Freed by 50

Before I started writing my goals for 2022, I thought it was important to look back at previous posts. Last year my focus was on maxing out the mega backdoor Roth contribution and funding a major renovation. In 2020, my goals were to pay down my mortgage, increase my investment contributions, and fund a major renovation. Three years ago in 2019 I was working to max out my ESPP and 401k while shoring up our emergency fund…and funding yet another major renovation. And although I didn’t write a goals statement for 2018, you can see from early posts that my major focus was eliminating our last $35k in college loans, which were our only non-mortgage debt.

It’s important to keep these things in mind as you read this and all of my other posts going forward. It has been a journey, and not an easy or straightforward one. I have had setbacks, I have spent money stupidly, I have worked hard and made sacrafices to get to this point. So if you look at me today and say: “Great, another tech asshole making a bunch of money is here to tell me how easy it is to FIRE.” please consider that just four years ago I was in complete despair that I’d be paying $1000/month in college loans for four years if I didn’t save up to eliminate them entirely.

You’ll notice I’ve changed the title from strictly financial goals, to “mostly” financial goals. Starting last year I’ve been adding personal goals into the mix, and I think they’re important to keep here because life is more than finances.

Major Goals

1. Pay off the house or become a millionaire – Yup, I seriously just wrote that. I find myself in a surreal situation in which I can keep my existing savings rate and do one of these two things this year. What’s more, it’s close enough to be the same amount of money for each of these. Now I know Dave Ramsey would tell me to pay off the house. His reasoning is that most millionaires do this and it works. Paying off the mortgage would save me $2200/month and $55k in interest over the remaining 13 years. The flipside to this argument is that my interest rate is only 2.625%, I only have 13 years left, and I can make way more money by putting a couple hundred thousand dollars into the stock market this year than I’ll save by paying off my house. Then there’s the question of security; the security of a paid off home vs the security of having a million dollars available to me (although I’d argue having $800k isn’t much different).
   
   All things considered this may come down to one thing, RSU’s. The past three years I have been riding a wave of RSU’s that have allowed me to greatly accelerate my financial goals. As things currently stand, I will see a significant drop in the amount of RSU’s I have left in 2023. If I do not get a grant refresh in my February compensation review, I’ll be leaning towards paying off the house, which will lower my monthly bills by 25%. If I do get a grant refresh, I’ll be leaning towards socking the money away in the market for 2022 and addressing the house a little slower.
2. Don’t do a major renovation – If you noticed a trend in the introduction to this post, or in the blog itself, it’s that I’ve been doing major renovation projects at my house for a very long time. Between solar and air conditioning and windows and the driveway and the pool and the kitchen and the basement and the backyard it has felt like an endless parade of construction for far too long. The one major project remaining, my master bathroom, can wait…as long as I make sure the shower stops trying to leak. Not spending tens of thousands of dollars on renovations really opens up a lot of doors to spend a little more time enjoying life, which brings me to my next goal…
3. Enjoy life – For far too long I’ve felt trapped. First it was because we were struggling to have kids, then it was because we had too many kids too quickly! It has been over seven years focused almost entirely on babies (and renovations). My wife and I have been on exactly two days of vacation in all that time. We were supposed to go on our first real vacation with the kids in March of 2020 (cancelled due to Covid), and we will finally be taking that vacation in February of 2022. This year I am making a point of prioritizing time off of work, travel, and taking time to enjoy the life we have. This doesn’t always mean spending money. I really want to take the time to get together with friends and family, to make meals that take all day to cook, and to really focus on the things that make life worth living.

Minor Goals

1. Lose 10 pounds (and keep it off) – In late 2021 I set out two goals that should have been pretty easy, A- run a mile in under eight minutes, B- lose 10 pounds. I actually accomplished both. I got my mile run time down to 7:49, and by way of a very restrictive keto diet I lost 12 pounds. Only like most people I couldn’t bare to keep with such a restrictive diet and I quit, only to gain half that weight back. It’s really not about weight, it’s more about feeling right with myself, and right now I feel out of shape. I look it too. So I’ll now be going after this goal with a more balanced approach in hopes I don’t rebel against diet restrictions.
2. Drink less alcohol – This is likely the source of my struggle to keep weight off! We drink pretty often around here. With three screaming kids and a job that requires my attention about 12 hours per day I make up plenty of excuses to drink. We drink to celebrate, to deal with stress at the end of the day, to relax, etc. I know other countries don’t put as much of a stigma on drinking as we do in the US, but I probably shouldn’t be having at least two alcoholic beverages each night.
3. Rebuild the emergency fund – During the never ending backyard renovation costs ballooned well above our estimates and we had to dip into the emergency fund. This wasn’t ideal, but I was glad to have all that cash available. Now with the project mostly complete, I’ll need to make sure I have at least three months in our money market account. I should be able to knock this out in February, which is right around the corner.

This is what the boring middle looks like. There’s no more sexy goals that are cut and dry like “pay off _____.” Now it’s mostly “keep saving,” “spend wisely,” “get healthy.” I may try my hand at gardening again in the spring, but my previous attempts have been pretty bad. Maybe this year I’ll scale it back a bit.