Financial Independence is Not a Destination, But We’ve Made It!

We just achieved financial independence, and it felt a bit… anticlimactic?

Yes, you read that correctly. It’s not the feeling I had expected either.

After months of build up and excitement, we blew past our financial independence target of $1,000,000 the first week of January.

The timeline of this achievement was expected. Mr. RFL (finally) vested in his first tranche of restricted and performance shares, after over 3 years with his current employer. Thanks to a pandemic-driven recession in 2020 and company’s strong performance since, his actual payout was much higher than we expected when he accepted the offer. And, it was enough to push us past our FIRE number!

However, after so much excitement towards the end of our journey, crossing the finish line felt surprisingly anticlimactic.

Don’t get me wrong… I am thrilled to have reached this lofty goal and feel blessed to be in this position. Yet at the same time, I was expecting to feel an overwhelming sense of excitement and happiness at the finish line, that never came.

Instead of shouting it from the rooftops and celebrating with a fancy bottle of wine, I casually shared the news with Mr. RFL in passing, who had the same muted reaction. It took us 3 more weeks to finally open that nice bottle of wine and properly celebrate. And even then, the celebration was very low key and frugal compared to my 40th birthday dinner.

All of this left me wondering….

Why didn’t reaching Financial Independence feel like winning the Super Bowl?

This was perhaps our largest and most ambitious financial goal ever. Why didn’t reaching it fill us with the expected jubilation?

After reflecting on this question, I came up with four reasons why this win didn’t provoke the expected feelings.

1. Did a bear [market] just eat my financial independence?

Although we reached financial independence at the beginning of January, the stock market decided to “correct” itself almost immediately afterwards. With several days of decreases, the S&P fell over 10%, sending the market into bear territory and rendering us no longer financially independent.

Seriously!?

I would have been more upset about this, but I knew that the vesting of Mr. RFL’s stock options shortly after would bring us back within the confines of our FIRE number.

However, this volatility and uncertainty as to whether we were actually financially independent that day (or would be the next), caused me to delay our announcement.

This likely played a role in my muted reaction, though I think it’s the least of these four reasons.

2. Our lives are no different today, than they were yesterday. 

I retired almost two years ago… well before we reached financial independence.

Although much of that time was spent taking care of our daughter during the pandemic, I still use the term “retired”, because I left the workforce with no intent of ever returning.

Leaving my accounting career allowed me to help our family achieve the balance that we so desperately needed.

Mr. RFL and I had been struggling with the desire to do it all, but the lack of time needed to do so. It seemed impossible to find enough time to be all-star employees, great parents, nurture our marriage, take care of our health, and manage the household. Trying to do so was both difficult and stressful.

We’d talked about switching to a single income family since becoming parents, but never made the change. I wasn’t comfortable taking several steps down the corporate ladder to stay at home, if it meant having to go back to work and climb it all over again in a few years.

Retirement is a much sexier word. Maybe not traditionally, but it certainly is when you’re in your 30’s.

Having enough “FU” money to walk away from the corporate world for good was life-changing!

Although it hasn’t been perfect, being able to slow down our pace and have more time freedom has helped us to become stronger as a couple and family. It’s also improved our physical and mental health.

Mr. RFL plans to continue working for a few more years before beginning his early retirement, as shared in our 5-year transition plan. He’s up for a promotion and near the pinnacle of his career. Although now officially “work optional,” he ultimately had just as many options before we reached this milestone.

So nothing is changing in our lives… yet.

3. FIRE is a journey, not a destination

I say this a lot, and feel even stronger in my conviction now: FIRE is not a destination; it’s a journey.

The “RE” part is more like a destination, but even that looks different from individual to individual and can be done in stages. Much like life, financial independence is best enjoyed when you focus on the journey.

Every single step you take brings you closer to your goals and a new level of freedom. The real power to change your life comes from the freedom you gain along the journey, not reaching the end goal itself.

Sure, the end goal may be the point you can just sit and stare at the sunset for the rest of your life. However, you’ll have earned enough financial freedom to build your dream life way before you get there. This could mean the freedom to switch jobs, go part-time, start a business, semi-retire, or to spend more money buying back your time or creating new experiences.

Financial Independence is just one more milestone in the journey, and not even the most important one.

That’s right, I said it. Want to know when I felt the biggest bump in freedom along this journey? It was when we realized that we had surpassed “Coast FI.”

Coast FI is the point at which your investments are expected to grow to your target retirement balance by normal retirement age, without adding another $1. Said another way, you only need to earn enough to cover your expenses and can technically stop saving for retirement.

For two experienced accountants, being able to cover $40,000 – $55,000 in expenses each year would be relatively easy. From that point we knew that we could either work a few more years to take advantage of the high income levels we’d finally achieved, or switch to part-time work or a different career.

My point in sharing this is to remind you that freedom comes in different forms all along the journey. Which is exciting, right?!

4. Addressing the elephant in the room…

Sometimes, I get that nagging feeling: What if we haven’t saved enough?

Mr. RFL and I are only 35 and 40 years old, respectively. We also have a young child. That is (hopefully) a very long runway for retirement. It’s virtually impossible to plan for every “what if” scenario.

Although we’ve done our homework, recent challenges to the 4% rule, lower bond yields, rising healthcare costs, and my own risk aversion have led me to think more about the uncertainty around determining your FIRE number.

Perhaps this uncertainty is a subconscious reason why achieving this milestone didn’t feel as big as I’d expected.

Luckily, we aren’t planning to draw down our portfolio just yet, so I don’t need to worry about it too much.

Even if Mr. RFL only ends up working for one more year, we’ll have a nice cushion and more options to adjust our plan, if needed. Whether that’s using a lower starting withdrawal rate, or increasing the retirement budget, we still have the time and bandwidth to do so.

Moral of the story

If you’ve been following our journey, this probably isn’t the celebratory post that you expected. Frankly, it’s not the post I expected to write either.

But in keeping with my commitment to be fully transparent with you, I wanted to share our authentic experience.

The good news? Financial independence is still exciting. It’s just that we just already did most of the celebrating during our journey!

In my opinion, only a small fraction of the freedom this lifestyle provides actually comes from surpassing that end goal.

So if you’re on your own journey to financial independence, those reasons to celebrate may not be as far off as you think. Allow yourself to celebrate every milestone! And when the going gets rough, don’t forget to reflect on how far you’ve come and the freedom you’ve already attainted.

For now, I can check this achievement off of my 2022 Goals List and continue to focus on our journey.

What are you most excited about on your financial journey?

Sharing is caring! If you enjoyed this post, please consider sharing it on social media. This helps the blog continue to grow and reach a larger audience. Thank you for your support!

Disclaimers:

Rich Frugal Life is a member of affiliate programs for Amazon and other vendors. This post may include affiliate links, which provide a small commission to us when used to make a purchase (at no additional cost to you). You can show your support for the blog by using a referral link or making any purchase on Amazon through an affiliate link. Thank you!!

The content included in this blog reflects the author’s opinions and personal experiences, which may be different than your own. This blog is not a replacement for, nor is it intended to represent, financial or investing advice. Please refer to our disclosure and privacy policy for further details.