FISH | Financial Independence Seeking Happiness: Life

Fragilista - Part 2

Contender 1 Black Swan, Dividends, downshifting, early-retirement, Life, survival 08:01

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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgXwAoXjEgKEvl3-F4XwJgGG12uNV84XrmmEkqzAtmV-2kuI97Dbhj0zC1ZLurY4WOrK0NffkfyQT7gNHHYWkPZk72pDdxWpgOtJeR3IxoVhwXCyGfqrqZEHmUGIDz_sHy-bTz3q92rOxr9/s1600/P1080350.JPG" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="240" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgXwAoXjEgKEvl3-F4XwJgGG12uNV84XrmmEkqzAtmV-2kuI97Dbhj0zC1ZLurY4WOrK0NffkfyQT7gNHHYWkPZk72pDdxWpgOtJeR3IxoVhwXCyGfqrqZEHmUGIDz_sHy-bTz3q92rOxr9/s320/P1080350.JPG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Low cost fuel and no moving parts - a robust heating solution</td></tr>
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Have you ever wondered how some people get rich and are able to grow their wealth? 
 
In <a href="http://getintheringwithme.blogspot.fr/2017/01/Financial-Planning.html" target="_blank">part 1</a>
 I covered the principles of financial independence and shared a planning tool to work the numbers. I highly recommend you <a href="http://getintheringwithme.blogspot.fr/2017/01/Financial-Planning.html" target="_blank">check it out here  </a>before reading this post. 
 
Today it is all about taking "Talk the Talk" about wanting to be financial independent, happy and resilient to reality by "Walking the Walk". 
 
 
<blockquote class="tr_bq">
I gained an interest in wealth accumulation through a very dynamic friend Chris in 
university. He would read every autobiography of a successful person he 
could get his hands on and say that was going to be him one day. 
 
My take at the time was to get a good job work 
really hard and work my way up the ranks. Little did I know at the time 
that this actually takes a long time. After a few years I started to read up about rich people like Chris did. My general take at the time that they were not afraid to invest and take risks. So I changed jobs and started investing badly. I had a severe lack of financial knowledge and was letting myself to be guided by speculative investment newsletters.   
 
My first breakthrough was coming across the blog "Early Retirement Extreme" which turned on the light bulb of frugality = increased investments and a few blogs on dividend investing. Eventually I joined the dots to frugality = increased investments = increased passive income => financial independence + increased freedom. 
 
My second breakthrough was understanding the need to build resilience. This was triggered by two topics. First the blog LATOC - Life after the oil crash website (which no longer exists) which highlighted that the world is not infinite so some self sufficiency is a good thing. The second topic was the tech boom and bust followed by the sub prime meltdown and oil price crash which moved our investments all over the place. Importantly we waited it all out teaching us to be long term investors. We are unable \ lack the knowledge to "trade" short term effectively.  </blockquote>
<blockquote class="tr_bq">
Finally I started to read about "Black Swans", "Business Cycles" and "Capital Flows". This made me realise that we needed to be serious about resilient living. This allows us to continue to live frugally and use the savings to re-invest in even more income investing assets. This is to help us ensure we can keep the financial independence dream alive indefinitely.</blockquote>
So today this post is all about what we are doing to keep the FI dream alive: 
<ul>
<li>A look at some potential risks we want to counter (several graphs)</li>
<li>Our "Walk the Walk" anti-fragile changes we are making to our lives (financial and at home)</li>
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<ul>
<li>Personal - Family education \ health </li>
<li>Sustainability \ Antifragility - reducing our reliance on outside help</li>
<li>Community - Engage in the local community and with friends</li>
<li>Financial - building diverse assets and income (Our latest financials)</li>
</ul>
<li>Inter-generational wealth building </li>
<li>How you can start on the road to antifragility  </li>
</ul>
<ul>
</ul>
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<h2>
Why we want to be Resilient</h2>
Over the last 10 years I have read, 
learnt, been lost by and perplexed by economics and life. My lifestyle has been 
cajoled by consumerism, dazzled by technology and awed by my ability to
 travel. Our modern world is great and we want to participate in it. 
 
We are looking at a substantial period of time without "jobs" and have two kids to raise. We need to make sure our standard of living remains the same or improves by: 
<blockquote class="tr_bq">
"Hope for the Best, Plan for the Worst"</blockquote>
In hoping for the best: we are waiting for battery storage to make the next step, solar panel efficiency to go to the moon, nuclear fusion, 99% recycling and an iRobot to do all our heavy lifting. 
 
While we wait for this Utopia we should "hedge our bets" and "plan for the unexpected".  I want to point out we are not Doomers but Realists. Risks may be small but we are well aware black swans can appear. For example having some alternative sources of lighting if a storm takes out the power lines for a few days is appropriate and cheap to implement. 
 
Other risks are harder to mitigate. Here are a few risks worth considering: 
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<ol>
<li><table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi13n1KT5u1-wX-EzErxzDPcsbjKgWIewJ4pWvGTJvS-VSqPiUVREOqJXrEgO5TIsOvZaro3VQUj8zEioWeb5gs2RF4nu8736YzI2corDHb3E3Y9zZ75eDZwtr8c5SlkidB9CYHJrxp0gbX/s1600/2035.PNG" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi13n1KT5u1-wX-EzErxzDPcsbjKgWIewJ4pWvGTJvS-VSqPiUVREOqJXrEgO5TIsOvZaro3VQUj8zEioWeb5gs2RF4nu8736YzI2corDHb3E3Y9zZ75eDZwtr8c5SlkidB9CYHJrxp0gbX/s320/2035.PNG" width="245" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source http://populationpyramid.net/</td><td class="tr-caption" style="text-align: center;"> </td></tr>
</tbody></table>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjVXLVUe15n6uW8jbzG6-LZfX3cr_k1tGVWt3b_bcRjk7wIdqAcgqQwZ-TFqHf5U3TuGoITUog1eVrhvTHmU9TrQfqKXfjWKQjvaIPBdoYrTwkHkliPnv7Fqzt3eCIjYCnOUtiIWJ8ybiDH/s1600/2015.PNG" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjVXLVUe15n6uW8jbzG6-LZfX3cr_k1tGVWt3b_bcRjk7wIdqAcgqQwZ-TFqHf5U3TuGoITUog1eVrhvTHmU9TrQfqKXfjWKQjvaIPBdoYrTwkHkliPnv7Fqzt3eCIjYCnOUtiIWJ8ybiDH/s320/2015.PNG" width="250" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source http://populationpyramid.net/</td></tr>
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Society is now rapidly ageing\ retiring in the west and dependency 
ratios are rocketing. 
Pension funds are massively underfunded and assume
 large percentage YoY growth. Risk: large liquidation of stock and housing by boomers paying for their retirement. Tax rises to pay for services and entitlements that are underfunded by the tax receipts caused by a drop in the workforce to retiree ratio? <table border="0" cellpadding="0" cellspacing="0" style="width: 163px;"><colgroup><col width="79"></col><col width="84"></col></colgroup><tbody>
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  </li>
<li><table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><img alt="CHART OF THE WEEK: European Debt-to-GDP Ratios | The Economic Voice" class="detail__media__img-highres js-detail-img js-detail-img-high" height="203" src="https://images.duckduckgo.com/iu/?u=http%3A%2F%2Fwww.economicvoice.com%2Fwp-content%2Fuploads%2F2013%2F10%2FEuropean-Debt-to-GDP-Ratios-Oct-2013.jpg&f=1" style="display: block; margin-left: auto; margin-right: auto;" width="320" /></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source: <a href="https://www.economicvoice.com/chart-of-the-week-european-debt-to-gdp-ratios/" target="_blank">www.economicvoice.com</a></td></tr>
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Debt has been piled on at 
staggering rates. It is only really backed by the faith that some poor fools will foot the bill (us the tax payers). Risk: Debt jubilee, high inflation, currency devaluation, new currency? </li>
<li>Assumptions on 
property prices are <table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhjE6IHdx7kRYEIRdQykxC_nzkNWGmAipHlcsI2r485tfUdSagHwf_MljdeOnboF4sUWPLQLefbqFWHsWJmTScOlR9TfJ2loI0kNufveQx0-aPe09Z9pBp_ARM_Cv6KthYOE1FMtGOZ0p5I/s1600/10Yr+Treasuies.PNG" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="180" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhjE6IHdx7kRYEIRdQykxC_nzkNWGmAipHlcsI2r485tfUdSagHwf_MljdeOnboF4sUWPLQLefbqFWHsWJmTScOlR9TfJ2loI0kNufveQx0-aPe09Z9pBp_ARM_Cv6KthYOE1FMtGOZ0p5I/s320/10Yr+Treasuies.PNG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Is it time for interest rates to rise.....The million $$$$ ?</td></tr>
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potentially widely wrong - low interest rates and 
credit have driven prices sky high. They are unaffordable to the young who can not get the
 high paying jobs needed to even get a deposit together. Risk: Onerous under water mortgages suppressing property values and rental incomes or a period of high inflation eroding their real value? <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhjE6IHdx7kRYEIRdQykxC_nzkNWGmAipHlcsI2r485tfUdSagHwf_MljdeOnboF4sUWPLQLefbqFWHsWJmTScOlR9TfJ2loI0kNufveQx0-aPe09Z9pBp_ARM_Cv6KthYOE1FMtGOZ0p5I/s1600/10Yr+Treasuies.PNG" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a> </li>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://www.newscientist.com/data/images/archive/2605/26051202.jpg" rel="nofollow" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;" target="_blank"><img alt="Source newscientist.com Click to Enlarge" border="0" height="196" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgwl2eWIlIXf0ZMut4TLkmnHfQa9eSkFhC3zJ-Yba4lLxH7021qaGn-pIEhY9_NhdmDDYN-GvvZ00f9HAJaH8Nob-sDh_noLb7b9OfMbJ0aS_9DANlB6_naFHNZqZuKFj_9DockVdtlArbV/s320/Years+Left.PNG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source: Newscientist click to enlarge</td></tr>
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<li>We all 
live on one planet and consume more of its resources each year than can 
be replaced by equivalent alternatives. Liquid fuels, metals, fish, 
lumber and soil. This is just another form of debt we are piling on and 
the bill will become true at some stage. Risk: Lack of resources to build out our technological society of the future? </li>
<li><table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgGWyPzjir7tFI4CtjEXpgHvssK0dWzkMMLROvwXjGijSdZmEUoAQATm_JDEkC4RY3Eg3JelAEIoCJigjq_uWXnp3abi5iXVRCzn1H7UCM0WHkosfgpRbsU-UeSlkIPg6CdiURKwBitzapY/s1600/Soil.PNG" style="margin-left: auto; margin-right: auto;"><img border="0" height="221" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgGWyPzjir7tFI4CtjEXpgHvssK0dWzkMMLROvwXjGijSdZmEUoAQATm_JDEkC4RY3Eg3JelAEIoCJigjq_uWXnp3abi5iXVRCzn1H7UCM0WHkosfgpRbsU-UeSlkIPg6CdiURKwBitzapY/s320/Soil.PNG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source: <a href="http://www.seafriends.org.nz/enviro/soil/erosion1.htm">seafriends.org.nz</a></td></tr>
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It is about time food production
 is  re-thought to re-build soils that have been degraded 
by the green revolution. Organic farming (including pest and weed control), low tilling soil and replanting hedgerows and trees are gaining ground around the world. Perhaps the days of the 6000 mile lettuce has 
almost had its day - you can easily grow one in your basement with the 
right setup. Risk: large increase in cost of food as more resources are dedicated to its production?</li>
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</div>
</ol>
<h2>
What Resiliance means to us</h2>
My personal take on resilience is OPTIONS. Lots of them. Options to move, different income streams and multiple ways to provide the basics (food, water, shelter and warmth). 
 
As early retirees we have a likely 40+ years ahead of us. A lot of things can and will happen in those 40+ years. Most of them will be surprises good and bad. OPTIONS will either allow us to take advantage of these changes or ride them out. 
 
Staying financially independent = fix up our place, be 50% + self sufficient and build excess income streams. 
 
We need to be able to offset the risks we have listed above (and others) and setup our investments to to take advantage of any opportunities. 
 
This "work" has taken priority over this blog in the last year. We have been super busy but the benefits have been amazing for us. We are so happy that we have taken steps to anti-fragile our lifestyle which has relieved some of our anxiety of going it alone. 
 
First up here are our Anti-fragile / Resilience goals: 
<ol>
<li>We want to provide a normal middle class up-bringing for our kids and afford them opportunities to grow. This requires us to at least maintain our inflation indexed income and ideally grow it. We need to be able to ride out any large unexpected bills and save for the kids education.</li>
<li>Not to be a burden to the state \ provide adequate funding for our lifestyle through low living costs, excess passive income and a small amount of paid work. We will pay our fair share of taxes on time and limit our impact on local amenities (e.g. less waste, support fund raising for the school etc.)</li>
<li>Reduce our reliance on external resources - we will source as much of our food, building supplies and fuel locally.</li>
<li>Look after our health (again reducing the cost to state) eat our own organic food and fruit, cutting wood, cycling instead of driving etc. </li>
<li>Engage with other people, to share resources to help with maintenance issues for example. </li>
</ol>
<h2>
4 action areas</h2>
We have decided to consolidate our actions in to 4 main areas 
<ul>
<li>Personal - Family education \ health </li>
<li>Sustainability \ Antifragility - reducing our reliance on outside help</li>
<li>Community - Engage in the local community and with friends</li>
<li>Financial - building diverse assets and income</li>
</ul>
<h3>
Starting with our Personal Gaols</h3>
Adult Education - We continue to read up on wide ranging topics 
(Super-forecasting, Logic, Perma- 
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culture \ Market Gardening, the 1930's, 
Solar Energy to name a few) and most importantly put these into practise. An example 
of this covered in more detail below is our ability to grow our own 
food and generate some of our own energy. This improves our finances and health. 
 
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEEeJUmovd94-JDI2UQwBml7YKK41iEGolEzxji18lBZj_Z4ghSP8oOyyZOFu9boQqmFjZi5LsMaQ-DURSZIWOUfKhg5BpABKcIGaIKxRRM7fxC87sIE_NrObi3cgtmQROgvbGTJdfcI2d/s1600/DSC_0181.JPG" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEEeJUmovd94-JDI2UQwBml7YKK41iEGolEzxji18lBZj_Z4ghSP8oOyyZOFu9boQqmFjZi5LsMaQ-DURSZIWOUfKhg5BpABKcIGaIKxRRM7fxC87sIE_NrObi3cgtmQROgvbGTJdfcI2d/s320/DSC_0181.JPG" width="212" /></a>Kids 
education - we continue to encourage the kids to learn through play and 
experience. The TV has long gone. This been a brilliant thing to do as their play is more beneficial helping them to develop personal / communication skills, anger and conflict management. 
The both take judo classes which we hope will help with confidence, control and respect. 
 
We take them to museums (locally we have a school and a bee\ honey museum, down the road we have the Airbus museum). We 
engage them in day to day activities, cooking, gardening, cleaning, 
painting etc. They are learning 4 languages.... wowser!  I struggle with English let alone French. 
 
Lifestyle - An added bonus is lifestyle here in the south west of France. It is a
 holiday for us. Our local town has just been added to the Michelin guide. In fact our whole area is a hot tourist area with lots
 of things to do. We have easy access to the Mediterranean and Atlantic coasts 
as well as the Pyrenees mountains. 
 
We continue to improve our house and land. We are renovating, planting, repairing and cleaning. We love our flowering pots around our terrace, the picturesque views and starry nights. 
<h3>
Sustainability & cost reductions \ savings</h3>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi8-UWfaUdD4ESx2rHKuxYN7jLFd6lxzinXZDaBRm4HVNZB5qHTtGjcKWy7dkSsP1JPqg0cSRFWaDFlyMAw6sXtdY_5EPOoi6SM2g-AwaPRqfOAfGsP1J5WWJLaO0Gn7XEpMhM_Cz2hidPQ/s1600/P1080133.JPG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="240" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi8-UWfaUdD4ESx2rHKuxYN7jLFd6lxzinXZDaBRm4HVNZB5qHTtGjcKWy7dkSsP1JPqg0cSRFWaDFlyMAw6sXtdY_5EPOoi6SM2g-AwaPRqfOAfGsP1J5WWJLaO0Gn7XEpMhM_Cz2hidPQ/s320/P1080133.JPG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Our preserves from the garden and batteries for 
off grid solar system</td></tr>
</tbody></table>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgVBY4pvs2H3f9bEHJM9r8f9fK7TTI6OiBFI5x3udsydHPkLJTO_B6iW4Sp6nXaKW0E64QhEao0PATvYXRMHiJb4YOrjZpoxv3g-dDw1IYEED8gKpX6_LcDJ7HDQZOhV3VwgL2AySj00ev9/s1600/Solar.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgVBY4pvs2H3f9bEHJM9r8f9fK7TTI6OiBFI5x3udsydHPkLJTO_B6iW4Sp6nXaKW0E64QhEao0PATvYXRMHiJb4YOrjZpoxv3g-dDw1IYEED8gKpX6_LcDJ7HDQZOhV3VwgL2AySj00ev9/s320/Solar.PNG" width="280" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><a href="http://eco-worthy.com/">eco-worthy.com</a> wind solar off grid system</td></tr>
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<ul>
</ul>
 
<ul>
<li style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"> <div style="text-align: right;">
</div>
 
 
</li>
<li>We have built an intricate gravity and solar fed 
irrigation system - reducing our demand for mains water and allowing us to grow lots of lovely veg.</li>
<li>Done as much renovation work as possible by ourselves saving thousands</li>
<li>Replaced lots of damaged roof tiles </li>
<li>We have started to build a 
perma-culture garden, permaculture mounds, a couple of ponds and a poly 
tunnel.  </li>
<li>We have invested in manual garden tools.</li>
<li>We have invested in preserving equipment and Mrs C has been really busy canning (Bocals)</li>
<li>We have purchased a sun oven to cook and preserve our food </li>
<li>We have planted more fruit and nut trees </li>
<li>We have started making our own compost without fuel and fertilisers. It has no 
requirement for machinery only hand tools.</li>
<li>We have installed an off grid solar and wind system and are 
currently adding the option to run the whole house off it as required. 
It is a 1.4KW system (1KW solar and 400W Wind) with 4*130AH batteries. This system running at 1/3 of capacity daily = 1.4KW * 1/3 * 24 = 11.2 KWh per day Our average house consumption we believe is around 8.3 KWh per day (350 AH per day @ 24V) The
 only issue is that the battery bank (the 4 batteries give 260AH @ 24V) 
is not large enough for a prolonged period without the system running at
 1/3rd of capacity. 
</li>
</ul>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg5xuiftzpCFkMOjt8Sh1Yi6yiiPU7K2R3CRzJr9vpE3WFGG5VLoJua9bCJK0lxbk0VQuwzoD6P3FkfM4n3R2b3lnIeO77L9HsVymF9H5NuWmvk_aP18G2B5ofS6EP1srlJ-Oa2auxQyJMw/s1600/P1080158.JPG" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="240" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg5xuiftzpCFkMOjt8Sh1Yi6yiiPU7K2R3CRzJr9vpE3WFGG5VLoJua9bCJK0lxbk0VQuwzoD6P3FkfM4n3R2b3lnIeO77L9HsVymF9H5NuWmvk_aP18G2B5ofS6EP1srlJ-Oa2auxQyJMw/s320/P1080158.JPG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Our Permaculture "mounds" 
which have now been planted with fruit bushes</td></tr>
</tbody></table>
Benefits 
<ol>
<li>We can save and invest more each month increasing safety nets and future options </li>
<li>We are growing our own organic food - this is exercise, provides healthy meals (Vegan) and saves money</li>
<li>We are able to use resources on our land (we have solar electricity and hot water, a
 gravity fed water source, trees for firewood, fruit and nut trees, and 
we are developing good soil). </li>
<li>Our kids are learning real world skills with us such as solar system installations and calculations, water flow and management.</li>
<li>We are not buying loads of rubbish "entertainment" for the kids - they play outside making their own games. </li>
<li>We can repair things ourselves which is satisfying, saves time, money and stress.</li>
</ol>
We have reduced our necessary living costs (2 adults and 2 children) to ~£900 (1,050 EUR, ~1,170 
USD) per month (property tax, food, utilities, school fees and cars) as of Sept 2016. We can live on much less if needs be. 
 
From an Antifragile standpoint - we are able to provide for ourselves in an emergency and have reduced our "fixed" living costs. We have learnt additional real world skills that allow us to do things for ourself. 
<h3>
Friendships & Community</h3>
We have abnormal living arrangements in a normal community of hard working individuals. The "abnormal" part is that we do not have "normal" work and "normal finances". Talking about financial independence and resilience building seems almost taboo... We try not to talk about unless someone specifically asks. 
 
Financial independence is a bit like talking about how much you earn (ironically it is fine to talk about how much you spend;) see the following <a href="http://www.elle.com/culture/career-politics/a28515/why-cant-we-talk-about-how-much-we-make/" rel="nofollow" target="_blank">article.</a> I often wonder why this is the case. Surely it would be beneficial to know if you are being paid fairly? Wouldn't a discussion on money, budgeting and investing be beneficial for people to have? So talking normal finances or investments is not really touched either. 
 
 
Work has become so hectic and all encompassing most people do not have time to have a go at sustainable living. After all it is a lot of additional "work". Do you have the energy to dig the garden, chop some wood or insulate the house when you get home late and exhausted from work? Promisingly on this topic we are finding that people are more interested in this area and are taking small steps. 
 
Sport, weather, holidays, kids, homes and mainstream hobbies are all in the easy bucket. A good way to chat over a beer. We live in an outdoor party area so BBQ's are great places to catch up and make friends. 
 
Ultimately friendships take time and a lot of work. We can definitely do better. We want to have fun and relax with friends so it is important we build rapport by talking about stuff they are interested in.  So KISS (Keep it simple stupid!) really works here :) 
<h3>
Financial</h3>
Our financial plan is quite simple - take part in the ownership of productive "cash flow" assets. Have skin in the game. Our trading accounts are invested in individual companies. Our pension choices are limited to funds. We have part ownership of some commercial real estate. 
 
Thankfully building income is easy and can be done in small increments over time. We do this primarily through share and bond ownership. Lending clubs have also become popular. 
 
Unfortunately very few people we know actually"invest" perhaps due to the risk warnings written across all financial products. They rely on earned income. Any spare cash is generally not put to work but "saved" as cash or spent. 
 
Inflation means cash "value" is eroded instead of growing and providing an income through positive interest. Investing in dividend stocks opens the door to capital gains and cash flow. Admittedly you need to hold some cash - it gives you quick access, options to deploy the cash to an opportunity. 
 
Ownership can be expanded to other assets such as forestry, agricultural land, commercial property, private company investment etc. 
 
Our financial actions to increase our assets are as follows: 
<ul>
<li>We have opened tax efficient share savings vehicles in France (PEA - stocks and shares)</li>
<li>We are saving cash in multiple currencies (GBP, EUR)</li>
<li>We continue to re-invest dividends</li>
<li>We are investing in alternative diversified real assets (Sustainability projects, REIT (commercial real estate))</li>
<li>Mrs C's has setup as a small business </li>
<li>We have been saving for the kids who both have savings plans based on the permanent portfolio approach. (25% fixed income, 25% Shares, 25% Cash, 25% Commodities)</li>
<li>We have made our wills</li>
</ul>
Our preference is a take on the permanent portfolio approach.....at the moment we are overweight global stocks and underweight bonds and cash and commodities due to historical reasons and the way our pensions work (limited choice). 
 
Pensions 
<div class="separator" style="clear: both; text-align: center;">
</div>
 
Global Stocks (EQ) 
Bonds (BN) - Final Salary Pension Scheme mainly high quality bonds 
Commodities  - (GLD) 
 
These have seen phenomenal gains on a small investment 500%+ since inception due to matching contributions from employers and the power of compounding. Both Mrs C and I joined our schemes as soon as we started work. We cannot access this money for 25 years...... 
 
Income 
 
Dividend growth stocks (EQ) 
Commercial Real Estate Investment Trust (PR) 
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhGfEUgec6bIYbP7_pHSHb8TRXr7-mipGfnwxCZjsUbz4XDcZ9eTG7SEag14CaMNsj98hsb9THNJ2B6mz5h05JXTTF4IG9W_OcoN0T0wq4YMOzAal_exVaEzrcuNWdkJAOna7qAv0l8DOYQ/s1600/Financial+Investment.PNG" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="252" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhGfEUgec6bIYbP7_pHSHb8TRXr7-mipGfnwxCZjsUbz4XDcZ9eTG7SEag14CaMNsj98hsb9THNJ2B6mz5h05JXTTF4IG9W_OcoN0T0wq4YMOzAal_exVaEzrcuNWdkJAOna7qAv0l8DOYQ/s320/Financial+Investment.PNG" width="320" /></a>French PEA tax exempt stock and share account after 8 years of holding (EQ) 
 
Cash 
 
GBP and EUR (small holding as neither currency is great at the moment) (CA) 
 
 
 
 
 
 
 
 
On the EXPENSES front our current budget is 1,709 Euros per month (~£1,450, ~$1,828 - FX is moving all over the place). 
 
This includes 300 Euros per month for holiday and entertainment, school fees (150 Euros) and after school activities (70 Euros). 
 
Our "bare bones" costs if we had to extreme economise would be 730 Euros per month. 
 
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgerUqq94Ad5AMX9jfdOe3TKrhn5Za8CayVddaFLrGfzPlSW8TlJVXkZCjrFY9JtSdth_TJPNuveAxjYJibnaV9UL0ZSlWOeJU3Jruwt5Yk2i73ecRInfrW7Uig9uwuRCIXmI3rqhkz86d-/s1600/Expenses.PNG" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="296" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgerUqq94Ad5AMX9jfdOe3TKrhn5Za8CayVddaFLrGfzPlSW8TlJVXkZCjrFY9JtSdth_TJPNuveAxjYJibnaV9UL0ZSlWOeJU3Jruwt5Yk2i73ecRInfrW7Uig9uwuRCIXmI3rqhkz86d-/s400/Expenses.PNG" width="400" /></a></div>
<ul>

</ul>
We
 have ample safety nets, live a comfortable middle class lifestyle and 
do not go without anything. Our activities make us more robust and able 
to be in control of our lives. 
<h2>
Now Build Your Resilience</h2>
There are major benefits of building resilience and many steps will actually get you to financial independence earlier. 
<ol>
<li>You will reduce your living costs (hence save more)</li>
<li>Learn to do things for yourself such as basic plumbing, gardening</li>
<li>Start to adapt to a new way of life - a financially independent way of living</li>
<li>Be risk aware and adapt your plans accordingly</li>
</ol>
Considering these points (and some of the above risks) I believe that building resilience is an absolute must. Again 
<blockquote class="tr_bq">
"Hope for the best and plan for the worst" </blockquote>
Considering the needs of resilience building this means early retirement is MUCH more than just investing to replace earned 
income to retreat to the beach. 
 
You can't leave all your eggs in one or two baskets or leave them to chance. I suggest you
 need to continue to live well within your means. Consider emergency planning (which usually requires more money than you think). Be able to look after ourselves in a 
time of difficulty such as a natural disaster. 
 
Additionally we need to take opportunities when they come our way (such a a bit of paid work). Use our new found freedom from debt and wage slavery to develop new skills to keep our mental skills sharp and hopefully gain a cash flow from them. 
 
Some resilience building strategies that come to mind are: 
<ol>
<li>Aim for low "fixed" living costs and continue to drive them lower - we have below average bills for utilities, cars and fuel.</li>
<li>Some self sufficiency in water, energy and food - make sure you live somewhere where you can provide some of the necessities of life on your own.</li>
<li>Easy to get a job if you need to (CV up to date etc) - can you work from home \ setup an on line business - give it a go and perhaps it could become your job.</li>
<li>Diverse income streams - Property, Shares, Work, Interest, Bonds, Capital gains. </li>
<li>Continued monthly saving - 10% per month as a minimum? </li>
<li>Have a large rainy day fund - 6 months + of living costs? </li>
<li>Speculate to accumulate (have 5% of your savings going for big gains at high risk)</li>
<li>Do stuff you enjoy - if you are not happy perhaps early retirement was not for you?</li>
<li>Continual learning - great for spotting opportunities and problems. I believe this is a good balance between opting out and keeping a good foot in the real world. Isolationism we believe is a dangerous approach to take when you need the help of others and want to have normal relationships. Extreme frugality (without excess cash flows) leaves you vulnerable and open to shocks. Lack of resilience could have you back to work to recover a capital \ cash flow shortfall quicker than you think. </li>
</ol>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgZcq3rK-SXzTK3tkEf934ky_nFcDG_QxxydMicB-G6_wYKVqkAgfWHl_EJuaiA0XaujZlqUje85Jd3BjcVnhgIskDzzirtQABzK7YAAHCSLj3KzZWO8kHVKTgEH28A7T1MC63fCCx5YBv9/s1600/disqus.PNG" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgZcq3rK-SXzTK3tkEf934ky_nFcDG_QxxydMicB-G6_wYKVqkAgfWHl_EJuaiA0XaujZlqUje85Jd3BjcVnhgIskDzzirtQABzK7YAAHCSLj3KzZWO8kHVKTgEH28A7T1MC63fCCx5YBv9/s1600/disqus.PNG" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Commenting using Disqus</td></tr>
</tbody></table>
** I have installed a new commenting tool for this website DISQUS which makes it easier to add comments depending on what type of account you want or just leave an Anonymous comment if you would like any more information or add useful information. 
 
<ol>
</ol>
 
Peace, prosperity and happiness 
 
CoNTeNDeR 
 
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Fragilista - Part 2

Low cost fuel and no moving parts - a robust heating solution Have you ever wondered how some people get rich and are able to grow thei...

Fragilista - Part 1

Contender 0 Early Retirement, Finance, financial freedom, Inflation, Investing, Life 11:55

<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; margin-right: 1em; text-align: left;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgKbDYxlgTwvAiGjYpQbnH4mjq2ITL0w5qPX7CFqf37GN9NIWUfwsuJy1CeLcmyXlqQioTOue1F_909H7T-c-wKDzlDIzyTG13QCa78Cb2yhVVsziXREB9hfztL0E0kXCTk2Ji-8BJt-nTk/s1600/P1050243.JPG" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="240" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgKbDYxlgTwvAiGjYpQbnH4mjq2ITL0w5qPX7CFqf37GN9NIWUfwsuJy1CeLcmyXlqQioTOue1F_909H7T-c-wKDzlDIzyTG13QCa78Cb2yhVVsziXREB9hfztL0E0kXCTk2Ji-8BJt-nTk/s320/P1050243.JPG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Our very fragile sink - we are chucking everything at the 
kitchen sink of 2017 to make it as successful and 
anti-fragile as possible</td></tr>
</tbody></table>
Welcome to a New Year of new opportunity ladders and slippery snakes.  
 
This year I am kicking off with the basics on how to achieve Financial Independence with a link to my <a href="https://sites.google.com/site/lifeplanltd/home/TimeLine_Financial.xls?attredirects=0&d=1" target="_blank">updated Financial Independence Timeline planner</a> that allows you to create a basic budget, track spending and create a financial independence plan. 
 
I will cover a bit of media bias (plenty here;) in the wold of fake news and risk planning especially focus on becoming anti-fragile (Courtesy of Nassim Taleb) 
 
In part 2, that will be released later, I will 
 discuss our anti-fragiliska actions and what you can do. 
<h2>
Early Retirement does not have to be a dream - maths 101</h2>
<div style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;">
I have read a lot of articles from the FIRE community and mainstream media. Some are very good at highlighting how it is possible to save what can bee seen as a daunting wad of money. Some talk of extreme "sacrifices" made at a young age to do this. In reality it is sensible to choose somewhere in between. 
 
A happy financial independence is possible with a reasonable wad. It is possible to avoid extreme living arrangements to get there. We "retired" at age 37 and still managed to have a great time along the way. How? 
 
Simply - we worked (at education to get good jobs where we put in the required effort) and saved hard all our lives (50%+ of our after tax income) - <a href="https://www.amazon.co.uk/Grit-Passion-Perseverance-Angela-Duckworth-x/dp/1785040189/ref=sr_1_1?ie=UTF8&qid=1484472770&sr=8-1&keywords=grit" target="_blank">See the book Grit</a>. Secondly live with a good standard of living but nothing extravagant which is the premise of the book "<a href="https://www.amazon.co.uk/Millionaire-Next-Door-Surprising-Americas/dp/1589795474/ref=sr_1_1?ie=UTF8&qid=1484472896&sr=8-1&keywords=The+Millionaire+Next+Door" target="_blank">The Millionaire Next Doo</a>r". 
 
A middle class lifestyle is a luxury and there really is no need to overstretch yourself with "luxury goods" trying to keep up with the "Joneses" or "Showing Off". A middle class lifestyle in this day and age means access to cheap world travel, indoor toilets and central heating. These are luxuries in their selves and were not available until recently. Obtaining financial independence just means understanding and applying the following maths: 
<blockquote class="tr_bq">
The MAGIC of COMPOUNDING and the RULE of 72. Divide 72 by the rate of return you obtain and this gives the time for the initial amount to double. If you have 50,000 saved and get a 10% return in 7 years you will have 100,000, 14 years 200,000, 21 years 400,000 etc. This is with no additional capital added! Sprinkle some in and this process speeds up dramatically.  
 
The secret is that at first you don't see the nest egg grow much - the power of 72 is hidden.  Add in a sprinkling of the ups and downs of the business cycle and it is easy to see this as a deterrent - it is not working....persistence is the key.</blockquote>
<blockquote class="tr_bq">
Secondly how much do you need to live off in FIRE 15,000 per year? This requires an investment pot of around 214,000 returning 7% a year........(too aggressive for me - but it is quite startling) 
 
15,000! This surprisingly goes a very long way when you house is paid for, you live in a country that has good health coverage (providing you pay your taxes) and you have low living costs by SMART living choices. </blockquote>
<blockquote class="tr_bq">
BIG IDEA: Do not be part of the heard, save as much as is reasonable and make sure the money is put to WORK providing an INCOME (not a speculation or gamble).</blockquote>
To help you visualise how this all works I have updated my financial independence time line planner with new budget and spending tracking sheets (excel spreadsheet). 
 
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://sites.google.com/site/lifeplanltd/home/TimeLine_Financial.xls?attredirects=0&d=1" style="margin-left: auto; margin-right: auto;" target="_blank"><img alt="TimeLine_Financial.xls" border="0" height="152" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgTBQKRWQKsRKNedGhHOJJVCFo3JLHg5MPBwzo4ov_OUHZ1ieUjW1sDEzq68J1F1XIIADEn94hctjbwFeQyg-IH757skuxLaO31qey9E3L8Ja94n-zOFnS_pQ28QWxpyJis-uYshHwpvp7_/s400/Timeline.png" width="400" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Click on picture to download expense tracking, review, budget and financial time line*</td></tr>
</tbody></table>
<h2>
Can it really be so easy - if so why don't more people do it? </h2>
First up were are told it is not possible - daily. Retirement has been dolled up over the years as golf, beach, cruises. All of this is a massive sales job. Before you now it big bucks are needed in your pension plan (a million dollars or more in today's money). Don't believe this PROPAGANDA. 
 
These numbers are a natural brake on people retiring early. You get your pension projection in the post giving a pension estimation at 65. Usually falls short of your expectations and encourages you to add more funds. 
 
Message: Just keep on contributing (and paying all of those lovey fees that drive the pension industry)! This leads to 
 
Behavioural change: This perception management encourages irresponsible spending. 
<blockquote class="tr_bq">
"I am paying into a pension so I will spend the rest - this is fragile thinking"</blockquote>
Saving slowly and squandering the rest on a consumerist lifestyle, of junk whose value generally returns to its intrinsic worth of zero over time as it becomes broken, worn or obsolete, keeps you on the treadmill of salary, taxes and fees. Don't FALL for it! 
 
This vicious circle sets high spending expectations in retirement hence the need to save more. We live VERY comfortably on what is deemed a poor family income in France as we have NO DEBT, NO LIABILITIES and LOW FIXED COSTS. 
 
Whats even worse is there no real guarantee of a good pension payment at the end of your working life (think low returns, unfunded liabilities and inflation). I firmly believe this will leave a lot of people in a bad position in the years ahead as we are starting to see in the <a href="https://en.wikipedia.org/wiki/Pensions_crisis" target="_blank">US with state pension funds in crisis</a>. 
<blockquote class="tr_bq">
BIG IDEA: Everybody needs to be an active manager in their own pensions. Have a plan and a set of pension goals and accept these change over time. </blockquote>
Unfortunately this skill set is not part of the education system which is a topic for another day. I will just question why were are pushed out of the education door, to get on with it, without some basic life skills such as budgeting and planning. 
 
The only way you get these skills are if you are lucky enough to have parents who have filled in the gaps (financial and emotional intelligence to name but two). You have a fascination with making it big or have a mentor of some sort. Knowing the GAME early makes ALL the difference to your future. 
<h2>
Hyper-Normalisation - is there a retirement trap brewing?</h2>
To compound the issue that returns are not knowable in advance. 
 
Things could dramatically advance just think of free renewable energy for all, new industries crop up overnight that revolutionise the world economy and we all get an iRobot each, eliminating the need for hard work and the ability to fund a living wage for all. 
 
On the flipside to utopia we need to consider a few stumbling blocks (until we get our robot;). 
 
One potential issue is that current asset prices and projections are based on perpetual growth calculations. We buy productive assets to pay for our pensions whose price is determined by predicted growth as measured in GDP and profits. These projections are based on historical "norms". 
 
As we all know from history classes and current problems in countries; Argentina, Greece and Venezuela - upheaval can occur in any country devastating the "normal growth mantra", currency value and pension pots very quickly. 
 
Secondly we have no real leadership in the world - challenging the status quo and changing our path to a brighter future.  Leader holy grail is to keep inflation (confiscation) around 2 percent and growth in GDP of 3 percent and debt growing into an even bigger Godzilla than it is now......?). Nothing really changes. 
<blockquote class="tr_bq">
Growth has been great but time is running out on this model - back to the rule of 70 (divide 70 by the percentage growth rate to give the doubling time) - at 3% growth the GDP would double in 23 years. Twice as much of everything...!!! yet we live on one planet and there are some serious restrictions to this thinking.</blockquote>
 
Considering most pensions are based on tracker funds which "diversify" risk buy owning a bit of everything surely this is a problem when we can't have everything when scarcity kicks in. Will luxury goods companies be top of peoples shopping lists? Will people pay for stuff they don't really need in this circumstance? Will society change where conspicuous consumption and keeping up with the Joneses is no longer seen as socially responsible? What happens when cheap debt is no longer available? 
 
Another potential car crash for pension promises is that we are all living longer. Demographics are terrible in major economies (ageing society, less workers per retiree). Populations are highly unlikely to grow at 3% a year.... 
 
People stop spending in later years. They sell investments and assets to pay for their living costs - no GDP growth here then either. 
 
But wait we can just print GDP right.....It's just logical - we currently have already bankrupt public finances and pension entitlements to pay just QE it (the law of supply and demand does not apply), NIRP it (negative interest rates what the!) it to make people spend and soon to be helicopter it (give people the money directly). 
 
There is no real growth here just accounting tricks and boon dongles to keep us hyper-normalised. Slowly boiling the frog. 
 
We are looking at a step change in humanities approach to retirement and entitlements. A new deal will eventually be forced upon us. 
 
Future retirees need to be smart and understand their investments instead of a docile awaiting a check at the age of 65+. Their wad has to be structured in such a way to ride out risks and change to real future conditions of an ageing society consuming one rapidly depleting planet. It need to generate surplus instead of being "drawn down" only then can you be confident to splash out. 
 
This is even more important for people considering FIRE (or FISH :)). Empires rise and fall, companies collapse and new ones are borne. We need to be informed, nimble, reactive, critical and opportunistic to have so many years not reliant on our labour. 
 
<blockquote class="tr_bq">
BIG IDEA: "Hope for the best and plan for the worst" Financial Independence must have INCOME above OUTGOING with continued SAVING and INVESTING. 
 
Seeking Happiness means RESILIENCE building and RIGHT SIZING ones LIFESTYLE to a changing society to survive many years free from working for the man or looking. HAPPINESS is NOT looking over your shoulder each day. </blockquote>
</div>
 
 
 
 
 
 
 
I have a couple of people I want to mention who are doing great work in thearea of building resilience: 
<h2>
 Fragile, Rhobust, Antifragile - Nicolas Taleb</h2>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://images-na.ssl-images-amazon.com/images/I/31PyTZdiN-L._UX250_.jpg" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://images-na.ssl-images-amazon.com/images/I/31PyTZdiN-L._UX250_.jpg" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source: Amazon</td></tr>
</tbody></table>
I have been a fan of Nicolas Nassim Taleb since reading his "Black Swan" book. He has followed this<a href="https://www.amazon.co.uk/Antifragile-Things-that-Gain-Disorder/dp/0141038225/ref=sr_1_1?s=books&ie=UTF8&qid=1484474288&sr=1-1&keywords=antifragile" target="_blank">anti-fragile</a>. As I have read it it implies being able to make good by embracing risk and making sure shocks don't really hurt you. 
up with a book on a form of robustness which he calls 
 
I have a few takeaways from his work 
<ol>
<li>Specialism can be very dangerous - what if your job becomes obsolete - can you do other things \ have other skills?</li>
<li>Having all your eggs in one basket is just waiting for someone to knock it over - "safe index low cost funds", stocks, bonds etc.</li>
<li>Being part of the herd will lead you over the cliff - leading a debt based consumerist lifestyle makes you fragile</li>
<li>Taking calculated risks makes you stronger </li>
</ol>
<ol>
</ol>
<h2>
Peak Prosperity - Chris Martinson</h2>
<ol>
</ol>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; margin-right: 1em; text-align: left;"><tbody>
<tr><td style="text-align: center;"><a href="https://images-na.ssl-images-amazon.com/images/I/514%2Bkx0vKaL.jpg" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="320" src="https://images-na.ssl-images-amazon.com/images/I/514%2Bkx0vKaL.jpg" width="213" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Source: Amazon</td></tr>
</tbody></table>
Secondly I have followed the work of Chris Martinson and his Crash Course which I highly recommend you watch on his website <a href="https://www.peakprosperity.com/" target="_blank">Peak Prosperity</a>. This shaped our thinking on early retirement, investing and the need for self sufficiency. After all stopping work at 37 and providing for our family until we pass can be a very long time and lots of "Black Swans" can be lurking in the shadows. 
 
Chris covers risks from the three E's. Economy (massive build up of debt). Reliance on depleting fossil Energy supplies (and resources in general) for day to day life. How we need to look after the Environment we live in which provides us with our nourishment (soil building, wildlife (bees) for pollination, water etc. His latest book <a href="https://www.amazon.co.uk/Prosper-Prepare-Future-Create-Inheriting/dp/1937832767/ref=sr_1_fkmr0_1?s=books&ie=UTF8&qid=1484474351&sr=1-1-fkmr0&keywords=prosper+chris+martinson" target="_blank">"Prosper"</a> is a great resource. 
<h2>
More reasons to be ANTI FRAGILE in Retirement</h2>
External Surprises - Life has a funny way of punching you in the
 face. All is fine then wham - the car is written off, you break an arm 
or lose big on your investments. There can be an external shock 
completely out of your control such as war, demographic crash, capital flight and times of deflation and inflation. 
 
<div style="text-align: center;">
This is relying on MULTIPLE DIVERSE sources of income is a must.</div>
 
Challenge and happiness - Taking FIRE
 to live in a modern villa with no way to be a bit self sufficient, the 
bills just covered and a rosy outlook for investment returns is anti fragile and can get you
 in deep trouble quickly. Sitting in the sun and going for your daily swim can become stale quickly, as humans we need to keep moving or wither.  
 
 
<div style="text-align: center;">
You make your own luck and happiness through hard work, continuous learning, making
 the hard choices. All of these must continue throughout life - its what life is
 about, makes you want to get up in the morning and puts a smile on your
 face. I did that!</div>
 
<h2>
Retirement - use it to build inter-generational Wealth</h2>
Our aim is the continuous accumulation of wealth. We want to be able to pass on the knowledge we have to our children so they can do the same for their own. Why? Well the ability to control your freedom is in my opinion a major part of happiness - choosing what you want to do. Money and assets allow you to take risks, build a business out of a passion, make value for the people around you. 
 
Having a framework that makes sure you have real title to assets, legally avoid inheritance taxation (think farmland, 100+ year old antiques, passing assets on before they get taxed) is a real legacy for FI seekers. Building a business to hand over or sell in "retirement" provides a spark to your life, a reason to get out of bed, challenge yourself and keep your self healthy (heath is mental and physical and is WEALTH) 
 
Draw down of assets in retirement is what the state wants - not what you want! That way the next generation have to get to work for the man to pay their taxes. 
 
Why should we just accept this? This type of FIRE is not leaving a legacy behind. It is giving it to the state to squander on its latest pet project. By all means pay you fair taxes I have no problem with that but WILLINGLY give up your CAPITAL at the EXPENSE of your family is another issue all together. 
<blockquote class="tr_bq">
BIG IDEA: Financial independence is about leaving a legacy of inter-generational WEALTH and KNOWLEDGE.</blockquote>
 
In part 2 of this post I will go through the modest steps we are taking to be anti-fragile and build inter-generational wealth for our family. 
 
<ol>
</ol>
<ol>
</ol>
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://sites.google.com/site/lifeplanltd/home/TimeLine_Financial.xls?attredirects=0&d=1" style="margin-left: auto; margin-right: auto;" target="_blank"><img alt="Finacial Time Line Planner" border="0" height="152" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh1_UvAsfYu6nhtyt5mABN2Npg1FjvH88PiJ8ComrXLb1cG2MY_2x4Pw48UB7-d0r52ebSWoYMI3N2J1eno7QF4wgSfunnBecJPeV8LMRF84W3iuTxUFl2odOAG9h4QbAWb2GHhK_AiN39w/s400/Timeline.png" width="400" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Create a FI plan today*</td></tr>
</tbody></table>
Peace, prosperity and happiness 
CoNTeNDeR 
 
 
Welcome New Readers! Please take a look around.<a href="http://getintheringwithme.blogspot.com/p/about-me.html" target="_blank">Click here</a> to find out more about THE.TriBe and the blog is or perhaps browse the <a href="http://getintheringwithme.blogspot.com/p/all-posts-get-in-ring.html" target="_blank">all posts list</a>, Please feel free to play with the <a href="http://getintheringwithme.blogspot.com/p/muff-tools-and-check-lists.html" target="_blank">planning tools and checklists</a>. If you liked this post can you please spare a few seconds to share it? 
 
* Inevitable legal disclaimer. Everything on this site is intended for entertainment purposes only. I take no responsibility for its use.

Fragilista - Part 1

Our very fragile sink - we are chucking everything at the kitchen sink of 2017 to make it as successful and anti-fragile as possible W...

2 Years of Financial Independence

Contender 3 #financialindependence, Dividends, downshifting, Early Retirement, financial freedom, financial independence, Investing, Life 09:11

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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi0GVpCROTB0x3ZR4DgPEi9hAIeoEoRISidWAakk8I4_13mTkXxMObSmS52P09PpVVCtg3K0iEjE6Qbx8p_1sfvYl9eEBUYG6uzwQj-xQpngzahQQTPvmaUW2ECaB9kI_17aYMqR2n0oQtz/s1600/View.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="212" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi0GVpCROTB0x3ZR4DgPEi9hAIeoEoRISidWAakk8I4_13mTkXxMObSmS52P09PpVVCtg3K0iEjE6Qbx8p_1sfvYl9eEBUYG6uzwQj-xQpngzahQQTPvmaUW2ECaB9kI_17aYMqR2n0oQtz/s320/View.jpg" width="320" /></a></div>
It was easy to get carried away by our dream of financial independence but what about reality? What are the cold hard numbers? Are we any the wiser and have we made a good decision? 
 
Today I am giving you the actual living cost numbers and lifestyle trade offs for your consideration of a Financial Independence Seeking Happiness lifestyle. 
 
 
 
 
 
 
<ul>
<li>A look at our current budget (and comparison to national statistics)</li>
<li>Future cost reductions </li>
<li>What do our investments look like after the house purchase. </li>
<li>Lovin’ the new lifestyle </li>
<li>Is it possible for you - a crude calculation and links to financial timeline planning tool? </li>
</ul>
<h2 style="text-align: center;">
Expenditure</h2>
As some readers are interested in living costs in France. I thought I would outline our hopefully-settled-and-no-surprises FIRE costs here. 
 
<div style="text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiFo6gvJiBekoR4-N6rad1ClJ9DaxefVp5dYnREiWaLq19JS-5grMNYo2sWlFIDMB_7PTxRL6xkACghSsiYlgZQPhDGeiLZi4HilfRYwmMbusFvhLknwneFWYQRNwFg3Kqn19s8fJVmsobk/s1600/Expenses.JPG" imageanchor="1"><img border="0" height="443" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiFo6gvJiBekoR4-N6rad1ClJ9DaxefVp5dYnREiWaLq19JS-5grMNYo2sWlFIDMB_7PTxRL6xkACghSsiYlgZQPhDGeiLZi4HilfRYwmMbusFvhLknwneFWYQRNwFg3Kqn19s8fJVmsobk/s640/Expenses.JPG" width="640" /></a></div>
<ol>
<li>We have been spending too much on food. My waistline is a tell-tale sign. It is mainly due to a few parties all summer long (erg every other day) and little indulgences (542 vs budget of 480)</li>
<li>We have more money in the budget for Entertainment than we had initially budgeted for (163 vs budget of 200). Continuous saving can be a means to an end but saving for saving's sake is not fun. This year we will use the savings for entertainment.</li>
<li>Holiday was below budget (202 vs budget of 300) even though we had 5 good trips to the mountains and to Paris.</li>
<li>We used extra fuel (Petrol for clearing the garden and chainsaw work), electricity and water (had to fill the fosse septique for the first time, 5,000 litres of water) when renovating the house.</li>
<li>Clothing has been low as we are currently fully kitted out....for a few months as the kids grow! </li>
<li>We are liable for part of our healthcare costs (averages 34 euros per month including minor surgery, a couple of hospital consultations and numerous visits to the GP).In order to have access to the health system in France it is not just good enough to pay your taxes (aren’t there a lot!). You have to contribute to the system through a job as well otherwise you just have to pay for private cover. </li>
</ol>
 
We like “working” a bit. Mrs C is lecturing at the moment. I am looking at options to generate an income as well so we both contribute to the system. 
<h3>
What is not included and National Statistics?</h3>
We could take out top up health cover for major medical issues which would require a long stay in hospital. Instead of this we are putting aside 100 Euros per month into an emergency health fund. (see the comment above that we are spending on average 34 Euros per month including visits to the hospital at the moment) 
<ul>
<li>House maintenance costs – as we are still renovating - we don’t really include these yet….. estimate 50-100 Euros per month</li>
<li>No life insurance – we save and invest in different ways</li>
<li>Saving for a new car would need to be about 100 Euros a month</li>
<li>Saving for the kids higher education - 100 Euros each per month</li>
</ul>
<blockquote class="tr_bq">
Looking at these numbers we can be confident that our underlying costs are around 1,600 Euros per month (~£1,200, ~$1800). </blockquote>
<blockquote class="tr_bq">
This can be compared to the average monthly expenditure in the UK of £2,336 (3,200 Euros). Source <a href="http://www.telegraph.co.uk/finance/personalfinance/12038850/How-much-does-the-average-household-spend-each-week.html" target="_blank">Telegraph</a> and ONS (Office of national Statistics). </blockquote>
<blockquote class="tr_bq">
Notable differences are Transport £330pm (452 Euros versus our cost of 175 Euros per month) Housing and Fuel £321pm (440 Euros versus our cost of 198 Euros) </blockquote>
<blockquote class="tr_bq">
 
A couple of other categories that stand out from the ONS £187 on hotels and restaurants per month and £302 on Recreation and culture. (670 Euros per month versus our cost of  353 Euros). </blockquote>
<blockquote class="tr_bq">
Just these four areas (Transport, housing, hotels and recreation) the total UK average per month is £1,140 versus our outgoing of £530 a huge difference. </blockquote>
<blockquote class="tr_bq">
These numbers from the ONS are averages. We know the South East of England is much more expensive than other areas. To this point a comparison of any average can be misleading. The average household has only 2.3 persons in the UK. What about a family with kids which will most likely be the composition of an early financial independence seeker? </blockquote>
<blockquote class="tr_bq">
The best I have is basic living costs for a couple with two children (deemed essential) from this <a href="http://www.theguardian.com/uk/2008/jul/02/welfare" target="_blank">guardian article</a> and are £1,914 pcm (2,622 Euros)</blockquote>
<h2>
 Further Cost Reductions </h2>
<ol>
<li>We purchase some seasoned wood each year. I am adding to this with wood from the property. The wood heating will cost considerably less than fuel, electricity or gas heating. The log gassification boiler we have installed is super-efficient and takes all types of seasoned wood.</li>
<li>We should be using less electricity. The solar panels and the wood boiler are replacing the electric water heating we had last year.</li>
<li>We will now reduce our use of the car. We had to travel around a lot to get items for the house renovation. The compact Eco Diesel sips fuel.</li>
<li>Homemade tomato chutney is replacing tomato sauce (it’s a start ;). We have loads of homemade jam, soup and compote from the fruit trees.</li>
<li>We have had a small vegetable patch but will have a very large one next year as we will have the time to plant and maintain one</li>
<li>We have connected the natural spring to the vegetable patch to avoid using metered mains water.</li>
</ol>
<div style="text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjeZ5aW8rFdgzheDWyYy_thYi4YbWuSihiAa5kIl2Nc2hGF3Xu-ACDEJnD3jZfz1v7_RFAXp0LI-djB_W-waefyRqZeMAYYEP62PuqGSXhr566Qm9AlqSjatkEY8OW4m07xFvIEf5IWe95N/s1600/Gardening.jpg" imageanchor="1"><img border="0" height="300" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjeZ5aW8rFdgzheDWyYy_thYi4YbWuSihiAa5kIl2Nc2hGF3Xu-ACDEJnD3jZfz1v7_RFAXp0LI-djB_W-waefyRqZeMAYYEP62PuqGSXhr566Qm9AlqSjatkEY8OW4m07xFvIEf5IWe95N/s400/Gardening.jpg" width="400" /></a> </div>
 
NONE of these cost reductions are arduous and many are beneficial to our health.So Is our income sufficient and has adequate safety to pay for the new cat? 
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj3frYbclNwi49saqjRcLpnv_ZtOOIVzbAP4A1KlzheZO63fAZ0k2C3zXl639aZyQWURrjcFhL4EWZJOocUCjcgOdyEhP5nNpzjy8HqHA8I0fsTQlEGu4e_9B4V4w5692C0nmjGiPhPfkT-/s1600/Smokey.jpg" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="265" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj3frYbclNwi49saqjRcLpnv_ZtOOIVzbAP4A1KlzheZO63fAZ0k2C3zXl639aZyQWURrjcFhL4EWZJOocUCjcgOdyEhP5nNpzjy8HqHA8I0fsTQlEGu4e_9B4V4w5692C0nmjGiPhPfkT-/s400/Smokey.jpg" width="400" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Smokey the cat - our chief pest controller</td></tr>
</tbody></table>
<h2 style="text-align: center;">
Investment and Income</h2>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhRS9Cw0tLYqyQBhco5pDzZJFmIzwAKBNKkWC4bFfEKkvQI_evDPkGNQC43bvPOB5q4ggdC9GcEeCJ4GNLLsRId4SoU4Gyy1qINJmbb6DcuEEyV3RQAZWUCdVWI8zF2WPd9-qGnqUuRamdJ/s1600/Portfolios.JPG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="247" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhRS9Cw0tLYqyQBhco5pDzZJFmIzwAKBNKkWC4bFfEKkvQI_evDPkGNQC43bvPOB5q4ggdC9GcEeCJ4GNLLsRId4SoU4Gyy1qINJmbb6DcuEEyV3RQAZWUCdVWI8zF2WPd9-qGnqUuRamdJ/s320/Portfolios.JPG" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Three Investment Portfolios</td></tr>
</tbody></table>
We run 3 portfolios: 
 
PROTECT (Emergency and opportunity portfolio) – Cash related investments > emergency \ opportunity fund and money for the renovation project 
 
HYP (High yield portfolio) – Consists of dividend paying stocks and property REITs > this pays for our living costs 
 
We would like to maintain the capital until we are able to access our pensions. If it works out well, we will be able to help our kids out. The caveat being that they can stand on their own two feet, confidently and independently first! 
 
We have the safety net of the PROTECT cash in case of emergencies (and a worst case scenario we can sell the house \ downsize \ rent again). 
 
GROW (Future proofing and speculation) – Consists of our pensions. These are mainly equities UK, EU, WORLD and PRECIOUS METALS and one Final salary scheme. This portfolio is our inflation hedge. 
 
As you can see from the pie chart this (pension) is a significant part of our portfolio. We have been prodigious savers and always maxed out our matching employer contributions (e.g. we added 7% and the employer added a maximum matching 7%). We both started investing in our personal pensions plans very early in our careers. 
 
Due to the rising stock markets the pensions have performed very well averaging 7% per year (after fees). 
 
A notable exception is the lack of bonds. The final salary pension, which we do not control, does hold a substantial proportion in bonds. Any shortfall is made up by the company. It is “inflation” protected meaning the pay-out amount will increase in line with inflation. 
 
As we are close to our 40’s we have time to be aggressive (overweight stocks) before switching to bonds. 
<h2>
Spare income</h2>
We have some spare income each month and deploy it in the following way: 
<ol>
<li>Save and invest part of our surplus in a Permanent Portfolio approach in tax efficient savings accounts (PEA in France). The more I learn about investing the more I believe in full diversification and rainy day funds. Sticking to just stocks and bonds I believe would be highly risky for us. There are many financial gurus warning of the drop in the business cycle so we need to prepare for it.</li>
<li>We are going to start a couple of small business which need some money to start up. This will keep the brain cells ticking over and contribute to society. The French government needs all the money it can get its hands on ;)</li>
<li>Have some more fun and interesting trips. We had great holidays this year, spending only just over 2,500 Euros. This included a trips to Paris, Strasbourg, Vulcania (a Volcano Park in the centre of France), visits to the beach (grandparents), a wedding and a trip to the Pyrenees mountains.<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjobEOgTgEFsB4-FNnEDL5ZrY87P4M5cb2saIl8RoktzzEdis6qtgU4GN5Fw9zFGICJHhQ2wUICfG3FwrHV9w4tcJvfC-27KV9AYXm0LSMpfNo22ES00JOIQRRrTdUFDaebGSq42zaMyflD/s1600/Holidays.JPG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="464" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjobEOgTgEFsB4-FNnEDL5ZrY87P4M5cb2saIl8RoktzzEdis6qtgU4GN5Fw9zFGICJHhQ2wUICfG3FwrHV9w4tcJvfC-27KV9AYXm0LSMpfNo22ES00JOIQRRrTdUFDaebGSq42zaMyflD/s640/Holidays.JPG" width="640" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">View from the Eiffel Tower, National Volcano Park and Pyrenees Mountains</td></tr>
</tbody></table>
</li>
<li>Spend some money improving the soil quality and irrigation around the new property.</li>
</ol>
<h2 style="text-align: center;">
2 Years in and Lovin’ it?</h2>
Somehow we have achieved what we were looking for when we decided to ditch the day jobs. 
<ul>
<li>We have a more sustainable living arrangement (food, heat and transport)</li>
<li>More Freedom and a simpler life (no landlord, no job commitments, less paperwork)</li>
<li>Stability – a base with no reasons to move (e.g. job \ landlord wants us out)</li>
<li>Healthier – we cook more food (some from our organic veg patch and fruit trees). We are less stressed (no one telling us what to do, no performance reviews, but still the odd nightmares about corporate life). We work outside on a daily basis. The Gers is one of the least populated regions of Europe and hence has fabulous air quality.</li>
<li>Time to spend with the kids, new friends and think!</li>
<li>Great holidays do not have to be expensive – we have chosen a location where holidays are literally on our doorstop (~2hrs to Atlantic or Mediterranean beaches, the Pyrenees’ mountains and large cities of Bordeaux and Toulouse.)</li>
</ul>
It has not been all plain sailing: 
<ul>
<li>Our income is not as high as expected (dividend cuts). </li>
<li>Income tax is higher in France. </li>
<li>We
 could not find a property at a good price in the local area
 so had to improvise and take on a renovation project. </li>
<li>French 
Paperwork - A major advantage is that Mrs C is French. She has been 
amazing at cutting through the red tape and paperwork.</li>
<li>We see less of of our old friends in the UK(but are making so mnay new friends here).</li>
</ul>
We can’t complain when we look at a list of Lifestyle improvements: 
Was it worth it? Too right. We have never been freer and less stressed. We have learnt new skills, spent quality time as a family and learnt a lot about what makes us tick. 
 
If it has to change in the future so be it. In the meantime we are enjoying the ride. 
<h2 style="text-align: center;">
What about you?</h2>
<blockquote class="tr_bq">
We are spending around £1,200 per month ~$1800 for a family of four. This requires an invested amount of £288,000 @5% return per year. A really nice country house with land can be picked up for £150,000 in France. 
 
A crude calculation of Financial Independence 
 
If we take two young people with salaries of £35,000 each. In the UK ~10,000 is tax free and the rest is taxed around the 28% mark in this example. 
 
Your family after tax income would be £56,000. It should be EASY to save 50% of this per year £28,000. 
 
Considering NO interest, investment gains or salary increases it takes ONLY 15.5 years to accumulate the capital above. 
 
Save 70% and the number of years drops to 11.2 years ((288,000+150,000)/39,200). 
 
Now what if you add in investment gains, emergency funds, employer contributions to a pension, help from parent’s etc? Now financial independence really does seem like a real possibility quite quickly. Why not try some numbers out in the <a href="http://getintheringwithme.blogspot.fr/p/muff-tools-and-check-lists.html" target="_blank">Financial Timeline Planning Tool</a>?</blockquote>
<h2>
Key Learning's and Considerations </h2>
<ul>
<li>You need to have a good financial buffer \ emergency cash fund </li>
<li>Your income should be well above your projected living costs (20%+) </li>
<li>Your income must be inflation proof </li>
<li>A simpler lifestyle is much less stressful and healthy </li>
<li>What we have lost (access to amenities, concerts etc.) we have gained in other areas (access to countryside, quiet). </li>
<li>Changing country is a challenge and your financial situation changes dramatically (our tax free ISA’s are not recognised in France). </li>
<li>Financial independence can be obtained quickly but it is a discipline and has some costs that may not be negotiable. </li>
</ul>
Further reading: 
<a href="http://getintheringwithme.blogspot.com/2012/07/round-5-15-secs-muff-family-financial.html" target="_blank">Family Financial Independence in 7 Years! Almost FI this is how we got there</a> 
<a href="http://monevator.com/how-to-live-off-investment-income/" target="_blank">How to live off investment income</a> 
<a href="http://www.telegraph.co.uk/finance/personalfinance/investing/shares/11466551/10-shares-you-should-be-able-to-hold-forever.html" target="_blank">10 shares you should be able to hold forever</a> 
 
Useful tool: 
<a href="http://getintheringwithme.blogspot.fr/p/muff-tools-and-check-lists.html" target="_blank">Financial Timeline Planner </a> 
 
Peace and prosperity, 
 
Contender 
 
* Apologies I have been offline so long - since the move we have not had reliable internet at the house. This is being posted through a mobile phone... We have been promised it will be sorted out soon - all that French paperwork takes time! 
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2 Years of Financial Independence

It was easy to get carried away by our dream of financial independence but what about reality? What are the cold hard numbers? Are we any ...

Living With Little

Contender 1 Budget, downshifting, frugality, Habits, Happiness, Life 16:56

Living With Little

Living with less infographic from mnn While this site may not expose extreme very early financial independence by cutting expenses to no...

Do the Right Thing

Contender 4 Blog, Conformity, Critical Thinking, downshifting, Early Retirement, early-retirement, financial freedom, financial independence, Inflation, Investing, Life, Mid Life Crisis, Naive 23:17

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Is the Pursuit of Financial Independence Doing the Right Thing? 
 
THE PaST: "Go to school then study a degree that makes a difference to the world" 
 
THE.PReSeNT: "Go to school and study a degree to make you rich, all that touchy feely stuff won't pay, get a corporate job, go work in finance" 
 
THE.FUTURE: "sell your soul to me Muuugh Ha Ha Ha - OK a bit carried away just get into debt up to your eyeballs. I love a good debt slave, mine all mine." 
 
Has the world become more individualistic and materialistic? If you are not part of the system are you weird? Come on get with it, work hard, climb the ladder and load up on debt until you drop. 
 
Is this really the pursuit of happiness - stuff and job status or just a marketeers dream of control over the masses? 
 
Is getting with the system the way to go? if so why the F**** does this blog "chase" financial freedom?  
 
Why isn't THE.CoNtENDeR blogging about working, making a difference in BIG business?  
 
Perhaps the CoNTEnDER has got it all wrong. Perhaps he needs a good look at himself and get (back) with the system? 
 
Known, Know, NO's 
 
<div style="text-align: center;">
Let's start off with a few challenges THE.CONtENDER believes exist in the world, have shaped some of the thinking in this blog and yet we do very little about:</div>
 
We know burning fossil fuels is not 100% good. Particulate pollution and rising gases in the atmosphere come with some known and unknown consequences. On the other hand we have realised  the BIGGEST improvement in living standards mankind has ever seen. Life expectancies have increased dramatically. 
 
The group think it is now "normal" to burn fossil fuels, we are unsure of the consequences but are enjoying the ride while it lasts. 
 
We know that we live on a planet of finite resources but we still continue to consume them at increasingly faster rates. They will deplete - what do we do then? 
 
Someone will have to go without in THE.FUTuRE - be rich and buy our way out of it! 
 
We know work is good for us but too much work can be bad. We know that some stress (eustress) helps us fulfil our potential. At the same time a eustress 9-5 job is now becoming a stressed 8-9 job. 
 
Work adds meaning to life and stress is good for you as well as having money to exchange for some material comforts. You will have a career to look back on. You will have achieved something special in life - just make sure you are able to get the right job that pays well, letting you get ahead in life. 
 
We know that debt is bad so why do it? We know saving is good but the majority thinks saving 3-4% of their take home pay is very very good.  Invest it? Who are you kidding you cannot beat the professionals on Wall Street - pay them big fees to loose your money instead. 
 
Why save when we have a state and work pension. Inflation will erode the value of any debt we take on and our house will go up in price. My pay goes up over time so I will be able to pay for inflating goods and housing. I am told I need lots of shiny gadgets and lots of designer clothes. I need to be on the work bandwagon to afford it all. 
 
We know money doesn't grow on trees - it is made from them! On top of that more recently it is actually typed into existence on a computer - not the one I am typing on I am sad to say. Can fiat money really be a store of wealth when it can be created out of fresh air so easily? Go figure. 
 
The government is in control of inflation. Inflation = good and Deflation = bad because they say so. Just accept that it is good that your cash savings loose value each year and you have to pay more for goods and services. It is all OK as Inflation = good. 
 
The family structure is challenged by he reduced amount of time at home. On the flip side it has more money to spend than ever. 
 
The government is providing lots of tax incentives to help pay for child care at a creche. I need to be in work to accrue the state pension entitlement. Instead of the parent staying at home messing up their career their child can be happy with lots of other kids.

Do the Right Thing

wikimedia.com Is the Pursuit of Financial Independence Doing the Right Thing? THE PaST : "Go to school then study a degree that ...

THE PRESENT

Contender 0 Blog, financial independence, frugality, Life 08:07

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<tr><td class="tr-caption" style="text-align: center;">January in London? - So Pretty under Snow</td></tr>
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THE.PRESENT: "Come on Contender have some fun, get yourself one of those gadgets, go on holiday you need one and the kids do as well, a few more presents - they have not had enough for Christmas" 
THE.CONTENDER: "Thanks for the pointers. At the moment we are happy with our little lot, love our community and have some great laughs." 
 
 
This post - Enjoying life one day at a time, Embracing Change through planning and a little list of things to do at the start of the year. 
 
 
<div style="text-align: center;">
THE PRESENT</div>
Enjoying life now 
 
January 2013! Waking to the smell of freshly ground coffee. Our kids are playing happily with their generous Christmas presents, thank you Santa / Grandma. School starts next week. We meet and chat about random topics with friends in the park and run around the library. 
 
Hot warm home cooked meals are the order of the day. Delicious porridge for breakfast. Lentils with french sausages, vegetables and the last of the clementines a satisfying lunch. Soup and dips for tea. 
 
Skype the grandparents in the evening to amaze them with the new skills the kids have learnt. Bath time, story and bed. 
 
Time to enjoy a good book and perhaps a glass of wine, cozy on the sof,a stroking the purring cat on the lap. 
 
Simple times for a cold, damp dark time of the year and time to get on with a few things......

THE PRESENT

January in London? - So Pretty under Snow THE.PRESENT: "Come on Contender have some fun, get yourself one of those gadgets, go on ...

Community HELP! Part 2 - 8 Contributions and Develop New Skills

Contender 0 charity, community, Early Retirement, early-retirement, Happiness, health, Life 08:29

Community HELP! Part 2 - 8 Contributions and Develop New Skills

Look to your community and learn new skills SPENDITALL : "CONTENDER , when you decided to hang up your gloves, you talked about gi...

Early Retirement, Lean and Maslow what do they have in common?

Contender 1 Early Retirement, Education, Ethical, Freedom, frugality, Happiness, health, Investing, Life, Planning, Saving, Toolkit 09:27

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Hello Fight Fans, welcome to Fight Night on channel CONTENDER! Let's get ready to RUMBLE! Introducing in the red corner weighing in at 13st 2lb THE.CONTENDER! In the blue corner weighing in an impressive 16st 9lb is THE FUTURE.  
Tonight's fight is over 12 rounds. The prize is for the UFF (Undisputed Freedom Fight) Belt  
 
THE.CONTENDER has been training for the future for some time. Since he was born actually; just like everyone else. THE.CONTENDERhas been fighting to achieve his goals and desires; funnily enough just like everyone else. THE.CONTENDERhas searched for the key to making them happen; just like everyone else, where is it damn it! 
 
So this post is about THE.CONTENDER's personal thoughts on what this key could look like. In particular could it unlock the secret to an effective Early Retirement and Life Planning approach? THE.CONTENDER's approach is based on three key parts: 1) Maslow's hierarchy of needs, 2) a concept called LEAN and 3) Monthly Planning process. This is what it looks like in THE.CONTENDER's world: 
 
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEifLekrAUDqj7PQWK2Vg56aH8zkFXg1ic8fdfXFWvIUC5UuHJAOj59WMD-okA0c5uuDimuVQLAyVgFGhUIcwnPBdlvijYkyi3ryInWDbJKrMMXSpOD5xLzauX55-wqAUWxfxUec3rsKwMR5/s1600/Maslow.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img alt="" border="0" height="240" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEifLekrAUDqj7PQWK2Vg56aH8zkFXg1ic8fdfXFWvIUC5UuHJAOj59WMD-okA0c5uuDimuVQLAyVgFGhUIcwnPBdlvijYkyi3ryInWDbJKrMMXSpOD5xLzauX55-wqAUWxfxUec3rsKwMR5/s320/Maslow.jpg" title="Maslow's Pyramid of Needs" width="320"></a>1) MASLOW 
 
Maslow placed the most important aspects of life at the bottom of a PYRAMID. Water, food and shelter at the bottom as they are essential through to self-actualization at the top. 
 
 
 
 
 
 
 
 
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhPztYktJDZnAuDiWSX-Stf-t81W1DwUD83qlsbZNGcAc8KMbG51N9yKmc7nNi3lRdGY8nscgpfm-OV-2e83RjKPnHADiM2np2Z_eGD8cH_w81MsPqzu7VUBsF22ATjUi7VB66AQR_vgE-P/s1600/Lean+House.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a>2) LEAN 
 
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgLL63Q1BECuDcmvj-rw-mp0HDlVXUknkXvfD7A6Pd33q2ULfxuqsaiC37lVcqaf9QXl8r1ccnhA-GU0qrEodxjTVQ5-6kyStrWn6A8mf-1RSJKatD8mwczNCgMJXmKk29OIKkCpGAgyd1c/s1600/Lean+House2.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img alt="" border="0" height="213" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgLL63Q1BECuDcmvj-rw-mp0HDlVXUknkXvfD7A6Pd33q2ULfxuqsaiC37lVcqaf9QXl8r1ccnhA-GU0qrEodxjTVQ5-6kyStrWn6A8mf-1RSJKatD8mwczNCgMJXmKk29OIKkCpGAgyd1c/s320/Lean+House2.jpg" title="House of Lean" width="320"></a></div>
THE.CONTENDERwould like to introduce Tachi Ohno of Toyota. He is considered the father of  <a href="http://en.wikipedia.org/wiki/Lean_manufacturing" target="_blank">LEAN</a> in the manufacturing world. LEAN is all about removing waste (Japanese for waste is "muda") and making the products as close to the point of  delivery as possible (JIT - just in time). 
 
What is interesting is that LEAN principles have been simply represented as a house. You need strong foundations, build the walls and top off with the roof while regular maintenance will keep it in tip top condition. 
 
3) PLANNING (Making it Happen): 
 
Project management has lots of models and different approaches depending on what the project is. It can can be very complex such as building a skyscraper or simple in the case of planning a journey to the Zoo. 
 
Over complication and missing steps, have put THE.CONTENDERin hot water in the past. THE.CONTENDERhad to learn how to mange projects and people effectively to make sure he could not see the wood from the trees.  
 
THE.CONTENDEReventually learnt that planning really is a simple process wits for key repeating steps PLAN - DO - CHECK - ACT. When carrying out these steps a list of checks and skills must be used. Below is a list of the key aspects of planning, leading and execution that THE.CONTENDERhas been rigorously trained on. In THE.CONTENDER's opinion consider all of them, in a robust review process, and you won't go too far wrong: 
<ul>
<li>What is your VISION - what do you want- your end goal - Early Retirement and Happiness?</li>
<li>Do you have a PLAN to get there - this can be on the back of a biz card or a spreadsheet? </li>
<li>Are you keeping everything SIMPLE?</li>
<li>Be prepared to ADAPT your plan and goals, make sure you have regular checks </li>
<li>Do you have the right ATTITUDE - are you really committed to being frugal for early retirement?</li>
<li>Do you see the PROBLEM clearly? is it that you have to pay your debts first or get a new job close to home?</li>
<li>Have you DISCUSSED this with your close family / friends and do you have everyone on board?</li>
<li>Who is in CONTROL - tracking progress and spotting deviations, obstacles and opportunities and getting back on track if you fall behind.</li>
<li>ASSERTIVENESS - get on with it, have a go, back up your convictions</li>
<li>INVOLVE everyone in the decision making progress - THE.CONTENDER and his tribe are moving to France, the reason is that the living standard is higher, decent warm weather and it has good schools for the kids; so THE.CONTENDER turned to the grandparents: "what do you think?"</li>
</ul>
So what if we try combining the life (Maslow) with the continuous Improvement and removal of waste of Lean (Tachi Ohno), with the principles of planning and financial freedom? Here is THE.CONTENDER's interpretation, please read on ;)

Early Retirement, Lean and Maslow what do they have in common?

PERL Hello Fight Fans, welcome to Fight Night on channel CONTENDER! Let's get ready to RUMBLE! Introducing in the red corner weig...

Welcome to FISH !
You have come here looking for answers. How to get out of debt? How to save and invest? How to retire early and how you want to live in retirement.

Well this is the right place for you as out tribe has been through all of these steps. We no longer work for a corporate employer and have saved enough to retire early. How we did this is shared here on this site for you.

Our little tribe found out these secrets to financial independence in our late 20’s. Since then we have taken early retirement, in our late 30's, in just 7 years. We now live in the South West of France with our two young children.

Along the way I decided to share everything I learnt. My articles and tips on aggressive saving and compound investing are there to help you meet your financial goals fast. I discuss ways to help you decide what you want by building a life plan. This helps to work out how to get where you want to be whilst avoiding the pitfalls along the way.

My expertise was built up working in blue chip corporate jobs, extensive reading and putting it into practice. I have condensed this knowledge into simple strategies to help you meet your goals and not those of the bank or the place you work.

There are free planning tools on this site that help you make a life plan. A plan for your future. The tools calculate how to reach your financial goals in a timeline that suits you. The tools help set out your life goals, make them happen and how to exceed them.

There are tips on how to simplifying your life to remove day to day headaches. These include ways to pay off debt fast buy eliminating wasteful spending habits. How to reduce your monthly bills through choices that actually improve your health and wellbeing. Identifying things you don’t need that sap your time and wallet.

There are little sustainability projects to reduce your dependence on shops and utilities whilst saving money to spend on things you want.

All of these little steps will show you how save 50%+ of your salary so you can meet your goal whatever it is. This huge saving rate can be compounded for very early retirement. I am sure you will find something here for you.

Darren Lee (A.K.A the Contender as in my blog)

FISH | Financial Independence Seeking Happiness