Lessons from Mr Money Mustache
Have you heard, the FIRE is spreading?! There is a movement afoot. It’s a mindset, a system, a cult-like community. It’s an age-old way of thinking that has been given a modern day dose of manscaping, not to mention the positive impact and passions of countless extraordinary women.
Like any wonderful and worshiped venture it is cloaked in common sense and intentional contemplation that spans generations. It is simple, effective, proven and mysterious.
Financial independence. Retire early. FIRE.
Even the acronym itself taunts you. Come on, join us, we dare you.
I concede I am currently hooked. I am fascinated, impressed and motivated. I am thirsty for more techniques and ideas on how I can optimise my one-and-only life.
He writes regularly, ruthlessly and uniquely, brandishing a style that has resonated with millions… He is passionate, relatable and tackles complex financial concepts by unforgivingly suggesting that the mindless, commuting, hamster-wheel zombies need a good punch in the face.
One man, Mr Money Mustache (he is American and thus spells it without an ‘o’) inadvertently developed himself and his brand into a driving force for the FIRE masses. He writes regularly, ruthlessly and uniquely, brandishing a style that has resonated with millions of everyday Mom and Dad readers across the USA. He is passionate, relatable and tackles complex financial concepts by unforgivingly suggesting that the mindless, commuting, hamster-wheel zombies need a good punch in the face.
In the welcome post of his hugely popular blog-based website MMM explains that “by focusing on happiness itself, you can lead a much better life than those who focus on convenience, luxury, and following the lead of the financially illiterate herd that is the TV-ad-absorbing Middle Class…”
Mr Money Mustache has found himself as an inspiration and sort of spokesperson for the FIRE movement.
The FIRE mindset is essentially a re-alignment of modern values that places happiness above all else. It is constantly misunderstood by those that take the words of the acronym far too literally, or simplistically. It is a commitment to intentionality in regards to more than money, consciously considering and placing value on who we spend our time with, how we spend our own time and how valuable our time on earth really is. This prioritisation of time places retiring early at the heart of everything else FIRE related. All the tweaks, ideas and processes that swirl around, up for personal interpretation.
It is a commitment to intentionality in regards to more than money…
With over 400 articles being read by millions worldwide everyday, I quickly found myself happily plummeting down the MMM rabbit hole. It is an adventure.
Here is a summary of my favourites, a little tease, a tasting platter of the Mr Money Mustache smorgasbord, his blog posts that have stuck in my mind. Looking back over the seven years of his brain-dumping archives, this list represents a great bunch of punchy pieces to help you to sample the style of MMM.
The shockingly simple math behind early retirement
https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/
The general gist
“It turns out that when it boils right down to it, your time to reach retirement depends on only one factor: Your savings rate, as a percentage of your take-home pay. If you want to break it down just a bit further, your savings rate is determined entirely by these two things: How much you take home each year and how much you can live on. While the numbers themselves are quite intuitive and easy to figure out, the relationship between these two numbers is a bit surprising.”
My favourite quote
“A middle-class family with a 50k take-home pay who saves 10% of their income ($5k) is actually better than average these days. But unfortunately, “better than average” is still pretty bad, since they are on track for having to work for 51 years. But simply cutting cable TV and a few lattes would instantly boost their savings to 15%, allowing them to retire 8 years earlier!! Are cable TV and Starbucks worth having two income earners each work an extra eight years for??? The most important thing to note is that cutting your spending rate is much more powerful than increasing your income.”
Food for thought
“As soon as you start saving and investing your money, it starts earning money all by itself. Then the earnings on those earnings start earning their own money. It can quickly become a runaway exponential snowball of income. As soon as this income is enough to pay for your living expenses, while leaving enough of the gains invested each year to keep up with inflation, you are ready to retire.”
The practical benefits of outrageous optimism
https://www.mrmoneymustache.com/2012/10/03/the-practical-benefits-of-outrageous-optimism/
The general gist
“Your life and my life are both going to continue to increase in awesomeness over time. We are likely to have exceptional fortune and health throughout our days, we’ll help to change some lives for the better, our kids are going to turn out loving and great, and we will die with a broad smile across our rugged and weather-worn faces somewhere around the age of a hundred and twenty two.”
My favourite quote
“One of the problems with being a clever and analytical person like yourself, is that you’ve become very good at seeing what might go wrong. You can see the risks inherent in any enterprise, and if you’ve got enough Cliff Claven in you, you might even be fond of expounding about those risks to anyone around who will listen.”
Food for thought
“Fear-mongering in general tends to make you sound smart, and fearful people get a quirky sort of reassurance by snuggling up to a fearful leader, and confidently predicting the worst possible outcome.”
The true cost of commuting
https://www.mrmoneymustache.com/2011/10/06/the-true-cost-of-commuting/
The general gist
“It is ridiculous to commute by car to work if you realise how expensive it is to drive, and if you value your time at anything close to what you get paid. I did these calculations long before getting my first job, and because of them I have never been willing to live anywhere that required me to drive myself to work. It’s just too expensive, and there is always another option when choosing a job and a house if you make it a priority. And making that easy choice is probably the biggest single boost that will get the average person from poverty to financial independence over a reasonable period of time. I would say that biking more and driving less was the trigger in my own life that started a chain reaction of savings and happy lifestyle changes that led my wife and I to retirement in our early 30s.”
“I have never been willing to live anywhere that required me to drive myself to work.” — Mr Money Mustache
My favourite quote
“…a logical person should be willing to pay about $15,900 more for a house that is one mile closer to work, and $477,000 more for a house that is 30 miles closer to work. For a double-commuting couple, these numbers are $31,800 and $954,000.”
Food for thought
“The alternative I would have recommended to this couple, if they had asked my opinion, would be to make sure their house is within biking distance of both jobs, immediately sell both borrowed cars and replace them with a single ten-year-old manual transmission hatchback, and finally, let the good times roll.”
Wealth advice that should be obvious
https://www.mrmoneymustache.com/2013/09/20/wealth-advice-that-should-be-obvious/
- You don’t try to gamble your way to wealth
- Windfalls are for buying freedom, not jet-skis
- You don’t buy shit you can’t afford
- You don’t buy shit you don’t need
- You don’t pay to have shit stored
- You don’t think of restaurants as a source of food
- You put the good shit on automatic
- You stock up when things are on sale
I am a relatively new fan of Mr Money Mustache, but I have fallen hard. His website is a fun and thorough resource that will have you constantly contemplating you current circumstances, which is a little scary but very healthy.
Obviously his handiwork is not for everyone, however the popularity of this sub-culture icon is undeniable. Anyone of influence in the FIRE community will quote MMM as a driving influence and often they identify one his articles or phrases as a defining lightbulb moment — a lightbulb that will undoubtedly be powered by solar panels.
Originally published at http://downunderdad.com on September 27, 2019.
