FIRE!

How We Got Here, and What's Next

Damien and me posing on the steps of our first home in 2013.

Hello, beloved readers! I rarely take the time to share updates on my posts, but I have a couple of important ones this time.

• Welcome to the new subscribers to Letters from the Questhouse. I’m so grateful you’re here. This is a wide-ranging and highly personal newsletter about hunkering down and doing what really matters. I write about a variety of subjects, ranging from the challenges of writing, to AI, to lessons I learn from my brilliant and beautiful family.

• Thank you from the bottom of my heart for all of your encouraging texts, messages, emails and hugs after my last post. Since I wrote last, I have been working hard to grow and develop my voice, and I even had a lesson with the legendary Patti Cathcart of Tuck and Patti fame. My biggest takeaway from the lesson: I have to stop imitating other singers and learn how to sing like myself, a worthy challenge if ever there was one.

• Finally, I’m sorry this essay is a couple of days late. Our dog Wiley had a health crisis, and I didn’t have the bandwidth to write until now. (He’s doing much better!)

Earlier this week, Damien had his last day of work at Google. And I saw my last coaching client about nine months ago. We’ve been struggling with what to call this transition in our lives.

Saying we quit would suggest that we were dissatisfied with our jobs in some way, which isn’t true. As corporate jobs go, Damien’s was pretty fantastic. He got to solve thorny problems to make people’s lives better. And I loved both teaching and coaching and felt a great deal of pride in the little business I built.

Saying we retired, though, also feels wrong. Our careers didn’t end with a gold watch and a pension, and we’re not old enough to collect Social Security.

Besides, retirement implies retreat. People retire from sports matches because of illness or injury. People retire for the night because they’re tired. Retiring people are shy and passive by nature. Damien and I aren’t retreating from anything - we’re moving toward the things we want to do without the burden of needing to earn money.

The best way to describe the trajectory of our financial lives is as members of the FIRE movement, which stands for Financial Independence, Retire Early, though we never considered ourselves to be part of any movement and didn’t know much about it. I discovered recently that there’s even a name for the specific strategy we employed: Coast FIRE. People who Coast FIRE save a lot of money early in their careers. After funding their nest egg, they downshift to less stressful careers to cover expenses while their wealth grows. When their nest eggs are big enough, they begin full retirement.

Though 57 and 60 aren’t much younger than the average US retirement age of 62, Damien and I got a late start, and so our path to full retirement took about fifteen years, five of which we spent working part time. We got here through a combination of hard work, luck, discipline, privilege, and a tax system that allows people to consolidate their privilege.

When Damien and I first met, we were in our mid-forties and both pretty much broke. Damien was living with a roommate in an affordable rental house and doing (very) part time freelancing to earn just enough to live. I had recently moved to California from Maine, gone through a divorce, and was putting my kid through college on a teacher’s salary. My net worth consisted of a five year old Subaru and what I could fit into it.

We spent the first ten years of our relationship working full time and spending much less than we made. Part of our earnings came in the form of Google stock, which was worth about $17.50 per share when Damien started at Google and is now worth almost ten times that much.

After a few years in our jobs, we were lucky to buy our first home together in 2012, near the bottom of the historic housing crisis that began in 2008. We chose a 15 year mortgage, and we paid off extra principal whenever we received a windfall. For the first several years, we rented out our back cottage to help pay the mortgage. In the FIRE world, that’s called house hacking, but to us it was just common sense.

A couple years after we bought the house, we purchased a duplex in Yuba City, a small city near Sacramento that had low housing prices relative to rents. We plowed the rent proceeds into paying off the mortgage. Three years after we purchased it, when real estate prices in the area appreciated faster than rents, we sold the duplex, depositing the profit into a 1031 exchange, which we used (along with some of our savings) to buy two properties in Maine. Until just a few months ago, almost all the rent proceeds went into renovations, but now, just in time for our early retirement, the apartments have begun to turn a profit.

Damien and I didn’t have any kind of overarching plan in doing what we did. We bought a house together because we wanted to put down roots in Santa Cruz, and we hated throwing money away for rent each month. We hung onto the Google stock because we believed in the company. We bought apartments because, much as we hoped Google would keep growing forever, we also wanted to own something tangible, in case the bottom dropped out of the tech market. We also both derive satisfaction from providing comfortable, well cared for housing at a reasonable price.

Our transition from full time to part time work happened gradually. In 2015, a couple years after we moved to Santa Cruz, my long commute became too much for me, and I went part time. A couple years later, Damien also began to work part time. Even with only sixty percent of our former income, we spent less than we earned, which helped me feel brave enough to leave my teaching career to start an ADHD coaching business in 2017.

During the pandemic, both Damien and I were able to shift to online work, so we sold our little Santa Cruz house (which was well-located for Damien’s bus commute to Google but was really cramped) and bought a much larger but similarly priced house in La Selva Beach. Because of California Proposition 60, we were able to sell our Santa Cruz house at a huge profit and transfer our original (much lower) tax basis to our new home. Both Proposition 60 and Proposition 13 (which limits the property tax rate to 1% plus the rate needed to fund local bonded indebtedness, and also limits future property tax increases to a maximum of 2% per year) are regressive policies that we benefited from. I wish we lived in a society that viewed housing as a right, not a commodity.

So, that’s how we got here. Through it all, we have been conservative in our approach, keeping our debt burden very low, living below our means, and working a couple years longer than we really had to. As the Coast FIRE name suggests, we pedaled hard for awhile, and now we can enjoy the ride.

We weren’t just careful with our money; we were also careful with our time. As soon as we could shift to part time work, we did it, not because we disliked our jobs, but because we didn’t want them to be the center of our lives. With our free time, we cultivated friendships. We took care of our bodies by making time for good sleep, good food, and exercise. And we took our “hobbies” seriously, joining tennis teams, forming bands, and building Letters from the Questhouse, among other endeavors.

Why am I sharing these gory details with you, my dear readers? I hate talking about money. This isn’t a personal finance blog. But it is about hunkering down and doing what matters. And I think it’s important to share that, even in a crazy expensive economy like the Bay Area, it’s possible to build an abundant life without grinding ourselves down to nothing in the process. And the story we’re all told, that our value derives from what we “do” and how much we own, is bogus.

Home ownership also isn’t the only path to financial freedom. For example, my badass SIL (sister-in-law) Taylor was also able to retire in her fifties by living frugally and investing in annuities. She derives meaning and satisfaction (as well as some helpful income) in her post-retirement life by petsitting, and she would never go back to a corporate job.

Damien and I had lots of advantages. We both had good educations, and software engineering is a highly paid field. We only have one child between us, and I had her so young that she was launched long before I began to consider retirement. We’re married, which confers a host of benefits, financial and otherwise.

Still, when Damien and I got together in 2008, owning a home seemed like an impossible dream. We were in a housing crisis and a full blown recession, and it was hard to imagine that we could ever make it to where we are now.

Though we shared strategies with members of the FIRE community, I actually feel more kinship with the OGs of the voluntary simplicity movement, Vicki Robin and Joe Dominguez, whose 1992 book Your Money or Your Life was a huge inspiration. As Vicki Robin says, “You have to want something more than you want stuff,” and the folks who are hellbent on retiring early with no idea of what to do when they get there are in for a “huge identity crisis.”

I’m hopeful that Damien and I will use our time wisely and well. In my nine months of freedom from paid employment, I have sometimes struggled to find my way, and I have felt almost ashamed to admit that I’m not working for money anymore. Writing this essay has been, in part, an attempt to shake off my ambivalence and move forward. Even after just a week, I can tell that having Damien also “rewired,” as my dear friend Tom Leitzke used to call it, will help a lot.

I look forward to reporting on our new endeavors here at Letters from the Questhouse.