The one thing that all of us have the same amount of every day is time.
No rich person has more than 24 hours a day, and no poor person has less.
So understanding that value proposition all of us have in trading our time for money is one of ten lessons that our poster, Tawcan, has learned during his FIRE journey that he shares with us today.
This changed just before I turned 30. Someone gave my wife and me a book called Secrets of the Millionaire Mind and our lives were forever changed. We aspired to make changes in our financial plans and how we manage our money. We knew FIRE was a possibility and we started investing in dividend-paying stocks with the plan to live off dividends by 2025 or earlier.
Ten years into our FIRE journey, we’ve made great progress on our goal of becoming financially independent. We are appreciative of this journey and how it has transformed our lives and made us more rounded people. We also have learned many lessons that we wouldn’t have learned if we weren’t on this journey.
I’d like to share with you the ten lessons I’ve learned so far on our FIRE journey.
1. FIRE is not the finish line; it’s a journey
Many see reaching FIRE as the finish line. For them, it means an escape from the rat race. However, I believe we can’t see FIRE as an escape route, a happy ending, a finish line, or the solution to everything. Reaching FIRE certainly doesn’t mean you will magically become happy and live happily ever after.
If you don’t work on yourself during the FIRE journey and improve yourself, you will continue to face the same challenges over and over.
Look at FIRE like a journey. It is very important to enjoy the journey and work on yourself while on this multi-year journey. So take the time to learn new skills, take self-improvement courses, gain new hobbies, make new friends, provide a helping hand in your community, etc.
2. Have a core investment strategy
In my 20s, although I was investing in the stock market, I was trading in and out of stocks frequently. I also invested heavily in high MER mutual funds and low-interest-rate GICs. In other words, I didn’t have a core investment strategy and my money wasn’t working very hard for me.
Since starting our FIRE journey, I learned to get in line and stay in line. I learned the importance of having a core investment strategy.
For us, it means investing in both dividend-paying stocks and index ETFs. This hybrid investment strategy allows us to have a predictable dividend income every month while staying geographically and asset diversified. By getting rid of high-fee mutual funds and so-called “high interest” GICs, on top of investing in the stock market for the long term, our money is working much harder for us.