How We Unlocked More Options and Insanely Better Choices

Welcome to the monthly update of our journey to financial independence, where we report on the progress of our FI tree, aka Freedom Fund. Our mangoes are almost ripe and our goal is to reach financial independence by July 2017. This means that we’ll have enough investments to live off of without ever having to work again to pay for living expenses.

We’ll consider ourselves financially independent when our Freedom Fund is able to support our lifestyle indefinitely. Our Freedom Fund is comprised of the following income-producing assets: index-based investments, short-term reserves, and a real estate property.

The big announcement!

Hola, dear readers!

What a month, financially speaking, January has been. The market finished in the green zone. Except for a splurge on Ricky Martin concert tickets in Maryland, we spent very little during the month. That should be a fun weekend getaway for Cinco de Mayo.

We also completed a lot of year-end planning while our dollars worked hard in the background to help us meet our financial goals. Something we’d hoped to accomplish also took place last month.

We are overjoyed to announce that we have achieved financial independence!!!

Let me say it again: we are now financially independent!

That’s right, folks, we nailed it. Yes! On January 14, we reached our target. It was the weekend when I caught a cold.

I woke up with little energy and checked our accounts online from bed, and boom! There it was, completely unexpectedly, income-producing assets reaching the digits we’d been hoping to see for a few years.

It feels surreal

Bert from Dividend Diplomats commented in one of our update posts that declaring financial independence must feel like Michael Scott declaring bankruptcy in The Office. Watch the video below.

Bert was right on the money. That is exactly how we feel right now.

We…declare…financial independence!

Though I was sick, I couldn’t show Tatiana my full excitement when we reached our goal.

This reminded me of why it’s important to enjoy the journey to FI rather than just working yourself to death. My illness was only temporary, but consider the people who achieve financial success while sacrificing their health.

It’s not worth sacrificing your health, so enjoy the journey, take the time to care for your health, and celebrate the milestones.

Although we haven’t had a chance to celebrate yet, we find it surreal that we’ve arrived. Our relationship with money has changed, and money will soon become background noise for us as we begin to devote more time and effort to our happiness without worrying about how we will pay our bills.

How it all began

In 2012, we became aware of the FIRE concept. We did this “work” thing for the past 5 years that guaranteed us financial independence if we devised a FI Plan. Essentially, we could declare ourselves financially independent if we could save up to 25-30 times our estimated living expenses in retirement. That’s exactly what we did.

We kept track of our expenses over the years and calculated how much we needed to retire. Now that that goal has been met, the 9-5 feels almost like a hobby because it is completely optional. We still need to save a little more for other plans, but if we retired today, our bills would be covered almost forever, more like 99 percent of the time.

So that’s the exciting news. Let’s take a look at how the Freedom Fund performed this month and how it achieved its ultimate goal.

Freedom Fund Progress

Percentage of Freedom Fund reached in January

The market had a nice month’s return, but we also spent very little, so we’ll take credit for the new money that was invested. In January, our Freedom Fund increased to 101 percent!

This represents a 4% increase over the previous month. After experiencing slow growth from March to May and July to October of 2016, the quick turnaround caught us off guard.

If we retired today, our investments could cover up to $35,574 in annual expenses. That puts us $574 over our goal! The extra savings above and beyond our Freedom Fund goal will go toward a few short-term goals.

Happy finances, happy marriage! 🙂

The road ahead

This is a bittersweet moment because it is our final monthly report on our FI goal. I wish we had started reporting on this sooner because I enjoy writing these reports, but it is what it is.

Here’s a list of our previous updates:

Our Freedom Fund: Creating a Portfolio That’s Built to Last

August 2016 Freedom Fund Update: 6.3% in Market Gains

September Freedom Fund Update: We’re in Good Shape for Retirement!

October Freedom Fund Update: Earnings Increased 25% Over a Year Ago

November Freedom Fund Update: Progress is Not Always Visible

December Freedom Fund Update: We Are Very Close to Declaring Financial Independence

January Freedom Fund Update: We Reached a Dividend Goal Last Month

Do you want more Freedom Fund Updates in the future? If so, how frequently and what kind of data do you want to see in the report? Please share your thoughts in the comments section.

FIRE is in the air. The first piece of the “FIRE” puzzle has just been placed. We’ve reached a point in our lives where we can decide whether or not to continue working. This raises, of course, raises questions.

Are we going to quit our jobs right away?

Nothing will change in our lives in the short term because we cannot simply pick up and leave. We have a transition plan in place for the next few years that includes saving more for a house, selling the rental property, and planning a move abroad. We’re not in a hurry and it will take two years to complete this chapter.

What if there is a bear market and our Freedom Fund drops by more than 20% over the next few years?

So, if the market falls, we’ll buy at a discount because we’re still working. 🙂 Otherwise, we’re unconcerned. We have a sound asset allocation strategy that allows us to sleep well at night. No matter what happens in the market, our plan will continue uninterrupted.

Are we done saving for retirement?

We’ve essentially finished saving for retirement in the sense that the Freedom Fund can now support us for the rest of our lives.

Does this imply that we should cease all contributions to retirement accounts?

Certainly not! We’d be foolish to lose money by refusing a company match. To take advantage of the match and lower our taxes, we’ll continue to max out our retirement accounts until the day we retire.

Is it possible that we are suffering from the “one more year” syndrome?

Some members of the FIRE community tend to work for one more year after reaching FI, which has been dubbed “The One More Year Syndrome.” Giving up a paycheck can be a difficult decision for many people.

This is not the case for us. Working a little longer after reaching FI has always been part of our plan. We’re not adding working years for the sake of it, and we’ve already set a retirement date. The light at the end of the tunnel is as bright as the mid-afternoon sun on a Caribbean beach! We want to be at the beach as soon as possible and for as long as possible.

However, we would consider shortening the timeline if our working environment deteriorated and triggered the “we have FU money, this is not worth it” feeling. That is the power of having FU money: you have more options and they are insanely better options.

The next two years will be very exciting for our family. Keep an eye out!

How are your FI plans going? How far have you come?

Risk disclosure: All investing involves risk, including the loss of principal. The material contained on this website is for discussion purposes only and should not be construed as financial advice.


After dedicating 13 years of his career to Vanguard, José retired from the corporate world at the young age of 44. During his tenure at Vanguard, he expertly coordinated the production of both electronic and print educational materials for 401(k) participants. Now, he relishes in his early retirement, cherishing time spent with his family, indulging in his favorite hobbies, seeking out new experiences, and savoring meals in the comfort of his own backyard.

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7 years ago

Hey Congrats on reaching the FI figure you hoped for. Im sure it feels great to finally have met such a big goal. Yeah if your work situation is not so bad or stressful, why not work a bit longer to have a buffer. If work sucks I would leave as soon as possible. Good luck.

7 years ago
Reply to  EL

Hi Rich Uncle EL –
I agree. There’s no need to run for the door if the job situation isn’t uncomfortable. As we get to ready to make our retirement move, our investments will definitely create a nice buffer. Thanks!

Louis Bautista
Louis Bautista
7 years ago

Huge congrats to you guys! I am early in my journey, but I have you guys to thank for inspiring me to pursue this journey. Wish you a lot of success on your future endeavors.

7 years ago
Reply to  Louis Bautista

Thanks Louis! Glad we can be of inspiration. Consider yourself lucky that you found the FI journey much earlier. 🙂 I wish I did but no regrets here.

Alex C.
Alex C.
7 years ago

Congratulations!!! That must be such a relief! So what’s your next big goal?

7 years ago
Reply to  Alex C.

Thanks Alex,
Our next big financial goal, which is already in progress, is to save up the funds to either build or buy our home abroad. This will happen while we take care of a few things prior to retirement over the next couple of years so we’ll try to do as much as we can since we do have a retirement date in mind. Thanks for commenting.

Mr Crazy Kicks
7 years ago

Congratulations! I remember when we first realized we were FI, it’s a great feeling to be free from needing to work. Enjoy your success, you earned it 🙂

7 years ago
Reply to  Mr Crazy Kicks

Thanks! We can’t wait to be retired like you guys. It a great sense of accomplishment to realize that what the industry promotes as a 30 year goal (retirement savings) we got it done in less than 10, and well done. After all, how many retirees get to retire without counting social security or a part-time gig as part of their retirement funds?

Even though our routines haven’t changed, our mindsets feel a little different and I think that will also be reflected in the kind of posts that we’ll be writing moving forward. I guess it’s part of growing and learning. 🙂

Thanks for stopping by!

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