with the city (if that makes sense). Our current plan is to rent out our current house, and pay for the homestead with that money since our current house will be paid off. Not part of our FI money. This was a hard conclusion to come to because it would push back our FI date. However, we would be making 2 investments into our real-estate. Our rental property would continuously provide income as long as we keep a tenant and our homestead will be paid for from said rental.
Second, we want to enjoy as much time with Little Rock. They are only little once. Currently the Mrs gets to capitalize on this because she is a stay at home mom. It is an amazing time. Watching her grow up is a once in a lifetime opportunity. Eventually she will move away and start a life of her own and all we will have is these memories of when she was little. This is why it is most important for us to spend as much time with her as we can. I'm excited to see who she becomes and be a big part of her life, but right now, for the next 17 years, she will be living here with us. This is the time she needs us the most, so I want to be there for her.
Third, we continue to work toward being financially independent. We are not there yet, but we live a simple life continuously so we are making our there quickly. Our current savings rate (savings that is going into our FI bucket) is 20% on average. Not bad, but we strive to be better. Our goal is to get to about 45% month-to-month. We have a mortgage which is in the way, but we have a plan...
Fourth, we will pay off our first house. That's right, in about 10 years this house will be ours. We are throwing cash into our mortgage right now. Not all of it (see above) but we decided waiting out our 20 year mortgage is silly. So much wasted interest. We did some math and realized that instead of putting the minimum payment toward the house if we upped it per month we'd pay off in about 2/3 the time (17.5 years vs 10 years). Then once that is paid off, we would roll our additional free money into our FI money and get to FI even faster. We found this calculator handy.
So how does that math work out?
20% - FI money (invest, invest, invest)
50% - House mortgage (pay that sucker off!)
30% - Living expenses (we have plenty of delightful food)
Crazy to think we only need 30% of our income to live.
I know what you are all thinking, wait wait wait, how are you going to hit FI on 20%?! Ah, so we did our math and we believe that by throwing more money at our mortgage we get to no-mortgage land way faster (about 7 years faster!), then that 50% into our FI bucket which will make 70% for a few years and boom, FI. Totally agree we are not in an ideal state. We were not always frugal as we are today. We made some non-frugal choices. We have learned a lot over the past few years and we are crawling our way to FI. Our current plan is to get there by the time we are about 45-50 years of age. I know this isn't as exciting as MMM or Frugalwoods, but like we said we made some non-frugal choices in the past, so our plan is starting from where we are at.
Lastly, we want to be able to enjoy nature every.single.day. We love hiking, both in urban and forest. We want to live in a place with easy access to get to said trails. Nature is our happy place.
So that's it, that is our 10 year plan.
First, we had to establish where we wanted to be in 10 years, or where we are gearing up to be. We love a simple life and nature. Time is the only true currency (book reference, Your Money or Your Life) and we'd like to spend ours with our close nit family and some forest. We currently live in a wonderful 2 story house on the far stretches of the city. We built a new build because it was actually cheaper and we had time left in our rent. It was are way of getting what we wanted in a house. It's a great place to be while the kiddo grows up, however since we live in a newer neighborhood we have to drive to get anywhere with forest. If we could have exactly what we want, we'd love some acres with some forest and a bit of land for a hobby farm. We have a small plot (10'x10') in our yard at the moment, but we desire more. We want to raise chickens and have berry bushes for days. Living off the land if you will. We decided that we want to target moving to a homestead once Little Rock is done with high school. That gives us about 17 years to become FI and save for a homestead, very doable. Somewhere not too far out so we don't have to drive far to get into the city, but far enough away to not have to deal with the city (if that makes sense). Our current plan is to rent out our current house, and pay for the homestead with that money since our current house will be paid off. Not part of our FI money. This was a hard conclusion to come to because it would push back our FI date. However, we would be making 2 investments into our real-estate. Our rental property would continuously provide income as long as we keep a tenant and our homestead will be paid for from said rental.Second, we want to enjoy as much time with Little Rock. They are only little once. Currently the Mrs gets to capitalize on this because she is a stay at home mom. It is an amazing time. Watching her grow up is a once in a lifetime opportunity. Eventually she will move away and start a life of her own and all we will have is these memories of when she was little. This is why it is most important for us to spend as much time with her as we can. I'm excited to see who she becomes and be a big part of her life, but right now, for the next 17 years, she will be living here with us. This is the time she needs us the most, so I want to be there for her.Third, we continue to work toward being financially independent. We are not there yet, but we live a simple life continuously so we are making our there quickly. Our current savings rate (savings that is going into our FI bucket) is 20% on average. Not bad, but we strive to be better. Our goal is to get to about 45% month-to-month. We have a mortgage which is in the way, but we have a plan...
Fourth, we will pay off our first house. That's right, in about 10 years this house will be ours. We are throwing cash into our mortgage right now. Not all of it (see above) but we decided waiting out our 20 year mortgage is silly. So much wasted interest. We did some math and realized that instead of putting the minimum payment toward the house if we upped it per month we'd pay off in about 2/3 the time (17.5 years vs 10 years). Then once that is paid off, we would roll our additional free money into our FI money and get to FI even faster. We found this calculator handy.
So how does that math work out?
20% - FI money (invest, invest, invest)
50% - House mortgage (pay that sucker off!)
30% - Living expenses (we have plenty of delightful food)
Crazy to think we only need 30% of our income to live.
I know what you are all thinking, wait wait wait, how are you going to hit FI on 20%?! Ah, so we did our math and we believe that by throwing more money at our mortgage we get to no-mortgage land way faster (about 7 years faster!), then that 50% into our FI bucket which will make 70% for a few years and boom, FI. Totally agree we are not in an ideal state. We were not always frugal as we are today. We made some non-frugal choices. We have learned a lot over the past few years and we are crawling our way to FI. Our current plan is to get there by the time we are about 45-50 years of age. I know this isn't as exciting as MMM or Frugalwoods, but like we said we made some non-frugal choices in the past, so our plan is starting from where we are at.
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| A 2019 forest hike we discovered a cave |
Lastly, we want to be able to enjoy nature every.single.day. We love hiking, both in urban and forest. We want to live in a place with easy access to get to said trails. Nature is our happy place.
So that's it, that is our 10 year plan.
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