Every journey has a beginning, and this one is no different. Some even begin before we’re ever even fully conscious of it. Along the way, it is fun to look back at the early days and witness the transformation that has occurred. Sort of like with exercise and working out, you won’t notice any discernible results if you simply look at the mirror everyday. Progress is subtle, slow, and you really can’t know how far you’ve come until you take a closer look back at the things you’ve done.
Thanks to this blog, I’m able to time capsule the events of days past. This allows me to retrace every step, as all the data is archived on this site. At this time, I thought it would be a fun exercise to re-live certain parts of the journey. Of course, my thought process is constantly evolving/changing, so I wouldn’t expect to look back at these early posts and agree with what I did 100%. In many cases, I can’t help but to reminisce back and think, “wow, I’m so embarrassed by that! How did I not know any better?”
Nobody is perfect. We are constantly learning, improving, adapting, and growing (hopefully). Let’s see if we can sum up the journey in a few short paragraphs:
This blog launched in February of 2012. During Thanksgiving break of 2011, I made the declaration to myself to start the journey to early financial independence. It was at that time that I realized I wanted something different out of life. I didn’t want to be resigned to the De facto “American Dream”. You know, the dream where everyone focuses on the following — go to school, graduate, get a good job, get married, buy a HUGE house, have kids, work for 40-50 years, retire, the end!
I wanted to blaze a different path. So, I took a day off from work, spent a day at the lake, and tried to formulate a realistic plan to help me get what I wanted out of my own life.
What did I want? TIME! It’s our most precious resource and something you cannot buy back. Once it’s gone, it’s gone forever. Life is already so short, why would I possibly want to waste it by giving it to the “man”, and not retiring until 80? Thanks to the rigors of work, I was also starting to burn out and declared, “enough is enough.”
It’s funny… Time cannot be bought directly. But with money, it can be maximized to the fullest extent possible. I found this out first hand when I was at the lake. I was only there for a few hours but it felt like an eternity. This a beautiful thing! I now reasoned, it is possible to extend time… you simply need unrestricted freedom to do so.
The challenge was set. In order to obtain the one thing I truly coveted, I would need to carve out a path to help me reach financial independence as soon as possible.
Year 1: 2012
When 2012 started, I went guns blazing in and took up dividend investing. I did my research and figured out how to invest in dividend growth stocks. My initial plan was to retire off my dividend income, utilizing a dividend investing safe withdrawal rate approach of taking out 4% each year. I reasoned that my dividends should yield roughly 4% as well, so they alone would be sufficient to sustain my freedom forever. In other words, I would be able to use the dividend income to pay all my bills and not have to touch any of the underlying principal. This would help my portfolio last forever.
Along the way, I snatched up some bargains and made some dumb mistakes. Still, I kept rolling with it because I was fully convinced my plan would work. I decided to focus on the core, allocating the base of my portfolio to dividend stalwarts.
By mid-June, I made the decision to further diversify my investments by picking up a rental property. I knew prices were close to rock bottom and interest rates were at historic lows. I didn’t know a thing about real estate investing, but also didn’t want to miss this golden opportunity (that’s what everyone around me was saying).
My first attempts were unsuccessful. I was routinely being outbid, and this was extremely frustrating. Prices kept on soaring! Still, I kept at it, and eventually was able to win a property in early August.
By the end of 2012, I could see for myself that the plan was working. I was hitting passive income milestones on what seemed like a regular basis. Further, by the end of the year, the passive income stream of all my accounts (including retirement) were close to hitting $800/month. This visual map inspired me to keep going.
Year 1: 2012 Recap
At the conclusion of Year 1, I started to really believe that the plan could work. When I first started, I’ll be honest and admit that I wasn’t fully convinced… I just knew that I would have regrets if I didn’t at least attempt the journey.
When the dividends and passive income started to roll it, it gave me the confidence and reassurance to keep going. Earning passive income was addicting and I wanted more… lots more! In November of 2012, I reasoned that it would probably take me 4 years total to complete the quest to financial independence. Finally, I could start to see some light at the end of the tunnel. Things were looking up, and work was even becoming more tolerable.
The journey to early financial independence was helping to improve my life. After one year, I really couldn’t have asked for more! The best part? Being able to share this adventure with fellow bloggers, and others who are trying to do the same.
To be continued…