Jul 1, 2020 | Uncategorized
‘Hey, Honey! Let’s pack up the kids, sell the house, and move overseas with no income!’
‘Sounds good, Babe. I’m in!’
The end
Even though that is way, way over-simplified, that is more or less the conversation my husband and I had in 2016. We had played around with the idea of moving overseas for a while, and both of us wanted the kids to have another experience of ‘normal.’ After the 2016 Presidential election, we realized that our vision of the world was more and more out of sync with what was happening in the US.
It took years of research, planning, and focus, as well as a couple of heartbreaks, but in July 2019 we started our new life in Stavanger, Norway.
Let me start by saying that I realize we had a lot of advantages that allowed us to make this goal a reality: steady, well-paid jobs, no debt outside of mortgages, and a generally frugal lifestyle. But that is part of the reason that I write this: to help others understand what lifestyle design – especially a MAJOR readjustment – takes and how to use the knowledge and skills you have to put yourself where you really want to be.
Step 1: Reflection
This step is such a part of who I am and what I do that I almost forgot to include it. But I realized that this is the keystone that holds all of the other steps together and gives you the best chance for happiness in whatever life you choose.
And by reflect, I don’t mean reflect on what you want, I mean reflect on WHO YOU ARE. Both Robb (my husband) and I have a really strong sense of self. Even before we started talking about a move, we knew that our deepest moral convictions didn’t match what we saw happening around us.
We weren’t OK with the number of people (especially children) living in poverty, the divide between Black and White and Asian and Latinos and Native Americans, the increased polarization of politics, or the growing culture of violence. Both of us had spent the majority of our professional lives trying to solve these problems in some capacity: him as a consumer advocate and me as a teacher in low income schools. We had protested before protesting was cool. We had contacted our legislators. We felt like we had to resign ourselves to living in a grossly unjust society, which we could not do. So we went for option B: leave.
Now this is a whole blog post on its own. Things aren’t perfect in Norway and I’m not going to say they are. But we both feel more comfortable here. However, in order to realize this, we had to name what was bothering us and admit how much it was bothering us. Because we knew ourselves, we knew when it was time to seriously try something new. And we were also able to stay the course when things got really tough.
Step 2: Reconnaissance
We were hoping to move in the summer of 2018, and we knew this would be a huge undertaking with three kids, especially one who had some issues with anxiety. We didn’t want them to freak out any more than necessary, so we decided to do a family trip. During the summer of 2017, we travelled to Norway as a family and spent 3 weeks in Oslo and visiting with distant relatives.
Besides demonstrating to the kids that Norway is the land of 10,000 playgrounds and giving them a positive feeling about the country, it allowed me to actually experience how expensive things were. (REALLY expensive!). Without that, I don’t think I could have made budgets that were realistic, because honestly, who would believe chicken breasts could possibly be almost 5 dollars a pound – on SALE!
There were a hundred little things we gained from our reconnaissance vacation, but the big one was a feeling: ‘Yes. We could live here. We could be happy here.’
Steps 3 – 5: Research, realistic projections, readjustment
I put three steps in one here, because it is kind of a continuous loop. I researched, created projections (translation:budget) and then readjusted as I got more info. We didn’t know where we could be living until about 3 months before we actually left, so I was researching four different cities: Oslo, Stavanger, Trondheim, and Tromsø. We over-estimated costs and under-estimated income. How much money would we need to live with absolutely no income for a year? How long could we make it on 50K? (Not long!) 80K? 100K?
Even though it is impossible to think of everything (as evidenced by the global pandemic that hit about 9 months after our move), I did my best to leave no stone unturned. Some of the things that I checked on were costs for housing, transportation, food, utilities. And whenever possible, I would recommend checking ACTUAL sources. For me, that was finn.no, the go-to site for all things second-hand in Norway. I also checked sites that give comparison costs for groceries in different countries.
But it wasn’t just the costs. We also had to research ways to live in Norway legally. Even though Robb has Norwegian heritage, immigrating to Norway is extremely difficult.
One of the places we used to do research on this (and a lot of other weird stuff, actually) was Facebook. There are a ton of ‘expat’ Facebook groups where you can search to see if your question has already been asked. If not, you have hundreds of people with real world experience who are usually very willing to help. (Assuming you already checked the previous threads and didn’t ask a question that is posted approximately once a week. Then, they can get a bit testy.)
After gaining some basic info – including that education is free in Norway, and most Masters degree programs use English as the language of instruction – SCORE!!!! – we checked out the Norwegian government sites. We finally decided that my husband would apply for two programs in his field, and I would apply for one.
Step 6: Regroup
After applying, we were in limbo from about December to April. That’s a long time to wait when you may be moving your family to a different country. I kept researching like a mad woman, tried to declutter whatever possible, and kept socking away my pay check. (For more info on how we planned financially, check out this blog post.)
We got the first response in March. It was a ‘no’, but it wasn’t our first choice anyway. Then the next one. Again a no, but not one we were hoping for. Then I came through the door one day, and Robb said, ‘We heard from Oslo. I didn’t get in.’
Wow! Didn’t even know what emotions I was feeling. On the one hand, I was thrilled that we would have another year to save (and that turned out to be a HUGE bit of luck) and that I would have another year in my dream job teaching English to non-English speakers. BUT, we were also really disappointed. We had worked so hard, and of course, there was no guarantee it would work out for the following year, either.
I will say this, though. I don’t think that either one of us really considered NOT trying again the next year. Pretty much the first thing we did, was return to the ‘Study in Norway’ web site and find Every. Single. Program. that we qualified for.
In 2019, we applied for every possible program. We were determined to get to Norway. Again with the waiting. Again with the suspense. But this time, I got an acceptance from the university of Tromsø in March. We were 100% for sure going to Norway. But Robb still hadn’t received his responses, so we didn’t know for sure whether we could accept my position or whether his would be a better fit. So we waited. He got a no.
Then a ‘Yes’! We were only waiting for Oslo, his first choice program, the one that was an almost perfect match for his experience.
And then the answer came. No. But we were going. We were moving to Norway after almost 2 years of trying. Stavanger, Norway would be our new home.
Step 7: PANIC! And become best friends with good enough
You may have noticed this step doesn’t continue my lovely ‘r’ theme. As an English teacher, I can tell you there is some symbolism to that: everything went to heck. Sometimes there is just more to do than you have time for. We had approximately 3 months to prepare our house to sell, pack everything we were keeping into a shipping crate, and get rid of everything else, all while caring for 3 kids and working.
This is actually one of the more sensitive topics of our move for me because I felt completely out of control and pretty much like a failure through most of it. When we came to the last 2 days, we still had things in our house – LOTS of things. And we were flying out whether we got them out of the house or not. We accepted that we would have to hire a clean-out service and shifted tactics from getting everything out to making sure we didn’t leave anything precious behind.
We also had to sell our car. It was one of those things that just didn’t get done in the mad rush because we both needed transportation. So we were sitting in a used car chain on the Saturday night before we left on Monday waiting for a quote that turned out to be about half of what we would have gotten if we had the time to sell it on our own.
But like I said, we became best friends with good enough. Our priority was getting to Norway, and we had built enough cushion into our finances that the money we lost on the car was an inconvenience, not an emergency.
As we left, I had tremendous guilt about not leaving things the way I wanted to. Flying to Norway, and even for a few months after we arrived, it hurt me to remember those last weeks. But now, those feelings are receding into the background as I realize that we did what we had to do to get our family to Norway and to our new life. I’m thankful that we are here and I just have to accept that we did the best we could in a really hard situation.
In other words, there is a happy ending. Or perhaps it would be more accurate to say there is a happy beginning. If you want to check out our adventures in Norway, head over to World of Wonders, where my husband and I write about our life in Norway.
And if you are dreaming of a major lifestyle change, remember, You’ve got this!
Jun 21, 2020 | Uncategorized
Broken air conditioners. Late rent. Evicting problem tenants. Replacing carpet torn up by dogs that were not even supposed to be in the apartment. After I bought my first investment property in 2002, those issues (and more) became a normal part of my life for over a decade.
And at the time, I wasn’t putting even a dime in my pocket. I had chosen to put 100% of the rents from the 13 units I eventually owned or co-owned back into the real estate.
I’ll be honest. It was a drag, especially during the great recession. Our tenants moved out, and we had to start dipping into our cash reserves to pay the mortgage. At that point, my partner wanted out. I believed it was the worst possible time to sell, and stuck it out, buying out his interest.
In 2018 & 2019 (that’s 17 years from the starting point, for anyone who is math-challenged), when the market had FINALLY rebounded, I sold the majority of my rentals. Because I had consistently put that money back into the real estate, they were paid off by that time. I deposited checks for almost $250,000 during those two years. That’s and amount equal to almost 6 years of take home pay from my teaching job. AND I still have about $1500 of passive income each month.
And that, my friends, is the power of the long game in side hustles.
I am all about side hustles that give you cash today, especially if you are trying to pay down debt. But once you are on firmer ground, the long game side hustles can be a source of very real wealth.
If you are interested in creating a side hustle that will pay off for years to come, there are certain things you need to understand or you will get discouraged. During the great recession, I saw a ton of people trying desperately to get out of real estate. They had an unrealistic idea of what the long game was, or maybe they didn’t realize the huge rewards they could get if they just stuck around.
So if you want to pay the long game, here are some lessons, insights, and pointers to give you a realistic idea of what that might mean.
Prepare for the worst, work for the best, and be happy with anything in the middle.
That’s not my idea. It’s a paraphrase of Maya Angelou. But it’s a pretty good idea of what to do if you are going to play the long game. Again, I’m going back to the great recession of 2007-2010ish, because that was a huge moment in real estate. A moment when a lot of investors lost everything.
Unfortunately, my sister and I bough 4 units shortly before the big downturn. But fortunately, we bought them with that ‘prepare for the worst’ idea in mind. Instead of putting down only 10%, or even less – like some people encourage you to do, we put down over 20% and made sure that we could cover the mortgage out of our own salaries if need be. We also didn’t take any money out of the real estate. In other words, for the two years or so during which we were actually making money each month, whatever was left over after paying the bills just sat in our bank account and grew until we needed it.
And need it we did. That extra money was a lifesaver. At one point, we had 3 out of 4 units unoccupied. That’s pretty unheard of, but our small town was really hit hard. To translate into dollars and sense, we had about $500 a month coming in, and a mortgage payment of $1040, not to mention water bills, property taxes and any other expenses. But we used that money we had saved up when times were good, and we knew that even if we burned through that, we would be able to cover it from our own incomes. So yes, we did have a backup plan for our backup plan.
If you are going to play the long game, remember that it is a LONG game. Don’t check the score every 10 minutes.
When I bought those first apartments in 2002, my plan was for them to pay for my kids’ college. Yeah, I didn’t have kids yet, so even going in, I knew it was the long game.
Knowing I was playing the long game helped me to remember that I wasn’t worried about what happened over a year or two years. I was looking at the 20-year time frame. So when the taxes were higher than I expected or we had a tenant who really tore up the apartment and we had to put a ton of money back into it, I wasn’t as likely to freak out. I knew that those things happen, and I knew it would even out over time.
The other thing that keeping the long game in mind helped me to do was NOT sell out at a loss. No shade for my partner. He made his decision based on his life at the time and what his goals were right then. But he did choose to sell out just as the market hit pretty much its low point. We weren’t making money that year. We were losing money. And he just kept seeing it go down the drain. So he sold his share out to me at a loss.
I knew we were losing money that year, but I also knew I wasn’t worried about that year. I was looking at the long game. So about 4 years after he sold out to me at a price equivalent to $150K, I sold 5 of the 6 units for $230K. I still have one of those units that pays me about $500/month.
That’s the power of knowing that you are playing the long game. It keeps you from messing things up for yourself because of what is happening in the moment.
Business is a snowball
When you are playing a ‘long game’ it is often like rolling a huge, huge boulder. At first, even a tiny bit of movement takes incredible effort. You push and strain and push some more just to move that massive rock a centimetre. But once it is moving, if you keep exerting that same amount of effort, it moves a bit faster. And then a bit faster. And then a bit faster. Suddenly, you look up and realize that you really couldn’t stop that boulder if you tried. (I would advise you NOT to try.) The cumulative efforts that you have put into rolling that rock are now allowing you to work a bit less hard and still keep the rock moving.
This concept applies to real estate (look at a chart showing how much principle is paid off each year of a mortgage), but to getting clients, building a brand, and a million other business processes, as well.
When I started my language teaching business, I had to hustle my butt off to get ANY traction, ANY forward motion. To get my first preschool class, I probably had to make 20 calls and teach 15 free class sessions for exposure. My second one was easier. And on it went from there. Even a full year after I sold my business, I actually had people contacting me for language teaching because they had heard of my business through word of mouth.
But you will never get to that point if you don’t do the hard pushing in the beginning OR if you get discouraged because things just don’t seem to be moving as fast as they should for all of the work you have put in.
And right at the moment I’m writing this, I am SO right there with you. I’ve set up my web site, written over 30 blog posts, created more Interest pins than I ever wanted to, and taken several courses on blogging. Have I made a penny? No, I have not. But I’m not quitting, because I know that you never get where you want to go if you quit. And you watch this space, cause big things are coming.
If you are playing the long game, I’m right there with you. It’s not going to be easy, but if we keep at it, it WILL be worth it. Hang in there, cause we’ve got this!
Jun 9, 2020 | financial freedom, financial independence, Increasing income, Personal Finance, Uncategorized
I am a personal finance nerd. If you have been reading this blog for any length of time at all, you probably know that. But I realized recently that I haven’t really explained much about multiple streams of income and why I am totally committed to this idea.
What does multiple streams of income even mean?
Multiple streams of income became kind of a buzz word during the 1990s when Robert Allen published a series of books on different angles of this concept. The basic idea is that people who are wealthy often don’t rely on a single income source. They might. For example, a family in which there is one high income-earning spouse who brings home income and the other spouse does not contribute to income earning at all. However, in order to TRULY not have more than one stream of income, they would have to have no investments in dividend earning stocks, no income real estate, absolutely no other sources of income. That is actually pretty rare.
On the other hand, a family that had 2 income sources would be a family in which both spouses earned income, OR one spouse earned income AND they had some other source of income, like an apartment they rented out, or a bedroom they used for AirBNB.
It has been over 15 years now since I have truly had only one source of income, and it’s pretty clear I’ll never go back.
Why I love multiple streams of income.
In two words: freedom and security. I know those are two words that are often used as opposites, but if you have multiple streams of income (and you have chosen them well), you get them both.
First, multiple income streams can provide security that no single income source can. You’ve heard the old saying about putting all your eggs in one basket? Well, that’s what you are doing if you have only one income source. Unfortunately, if that one source goes away, you have no income.
A lot of people who thought that their jobs were incredibly secure before the Corona Virus pandemic have lost their income because their job can’t be done without face-to-face contact and it is not considered ‘essential.’ While it is true that a lot of people’s side hustles have taken a huge hit, as well, having multiple sources of income means that the chances that you will still receive SOME income are greatly increased. And the more sources of income you have, the more likely that one of them will not only survive, but THRIVE during downturns.
So, security. Big, hairy, wonderful reason #1.
Freedom
Who doesn’t dream of freedom? Hopping from Greek isle to Greek isle sipping – well – whatever wonderful things they sip on Greek isles?
And if that is REALLY what you want, then absolutely, go for it! I’m cheering you on!
But freedom comes in many different flavors. Even an increase of $10K a year can give you so many more options. Options of where to live, where to eat, where to vacation. So yes, definitely short term, it gives you more freedom to have more income, and that is a great thing.
But it can also give you more freedom long-term, as well. My side hustles over the years (paired with other financially responsible decisions) put me in a position to grab my own personal dream when it came along. I’m writing this from Norway, where I now live with my family and teach part-time at an International school. In a couple of minutes, my train will run along the fjord, and I’ll be able to see the mountains on the other side of the sparkling water. Yup. To borrow from McDonalds, I’m LOVIN’ it!
But whether your long term dream involves Greek isles or Norwegian fjords, or just staying home with your own kiddos for a few years, multiple streams of income really increase the chances of you making those dreams a reality.
BUT, you must remember this.
So I’ve painted a pretty rosy picture of this multiple streams thing. And, that’s not hype. I totally believe that the more solid income streams you have, the more freedom and security you will built into your life. But there is a catch.
Some income streams actually LIMIT your freedom and security if you don’t use them well.
When I started my language teaching business, I forgot this rule. I saw an opening in the market because I knew that American parents wanted their preschool kids to learn Spanish. So I focused my energy there. My business was growing. But just about the time it started to really take off, my husband and I started seriously considering an overseas move. Since my business was location-dependent, I had to make a choice. And since I’ve already told you I’m writing this from Norway, I’ll bet you can figure out what the choice was.
As you think about multiple streams of income and how they can play a part in your life plan, remember: You’ve go this.
May 30, 2020 | Uncategorized
As I get ready to start this blog post, I take a deep breath and memories from the past 10 years wash over me. Just a little over 10 years ago, I was a single high school French teacher in rural Indiana. In the past 10 years, I have adopted a child, gotten married, had two more children, started a new teaching job, quit the job, started a business, sold the business, gone back into teaching, moved to Norway, and started a career in an international school. Whew! It makes me tired just listing it.
As you may have guessed from that list, I am a do-er. And often I get frustrated by the fact that I am not ‘do’ing more. I want to have 100 blog posts and 10,000 readers and start mentoring teachers on financial freedom, all while being a perfect, involved mom, creating enthralling lessons, and making dinner from scratch every night. I mean, come on, that’s not too much to ask, is it?
OK, um, maybe it is. A little.
Yes, I want all those things, but I will also admit to being happier than I have ever been in my life because of one question that I learned to ask myself during the continual change that has defined my life for the past 10 years.
So here it is:
Is it forever, or for a season?
When I’m struggling with something that I really want to do, but can’t seem to get it done, I ask myself “Is this forever, or for a seaon?”
Maybe I’m trying to get ahead on my blog posts (true story, at the moment) and I’m relying on a lot of convenience foods (which I HATE to do). But I ask, “Is it forever, or for a seaon?” And it is for a season. I know because I usually cook dinner, but right now I’ve got to get a little bit ahead on blogging. So no, it’s not forever. I can give myself some grace. And my kids can cope with the flavored cardboard that passes for frozen pizza here in Norway.
Or we are trying to get a house on the market so we can move to Norway with three kids. And I have to stop working on my beloved blog. Not cut down on it. Stop. Completely. But is it forever or for a season? Well, as you can tell by the one year gap in my posts, it was a few seaons, but it was NOT forever.
It depends on priorities. And those change and shift constantly. And you know what? That’s OK. More than OK, that’s life. And the sooner we give ourselves a bit of grace, the sooner we’ll have the courage to get up and dust ourselves off after those ‘seasons’ that are going to happen one way or the other.
With that said, I’m going to go read to my son, because that stuff, that’s forever! And as you go through this thing called life, remember: You’ve got this!
May 3, 2020 | Uncategorized
Why I committed to financial independence
If you’ve been reading my blog for long, you know the story that really got me started thinking about financial independence for teachers. My best friend’s infant son had a health issue that caused him to ‘seem’ sick based on the criteria of his daycare. He wasn’t sick, and he had a note from the doctor to attest to the fact that his body just worked a little different from the norm. However, the daycare didn’t seem to care. Consequently my friend was getting 1-2 calls a week to come pick him up within an hour. Not an ideal situation for a busy high school English teacher.
I saw how stressed she was. I saw how she felt like she was failing both at work and as a mom. And I decided right then that I had to do something so that I could choose not to teach if I needed to. I needed to put myself in a position where teaching was a lifestyle choice not a financial requirement.
Taking action
I watched my expenses, increased my income, and stashed the extra away. I’ll skip the gory details – ok, they weren’t that gory, but they could be boring, so we’ll cut to the chase. Let’s just say that put me in a position fairly early in life to choose whether I wanted to teach or not. At four different points in my life, I’ve been able to step out of the workforce for various reasons. And each time, I’ve gone back to a job I liked even better than the one I left. Even better, each time I have returned to teaching with more energy, more joy, and more enthusiasm than ever. My breaks from teaching have made me a better teacher.
But I would not have been able to check out and check back in if it weren’t for the fact that I didn’t need my teaching paycheck. And as I watch what is going on in education, I desperately want every educator to be able to make the choice of whether to continue teaching or not, especially today.
So why is financial freedom for teachers more important now that it ever was before?
Reason #1: Mental health
The pressures put on classroom teachers by administration, parents, and society in general are taking a huge toll on teachers’ mental health. According to a 2017 survey of 5000 American teachers conducted by the AFT, 58% of teachers polled indicated that at some point in the previous 30 days their mental heath was “not good.” (By comparison, just 2 years earlier, only 34% had responded similarly.) In personal experience, I have been amazed by the number of teachers who have told me they were on anti-depressants because of the pressures of teaching.
Look, we all want to be there for “our kids.” But at some points in time, you have to prioritize your own mental health. And let’s face facts, our students really deserve to have teachers who aren’t stressed and depressed. Just as importantly, we deserve to have professional lives that don’t require an anti-depressant to cope with the stress of our jobs.
Reason #2: Transition and uncertainty
Education is in transition right now. In some states, there are movements to privatize public schools. In most states, a teacher’s and a school’s value is based heavily on standardized test scores. And with the impact of the global pandemic on education, who knows when classroom teaching will return to ‘normal’ whatever that is. Even teachers who would never choose to leave the field of education might not have that choice. And if a teacher who loves teaching with every fiber of her being is pushed out of the classroom, the last thing she needs to be worried about is money.
Reason #3: Force for Good
In my most recent job, I was touched by an angel. No, not the Hallmark-esque 90’s TV show. A former teacher who made my classroom a lot more like heaven. Marla Tasch was a former classroom teacher who volunteered in my English as a New Language classroom 2-3 days a week. It was the best thing ever! You know how you sometimes wish you could clone yourself because there is Just. Too. Much. To. Do. Well, having Marla in my classroom was like having that often-wished-for clone. She still wanted to work with kids, and she had the skills and empathy to do so. But she didn’t need the paycheck. So she made my life better, made the kids’ lives SO much better, and I think we made her life better, too. Best of all – get this – she didn’t have to grade papers! Sounds to me like everyone lucked out.
But seriously, she was able to hold onto the parts of teaching she enjoyed and let go of the ones she didn’t. What kind of impact could we have on education if we had an army of Marlas? What if all those people who were leaving education to go into some other field, instead just hung around and helped out all the teachers who are still in the trenches? It would be a revolution in education.
Reason #4: The tough stuff
Strikes. There I said it. Across the nation teachers have gone on strike these past few years, not just for themselves, but for their students, as well. Kids deserve small class sizes; they deserve competent school counselors, nurses, and other support staff; they deserve specials like music, art, and PE. But if we teachers don’t stand up for them – and stand up STRONG – they often don’t get those things. Financial freedom means that if – God forbid – your school decides that a strike is the best way to stand up for teachers and students, you won’t be wondering what those days of lost pay are going to do to your family.
And then there is doing what is best for kids. I was once put in a situation where I had to speak up about some very popular and powerful people who were harassing students. Make no mistake, I would have done it no matter what. But it was super stressful, and I’m glad that the “How will I pay my bills if they make up a reason to fire me?” wasn’t part of the mental calculus I was doing.
But aren’t teachers above all that money stuff?
As teachers, we are often kind of told that we shouldn’t think about money. After all, teaching is a calling. And when you are doing something so noble, you shouldn’t even think about money, much less about having more than you need to pay for the bare necessities, right? Isn’t financial independence for teachers just selfish?
Hogwash! (Sorry, that’s the country girl coming out in me.) Being paid like the professionals we are, having extra money for things that just make us happy, and even financial freedom – these things can ease the worry and actually make us better teachers.
So if you are ready to learn more about financial freedom and how to make it happen for you – whether you want to quit teaching as soon as possible or never in a million years – read on. This blog is for you.
And remember, you’ve got this!
Apr 18, 2020 | Uncategorized
The “Financial Rock Star”
One of my best and oldest friends is also a teacher, also willing to talk about money, and also does pretty well financially. This means we know a lot more about each others’ finances than most friends because we just chat about that stuff without it getting all weird.
However, she has a totally different style than I do. TOTALLY. Whereas I am always ready to jump into the next new thing, she does NOT like change. She’s awesome, and whenever change occurs, she totally kills her new venture, but it takes a lot more time for her to get on board. So when she read my blog, she had some advice for me: Keep it Simple, Stupid.
OK, she didn’t use those exact words, but we’ve known each other long enough that I can read between the lines. And I may be stupid, but I know enough to value other perspectives, especially ones from someone whose financial advisor refers to her as a “financial rockstar.” (Seriously.)
Let me give you a little background info. She has requested to remain anonymous, so I’ll call her Anne. Anne is 40 years old, single, and has taught in the Midwest for 17 years. She owns a modest 3 bedroom home in a nice, but not fancy, neighborhood in a small town. If it’s not paid off, it will be soon. She buys a new car (not used) every 7 years or so.
She really enjoys going out with friends to restaurants and wineries. And travel is a big part of her life. She has been to South America, several countries in Europe, and more cool spots in the US than I can count. She volunteers for a lot of community organizations, but hasn’t had any other paying gigs since she started teaching. She is not into side hustles, but has invested in and managed rental real estate. From what I hear (and she is pretty darn modest, so I imagine she understates her success, if anything), she has done well in real estate, but in a slow, steady non-flashy way.
As you can see, she doesn’t live like a hermit. She enjoys a lot of wonderful things in life, and she isn’t working her life away.
What she has accomplished
- When her teaching job got cut to ½ time just a few days before school started (She’s a specials teacher, so that stuff happens sometimes.), she didn’t blow a gasket. She just lowered her retirement contribution and started job searching. She literally lived on half her salary for a year while she prepared herself emotionally for the big change. She taught part time for a year (loved it!) and then found another job that suited her.
- As a 29-year-old teacher, she had stashed approximately $45,000 in her Edward Jones account.
- In January 2020, just before the big nosedive in stocks, she had $308,000 in her retirement account.
- As I mentioned before, she has paid off her house (or very nearly). And not in 30 years, either. In about 15.
We were talking recently about our different approaches toward money, she underlined how it was really doing the simple things that made a difference for her. For example, she invests in her retirement account every month, no matter what. Even that year when her income got cut in half, she found a way to invest something every paycheck. She’s all into that low-hanging fruit. Do the easy stuff, she says. If you do the easy stuff, the payoff is often bigger than you can imagine.
So here are some tips from Anne, in her own words.
Always invest. ALWAYS.
Anne says: “When I think back to how I have gained my wealth, some of it has come from the rentals, of course. But really, it is because I have done little things that have made a big difference over time. (Sorta like you post about jill from 2003 and jill from 2012).
Let me explain: I have been cleaning out files and decluttering my filing cabinet. I just found my Edward Jones statement from 2009. Want to know how much money I had in there at that time? Roughly 45,000 dollars. Not too shabby for a 29 year old teacher. I was pretty proud of myself back then. In January 2020 before the nosedive that the stock market took, do you want to know how much money I had in Edward Jones? $308,000!!! Yes! For a single income public school 40 year old teacher. Do I have that much in there now, no way! But it will come back, at least, that is what I am telling myself. And it is all because I put in the maximum amount for my IRA each year. Either 5-6,000 dollars a year (It has changed over the years). Not exactly sure what it is now. I rarely put extra money in, money outside of my IRA, because I just don’t have it. Right now I am trying to scrape together some money to sink in to the stock market while it is down, because it’s a sale on stocks! So I have done minimal work for that gain. I have just let time do its thing. Lots of people don’t have 5-6,000. I get it. I don’t think I started out maxing out my contribution either. But the key is to put it in there and let time help you out. I think that is a crucial piece that needs to be hit on.”
Make your investing automatic.
Anne says, “When I was a young naive teacher, one of the smartest things I ever did (Besides switching to PE) is I started having money taken out of my paycheck and put in my 403B without me even seeing it. At first I noticed it. But then I forgot about it. And each year I got a raise, I automatically went in and raised the amount to be taken out by 25 or 50 dollars. This then comes out of my pay check before taxes, plus I never even knew I had it, because the raise covered it. I changed it by 100 or so dollars when I got my masters. Today, I am taking home only slightly more than I did as a new teacher. My 2 week take home is roughly 1100 dollars. I think I started at 850 or so. But here is the thing–$450 or 500 a month is going into my 403 B and the school district puts in a % of that. Is it a lot? Nope, but a little over time adds up to lot. Plus I have some of my paycheck directed into a savings account before I ever see it each pay period. Then at the end of the year, I use that money for my IRA contribution, or vacation, etc. Also that helped when my position got cut to part time. That was the only time I lessened the amount that I was putting into my 403 B and savings account. Even part time, I managed to put in 25 dollars a paycheck. Because I still wanted my employer to contribute their percentage. But that gave me back that extra money that I “Never saw” so I could live on 1/2 my usual salary.”
On rotten days, pay yourself, not somebody else.
Anne says, “After a really rotten day at school. You know the days–the ones where you are defeated and you think to yourself, “There ain’t no way I can do this job for another year, let alone 15 years!” I always come home and put in 25 dollars into my savings account. Instead of going and spending $25 dollars on retail therapy or at a restaurant or bar, I put $25 in my savings account to feed my retirement. And it wouldn’t have to be $25. It could be $5 or $10. Just something I started doing years ago when I needed to physically do something to better my situation. Might not be much. But it makes me feel closer to being able to walk away from teaching.”
Be like Anne
Here’s the bottom line: Anne is proof that teacher doesn’t equal poverty-stricken. She did have some major advantages like graduating from college without debt and not having kids. (Kids are wonderful, but expensive as all of us parents know.) But she has found a way to live and enjoy life while still socking away some major bank. And she has done it by doing the things that are easy and putting them on autopilot.
If you are thinking, “Sounds great, but I can barely pay my bills, much less have any money left over,” check out my 5 Day Found Money Challenge. See what you are spending money on that you aren’t even using, cut your costs, and keep the $$ for yourself.
