No one says you have to wait until 65 to retire.
Brian hosts special guest Chris Mamula from Can I Retire Yet? to talk about all things financial independence and retiring early (FIRE).
Check it out their personal experiences and tip on F.I.R.E!
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Brian Davis: Hey, guys, Brian Davis here from Spark Rental, Happy Tuesday! And I am joined today by a special guest, Chris Mamula, from the blog Can I Retire Yet? So, Chris, welcome to the show!
Chris Mamula: Happy to be here and talking to you.
Brian Davis: Well, we’re super excited to hear what you have to say about early retirement, financial independence and retiring young. So, without further ado, I would just like to have Chris start telling us a little bit about his journey here. But before we do that, Chris, let’s start with where you are today and then let’s back up and talk about the journey to get there. So you are semi retired now, correct. And so tell us a little bit about where you are. Semi retirement was what your wife is up to, workwise. Let’s just get a sense of your current life as it stands today.
Brian Davis: Yes, I think maybe a good place to start is where I’m physically at, which is in my house in Ogden, Utah. OK, and we live like right on the backside of snow base and ski resort. And and that was kind of my wife and I that was always our dream was to like we got into the outdoors when we were probably in our mid 20s and started with like backpacking and hiking and climbing and skiing. And we just kind of fell into this. We call it like the dirt bag or ski bum like lifestyle. And like most of those people, they’re awesome. Like they’re living their their passion in their fantasy. But they’re also like one step away from financial disaster. Like if you have a fall, when you get an injury, you’re in a car accident, you have somebody get pregnant, like you’re always like one thing away from financial disaster and like so my wife and I both grew up without a lot of money. So we knew we didn’t want that, but we loved that lifestyle.
Brian Davis: So that was kind of our dream is kind of like to build enough of a cushion and then just go live that kind of dirtbag’s Skybound lifestyle. I love it. And we didn’t really think early retirement was possible. We had no idea what we were doing. As far as the technical stuff, we were just building a little cash cushion and then so we would have some security and then right as we were about to pull the trigger and move west. So I’m from Pennsylvania. We found out my wife was pregnant in 2012. And so like that, just winging it didn’t kind of seem like it was going to cut it. So I got really serious back then about like figuring out like what it takes to retire early and what it takes to be financially responsible. So, you know, we’re not putting our daughter’s security at risk, but we can still kind of live that lifestyle. And so that kind of brings us to where we are now. I left my career as a physical therapist in 2017 and we moved west that summer and we’ve been on it for 3 years now.
Chris Mamula: OK, all right. And you know, I have to ask, so how old are you? How old were you rather in 2017 when you retired. When you left your full time job.
Chris Mamula: Yeah I was 41 and I had practiced for about 6 as a therapist.
Brian Davis: That’s awesome. That is, that’s badass. So by the way, so we are broadcasting live of course Danny who is my partner and co-founder with Spark Rental, she says Hello. Tara says Go Pennsylvania, Danny and Tara actually are both from Pennsylvania. I’m from Maryland, not far away from there.
Chris Mamula: So and by the way, we do encourage people to bring their questions as we go here. And this is a 2 way dialogue or a three way dialogue, rather, Chris and myself, and of course, you guys in the audience. So let us know as you guys have questions. So, Chris, back us up to the beginning of your journey towards financial independence. You know, how did you start boosting your savings rate in the very beginning? And how did you get started down that path?
Chris Mamula: Yes, honestly, it was kind of a bit of luck to just stumble into things, and it was also a bit of like my wife and I just neither of us grew up having a whole heck of a lot. And we both are first generation college grads. And so we made above average salaries. So what we did is there was no like F.I.R.E, financial independence, retire early, like there’s this big movement and all these bloggers of which I’m one of them now. But there was none of that back in 2001 when I was getting out of school. So basically my wife had some school debt and she had a used car loan. And we were going to get married and I had no debt.
Chris Mamula: And my family was just always very anti debt. And so we kind of… the 2 of us came to an agreement that we were going to do everything we could to get out of debt before we got married. So she was working and I was still in grad school, but I was working part time, making a little bit of money. And we just did everything we could to throw all of my income at getting her out of debt. And she was kind of supporting us. And so when I got my salary as a physical therapist within my first paycheck or two, I finished paying off all of her debt and we were debt free and we were living off of her salary. And, you know, we’re kind of still in that college lifestyle. So we never inflated our lifestyle and living pretty comfortably. So we just kept saving mine initially for a down payment on a house. And then once we bought our house, we just we basically took my first paycheck and paid extra on the house and my second and we invested it.
Chris Mamula: And then once the house was paid off, which we did in about 7 years, we just put everything into investments and we just basically lived off of one salary and saved the other. So we were kind of living that high savings rate fire ideal that a lot of people talk about now. But we had no idea what we were doing. And on the investing side, we were just just throwing good money after bad and making a lot of mistakes. But at least we were still building because we were saving at such a high rate.
Brian Davis: So it sounds like part of your strategy was around avoiding lifestyle inflation. So as you and your wife started earning more and more money, you killed your spending very low and continued living this very frugal, almost student level lifestyle. Is that a fair characterization or is there a lot more to it than that?
Chris Mamula: I would say it’s it’s you’re directionally right, but I would say no, because so my wife started she just had a bachelors degree in math. And so she had like an entry level position and an actuarial firm and she was making about $35.000,00 or $36.000,00. And then when I started the physical therapist, this was a low salary. But in the city of Pittsburgh where I was from, I was starting about that same level, which was very low, but it was a flooded market at the time. And so we both grew our salaries pretty quickly, basically doubled them within 3 or 4 years. So we increased what we were living off of. We were traveling more doing more things, but we just continued to live off of her salary and continued to bank mine. And our salaries pretty much grew pretty much in parallel. So we were always saving about 50%, give or take.
Brian Davis: That’s great. That’s great. All right. Well, let’s talk strategy for a second here.
Brian Davis: I understand that you are not so much a real estate guy. You know, we do focus a lot on real estate on this on this podcast. But so it sounds like you guys are more focused on stocks and, of course, paying off your your primary residence. But talk to us about your investing strategy and how that started and then how that evolved over time as you became financially savvier.
Chris Mamula: Yeah, so when we started, we were just using an adviser and we were just basically whatever he told us to do, we did and did no due diligence. I mean, our due diligence was… we knew, like my parents, they basically made in combination what either my wife or I made. So and they did pretty well. They helped my brother and I both for college.
Chris Mamula: They were on pace for retirement just because they were again, they kind of taught me most of what I know, like as far as frugality and living within your means. And so I kind of my due diligence was, well, it’s good enough for them. It’s probably good enough for me. And I literally ask no other questions or whatever the advisor told us to do. We did. And so we were sold some really bad products and received some really bad advice. But that’s what we did up until 2012. Again, when my daughter was born, that’s when I started to get serious and think about, you know, what could I do to change my lifestyle? And I found these FI.R.E blogs and I changed my investing approach at that point. And then we just basically went to a passive low cost index fund approach to investing in stocks and bonds. And that’s what we still do to this day.
Brian Davis: OK, well, that in my own stock investments, that’s what I do as well. For the most part, it’s, you know, passive index funds, 90% of my stock investments are passive index funds. And I play around with a little bit of money on the side. But yeah, my core investing strategy is very similar to yours as which is what most people following the fire strategy tend to do, is there’s there’s broad basket index funds that are low cost, low expense ratio.
Chris Mamula: So, yeah, if I could just add one thing before we move on, I think it’s really important to understand, like, so that works. It works really well. But like so I wrote the book is called Choose a Fly, and it’s with a partnership with the guys who do the Choose a Fly podcast. And what we did is we really looked at a bunch of people from the F.I.R.E community who have taken different approaches and I really try to break investing down. So that worked for me. But again, it worked because we had a really high savings rate. So if you’re saving enough and you’re getting those average, let’s call it 7%, 8% returns every year and it’s going to be every year, but on average, that works, but it doesn’t work for everybody. And so we really laid out 3 paths for investment. And one is real estate. One is just investing in your own business. And the other is what we call the simple path, which is investing in these simple passive investments, but doing it with a high savings rate. So that’ll get you there. And any of those 3 would work.
Chris Mamula: And I really think you need to match your investing approach with your income, your savings rate, your needs, your goals, all that stuff. And so I don’t think there’s a one size fits all and those aren’t mutually exclusive either. Like I focused on that simple path to get to early retirement. But now that I’m here, you know, I do write on the blog and I wrote the book and so I’m generating some income from those things. And so just to kind of diversify, in addition to diversifying between stocks and bonds and domestic and international, that’s a totally separate thing, to invest in your own business or invest in real estate. And so you can do any of the 3 or all of the three and you have to kind of just match it to what you want and what works for you.
Brian Davis: Well, I mean, there’s so much that you just said there that I love. So I’ll start with my simplest reaction to that, which is just that Denny and I are doing the same thing in our own lives. We are actually approaching F.I.R.E with all three of those strategies, investing in real estate, obviously our business Spark Rental, and stock investments as well. So, yeah, those are 3 excellent paths to financial independence and retiring early. Any one of them will likely get you there. When you combine all three, it can be even more powerful.
Chris Mamula: And I also love the fact that you are semi retired, but you still have all of these, you have your fingers in these other pots as well. You’ve got the Can I Retire Yet? blog, which generates income, of course.
Brian Davis: You wrote the Tuzer Facebook or co-wrote the Choose a Fly book. So these are all forms of ongoing passive income that not only keep you in money, but also keep you fully engaged in the world and of course, doing good in the world and teaching other people how to be, how to invest, how to be better with their money, how to boost their savings rate. So, so much good stuff there.
Brian Davis: Let me ask you this about the what you said. You’re married and you have a daughter. So tell me about the role of family in your pursuit of financial independence and retirement early. You know, I get I get people all the time. Single people will complain, oh, it’s you know, this is so much harder for singles and it’s easier if you’re married and married people complain, oh, this is so much easier if you’re single. So I’m just curious about your particular take on all that and your experiences with that.
Chris Mamula: Yeah, I mean, I think I think probably both of those perspectives are valid, depending on who your partner is or if you don’t have a partner. Like I said, like I think for us it was a huge advantage, obviously, to have 2 incomes instead of one because we were on the same page. And so, like, when you have a partner and you’re on the same page, yeah, it makes everything easier because you have a kind of economy of scale. You have one housing payment or rent or whatever, your utilities, you know, it’s not going to be double because you have two people. So, in a lot of ways being married is an advantage. But like what my wife and I found is so we were always on the same page and saving just came easy. For my wife, she just grew up with a, I would say, a tougher background than I had. And so for her, saving is very much security for me. Like my dad was an entrepreneur, he had a small photography business. So we don’t have a big income. But I was kind of used to that more. I will call it like lumpy income and seasonal or good years and bad years and just being frugal and dealing with that. I kind of knew, I saw that and I knew how to make that work. And so for me, saving was much more about just opportunities to just live a totally different lifestyle. And so when we got to that point where we were approaching financial independence for the first time ever, we worked on the same page. And I would say to this day, we’re not totally on the same page. And so, yeah, I mean, it definitely it can add stress because, you know, if you’re doing this yourself, you can kind of make all the decisions. But when you have a partner, there is a challenge of that and negotiating that and getting on the same page. So, yeah, there’s definitely advantages of scale and there’s also advantages of being able to do it on your own. And we all have to just kind of figure that out.
Brian Davis: No question. No question. And, you know, I’ve had a similar experience with my own wife. You know, we we live entirely on her income and we invest all of my income. But, you know, she likes to spend in a way that I do not. So, you know, we went out this past weekend and got an hour and a half long massage, and I’m sad. And she’s like, oh, we should do this more often. I’m like, What, you mean we. But anyway. So you guys own a home. Do you own any real estate investments or no?
Chris Mamula: No, so we owned our original home back in Pennsylvania, and we were kind of in a unique situation and I saw I was in a it was like a depressed steel town outside of Pittsburgh. And so we lived in our house for about 12, 13 years and basically had 0 appreciation. We sold it for what we build it for. And then we were moving to Ogden, Utah, where it’s just absolutely insane. Here you’re looking at 10%, 12% year over year change. And so we knew we wanted to move. We weren’t quite ready yet. So we bought our house in, I guess, sort of in the summer of 2017 knowing we weren’t going to move until the next year. And we just tried our hands at landlordism for a year and kind of learned on the fly like I was. I was actually reading John Jobs building both one house at a time, like real estate has always intrigued me. So it’s reading it on the plane out.
Chris Mamula: And I was about three quarters of the way through and we made an offer on a house and I guess we better finish this book and figure it out. So we were landlords for a year, like we rented this house till we were ready to move here. But it was just it was definitely speculative, but it was a good move knowing that the market here was just going up so fast. And in the market where we were coming from wasn’t and it kind of got me interested in real estate, but it’s just the Ogden market here where we live is just not good for purchase price to the amount you can rent it for. So and I’m not quite comfortable. We did it once, like using a property manager and being across the country. But I would rather be here and be able to have more of a hands on approach. So we’re kind of holding off on that for now. But it’s definitely something that still interests me.
Brian Davis: I understand completely. All right. So what are your best tips? And I wanna split this question into two prongs. So first, best tips for people just starting out on the path to early retirement and some independence. So beginner tips and then also maybe some more intermediate or advanced tips or people who are already on the path, but, you know, maybe tips to get them to the next level.
Chris Mamula: Yes, I think the beginner path is I really think it’s just it’s vital to kind of know where your money is going. Like I said, I was never a hardcore budgeter by any means. And we’re still not. But we always knew we were living off of one salary. So, I mean, we kind of had at least the guardrails around what we were spending. And occasionally, like, if we were going to do a big splurge, like we’ve done some big trips and things, and we would dip into my income, you know, slightly maybe we spend $5.000,00. We were still saving, you know, a huge percentage for the year. And then other years we would actually save on my wife’s side. So we always had those kinds of guardrails, but we never really paid close attention until we found the whole idea of fire. And when we did, I mean, it was amazing even for us with such a high savings rate, how much money was just just bleeding out of our accounts. And we didn’t know it because we didn’t know our money was going.
Chris Mamula: So I would say, know where your money is going and kind of find some way to either track or budget or do something and then really just kind of be intentional and sit down and say, like, is my money going where I want it to? Because I think a lot of people who don’t naturally have that high savings rate, I mean, so much money just goes out of your life and very unintentionally. And so you can cut things that don’t add value to your life. And if you can do that, you can save a lot of money without sacrificing or scrimping.
Brian Davis: Absolutely, absolutely. All right, before we wrap up. Do you see any challenges for yourself moving forward financially? Are there any challenges that you see on the road for the average person who’s pursuing fire? And do you have any thoughts on overcoming those challenges?
Chris Mamula: I think for the average person, I think the biggest challenge is just getting started . Again, like I try to be humble and I don’t want to sound like bragging or anything, but I have to give my wife and I credit for just choosing to do something that was really different than everyone we saw all around us, really, without having a role model or a sense of what was even possible. We just kind of like intuited that, like, this doesn’t make sense. Like, we knew we were pretty happy and like we knew like buying a going out and buying 2 new cars and having a couple of $500 a month car payments wasn’t going to change our life. And so we just even though we saw everybody around us doing that, we chose to do something different. So I think if people can just choose to, again, just be intentional and decide what you want your life to look like and then align your spending with that, I think that’s the biggest challenge. And then I guess for me personally and I think for people that are on the path.
Chris Mamula: I think it’s really tough to be an investor right now. Like we talked about real estate a little bit. And like with interest rates so low, I mean, there’s just the demand, just some markets. Sure. I’m sure you could still find deals, but in general, it just seems like it’s so hard. And if you’re looking at paper investments, I mean, the stock market is just at such a high level compared to historical averages. Interest rates are so low, it’s really just hard to find a place to put your money to work. So I think it’s just a matter of staying disciplined, kind of having realistic expectations and just looking for opportunities as they start to arise. But right now, it’s really tough, I think, to be an investor.
Brian Davis: I hear you. I hear you 100%. Well, Chris, tell us a little bit about Can I Retire Yet? And and how people can connect with you.
Chris Mamula: Yes, so can I retire yet is my home on the Internet and very responsive, if people want to reach out and email me or leave a comment on the blog, it’s just: caniretireyet.com . And my book is Choose a Fly, your Blueprint to Financial Independence. And you can find that on Amazon or really anywhere you buy books. And I’d love to have people check out the book. And it really is a kind of an overall framework for getting started. And like, how do you actually spend less, earn more, invest better, and then what do you actually want to do once you’re on that path? So I’d love it if people would check me out in other place.
Brian Davis: Yeah. Guys, please do check out Chris Manual on how caniretireyet.com an Outstanding Fire Blog and more than just a fire blog and talk about a lot of traditional retirement issues as well. And of course, the book, is a modern classic. So, Chris, thank you so much for joining us today. This is a lot of fun. And, you know, our audience certainly appreciate your time and you sharing, such as your personal journey here with fire.
Chris Mamula: I’ve enjoyed it as well. Thanks for having me.
Brian Davis: All right. See you guys next Tuesday at two o’clock Eastern. Have a great week.