Financial Independence Day

FireworksHappy Independence Day to all of my US readers today. I hope you get to enjoy a day off, eat some good food, and watch fireworks. If you don’t live in the US, well Happy Thursday. I’ll either be completing or recovering from a triathlon, so sitting around this evening sounds just wonderful. My friend Pauline from Reach Financial Independence has asked me to share some thoughts on what it means to be financially independent. I’m not there, yet but hope hit Financial Independence Day in a few years.

I’ve seen several  arguments discussions about what it means to be retired. Does retirement begin with achieving financial independence? Can you call yourself retired if you still work? How many times can you retire? Honestly, the name you call it doesn’t matter. Becoming financially independent allows you to do whatever you want.

What Does Financial Independence Mean to Me?

Financial Independence is when you have enough money to cover the cost of all of your expenses without having to work for a paycheck to provide that money. You could argue that my in- laws are financially independent. They live solely on social security and own nothing other than their vehicles and personal items. They don’t work, yet manage to pay for rent, utilities, and groceries, but that’s about all. I know there are many things they would like to do, but they can’t because their income does not support much more than getting by. This still makes them financially independent, but that would not be my idea of a happy ever after.

My version of financial independence would mean that we have various investments to cover our basic needs, plus enough to travel, have as many pets as we want, be able to eat out,  or go to the movies when we want. We would like to help our daughter with college and spoil our grandchildren if we are lucky enough to have those someday. We also have some expensive hobbies like skiing and golf that we would like to indulge. Our wants are pretty simple. No mink coats or Ferraris in my future.

I would also like to give back to the communities that have supported us over the years. I’m not sure what that might involve, but I have some ideas. I would like to be able to work with stray animals, perhaps as a foster home coordinator. I would like to be able to offer eye care services for free to the needy in some capacity, and I would like to establish or contribute to a scholarship fund for students interested in medical fields. I’m never going to find the cure for cancer or create some brilliant work of art, but those are the things I can do and would enjoy doing.

How Much Do We Need?

In our strategy, most of the hard work is already done. I was either smart or lucky to purchase my business when I did, and while we made some mistakes along the way, that investment will fund a good portion of our investments for the future. We also have a commercial and residential rental that provide income. We need to add at least one, possibly two properties to bulk up this stream of income.

The really huge part of our strategy for financial independence is to pay off all debts. The only debts we currently hold are from mortgages on our primary residence and rental property. I’m not in a hurry to pay off the rental, but if we can knock out the home mortgage, that frees up quite a bit of money and makes our monthly expenses dwindle down to under $2000. This would mean we are financially independent, as our real estate income would should cover this amount.  My estimates show that we should be there in 6 years or possibly 4 if we really put our minds to it.

Since I don’t want to just get by, I would comfortably like to have $5000 a month. Some months we wouldn’t need it, but for the expensive ones, we’d still be covered.

How Do We Get There?

To us, I honestly don’t ever see a time when we would stop working while we were relatively young. However, working when you already know your basics are covered and working paycheck to paycheck are two totally different things. Jim will be pension eligible in about 12 years. Since we don’t know where he will eventually top out, we will assume his pension will be around $2500 per month. At that point we are beyond financial independence and into the comfort zone. Anything I make would be icing on the cake.

I think both of us would like to be able to work part time or do fill in work but not have anything that would prohibit us from traveling or doing the things we want to do. We are friends with several retired teachers who sub or have gone to work again because they are bored. I think there is a balance somewhere between boredom and full time work, and I’m determined to find it.

That is what my idea of financial independence means and how I hope to achieve it. If you want to visit me there, start making your own plan, decide how much you need, and how you plan to get there. Financial Independence Day starts with a desire and grows from there. Once you take ownership of your future, it might be easier than you think to celebrate Financial Independence Day.

Do you have a plan for financial independence?


Written By
Sydney White is a Texas-born stay at home mom who enjoys spending time with her family, bargain hunting and, hiking.


  1. It’s cool to see all these various perspectives on what being financially independent means to them! I like that you mentioned doing work you love like working with animals and giving back. I never even thought about that in my own definition!

  2. Good for you guys, Kim – you’re almost there! We are working on a plan. Our main goal is to get out of debt, first and foremost, and currently we are researching passive and other income streams, as well as assessing our current retirement funds and when we can tap them, what their value will be at, etc.

  3. Thank you for participating Kim! $2000 for a family including healthcare is really reasonable, and with free holidays from the credit cards a pretty awesome life on less than $25K a year. I don’t get why mr money mustache gets so much heat when he says he lives well on $25k

    1. That assumes that Jim still works and has free insurance with his job, and costs can always go up, but that would get us by. FI for us doens’t mean we go out and automatically quit our jobs. Like I said, I don’t want to merely get by, but it’s nice to know you could.

  4. We’re trying to reach financial independence in our 30’s, and like you it’s not going to be a number that involves “just getting by”. There’s going to be enough to travel and do other fun things as well =) Happy 4th of July!

  5. I achieved financial independence in my late thirties (28 years ago). I continued to work, but at things I enjoyed. For the last 12 years, I ahve been teaching and really enjoy it. Financial independence can be defined in various ways, but for me it was getting to do what I wanted.

    1. I really admire all that you’ve accomplished and how you have gotten to do what you want for so long. It’s something I strive for every day.

  6. I’m vigilant about tracking my spending. As an actor, my income is incredibly inconsistent. My only hope of reaching financial independence is knowing exactly how much is coming in and going out and maintaining a balance between the two!

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