One, more of a spender. The other, passionately frugal. One, an outgoing extrovert. The other, a quiet introvert. One, an enjoy-the-day type of person. The other, a think-and-plan-the-future type of person.
I could go on, but you get the idea. Mrs SMA is the yin to my yang. We have both changed a bit over the years, and perhaps come to embrace the positives of each others’ attributes.
And you’re in luck today, because we go behind the scenes for a deep discussion with Mrs SMA, who is much more of a ‘normal’ person than myself.
— How I managed to convince her that frugality and Financial Independence was the way to go.
— How she felt about spending less, and whether our ‘sacrifices’ have been hard.
— The frugality tips she has for other ladies out there.
— What she likes to do with her spare time.
— How we came from a ‘property-only’ mindset to embracing the sharemarket.
— How spouses should approach each other when it comes to FI and working together.
— Plus much, much more…
Introduction – Who is Mrs Strong Money?
We’ve been together for about ten years now (I think that’s right) 😉 Thanks for putting up with me for this long, by the way. First, can you share a bit about yourself? What kind of things do you like to do in your spare time?
I’m originally from Darwin and moved to Perth end of 2009. Prior to this, I’d visited Perth many times over the years to see friends and relatives. I’ve always preferred the weather in Perth, opposed to Darwin, and I finally moved here after my marriage break-up.
I go back to Darwin once or twice a year to see family, including my 2 adult daughters, who also occasionally visit Perth (as Dave has mentioned, I’m quite a bit older than he is).
Horses were always my passion in Darwin. This led me to volunteering for many years at Riding for the Disabled. Helping those less fortunate gave me a lot of satisfaction. I also did this for a short time in Perth, although it was hard due to working full-time and now having knee issues.
Gardening is now my favourite activity. I wasn’t confident at first, but have surprised myself by not killing everything I grow! We now have a nice collection of potted fruit trees and veggies on the side.
It’s great starting the day going for walks with Mr SMA and our dog, as well as going for bike rides practically every afternoon. I catch up with family and friends when possible, and also enjoy reading. (more here: Life After Financial Independence)
What kind of work have you done career-wise, and what do you do now?
I was a Travel Agent for many years, and now work part-time doing mainly Data Analysis and Admin with the Government.
Everyone knows I’m passionate about frugality and avoiding waste for its own sake. As we got to know each other, did you think I was a little unusual when it came to money? And are there any moments you remember thinking “wow this guy is weird”?
Well to be brutally honest, I thought you were a bit of a “tight arse” lol. I came to the conclusion everyone is different, but definitely thought you were a bit weird with money.
One thing I remember, you offered to take me out to lunch which I was quite excited about. Then, to my dismay you took me to IKEA for $1 hot dogs! This confirmed my initial suspicions of the “tight arse” title! LOL.
(Dave: Haha – in my defence, I said you can have as many as you want and we had a (re-fillable) drink too) 😉
Teaming up for Financial Independence
Let’s start at the beginning. Do you remember our first chats about investing together and possibly retiring early? What were your initial thoughts?
As I’d owned property previously (which was sold to help reduce my mortgage), I was excited to invest in property again. My thoughts in the beginning were that property was the only way to go if you wanted to get anywhere in life. So I was extremely happy that you were interested as well, and that we could commence this journey together.
Did you actually think retiring early was possible? You weren’t just going along to keep the peace? lol
After talking with you, I did think it was possible… but before that, not really. And I knew it was going to be a long term thing. But I was happy to have goals to work towards and that we wouldn’t have to keep working forever.
What was your attitude towards money like when we met? And has that changed over time?
Unfortunately, my attitude towards money when we met was to spend it and just enjoy today. But having discussions with you, slowly but surely, changed my way of thinking.
I learned that I didn’t have to miss out on the things I liked, and also that a lot of my spending was for a short-term high. But as we found lower cost ways to get the same things and seeing the progress we were making in reaching our goals, this motivated me more.
I remember you saying you wanted to never think about it and spend whatever you felt like (because your last partner liked to save too and you felt like letting loose a bit)? So, I can imagine you probably weren’t too keen with my idea of spending less so we could save and invest more?
Yes, my previous partner was also into saving and investing (in property). We were always very tight with money, so the idea of going through this again was not high on my wishlist.
So, when you mentioned spending less, my first thoughts were “oh no, not again!” But when you actually showed me in great detail how this can work, and gave an actual time frame when we could retire, I started to come around.
Improving Our Finances
We changed a number of our spending habits over time. Can you share some of these?
I remember we went on a few international trips together and then realised we hadn’t seen much of our own state. We decided to travel locally within WA and in doing so, were able to include our dog. Spending time together and just being able to go somewhere new is a very enjoyable holiday to me.
We decided to get rid of one car and replace this with a scooter. As my workplace was only 10 minutes from home, I felt comfortable enough riding to work. It actually felt quite invigorating starting my working day, especially in winter lol. Also, instead of going out every weekend to cafes for coffee, we purchased a pretty cheap coffee machine and enjoyed a nice cuppa at home more often.
As a female, you did some impressive optimising of your own. Can you tell us about that?
Instead of frequenting the hair salon every 4-6 weeks, I learned how to colour and cut my own hair (thanks Google) 🙂 As my hair is quite long, it wasn’t hard to trim it and colour the roots as needed. However, if I ever wanted something completely different, I would definitely go to the experts and not attempt this myself.
I can’t remember the last time I bought a new outfit. The op shops are definitely my favourite places to go. I was even able to buy a dress (brand new with tag) for my daughter’s wedding for a fraction of the price than if I went to buy retail.
I’m a little more fussy with footwear, as unlike clothes, there’s more of a hygiene issue here. So unless the shoes are in near new condition (which I have bought from Marketplace on Facebook), I do buy these retail…on sale of course.
Even for most of my makeup, I’ve saved heaps by buying from Marketplace where people have bought an item and have found it’s the wrong colour etc. It’s amazing what you can purchase for less than half-price by searching around.
Everyone loves a bargain, so in my mind, it makes total sense. I also feel I’m contributing in a positive way in helping with the war on waste, by recycling and buying second-hand.
As we changed our spending, our savings rate went up dramatically. So, the important part is, did your enjoyment level change?
I must admit, I was very shocked in how much our savings rate did go up just by doing things a bit differently. My enjoyment level hasn’t changed at all. It’s been very satisfying to find new ways to enjoy the things we like, without spending as much as before. (more here: If the FIRE Journey Makes You Miserable, You’re Doing it Wrong.)
Our household spending has fallen pretty much every year since we started making an effort. It’s now the lowest it’s ever been and probably half what it was when we first met. Are you surprised we used to spend twice this much? Do you think our standard of living has fallen every year?
I cannot believe how much our spending has reduced (mainly from my side, of course). But the thing is, I don’t feel I’ve missed out on anything. I’m still able to do pretty much what I was doing before, but doing things a lot smarter.
There’s so many different ways you can optimise what you spend your money on. In fact, I’m very content and happy with our standard of living and wouldn’t have it any other way.
Reflections on the journey
What made you feel that the end goal of long-term freedom was worth the short-term sacrifice of spending less? And has it actually felt like sacrifice?
Admittedly, I thought I was going to have to sacrifice a lot of things. I was very dubious at first, but eventually my barriers came down, and found it wasn’t that bad after all.
When you told me how each of our spending improvements was speeding up our progress and bringing our retirement date forward – that’s when I definitely realised it was working and the changes were worth it.
Was there anything you wish we did differently? Anything that was particularly difficult along the way?
Yes, I wish we did this sooner lol. And knowing what we know now, we should have started off with shares opposed to property. It was very hard in the beginning, with you doing so much overtime. Then again, this made the days we had together even more special, and was definitely worth the short-term inconvenience.
What’s the best way for someone to get their partner on board with their FI dream? Could I have approached it with you in a better way?
The best way is to persevere and try to show them how it can work. Having the figures in front of me really helped get me on board. When you can give a time-frame and show the progression along the way, that’s even more convincing.
You couldn’t have approached it any better. In the beginning, every time we broached the subject of spending less, I kind of shut down a bit. So I would have put my guard up whichever way you chose lol. But I learnt to trust you because you kept me updated on our progress.
I think it’s always going to be hard to try and discuss with your partner that spending habits need to be changed. Well….some might be more open than others 🙂
Were there times when you thought it wasn’t going to work, or it was going to take forever and you just wanted to stop?
No. Because I could see it was working, this only motivated me more. The only time I may have thought it was going to take forever, was when you were doing all the overtime. We didn’t see each other much due to your shift work. But it wasn’t for very long, in hindsight. Just seemed like it at the time.
As you know, I kept reviewing (obsessing over) our situation. Because of our optimising, and regularly questioning what we really needed to live on, it turned out that we needed less and less to retire. So, our retirement date kept coming forward… did that seem strange to you?
Yes. It was such an exciting feeling when the retirement date kept getting closer and closer. My first thoughts were, “wow, it’s really going to happen.” Previously, I’d never dreamed I could retire earlier than the normal retirement age. But on the other hand, it also made me more impatient as the date edged closer.
A Sudden Change
From the start, we invested heavily into property because that’s all we knew. Later on, I learned about shares and dividend income. The biggest moment came when I realised we could basically retire straight away if all our savings were in shares rather than property. Do you remember that? And what did you think at the time?
I was very hesitant on that idea when you first put it to me. Looking back now, I realise it was from pure ignorance. Investing into property has always been suggested as the number one way to get ahead. This was always instilled into me, either from parents, friends, media etc. So when you suggested this, I was definitely very sceptical.
Clearly, you weren’t keen on shares! So what made you come around to the idea?
Initially, I perceived shares to be like gambling your money in a casino. But later, I realised it wasn’t all about buying and selling based on prices moving up and down. And that we could own lots of different companies, hold, and receive regular income payments. (more here: An Open Letter to Property Investors and Sharemarket Newbies)
We’ve sold a few properties now over the last few years. Initially, you wanted to keep some property in our portfolio. How do you feel about that now, and why?
As my understanding of shares has grown, and we’ve been selling some of our properties, I can see the progress we are making (in getting more dividend income). And if we hadn’t changed our view and stuck with property, we would both still be working.
Not a month goes by, where we don’t get some sort of contact from our property manager. There’s always some type of maintenance or an issue with the tenants to deal with. Whereas with shares, it’s as simple as buying and waiting for the dividends to come in.
The only reason I wanted to hold on to some property in the beginning, was a fear of the unknown. Having never invested in shares, I wanted us to do it slowly so I could see that it was working.
Life during early retirement
After we retired, you took about a year or so off. How was that first year? And why did you decide to go back to work?
The initial realisation of actually having the year off was so exciting. Not having to wake up to my alarm and go through the daily routine of getting ready for work was wonderful. I think it took a few months to come down from the high of not having to go to work. (more here: Reflections On A Year of Freedom)
The funny thing was I never got bored, yet this seemed to be the most common question asked from everyone. There were always enjoyable things to do to keep me occupied. That’s when I started experimenting with gardening and realised I wasn’t so bad at it. Bunnings became my favourite place to go 🙂
I enjoyed the free time. But after a while I began to miss the social aspect of a workplace. So I put the idea to my old boss to go back part-time (2 days a week). He was open to this and I find it works perfectly for me. So for me, this is the best of both worlds.
It’s so much better being able to do things during the week. But I also noticed that it’s still hard to catch up with friends (because they’re working).
How do you enjoy spending your time nowadays?
I’m pretty much continuing with the things I really enjoy doing. Gardening, reading, bike rides, exercising and just enjoying the outdoors and not having to stress about much at all. I also like when we do our volunteering with Friends Of Yellagonga Regional Park, which we started a few months ago.
What’s the best part of being FI? And what’s not so good?
The freedom to choose whether to work or not. It makes such a difference with my mindset, going into work knowing that I don’t actually have to be there. Work is much more enjoyable now compared to when I was full-time.
Before I went back to work (part-time), the awkwardness of conversations when people asked what we did for a living, wasn’t great. Some of the looks people give you when you tell them you’ve retired made me feel like we were not normal. And that’s when we always got the same question…. “But don’t you get bored?”
What do you think helped us most in terms of being able to reach Financial Independence?
The consistent learning and knowledge Mr SMA gained and passed on to me. Without giving him a big head or anything :), if it wasn’t for him, I don’t think we’d be in this position.
Also, by having the faith that if we stay focused on what we were doing (saving lots and investing) we would eventually reach our goal.
Advice for others
What are the biggest mistakes you see people making with their money? Either peers at work, or people you know.
Mostly just spending on expensive holidays, renovations, latest technology etc. Which is fine if that’s what people want to do. But I also hear a lot of complaining about having no money and not wanting to be at work.
I do get a few digs from people saying, “It’s alright for some… part-timers!” But then I think they can also be in the same position if they optimised their spending. I do make suggestions sometimes, but they don’t seem willing to try.
Any last words of advice for couples who want to retire early?
If it’s one spouse trying to bring the other on board, remember to be patient. Eventually, they will see what you see, but it will take some time.
By making small adjustments to your spending over time, your spouse will see that saving more is not so hard, and doesn’t have to mean big sacrifices.
Realise you can still have ‘date nights’ and similar outings. Just aim to eat mostly at home together, and when you do go out to eat you’ll appreciate it more.
To get your savings up and your spending down, you can still live pretty much the same lifestyle you do now. It’s just about doing it in a smarter way, where you get to enjoy quality time together, see new places etc., while still making your way to Financial Independence.
For the fanatics trying to convince a spouse, maybe this post will be helpful to read together. And maybe your other half will see that having a high savings rate and living frugally isn’t as scary as they might imagine 😉
Thanks to Mrs SMA for sharing her thoughts and insights as a ‘normal’ person! She forgot to mention that she also proof-reads all the content here (since I make a few errors!), and typically reads the comments too.
There was a lot of good points to takeaway from this interview. Here’s what stood out to me…
— Sometimes we have emotional baggage in the area of money and that can take time to overcome.
— Communication is key. Couples need to do their best to get on the same page, by sharing a vision for a better future, while also explaining how it’s going to work.
— Sharing the progress and the wins along the way helps to reinforce positive habits.
— Small changes can make a massive difference. Altering spending in little ways over time can leave you with a much higher savings rate, without a loss of life satisfaction.
— You don’t need to have everything figured out at the start (or the best investment strategy). If you get the main things right – lots of saving and regular investing – you’ll do just fine and can always adjust course later.
Now it’s over to you. What were your takeaways from this interview? Let me know in the comments…