Those rags to riches stories can sometimes sound too good to be true. Can people go massively bankrupt to incredibly debt-free in one lifetime? Ron Schneider is living proof that you can achieve financial independence. He has gone from $60K in debt in 2006 to a net worth north of $2 million in the past 15 years. Ron joins Zeona McIntyre to talk about the things from his childhood that hindered him from paying off his debts. Tune in and learn how Ron used reduced spending, index funds, credit card hacking, and other techniques to supercharge his savings rate.

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Breaking Debt Chains: Money Fear And Financial Independence With Ron Schneider

I got a great guest for us. One little tip about my life that I wanted to share with you and the hack that I enjoyed the most that has made a huge difference in my financial independence journey is pet sitting. I don’t know if you have heard me talk about this. I might have mentioned it in my episode, where I got interviewed by Craig but what we do essentially is we’re part of a community on an app where we apply for pet sits and we do the exchange for free, but in turn, we get to rent out our home on Airbnb and make a good income on that.

I’m broadcasting from Steamboat Springs, which is a beautiful resort community for skiing and snowboarding. We get a full week vacation and a beautiful home for free, some cute doggies to hang out with and our home gets to pay for itself. If you want to know more about pet sitting and how I do that hack, please reach out to me on Instagram, @ZeonaMcIntyre. I would be happy to help you. Let’s bring our guest, Ron Schneider.

Big news, Invest2Fi has partnered with RentRedi. That is the software system that both Zeona and I used to do property management for our rental properties. It makes things super easy. We can send applications to get background checks and credit checks. When tenants come in, they could pay rent automatically through there. They can submit maintenance requests to everything you need to do for property management, all in one place. That’s why RentRedi is the thing that we’ve done.

I’ve been using them for years. That’s why we reached out to them for a relationship on the show. I’m super excited to have them on board. If you go to RentRedi.com and use the code INVEST2FI, you’ll get 50% off your first 6 months. Sign up and use the coupon code INVEST2FI. I can’t wait to see you there. Hit us up on Instagram or wherever and let us know what you think of RentRedi. It’s amazing software. I used it all the time. You can access it from your phone. It’s amazing stuff. Thanks so much. Let’s get back to the episode.

Ron Schneider, welcome to the show.

Thank you. How are you?

I am doing fantastic. Thank you for being here. It seems like we met at FinCon. What were you doing there?

I was a community pass holder. FinCon was held here in Austin for the first time. It was a conference I had planned to go to for quite a few years but never quite got there. They were 4 miles from my house, so I decided why not? I was able to ride my bike down there. It was awesome.

Let’s get into the show. Can you tell us how you first heard about financial independence?

It was an article in the Washington Post interviewing Mr. Money Mustache. He introduced a lot of people to FI. That was at a time when I finally had some money to start investing. Years ago, I was $60,000 in debt. I was 44 years old. In 2022, my net worth is over $2 million. A lot of the reason is because of the lessons I learned from the FI movement. I’m excited to talk about FI and be here. This is my first show. I’m happy to share the lessons that I’ve learned along the way. I’ve read a lot of financial blogs over the last few years.

Mr. Money Mustache is a personal friend of mine because we live pretty close together. He was my gateway too, and I’m forever grateful for him. What was it in that article that first sparked this idea that it wasn’t just, “I’m reading the Sunday paper,” but it’s like, “I’m going to do something and make a big change in my life?”

I’d been in debt for about 3 or 4 years by the time I read him. I learned how to get out of debt from Suze Orman, of all people. I watched her financial show on CNBC for nine years straight. I was able to come to a debt. By the time I needed to start investing, I felt like her advice was not working for me. When I read Mr. Money Mustache in the Washington Post, he talked about index funds, which turned something in me. I then found J.L. Collins, who was one of your guests here, and went straight into Vanguard.

I had been subscribing to a series of investing newsletters that Suze Orman recommended. They weren’t working. The fees were too high. There was too much trading. The expenses were too high, and we weren’t getting anywhere. Index funds, Vanguard, and loading into VTSAX were the key to supercharging our investing.

I wanted to highlight the Suze Orman thing too. I used to watch that show and read some of her books but I saw that saving 10% of your income, which a lot of the mainstream people recommend, seems like you’re going to work for the rest of your life. What I learned later and this is the magic of financial independence math, is that if you can crank that up to 50%, you’re cooking. You could change your life in 5 to 10 years. It is important to see that distinction and how much of a difference that can make.

In terms of getting out of debt, Suze Orman was crucial that I had a lot of money fear. I grew up with a lot of fear around money. My mom was a saver, married to my dad, who’s a spender and she’s terrified. That was her words. She told me when I was very young. I had a lot of fear and denial about my money. For somebody to show up in their mid-40s with as much debt as I had, some issues needed to be resolved emotionally. Suze Orman helped and internalizing her lessons helped but to supercharge the savings, it needed to be a higher savings rate, purchasing my own house and getting into low-cost index funds. I never got caught up in anything highly speculative.

You never really know what life is going to bring. And there is no price tag for your peace of mind. Click To Tweet

Bitcoin is not of any interest to me. It’s a legitimate field of interest for people but I don’t do speculation. My success has been a high savings rate, consistent investments, low costs and owning my own house in Austin for many years, which has grown 9% per year on average. My house is worth two and a half times more than what I paid for it. Years ago, I bought in for $385,000. Zillow has me at $995,000.

Let’s get back into the house in a little bit because it was a good story. I want to give some space to that. One thing I want to talk about is being in that much debt in your 40s. A lot of people who come to this late in the game think, “It’s over for me and too late.” Even later in their 30s, thinking like, “I missed all that good compound interest time of starting when you’re 18 or early 20s where you have this huge horizon in front of you.” How was that for you? What worked?

The average American has $93,000 in their 40s in their retirement accounts. Many people are starting late and what they feel is too late. My story says that it is never too late. It only takes 5 or 10 years to turn this around completely. As soon as you stop digging deeper into your hole and start climbing out of it, the sooner you will be able to feel the benefits of financial security. For me, I resolved what was emotionally keeping me down, the math and hard work.

I lived on austerity for the first few years but even then, it wasn’t 100%. My wife and I had $60,000 in debt and we would go out to eat after each $10,000 in debt was paid off. Maybe for 3 or 4 years, we only went out to eat a very handful of times and that was the austerity phase. As soon as we hit the landmark where our net worth was zero and broken even, it was a big, huge party. The next landmark for us was Suze Orman’s eight-month emergency fund.

What I love is that you gamified it. You said, “We’re going to set these goals and celebrate at every step.” That makes it fun and something that you can both buy into. You’re going like, “That dinner is going to taste good and enjoyable.” Rather than if you go out to eat every night, it gets to be normal. Those dinners were special for you.

The other thing that happened along the way in addition to having the fun celebration, is that we learned to cook and bring our lunches to work every day. In the beginning, we did not have high incomes. Honestly combined, we were probably making $75,000 a year, both of us working full-time. We pulled ourselves out of $60,000 worth of debt with a $75,000 a year combined income. It wasn’t until after we had some savings that I went into business and it took off that we started to explode.

Every step along the way, we learned how to be frugal, which wasn’t torturous. It was interesting. It became a game but also became a source of strength that we didn’t have to do things to put ourselves further into debt to feel happy or think we were feeling happy. We didn’t take crazy expensive vacations for quite a few years.

Let’s talk a little bit about the lifestyle changes that it took. Could you talk about maybe 2 or 3 that were bigger? It sounded like eating out was something that you did a lot. Learning to cook, sharing that and bringing meals to work was a big help. What were some other things that you had to make changes around?

Financial Independence: Budgeting and being able to see the progress keep you motivated and keep the ball rolling.

 

The one thing that helped us tremendously is we’re very old school. I’m not necessarily a high-tech person. Every single month we calculated our net worth. Sixteen years’ worth of monthly net worth calculations is right on a yellow pad. I can go back. This is a record. On June 29th, 2013, which was shortly after I discovered Mr. Money Mustache, our net worth was $441,000 at that point. We had started getting into some major investing. It worked for us to simply calculate our net worth each month to look at the progress. It was part of the game. This was almost like the score sheet. Our net worth went up $5,000 or $1,000.

When we got into the frugality piece, in the beginning, we realized our net worth would hardly ever go down. We had no investments. You realized this was during the great financial recession. We were in debt. At that point, we had no real estate and stock. When everybody else tanked, nothing happened to us. We were paying off debt. Every single month, our debt would go down and down. We were able to calculate it so that we could see the progress we were making as we were doing it. That was a huge game-changer for us to be able to check off the progress each month.

It sounded like budgeting and being able to see the progress kept you motivated and kept the ball rolling. You had momentum.

Being able to see it every month inspired us to keep going. You see it go from 60 to 45, 43 to 50 and all of a sudden, the day you come out of debt. I’ve got a page here with stars and bars. It looks like fireworks on it on the month we came out of debt. You saw the way I keep it. It’s not bound in a book. Some of the pages have frayed and so on. In addition to being frugal and tracking our progress, learning about finance and personal finance helped, whether it’s behavioral finance or investing.

I read so much about investing. I don’t know if you know the Ritholtz Wealth Management people. Barry Ritholtz is on Twitter. They’re an investment advisory firm but they all blog. They have podcasts. These guys are obsessed with markets. I’m learning a lot about investing, even beyond the basic index investing. I like to see what the lessons are from people who’ve been doing it longer than I have.

Let’s get back on track here. We were talking about your steps. First, you focused on getting out of debt but getting out of debt is baseline zero. You have to build up a net worth and a retirement that’s going to take care of you for the rest of your life. How did you do that? You started with a Suze Orman eight-month plan or something like that. Can you tell us a little bit about that?

She advises everybody to have an eight-month emergency fund. That was the next landmark for us, after getting out of debt and being net-zero, have an eight-month saved of what our monthly expenses were. Calculating our monthly expenses was a key piece of all of that. We were able to find out what our eight-month emergency fund needed to look like and that money stayed. Back then, you could get 4% or 5% in a bunch of crazy savings. I used to have these checking accounts where if you used your debit card 12 times in 1 month, they give you 5%. I had our emergency fund in accounts like that. I would roll from one account to another, trying to get the highest interest rate we could.

Saving money wasn’t any different of a process than paying off debt. It’s the same thing every month. We were still tracking our net worth on the yellow sheets, watching ourselves go from $5,000, $10,000 to $50,000 in net worth. What ended up happening is I had started my own business in 2008. I’m a political consultant. I never said what I did for money. I had worked for political campaigns up to 2008.

It’s never too late to completely turn things around. Click To Tweet

In 2008, I started my own business, which started slow. In 2009, I worked part-time as a campaign manager for somebody else. I’m still doing my business on the side. In 2010, my business exploded. At the end of 2010, we had enough money to buy a house. Finally, we saved a house, which was the next landmark after the eight-month emergency fund.

Let’s talk about due dates a little bit. When you were in a lot of debt, what was that date? When did you pay off your debt? It sounded like it was in 2013, maybe.

I got married in 2006 and had $60,000 of debt. We probably came out of debt in 2008 or so. By the end of 2010, I had finally made a good six-figure income. We had been saving so hardcore that we had enough for a down payment. The formula was at least 20% down and at least a 1-year emergency fund with the new expenses of the new house, whatever the new expenses were going to be. Our net worth when we bought the house was about $225,000. That was January 2011.

It’s still a little bit early and Mr. Money Mustache started writing in 2011. Did you have the concept of trying to have a fine number or retirement goal that you were hoping to hit?

No. At that point, we had still been working through the Suze Orman series of investment newsletters and we’re never happy with the returns. It wasn’t until I read Mr. Money Mustache. It was at the end of April 2013 that his article appeared in the Washington Post that I learned about index investing. Immediately all of our money then went into Vanguard, VTSAX, instantly. At the very beginning, the first year and a half of owning the home, I was freaked out by being in debt again.

I was throwing $10,000 and $20,000 at a time with the mortgage. The mortgage was $288,000. We put $100,000 down, $288,000 mortgage on this house, something like that. We paid $385,000. Immediately, I started to pay down the mortgage as fast as I could. The first interest payment on the mortgage was $930 a month. It freaked me out.

Let’s go into that a little bit. Most readers are in real estate, so it’s nice to hear about the numbers. You’re saying that you bought it for $385,000 and put $100,000 down. You were already great savers at that point. What was your reasoning for buying the house? Was this going to save you on rent? What were you paying on rent at the time versus what was your mortgage going to be?

No, it wasn’t going to save us. It was a step up in the lifestyle. We lived in a basement apartment in Washington, DC with little critters and things that I didn’t want to get into. You don’t want to live like that for too long. You put up with what you put up with to get out of debt. For us, it was simply a question of whether we could afford it. The prices in Washington, DC, at the time, were double what Austin was. We found our ticket out to a lower cost of living area. Austin has exploded ever since we’ve been here. It’s been on every ten best lists of places to move in the US for many years.

The real estate market has gone crazy everywhere. For us, we were in the same type of neighborhood and the same size house. We were able to buy it for half the price. What we bought for $385,000 was going for $750,000 in DC. We lived in the house and felt like, “We had friends here. We’re going to find the house we want to live in and still have a lifestyle that we liked.” We bought a house that was a little bit of a stretch but not too much.

Financial Independence: Saving money isn’t any different from the process of paying off debt.

 

I know that real estate investors work with leverage. The folks here in the ChooseFI group that I belonged to are real estate investors. I know one woman who owns twenty properties. She’s had never had a real job and had her first real estate investment when she was in college. She’s cashflowing her whole life long. That’s what she does. She’s fearless. It’s awesome. I started so late. I didn’t learn about FI until I was 52 years old. It was never about retiring early. It was about retiring.

Let’s talk a little bit about the why of buying a home. I’m curious if there was some security around that or if it was the next step that Suze was recommending? Why buy when you could have moved to Austin, upgraded your life but rented instead?

I don’t exactly remember what the thought process was but maybe it was because we didn’t know how to invest back then. We hadn’t learned about Vanguard or low-cost index funds. We didn’t know what to do with the money, so to speak. We were struggling with our investments. Home seemed like a good place to save, which a lot of Americans have their savings in their home. The next logical step is you have a down payment and don’t know how to invest in the stock market. Real estate seemed like a safer proposition at the time. We got very lucky we bought it at the bottom.

You buy your house and all of a sudden, you’re back in debt. Even though it’s a different debt, you’re back in debt and it’s keeping you up at night. How did you reconcile that? What did you do? It sounds like you tried to pay it down fast, which some people FI do. Have you since changed your strategy on that?

I paid the mortgage off completely years ago. I look back and can run the numbers and see that holding onto the mortgage would have been a smarter financial decision. I sold some of our VTSAX to pay off the house. I had a $90,000 mortgage at the time. It was down to $90,000. I paid off the last $90,000 because I didn’t want to see it and make the payments anymore. I’ve always been a little bit of a nervous financial person. For me, I didn’t want borrowed money from the market.

Even though I kept the $90,000 mortgage years ago, VTSAX was around $70,000 when I sold. It’s $110,000, $105,000 after the last correction or something like that. It’s worth 50% more than what I sold. I would have had to continue making the monthly payments and so on. My net worth would probably be $50,000 to $100,000 more than it is but I don’t care. I sleep well. I don’t have any borrowed money in the market at all.

I want to highlight these couple of things because this is a huge topic that J.L. Collins also wrote about and a lot of people talk about in the FI community. Do you pay off your house or leave that debt? It’s nice to hear you saying, “I went and did the math. It does make more sense to keep it in the market.” That’s good for people to know and have that in the back of their minds.

The earlier you can get financial freedom in life, the more freedom you can have to pursue your passions. Click To Tweet

There’s also no way to put a price tag on the peace of mind of having your place paid off. Most people don’t know what that experience is like. I paid off my first condo and lived there for a few years. Something is comforting about knowing that nobody can take that away from you. I can understand where you’re at with that.

I run the numbers. I have no regrets. I can say that my net worth would be $2.2 million instead of $2.1 million or whatever million. It doesn’t matter. You never know what the market’s going to do and what life is going to bring. There is no price tag for that because it’s not a financial equation at that point. It’s a behavioral question. How do you feel daily? How much money do you spend to feel a certain way?

I maybe shouldn’t point this out because it might bother you but how do you feel about the equity that sits in that home? That is an uncapitalized opportunity cost there. Do you ever think of that going like, “I could pull out $500,000 and do this, that and the other,” or does that not cross your mind?

It doesn’t cross my mind mostly because I don’t necessarily need a net worth of $10 million to be satisfied or $5 million to retire happily. Our number has changed through the years. At one point, we had it pegged at $2.25 million. It’s using the 4% rule that would give us the annual expenses that we could spend. I shifted up maybe to $3 million because of inflation. You don’t know what the stock market’s going to do for the next years.

I suppose I could have gotten there sooner but if I have financial regrets at all, it’s not about the opportunity costs of what’s sitting in the house. I don’t feel them very much anymore. It goes back to my 20s and 30s and all the mistakes I made back then. I didn’t show up in my 40s and debt for no reason. I had a very cavalier and live-for-the-moment attitude when I was in my 20s and 30s. I didn’t realize how much fear that was. There was a lot of fear and denial. I was not in touch with how I was feeling about it. I partied like it was 1999.

Are there any particular mistakes that you made that stand out that you think people should know? Is it in general that you were spending everything that you made?

I had an import business started in my later 20s and through my 30s. I had saved up a little bit of money and blew it all. It’s bad business deals, traveling around the world, going out to eat all the time. I’ve been to hundreds and thousands of concerts in my life. Things that, in retrospect, would have been better to put off a little bit, maybe. It’s hard for me to say I regret all of that.

Somehow you think that if you would save the money first in your twenties if any young people are reading, you’ll be able to do that much more with financial peace of mind along the way. I blew it all as I got it or it was easy come easy go. In retrospect, I worked a lot harder in my 40s and 50s than I would have done in my 20s and 30s.

Maybe it’s more of a balance. Not that you can never go to a concert, but maybe you do a few less. You cook some meals at home and have a little bit of consciousness around it in your 20s and 30s. The only thing I’m thinking is that maybe in your 40s and 50s, it was easier to do less because you’re like, “I don’t need to go to a concert. I’m happier staying at home.”

Financial Independence: You put up with a lot of things to get out of debt.

 

I can relate to the idea of once you have even a certain amount of money saved, say $50,000 or $100,000, that’s liquid, there’s a certain comfort of knowing like, “I’m not living paycheck to paycheck. I’m not desperate.” The earlier you can get that in life, the more freedom you can have to pursue your passions. That gives you so much more space.

I thought of another mistake. I bought a new SUV probably in the late ‘80s. I was probably 27 or 28 years old. I was making money from the new business but I didn’t need to buy a brand-new car. What I’ve learned from the FI community that has worked for us tremendously is to buy a five-year-old car and don’t buy a brand-new car. You buy a 5-year-old car, drive it for 10 years and then sell it. You are driving it during the years when it’s still functioning well. You’re selling it before the repair bills start to add up and you don’t pay the premium of driving a new car off the lot.

The big depreciation happens in the first 3 to 5 years. I’m a big fan of that too. The car is not the age, so it’s not the year. The age is shown in the miles. Anybody looking for a used car, try to get something that’s low mileage because a lot of the big expensive stuff happens at 100,000 miles. Even if you get a five-year-old car and get something that’s 40,000 miles or under 50,000 miles, you have a lot of time horizon, especially if you’re Fi.

You ride your bike around and don’t drive as much. This is great advice for people out there. Thanks for sharing that. I want to go into your FI goal a little bit. When you found Mr. Money Mustache in 2013, you were already out of debt. You have your house. Do you think you had paid your house off yet or were you throwing a lot of money in that direction?

No, it was $10,000 or $20,000 at that time. We’d still owed money. I probably paid for the house in 2016 or ’17.

When did you get to the concept of a financial number or a FI goal?

Shortly after reading him, I immediately went to his blog and started reading all the posts and learning about the 4% rule. We picked a number at the time that we thought, “We’re spending $75,000 a year. Multiply that by 25 times.” That was our original FI goal and I have to do the math because it’s been a long time.

I do want to highlight the math of financial independence and Mr. Money Mustache has a great 4% rule blog. You take your expenses, not your income and times that by 25 and that gives you your financial independence goal. Your target was $1.875 million. That is 1.875 in index funds or did you mean total with your house?

For us, it never meant our house. Our house isn’t producing any income other than imputed rent. It was outside of the house. We’re still debating after all these years about whether we’re going to cash out of this house at some point, go to a lower cost of living area and use some of the money towards our ultimate 25 times.

At $1.85 million, what is that a month that you’re spending?

It’s $75,000 a year. If you divide that by 12, it’s $6,500 a month.

Sometimes, the goal doesn’t really matter. It’s more the journey of enjoying your life. Click To Tweet

Even when you were living pretty frugal, you were still spending that much?

At first, it was $60,000 but it quickly ballooned to $75,000. It’s the cost of owning a house. We’ve done a good job of taking care of our house. We’re putting $10,000 even more during the pandemic, a year into fixing things up. I don’t mean fancy furniture and gadgets. I mean structurally fixing our house, yard and all these things. We do a lot of house maintenance and spend $75,000 a year most of the time we’ve been here.

What about having the home paid off? Do you feel like it’s a bit less?

No. It’s about $75,000 with the travel. If you count everything we do, we’re still spending $75,000 a year. I could do the math again and check our credit card bills to make sure. I’ve done a lot through the years to supercharge our savings rate with travel and credit card hacking things. I’m an expert in that stuff. I think of myself as spending a lot of time focused on. We’ve been flying 2 for 1 on Southwest companion pass for years.

Where are you in your goal? The original goal was 1.85 and then you’ve moved your goal up to probably 2.25. Where are you as far as your index funds?

We’re only halfway there. The other half is in the house. Our net worth is $2.1 million with a house being $1 million. Some of it is in the bank for an emergency or something. The goal is to stop working. It’s funny. There are a lot of FI people I’ve met that are itching to quit their jobs. They are trying to get out of the cubicle, which seems to be the typical person. For me, I’ve been working from home for several years and my wife started a business working from home. For us, we’re not dying to quit our jobs. I like what I do. It pays well. She’s just starting.

Getting to $2.25 million as the goal, it’s almost like the goal doesn’t matter anymore. It’s more the journey of enjoying our lives and our savings are on track. We know that at any time, we could cash out of this house and throw a stone on that goal. We’re there already. My net worth went up by 15% since the beginning of the pandemic in two years. The net worth is up to $300,000. I’m not saying that’s going to happen in the next years again.

I don’t know what the next years will bring but the reality is we’re so close to the goal that the goal doesn’t matter as much anymore. We don’t need to quit our job. We don’t want to quit our jobs. We have financial security at this point. I could sell my house, go live on a beach in Costa Rica and never have to work again. That’s official. I know I can do that but if I’m making a lifestyle choice thing, that’s not where I’m going to end up and I don’t think.

It’s great to have the knowledge and security that you can do that. That’s the point. You don’t need to, but you could and you know that. If one day you felt like you were done working, you could make a lifestyle change. This brings me to another question. The market has gone up a lot and we’ve been seeing a big decline. Do you have any thoughts or concerns around a recession coming up or what you guys would do and how you would pivot with that?

I switched from 100% VTSAX to a much more conservative portfolio years ago. I come from the land of nervous financial people. My asset allocation is very different. I’m in an asset allocation that’s 20% VTSAX, 20% small-cap value, 20% long-term bonds, 20% short-term bonds and 20% gold. I’m ready for the next recession, at least, in terms of my asset allocation. I’ve given up tremendous gains probably in the last few years by not being 100% in VTSAX.

Financial Independence: You don’t need a net worth of $10 million to be satisfied or $5 million to retire happily.

 

With the first few years in investing, I had been so far behind. We were pouring the money into 100% stocks. At some point, I was ready to declare victory a little bit. I don’t need a $5 million nest egg. I need to know that our nest egg isn’t going to drop below a certain amount. I’m in a defensive place. The stock market went up 25%, 26% in 2021. My portfolio went up 9%. It was still a good gain but it wasn’t the astronomical gains that we were getting at the beginning of our investing in VTSAX.

With Mr. Money Mustache, I was curious if it made you feel more reassured. If you were looking at Suze Orman at the beginning, she is famous for saying, “You need $5 million. You might end up meeting $10 million or $15 million so people can never stop working.” She breeds a lot of fear. When you found Mr. Money Mustache, even though $1.85 million is a lot, especially if you’re starting with not much, was there some reassurance of feeling like, “That’s not as much as I thought and I can get to that place?”

To a certain extent, his goal was $625,000 because he’s only spending $25,000 a year. For us, it was a little bit more difficult to realize that because we’re a little bit older, we were never going to be able to live at a $25,000 a year clip anymore. I did that in my twenties, even when I was going into debt. We spent what we made but we weren’t making hardly anything back then. I don’t know what to say if I felt reassured or not.

Suze Orman did have that whole fire podcast where she came out against the fire movement, saying that people shouldn’t stop working and should keep working until they have $10 million. I don’t agree with her but what she was reacting to was the linguistics, calling an early retirement when people were quitting the cubicle and starting their businesses or doing side gigs.

To me, that was never considered retirement. If I quit my tech job but become a person who makes their apps and becomes an internet person doing my freelance, to me, that’s not retiring. Mr. Money Mustache works as hard as anybody I know. He likes it. He does side gigs or whatever you want to call it. He gets offended when you tell him he’s not retired. I’m not saying that because I don’t want to start a whole fight. It’s like Suze Orman reacted to the words “early retirement” in a way that was a misunderstanding.

People get into the semantics and that’s not what’s important. People naturally don’t want to be idle. We’re all going to find something else to do but can the world be a much richer place if we’re all doing something that we feel passionate and lit up about rather than something that is killing our soul because that’s going to get us the next step in our career or pay the bills? That’s what this movement feels like to me.

Suze Orman came out with a blog post a month after that whole flare-up saying that if people want to change their careers, she’s totally in favor of that. She was reacting to people lying on a beach in Costa Rica when they’re 40 or something. I don’t know what her perception of retirement was. She wasn’t reacting to the reality of what people are doing with their lives once they have this money saved.

This has been a great conversation. I need to pivot to our final part of the show. Before we do, I was curious if you had any final words of wisdom for the readers.

The world will be a much richer place if people are doing something they feel passionate and lit up about rather than something that is killing their soul. Click To Tweet

I don’t know. That’s so general. Don’t get down on yourself. I had so much regret for a few years when I realized how I screwed up. In my early 40s, I was freaked out that I found myself in all that debt. When my values changed and I realized I needed to start saving for retirement, the amount of regret I felt at the beginning of the process was thick. I look back on all the mistakes I had made. For a while, I beat myself up a few years until I started to make progress. I was pretty hard on myself, so don’t do that. Those are my words of wisdom.

In this second part of the show, I’m going to give you four questions. The first one is, what are you reading?

The book that I’m working my way through is the real work. It’s called How to Retire Happy, Wild, and Free. The author’s last name is Zelinski. It is a workbook of sorts with a bunch of exercises that allow me to work with questions about what my values are? How do I want to retire? Where do I want to be when I finally do stop working? What projects do I want to want to work on? What is most important to me? It’s been useful. I have questions I’m writing out and it’s very introspective.

We’re working my partner out of his job. He’s not that old but we’re hoping that he’ll leave his job in the next few years. He could benefit from a workbook like that. There’s a lot of fear when people leave their steady income if they’ve never been entrepreneurs or never had the liftoff of their real estate or investments. It’s like, “Is this going to work for me?” For him, he’s planning to do a coaching business on the side and that’s his real passion. He’s very excited about it but there is a lot of fear. Would you say that even if you’re not in typical retirement age, this book would be valuable for someone transitioning?

It’s good. It’s a book that allows people to get in touch with what their values are. That helps people at any age.

Question number two, what is the best piece of advice you’ve ever received?

There’s a guy who came to fix a washing machine. He used to live in an old house in East County, San Diego for $300 a month rent on 10 acres of land. It was always breaking. The guy came to fix our washing machine. I call him the Maytag repairman many years ago. He came into my house and said to my girlfriend and me at the time, “You kids are spending all your money. I don’t go to any movies or concerts. Every single penny I make goes into the bank.” Ever since that, I refer to him as the Maytag repairman, the best advice we ever took.

That’s like the ghost of Christmas past or something. It was a glimmer of your future like, “I’m going to drop this here and maybe I’ll remember this later.”

It’s crazy. I looked at him like, “This guy is nuts.” He seemed like a crazy old man.

You’re going to do that. You’re going to, in turn, go around and give people unsolicited financial advice.

I don’t know how to fix washing machines, so I’ll never be the Maytag repairman. I help people get out of debt, especially friends and family. I’ve Zoom with ten couples in the last few years. My advice works for people that are in debt the most. Investing advice is more fraught. Once people have options and investments, there are so many opinions. Getting out of debt and some basic principles, I’ve been able to share that with friends and family and help people.

Financial Independence: If you save money first in your twenties, you’ll be able to do more things with financial peace of mind along the way.

 

Question number three, what is your why?

The most important things to me are my marriage, financial security, my health, leaving the world a better place and I care about the environment. We’re farmer’s market people, shopping for all organic foods and so on. That’s my why.

Question number four is if you had to go back and tell yourself at 40, when you were in all this debt from the position that you’re at, what would you tell yourself?

I’m an overthinker and an obsessor. It’s easy to feel regret when you’re thinking, “I made this mistake.” What I would say to my 40-year-old self is, “Relax. It’s a journey. There is progress along the way. Patience will ultimately reward you once you see the progress that you’re making.” If I had less regret at the time, I would have relaxed and had more fun. It would have been an easier journey at the beginning. Maybe I needed to kick myself in the butt a few times to get myself going, but ultimately, I would’ve ended up in the same place without beating myself up.

If anybody wants to reach out to you after the show, what’s the best way for them to get in touch with you?

I have a Linktree and all of my contact information is on that Linktree. Everything is right there.

Thank you so much for being on our show. I appreciate you sharing your story. We’ll have to see you again.

Thanks, Zeona. This was fun.

That was Ron Schneider. That was a great episode. He is a show virgin, so we had a few tangents and storytelling. What I loved is that he highlighted how you can start late and still achieve your goals. He wasn’t as frugal as people like Mr. Money Mustache and some of the younger people on here can be. Don’t get down on yourself if you’re in debt or feeling like your savings is happening so slowly. There are things like real estate that we talk about here.

There are hacks like pet-sitting, even some other hacks that we didn’t get into about credit card hacking can boost your savings. If you’re trying to get there fast, know that there are lots of people out there that have done it in 2, 5, under 10 years. You’ve still got time. Thank you so much for being here. If you would like, you can leave us a rating or review. We appreciate that. Share this episode with your friends. We will see you in the next episode.

 

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About Ron Schneider

Ron Schneider has gone from $60K in debt in 2006 to a net worth north of $2 million in the past 15 years. He has used reduced spending, index funds, credit card hacking, etc. to supercharge his savings rate.

He has been reading FI blogs since 2013. He can be reached at https://linktr.ee/RonSchneider