Aussie Firebug

Financial Independence Retire Early

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Chris is a 29 year old millennial from north east Victoria who owns a net worth of over $300K! Mainly invested in Vanguard managed funds, Chris also has a side business programming clocks and renting out his spare room through Air BnB. Tune in to hear about how he amassed this fortune at such a young age and how he plans to hit FIRE by 41.


Show Notes



Aussie Firebug: Hi guys, welcome to another episode of the Aussie Firebug Podcast, the financial independence podcast for Australians where I interview clever people who’ve already reached or are on their way to financial independence. Our guest today is actually a podcast listener, he reached out to me via email. Chris is a 29-year old millennial from northeast Victoria who works for a major corporation in a regional town as an engineer. His current net worth is an incredible 301,000, which is mostly invested in Vanguard Managed Funds. Chris reads the blog and listens to the podcast and he thought he could contribute to the discussion so here we are. Chris, welcome to the podcast.

Chris: Yeah, thanks for having me here.

Aussie Firebug: Yeah so really interesting way we got together- you just shot me an email, I guess you listen to a few of the podcast, did you?

Chris: Yeah I think I’ve listened to them all.

Aussie Firebug: Yeah cool so yeah I thought it was really cool. You shot me an email, you know, it had a whole bunch of stuff about you and you know, basically said if you’re interested, we can set up a time and date and we can do a podcast with yourself, which took me close to 6 months to set up because of how much stuff I got on but um… yeah, so here we are and I’m excited to get into it. So I guess the first question I’ll ask you, I gave a bit of an intro about you just before, is there anything I missed or anything that you want to add to that?

Chris: No, that’s about right. I started on not the financial independence journey as it was back in about 2013 after reading Mr. Money Mustache and there’s been some evolutions along the way about how I think but it’s looking pretty good so far I reckon.

Aussie Firebug: Yeah, cool. So were you always good with money at a young age?

Chris: Yeah, I think I’ve generally been pretty good at money. I remember I always had about $10,000 aside for most of my life–

Aussie Firebug: Even as a kid?

Chris: From age probably 15 onwards.

Aussie Firebug: Whoa, that’s a lot of money for 15-year old.

Chris: Yeah, I might  be overstating that but I always had money in the bank- I’m always used to having money in the bank that I wouldn’t spend except for emergencies, whatever that is, because it’s never happened.

Aussie Firebug: Yeah sure, and was that like– did it come from your parents like that mentality with money and having stuff/having money in the bank and you know, saving up for emergencies and stuff like that?

Chris: No, I don’t think so because the more I learn about my parents’ finances- it always seemed fine growing up, you know I come from a relatively well-off background- but the more I talk to my parents as a grown up, they were terrible with money and large credit card debt and you know, borrowing against the house to pay for– you know, not for fruit, well for sort of frivolous things. You know my sister would dance six times a week racking up hundreds of dollars of lessons, I would play music three or four times a week racking up hundreds of dollars of lessons and my parents wanted to fund that all, couldn’t afford it so you, just spend it on the credit card.

Aussie Firebug: Yeah, as you do like that’s just– kids are expensive, right?

Chris: it seems that way, yes.

Aussie Firebug: [Chuckles] Yeah right, so there wasn’t like a… you know, read a book or watched a movie or anything, it just sort of comes naturally to you?

Chris: It must have done, yeah.

Aussie Firebug: Okay. And so you said you first discovered the concept of fire in 2013, like were you saving- you were just generally good with money and you were saving but it wasn’t till 2013 until you had a goal to sort of walk towards, is that accurate?

Chris: Well, it wasn’t till in 2013 that I bought my house as well so I had– ever since starting work I had been saving for something so first of all, I took a huge trip around America so the first year or so I was saving for that then–

Aussie Firebug: What year was that?

Chris: So that would have been 2011.

Aussie Firebug: That was actually a really good– I went to America 2012 when the dollar was over parity back then and I didn’t realize back then how good it was but yeah, 2011 wouldn’t have been too bad as well I think.

Chris: It was pretty nice.

Aussie Firebug: Yeah right.

Chris: So you know, I was used to saving my money for that then I bought my car so I was saving… so week to week I’ve always been pretty good at saving but prior to this I’d always been like well I’m saving so that I can spend all my money at once, basically.

Aussie Firebug: Yeah, you know I had a very similar experience growing up as well that I’d save all this money and I’d be like well, like there’s no point in being the richest person in a graveyard like I need to spend it so I’d like have a big weekend and I’d buy a whole bunch clothes or whatever then I’d feel bad for like just wasting all of the money and it wasn’t until like I found at that financial independence was a thing that it you know, gave me a goal to walk towards and it made it so much easy to save these huge amounts of next stock pile, these huge amount of wealth because it was going towards something.

Chris: Yeah, absolutely.

Aussie Firebug: Yeah, right. So what you did, you bought a house/

Chris: So I bought the house in like 2013 so I sort of discovered the blog, thought maybe this is a good idea but I’ve got something on my mind at the moment and so all that money that I was working towards saving the house, I just kept saving it basically and I’ve tried to trim out the costs here and there on frivolous stuff that doesn’t bring me joy and yeah, keep putting it into shares now.

Aussie Firebug: Yeah right. So how did you actually stumble across Mister Money Mustache?

Chris: A friend of mine. So when we moved here to Victoria, I started meeting new friends kind of thing and one of them was a bit of a follower, she’s not super into the tenants although they’re pretty good, but yeah she mentioned Mr. Money Mustache and oh, “you could be just like him Chris,” well something along those lines.

Aussie Firebug: yeah, right, and that just opened your whole eyes to all the possibilities?

Chris: Yeah, I read the blog you know, I read one article that she was like “you should start with this one,” and then I just like read every single blog post he’d ever written and yeah, I was hooked.

Aussie Firebug: It’s a common theme I think. Well, a lot of people discover Mr. Money Mustache and then they just go nuts. For me it was a book, Rich Dad, Poor Dad, but same sort of a concept like you read and you’re like oh my God! And you read a whole bunch of things and then yeah, it’s pretty cool. So you said you moved to Victoria, where were you living previously?

Chris: Prior to that I lived in Bathurst for a couple years in sort of South Wales I guess, just over the Blue Mountains from Sydney.

Aussie Firebug: Okay, I was not aware of that, that’s not– it’s not metro, is it regional as well?

Chris: Yes, it’s regional as well. So Bathurst, you know the big– the 24-hour race, the supercar?

Aussie Firebug: Yeah, yeah, right. Yeah, yeah I know the supercar race, of course yeah. Okay, cool was that for a job or?

Chris: Yes, that was for my graduate job straight out of uni, I moved out there.

Aussie Firebug: Yeah, nice. That’s quite a move.

Chris: It was quite a move. Yeah, it was three hours from home which is you know, about enough that you can get back in a weekend but definitely far enough away that you’ve got to make your life there and then same thing moving here sort of thing so I’ve moved around a little bit for a while. There was– I think there was a six-year period where I moved every year just about.

Aussie Firebug: Okay, that would have been difficult, was it?

Chris: Um… you certainly have to get good at making new friends because otherwise you’re a very lonely person.

Aussie Firebug: Yeah, actually it was going to be my next question like so obviously you left all your friends and family, did that help save money? I suspect it would.

Chris: I wonder that. My friends are pretty good. Back home, I’m friends with a lot of PhD students and otherwise very low income people so they tend to want to be frugal when we go out anyway which is just what I want to do so we get along pretty well.

Aussie Firebug: That’s a life saver. There’s nothing worse than hanging out with a whole bunch of people that all want to spend money every weekend and you’ve sort of got to be like, “uh… like no, I don’t want to do this and I don’t want to do that,”

Chris: Like this damn a little?

Aussie Firebug: Yeah, that– it makes it hard so that’s good that you have that. So have you calculated your savings rate at all?

Chris: Yes, so I calculate it once per year. I go through pocketbook which is one of these apps that will link into all your bank accounts and you can categorize all your spending.

Aussie Firebug: Yes, that’s great.

Chris: So the year I discovered fire, 2012-’13 financial year, like I was already at about 50% saving rate so that was I was saving for the house so that was mainly a normal kind of thing. For when you’re ahead, 65%, last year I hit sorry, 14-15 I had 70% and then last year I did terribly partly because I got on an international holiday every year and two of those fell on the same financial year so I do one each calendar year but it was like a back half of one year and the front half of the next year so last year the rate was only 56% which was lower than I would ideally like but it was a nice holiday so it trades offs.

Aussie Firebug: Yeah, exactly. Yeah, I guess you can’t live you know, it’s got to be tradeoffs, that’s exactly right, you can’t be overly frugal, you know, have a bad quality of life, it defeats the purpose I guess to reach financial independence but yeah, it’s still good, 56 is nothing to pull your nose about. So you bought a house and now I have to ask so you just got a touch over a $300,000 net worth, is that including the house?

Chris: That’s including the house, correct.

Aussie Firebug: Okay and how much of that equity is part of that $301,000?

Chris: $107,000 is in the house.

Aussie Firebug: $107, okay alright. So you were what- 26 if my calculations are correct, when you bought?

Chris: Right, yeah, that sounds right.

Aussie Firebug: Yeah right, and I do have to disclose because I did I ask you about it, you did have some contributions to your parents towards that house, am I right?

Chris: Yeah, so we paid a 20% deposit and I had saved 10% of that, my parents gifted me the other 10% so I’ve gotten a bit lucky there.

Aussie Firebug: Yeah, yeah, yeah and like that’s– if you’ve got those advantages, you’ve got to take them, right? Like everyone’s got different circumstances so there’s no harm–

Chris: Yeah, as much I said my parents aren’t good with money and I was joking about that earlier, my parents are both public servants and living on government pensions which are pretty generous so they’re doing just fine I think they’re too taking the gift of them.

Aussie Firebug: Yeah and I’m sure they’re doing above average. I guess when you read and like you start listening to the fire crowd, so many people’s savings rates sound so abysmal but like in reality, if you’re saving 50% of your income, you’re better than 99.9% of people. It’s all the blogs that you’re reading. Yeah, cool–

Chris: Are they absolute outliers?

Aussie Firebug: Exactly right, exactly right. Alright so that’s about close to $200,000 in Vanguard, is that right?

Chris: Correct.

Aussie Firebug: Yeah, now I guess I’ll ask so why Vanguard?

Chris: I drank the cool aid I guess, I read a few books on investing well I was saving up enough to have a share portfolio so I started by just putting the money I had on the mortgage, paid off early for 3-6 months while I worked out how I wanted to invest/what I wanted to do and I’m pretty much convinced by the idea that some very, very well paid, fairly smart people on Wall Street buying and selling the bulk of shares and the idea that I could be smarter than any of them was unlikely, I don’t have the interest, I don’t have the inclination and I definitely don’t have the time so just riding the market out seemed the way to do it and Vanguard was the first player in that space, I had a look around at the different fee structures and Vanguard generally came out favorable so that’s where I made the call.

Aussie Firebug: Yeah right. Now you originally emailed me about that you did manage funds but we were recently speaking and you said you’ve just made the switch to ETF’s, do you want to tell us just a bit about the thinking behind that decision?

Chris: Yeah, yeah, absolutely. So the managed funds are really great because once you’ve opened it for $5000, you can just be paying $100 at a time and so when I started this journey, I was on a lower income and couldn’t save as much of my post-tax income per week so you know, a couple of hundred dollars or a $100 into an Australian fund and $100 into an international fund worked out really well, kept me disciplined, made sure the money kept going but the fee structure in a managed fund is much higher and I’ve never worked out why exactly that is but you pay about 0.9% expense ratio in the managed fund compared to only about 0.15 in the ETF’s but on the tradeoffs, you pay brokerage every time you want to buy into the ETF’s so if you buy $100 shares and you’re paying $10 brokerage you’re an idiot basically.

Aussie Firebug: Yeah, I think there’s a calculator app there that I might link to in the show notes that basically you know, you punch in buy shares what frequency you want to buy and stuff like that, it works out you know, is it better off to open up a managed fund or is it better off to go through ETF’s, yeah I’ll put that in the show notes.

Chris: Yeah, link that one because I did the calculations myself when I first started which is why I ended up in the mutual fund but I always knew that about this point in net worth, it seemed worthwhile to make the switch. Also I’m able to invest about $2500 a month in my take home pay so that seems to make the brokerage less significant, it’s a $10 or $11 fee and with CMC markets, that works out to about 0.5-0.4% I guess.

Aussie Firebug: Yeah right, cool. And so I’ve always gone through the ETF’s, I’ve never gone through the managed fund and I’m curious myself, are they the same? Are they exactly the same- can you know how like the ETF’s you can have like VAS for Australian shares, can you buy the managed fund equivalent of that or is it something different?

Chris: Yeah, they’re basically– they might not all be the same but I mean VAS and VGS I think and there is an equivalent managed fund for both of those.

Aussie Firebug: Yeah, got you. Okay cool and so how long– what time frame have you been investing through Vanguard for now?

Chris: So I started it on the 21st of May 2014, according to my spreadsheet.

Aussie Firebug: So a few years now and you loving it? Is it all going as you thought it would be?

Chris: Um… it’s up and down. You know there’s periods where you know I would throw $2000 a month that it and still have the same amount of dollars at the end of every month, which was a little bit sad. I sat on $49000-$51000 dollars of shares for how long- 10 months I think, so you know, that’s me throwing money into it and just watching it go down every month. That’s a little demoralizing but you’ve got to be in on it for the long haul. I take– particularly the more I follow this fire path, I probably got different goals in mind or a different philosophy in mind than a lot of people. I read on the Reddit a lot, people who just hate their jobs because they’re ultra-high pressure and they’re ultra-high earning kind of thing and they’re just begging to get out whereas I actually, I really quite enjoy my job, I quite enjoy my life even if I could retire right now, I’m not sure I’d change anything other than maybe go down to four days a week at my job so I almost pursue fire in absence of wanting to spend my money on anything else like I spend my money– I buy everything that I want but Mr. Money Mustache and the other bloggers like yourself have helped me focus on do I really want to drive a BMW to work every day or is my $200 bike actually a much better way to start the day and I’m firmly of the opinion that riding my $200 bike to work every day makes me fitter, makes me happier, makes a healthier, just gives me a better overall lifestyle.

Aussie Firebug: Yeah awesome, really, really cool. I think it had a really good post that the less things um… I don’t know how to table this correctly, it’s like the less things that you want, the more things that you’ll have, basically something of that nature. Like him and his wife come Christmas time, there is literally nothing that he really wants in reality. He has everything that he wants so he’s happy with what he has, you know spending such an incredibly low amount of money in a year compared to other people in his salary bracket that it’s like yeah, you think if you want that new BMW, you’re never got to satisfied because the new one is going to be released the year after, the year after so yeah, it’s a cool concept to have and I’m definitely a big believer in that as well. Me and the girlfriend actually, we’re just about to head off to a hike after this podcast– yeah we live in regional Victoria as well and like I love going down the road and hiking around where we live and it costs zero money to do and it’s awesome, you know I would much rather do it than like go out for  like go clubbing or something like that.

Chris: Yeah, pay $300 to go to a club or something.

Aussie Firebug: Yeah and even if you take away the dollar value, I’d almost like– well pretty sure I’d rather go hiking than like hit the beach or something than do the other thing that costs so much more but um… yeah that’s really cool to hear. What sort of bike you have- you don’t have an electric bike, do you?

Chris: No, I don’t have an electric bike. I’ve been tempted that several times but I just keep getting fitter so the electric bike gets less and less necessary. When I say about everything, I want every now and then that’s a big purchase so you may say you’re not really on the fire path. I’ve been riding a $200 trek 7.3 FX for the past three years but for Christmas I bought myself a giant defy advance 2 to which is full carbon fiber hydraulic suspense. It is magical.

Aussie Firebug: Yeah, I don’t think that’s too– you know, you can spoil yourself every now and then. I ride an electric bike, actually and I love it like I don’t ride it to keep fit, I always get talk shit from people at work like, “you’re a young, fit boy, like why do you have an electric bike?” something I’m like, “this is my toy, like I zoom around town on it like this is– I like riding this thing. I don’t do it to– like I run and play footy and stuff and I don’t ride my bike to keep fit but I love it. Have you ever ridden one? — Because it is so much fun.

Chris: I would love to give it a try because I’ve also thought, you know, I’ve replaced 90% of my car journeys with a bike, I reckon I could replace 95-99 if I have the electric bike because there’s times when you know you know, I’m going to be riding back at 11:00 PM, I don’t really want to so I’m just going to take the car out this time but if I had the electric bike and I knew it’s going to be pretty to scoot home I’d ride even more.

Aussie Firebug: Yeah, they’re really fun. I should do a post on them that they’re really cheap to build these as well like I remember looking–

Chris: Oh, you built one?

Aussie Firebug: Yeah, I build all of mine like oh my God, you save. You know, it costs you about a third of the price if you build like if you buy the conversion kits, that’s what they’re called, and you actually buy a decent bike like you can buy a joint and then you can put an electric kit onto it and its kick-ass like it’s so good. You get like a really high quality Samsung-cell battery and like a really good engine–

Chris: I reckon that would be a great post- that would be something I’d love to read.

Aussie Firebug: Yeah, I’ve got so many posts I need to get through but I’ll add it to the list but if you were to buy a pre-made one, you know, they’re still like $2500 if you want a real kick-ass one but I built mine for like 950 bucks and I ride it everywhere like all around town so…

Chris: Ever heard what the correct number of bikes to own is?

Aussie Firebug: Um… one? [Chuckles]

Chris: Well, one more than what you’ve got now.

Aussie Firebug: Yeah, I agree. [Chuckles] I definitely agree to that.

Chris: Alternatively, if you have a spouse, the correct number of bikes S-1 where S is the number when your spouse will leave you.

Aussie Firebug: [Chuckles] I like that too. I might put that in the show notes. Alright back to what we were talking about, so Vanguard yeah, you made the switch to ATF’s so tell me about– do you sell– so you’ve got a whole bunch of managed funds still or?

Chris: No, I sold out of them.

Aussie Firebug: So you completely cashed out?

Chris: Yeah.

Aussie Firebug: And did you jack a hit to a capital gains tax?

Chris: No, luckily, luckily [chuckles], I’d lost money on my shares so I had to cover the capital loss to carry forward.

Aussie Firebug: Right, so okay. So you lost money–

Chris: During the timing of the market, you know, that period I was saying where I kept throwing two grand a month and I kept making no money, the way it’s worked out is I’ve actually lost capital on my shares in Vanguard so…

Aussie Firebug: Cool and so it’s all in ATS, and which parker are you through?

Chris: I use CMC markets.

Aussie Firebug: And it was $10 a–?

Chris: $11 and if it’s over a certain value, they charge percentage as well.

Aussie Firebug: Okay, that’s quite like, I go through it at —

Chris: But it’s brighter as you– Yeah, I bank with Commonwealth but yeah, they’re about twice as much so…

Aussie Firebug: Yeah okay I might look into that. What’s it called, CM markets, is it?

Chris: C-M-C Markets, yeah.

Aussie Firebug: CMC Markets. I think my last one, like I just did under 10 grand’s worth and it was like 19 bucks so I’ll have a look.

Chris: Yeah that’s not too bad. That’s kind of the level of trading but I think CMC would’ve been 11 bucks for that much.

Aussie Firebug: Yeah, cool, cool. So you’re going to stick with Vanguard, any other investments interest you or you’re just going to stick with Vanguard till you hit fire?

Chris: I’m probably going to stick with Vanguard till I hit fire. Other than investing in my own business, which I think about, already I’ve invested a little bit I think on and off you know, took a big ten-twenty thousand dollar investment and get a proper production running, Vanguard just seems like the zero effort option.

Aussie Firebug: Yeah, I can definitely echo that sentiment as well because I’m with Vanguard and have three missing properties and it’s definitely– like Vanguard is just effortless, you know, you throw money at this thing and it spits out money, it just keeps giving you dividends and like eventually, it should go up after like a long period of time so it couldn’t be any more easier. I’d recommend it to absolutely anyone like the properties have done well for me so far but like I definitely– they’re in active management, those at Vanguard so it’s completely passive you know, so, so low maintenance. Tells us a bit about this business, what’s this business you’re thinking about starting or you already started?

Chris: We have started it, me and a friend from university, it’s a kick-starter business so I decided to learn how to program electronics last year, it must have been even the year before now that it’s 2017 and I’ve always had an interest in clocks which is pretty common for engineers and people who want to do electronics so I’ve designed this clock which I call The Light Clock. Initially it was going to be just a Christmas present for my grandfather because he loves clocks as well, but I kept posting about it on Facebook and a lot of people were like, ‘wow! That’s so cool, Chris,’ and a couple of them were like, ‘would you make one for me, I’d be happy to pay for it,’ I’m like oh, I have an idea now.

Aussie Firebug: So you’ve got a kick-starter page at the moment, do you?

Chris: It’s not live now, I threw on the kick-starter in October/November 2015, we raised $31,000 off that which was pretty amazing for a first time kick-starter I’m like shocked that we made it so then went through a manufacturer, we bought a lot of parts you know, custom designed parts from China, shipped them over to Australia, hand assembled them in my parents garage with some friends, bought them dinner, [chuckles] low labor costs there and shipped them all over the world so they’re in something like 30 countries, we did track it at some point.

Aussie Firebug: Oh my God, so what actually is it- it’s a clock, it’s a?

Chris: It’s a clock but rather than– it runs 120 high-brightness– let me– I’ll send you a link, you could put this in the show.

Aussie Firebug: Yeah, I was going to say, send me a link, it sounds cool and have you got a website or anything?

Chris: We do, yeah. It’s just, it should be in your text chat.

Aussie Firebug: Yeah, it is. Nice, okay, I’ll put that in the show notes and you guys can check that out. That’s exciting.

Chris: Yeah, it sort of was exciting, yeah we got a map, we’re in must be 20 countries, most of North America, a lot of Asia, Australia, a lot of Europe kind of thing but yes, as a clock, it’s sort of– it’s 120 high brightness LED’s and it connects to the internet so you can use an app with it on your phone and so rather than having a long hand and a short hand like a typical clock, you might have a blue hand and a yellow hand so it lights up your whole wall in this beautiful color which you can customize.

Aussie Firebug: You guys can’t see obviously in the podcast, but it looks pretty cool, I understand what you’re saying now that I can see it, yeah nice. How much do they run for?

Chris: They’re $229 US at the moment which is at about $300 Australian.

Aussie Firebug: Yeah very nice. So you programmed it yourself?

Chris: I programmed it myself, yeah.

Aussie Firebug: What language?

Chris: Arduino code.

Aussie Firebug: Arduino?

Chris: Which is sort of C but designed for electronics rather than just pure programming so it’s got a whole lot of libraries to run the LED’s and to run the Wi-Fi module and you know, you can attach sensors to it. It has got a lot of libraries prepackaged ready to go for that kind of stuff.

Aussie Firebug: Yeah cool, nice, very cool. And also so you’ve got that business and you work as an engineer but you’ve also got a side hustle?

Chris: Yes, I do, yeah.

Aussie Firebug: Why don’t you tell us a bit more about that?

Chris: Yeah, last year we decided to run our houses on Airbnb, we have a three-bedroom house just between the two of us which is massively excessive to our needs so it made sense to rent out a room. We’d had a lodger before, you know, someone who lived here full-time but we felt we liked our privacy some other time but didn’t need it all of the time so Airbnb, you get a much better rate per night and you have people on staying you know, one or two nights and then you can go back to having your privacy.

Aussie Firebug: So what was that conversation, like that with your fiancé, you know because that’s a site that interests me as well but you know, convincing the partner to have someone move in for a couple weeks or days at a time, how did that go down?

Chris: Pretty good, the way I sold it to her is that you know we have this wedding coming up which is going to be pretty expensive and that all of this money would get channeled straight into the wedding fund.

Aussie Firebug: Yeah right. And so what are you getting, just out of curiosity?

Chris: In some weekends, $60 a night, and we give a 20% discount if you stay for a week or more. But that’s still more than my mortgage like if people staying for a week, they’re paying my mortgage for me.

Aussie Firebug: That’s so cool and so that’s all through Airbnb?

Chris: All through Airbnb.

Aussie Firebug: And what do they charge?

Aussie Firebug: They make it very confusing to work out what they, they’re real sneaky. They charge me a couple of bucks on my end but I think they charge the guest a couple of bucks on their end as well. I actually don’t–. It’s got to be around 5-10% mark but it sort of well probably deliberately difficult to work out what Airbnb’s take is.

Aussie Firebug: And so you’re living in regional Victoria, how big is the town/city that you’re in, the population?

Chris: Um… it’s got 100,000, no probably like 80,000 somewhere maybe down.

Aussie Firebug: So it’s quite big, it’s a decent size, not like– I live in a town that’s like 2000 so the odds of me getting someone you know are severely lower.

Chris: Where you are, yeah.

Aussie Firebug: Yeah exactly but yeah now that’s a cool idea especially if you’re in like the city or something. That’s very cool. I guess the only thing is like you have a loan for your own home but if you are renting a house, I don’t know the rules behind subletting it.

Chris: Pretty sure you have to ask the permission of your landlord.

Aussie Firebug: I don’t know if you actually do because I’m a landlord myself and I read all the magazines and everything every month and I have heard, correct me if I’m wrong please someone in the comments if you know the answer to this, but I think that it’s part of like once you sign the contract, you are actually allowed to sublet but it sounds wrong, I’m not sure, I’ll find the answer to that but yeah, I thought it was some sort of weird thing that they actually can’t stop you from, you know, renting out a room via Airbnb because when you think about like if someone rented one of my houses, what’s me to stop them having someone sleeping like in another room, why can’t they just have like a friend over for a weekend? I couldn’t really– like I’d be a real prick if I said, “you know what…”

Aussie Firebug: Yeah, your landlord having that power over you, not to rent out.

Aussie Firebug: Yeah, exactly so I don’t know what the rules are anyway I’ll figure that out and put it in the show notes but yeah, so that’s another income stream?

Chris: Yeah.

Aussie Firebug: You guys would be loving– paying for the wedding, paying for your mortgage, sometimes that’s cool.

Chris: Yeah, it does help.

Aussie Firebug: Was there any– I guess if you’ve got the other business of the clock like I was kind of saying was there anything else you’re looking at as a side hustle but I’m sure–

Chris: That’s enough hustles for me.

Aussie Firebug: Yeah absolutely, like I’m having a look at this, The Light Clock website, you know, like all legit and everything so that’s very cool. Yeah, so you’ve got a few things going on then?

Chris: Yeah, I like to do things that I like to do. The Airbnb is purely for money as a side hustle, the light clock doesn’t really make me a whole lot of money, it’s just a fun thing sort of thing, learn a bit about business, learn a bit about coding, learn a bit about manufacturing as you said before, I’m an engineer so the idea of having a product that I have developed from the ground up was really, really appealing.

Aussie Firebug: It’s really cool. I really respect people that go off and create their own thing and make a little business out of it so you know, good luck to you.

Chris: Thank you.

Aussie Firebug: Do you know– have you worked out your financial independence number?

Chris: Um…it changes I was recently- I don’t know whether you read the post- there was a big analysis done on financial independence, the mine sub which this 4% rule that we’ve all been using for about I reckon is probably not that safe for a retirement. So you know, if you’re going to retire at 60, 4% is probably pretty safe, if you want to retire at 35 then you deal with a lot more risk with a 4% withdrawal rate so I’ve just shifted to a 3.5% safe withdrawal rate and that would put me at needing three quarters of $1000000 plus having paid off my house so that’s about a bit over 1000000 total.

Aussie Firebug: So assuming that your house is paid off, 370k. Sorry 350k?

Chris: 750k, 750k.

Aussie Firebug: That’s not too bad. And how are you going to incorporate super into that like I don’t know if you’ve seen, I had a financial independence calculator specifically for Australians that highlighted the you know, we could super search a tax advantage strategy, it’s hard to ignore it completely and you sort of have to break down your financial dependence number into two sort of numbers, one before you can hit your preservation age and the other one being how much after having super at your preservation age to last forever. Have you consider that at all?

Chris: I have considered that a bit and I’ve been working with you on your– I’ve been looking at your calculator with keen, keen interest so I’ve just made a whole lot of suggestions–

Aussie Firebug: Which I did read your email actually and you know what, I’m just about to release the second of it all, version 1.2 of it, because there was an error in one of the cells that was like throwing out this weird result and everyone was emailing me about the super contributions so yes, it’s coming everyone, I’ve added it in, you can change how much your employer contributes to your super yearly, yes it is coming.

Chris: That would be awesome so it’s basically something I’ve put in the back of my mind, my employer owes me, sorry doesn’t owe me, offers me a super match which I take advantage of, but I don’t sacrifice beyond what I need to get the maximum of that match. I would be really, really interested as we develop your calculator, as you develop your calculator and I’ll help where I can sort of thing, whether I should start contributing more because the tax advantages you know, are quite significant the more you move up in income and there’s that $25000 a year limit that you’re allowed to put into it so if I want to take more advantage of this super tax advantage, I need to start now rather than starting one year before retirement and just saying I’m going to put my whole income into super, something I should be thinking about. I’ve always sort of figured that retirement is ten-ish years away so I can be gradually working out the details but you know, that’s one of the details I would really, really like to work out.

Aussie Firebug: Which is what so many people do, right? Like they go through their whole life and in the last five years, they hit 60 or something, in the last five years, they dump in 90% of their salary into their super like it’s such an inefficient way to do it but like you’ve got understand not everyone can– it’s thinking about these sort of things at our age so I’ve had a play around with the calculator like the improved one that I’ve like fixed and it’s so incredible you know, you only have to add such a little amount of money into your super because we’re so young just to see it compound all the way up into your preservation age, it turns into such an incredible amount of money so easily, just like a couple years of solid contributions can just make a world of difference like it’s absolutely incredible. And the other thing is well, because your preservation age is you know, 60+ years away, who knows what they’re going to change it to by the time we get there. That gives us so many years that if we’re approaching the preservation age or a couple of years away, worst case scenario, and I think about this all the time like this, the whole financial independence you know it’s good to calculate a number and like you know, I made a calculated to help people calculate a number of years and so forth but really, worst case scenario, if you do you run low on cash, you can get a job, like you can get a job or you can do something else just to top up your money or your net worth for a few years and that just blows the projections completely out of the water like if you’re going to get another job 10 years down the track and you’re only working for a few years and suddenly your financial independence type, it’s decreased so much just because you hadn’t factored that into the equation when you first did it so I always think of worst case scenarios like that, it’s a pretty nice option to have if that’s your worst case scenario, you know, for you to survive I only have to work an extra year, didn’t think I’d have to work but it’s pretty cool.

Chris: Yeah, absolutely.

Aussie Firebug: Yeah I now I sell– I don’t know if I asked you– do you know how many years you’ve got till you reach your number?

Chris: If my very rough calculations are correct, then I’ll need another eleven years.

Aussie Firebug: Eleven years, that puts you what- up to 41?

Chris: 41 years old, yeah.

Aussie Firebug: Yeah, right, cool. That’s incredible and do you think you’ll work up till then and just like completely shut down or like do you have other aspirations that you want to move into once you hit that magical number and you know, you don’t have to work for a living?

Chris: Well, like I say, I quite enjoy my job so there’s a very strong possibility that I could get close or get there and just talk to my boss and see if I can organize you know, a three day week or a four day week, I might take a year off as a sabbatical to just go traveling. I used to live in the UK so I could go and visit friends over there. Yeah, I don’t see my life really dramatically shifting. This isn’t some sort of utopia that’s going to turn my life around but I think it’s just a hobby that’s fun to approach kind of thing so, yeah a bit more leisure time; potentially a year off or months off to go traveling.

Aussie Firebug: And I think that’s a good way to look at it as well like if you already have a happy life and then you reach financial independence, well that’s fantastic, it shouldn’t be– the goal shouldn’t be once I reach financial independence then I’m going to be happy because I don’t think like if you’re living a bad life you know, having a number tick over to a certain net worth in your bank account isn’t magically going to make you happy.

Chris: No it’s not.

Aussie Firebug: So I think it’s a good way to look at it and I am just on that, you know, winding down the days per week. I think that’s why I’ll do it as well because wouldn’t it just be magical to work three days a week, four days off? [Chuckles]

Chris: Four-day weekend but three-day week, yeah.

Aussie Firebug: Four-day weekend just sounds phenomenal to me. I could work just about any job like if I only had to be there three days a week and this is coming– you know, I like my job as well, I’m quite happy in my job but I feel though like five days is just like too much time out of my life like there’s so much else I could be doing and want to be doing even though I like my job to an extent. Three days a week, that sounds phenomenal, you know, imagine how much leisure time and creative time you could use to just do anything that you wanted without– and the other thing as well for me is you know, when kids roll along like I’ve seen a lot of people at work rocking up to work like an absolute zombie because their six-month old has been crying all night and hasn’t been sleeping or whatever, that really appeals to me you know, winding down the full-time work to you know, four days a week/ three days a week and then maybe you know, if I don’t like that job anymore, I could just quit without any repercussions financially and then pick up something else that I really like so just all the options and flexibility, really cool.

Chris: Yeah, money buys you a whole lot of options, that’s what I’ve found even more generally, you know since I’ve started down this track and have plenty of cushion underneath me, any setbacks doesn’t stress me anymore. My partner ran my car into my house, that’s got to be expensive but who cares, it’s only money.

Aussie Firebug: Yeah and that’s the beauty of having that buffer ride it’s like it doesn’t stress you out, yeah very cool. What’s the best bit of advice you can give to someone like you’re really young with such a good net worth already, and well on your way to reaching financial dependence, if you could give the best bit of advice to someone trying to reach financial independence today, what would it be?

Chris: I reckon you’ve got to start- and I see a lot of people do this which I think is good- you’ve got to start it as a hobby so you’ve got your hobby as how little can I spent this year? And it’s really fun, I found it really fun to work out you know, what can I say shave; if I ride to work, what does that shave? If I just make my own bread and have a sandwich, what is that shave? And have had a lot of fun with it but don’t feel like after a couple years that you can work out what’s important to you doing that so you know, buying a canteen lunch every day, super not important to me but owning a nice bike, turns out that is important to me and I’m okay to spend the money on that so I would say start by going as hard as possible for a couple years with the idea in mind that you’re not going to live this ultra-hard for the rest of your life, it’s going to help you figure out what’s important to you. I think the fire mindset is about working what’s important to you and only spending your money on that. There’s so many temptations in the world of people who want your money that don’t increase your happiness, don’t increase your life in any way, cut them all out and only buy back the ones that are important to you.

Aussie Firebug: Yeah wonderful. Great advice, I definitely agree with you and everything you said. I think having– and I always tell people even just friends and family that don’t even know I have this blog or anything, just that they know I’m good with money, you know, what can I do to help me save money? I always say track your expenses, that’s the number one thing- track all your expenses because it will open up your eyes to how much crap that you buy that you don’t even care about that you couldn’t even give two stuffs about but it’s coming out of your account every month. Track all your expenses and sort of make a game, like you said. We both use pocketbook to track our expenses. I love looking at the pie chart in pocketbook just about every day and like seeing how close I am to the record for this month and you know, if I don’t spend any money in the next couple days, I can break the new record and stuff like that so it is good to make a game out of it but like you said, you know, you quickly realize how important the real important stuff is to you and like it’s not the world if you just splurge once in a while on that sort of stuff.

Chris: Yep, if it’s adding value to life, buy it but if it’s not, cut it out.

Aussie Firebug: Yeah, cool. Now, you don’t have a website up or anything, a blog or anything like that? If anyone is listening to this podcast and wanted to ask you a question, what’s the best way to get in contact with you? I know you’re on Reddit?

Chris: Yeah, find me on Reddit, that’s where I do most of my financial independence kind of stuff so if you want to send a private message to Chris Melba, I’m happy to chat with you.

Aussie Firebug: Yeah and I’ll put that in the show notes, Chris’s Reddit username, so on Reddit where do you hang out mostly on?

Chris: I’m subscribed to Personal Finance, Financial Independence, F.I Australia, Australian Finance and the ESPA 266 but I browse slash 00 quite a lot so I just got a huge amount of crap sent to me through that.

Aussie Firebug: [Chuckles] Cool. So yeah, you can hit Chris up on Reddit if you have any questions for him. And that brings us to the end of the podcast. If you enjoy these podcasts and want me to make more, make sure you drop me a comment and a rating on iTunes, you can search for my name, Aussie Firebug, on iTunes and you’ll find me. I’m also in SoundCloud at and a transcript of the show notes of this episode can be found on my website at Thanks for your time, Chris.

Chris: No worries. I’ve just got a Mr. Silver, a friend mine who is also semi- F.I path, he says hi, he’s a podcast listener as well.

Aussie Firebug: Oh, who’s that?

Chris: Mr. Silver, he is on Reddit.

Aussie Firebug: Okay, Mr. Silver, alright. Shout out to Mr. Silver on Reddit. Thanks a lot Chris.

Chris: No worries. Thanks very much.


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