050 - Domestic GeoArbitrage Freedom is Groovy

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1 - 65 Jonathan Mendonsa Alright Guys we are very excited to bring a special episode to you today we are bringing on Mr. groovey from freedom is groovy dotcom. Mr. groovey was actually recommended to us by Fritz from retirement manifesto. He said this is the guy to get on to talk specifically about the topic of domestic Geo arbitrage and how in theory we understand how powerful this lever can actually be. But if you actually do it it can take you from a precarious financial situation to borderline at the gateway of financial independence without one single choice. And I think the story that we're going to talk about today is one that there are literally hundreds of thousands if not millions of people that over the coming five to 10 years if they wanted to could pull this lever and immediately be at the gate to financial independence. So I hope that we're able to kind of dig into the story with Mr. groovey and extract some of these really valuable gems of information that you can take and incorporate into your own life. I believe this episode will be particularly interesting to my cohost Brad because this is a choice that he himself made almost 10 years ago. And I know that he has thrived because of it so that Brad. What are your thoughts.
10yearstogo, geoarbitrage
65 - 96 Brad Barrett Hey Jonathan Yeah this should be fun and not only did I make an almost identical decision just in general right. Going from high cost living area to a significantly lower cost of living area. But I actually moved from the very precise place that the Groovies moved from which is long island New York. So yeah it's going to be a fun conversation for me. Just compare notes with him and see what decisions they made and compare notes on positives negatives. And it should add some flavor certainly to the audience that I did the exact same thing.
96 - 107 Jonathan Mendonsa All right well let's not waste any more time we're going to go and bring Mr. groovey on. But to set this thing up I think the most important question that we have to ask in this entire interview. Mr. groovey in Long Island do you go to that. Do you go to the food store as well.
107 - 119 Brad Barrett Yeah. I say a bunch of kind of weird things. One I don't see a grocery store. I call the food store and I don't know if that's a thing on long island but I know both my wife's family and my family say it that way.
119 - 124 Mr Groovy Yeah we we say the food store too. I know I sound like a rube but that's what we call it.
124 - 126 Brad Barrett Nice. I'm vindicated finally.
126 - 141 Jonathan Mendonsa Vindicated. Rather you're the contagion that is that word has spread to an entire geographic location. Clearly you have a very distinct Long Island accent Brad somehow doesn't but there may be traces there especially when it comes to the food store.
141 - 144 Mr Groovy Brad sounds nice.
144 - 154 Brad Barrett Well thank you sir. Yeah I don't know how I avoided the deep Long Island accent but people think I'm from like the Midwest or something. Yeah. People have a hard time pinning down where I'm from.
154 - 163 Mr Groovy But guys I'm totally screwed. My father was from Queens New York. My mother was from Boston Massachusetts so I'm really screwed.
163 - 181 Jonathan Mendonsa No way man it's the voice of an angel. Well let's listen. I've got a little bit off topic there but fortunately we do have time in this show. I'd love to kind of just hop right into your story could you maybe. Before we go directly into the topic of geo arbitrage Could you maybe talk us through a little bit of your backstory and how you found the financial independence community.
backstory, geoarbitrage
181 - 213 Mr Groovy Yeah I mean for most of my life I'm I'm a bit older I just turned 56 so most of my life up until my 40s I was a know a financial moron for lack of a better term. And basically what changed things was getting married and we didn't get married till we were in our early 40s. Mrs. Groovy kind of woke you up. Not that she was on top of her game financially but she knew she recognized we were having problems and she went to the library one day and came back with a dave ramsey's book his classic.
library, ramsey
213 - 216 Brad Barrett Of financial pieces
216 - 216 Mr Groovy Nono.
216 - 218 Jonathan Mendonsa His actual book was Total Money Makeover.
218 - 223 Mr Groovy Exactly. That was the one that was the beginning that was the start of our turnaround.
223 - 255 Jonathan Mendonsa This is interesting because I've mentioned in previous shows that Dave Ramsey was the gateway to personal finance for me and J.D. Roth mentioned something similar. And we're in the FI community and I think the FI community in many cases we get to the point where we feel like we've kind of graduated past the point of what Dave Ramsey can really offer us but there is this commonality that he is a gateway for many people to personal finance. And I'm curious what did, you know, if he is what you discovered what sort of makeover did you actually need in your life and what sort of steps did you take once you found his philosophy.
255 - 276 Mr Groovy I would say I mean it sounds ridiculous but something as simple as an emergency fund. I never heard of that concept before and it was like like I said my whole world change just on that one simple concept and then take it from there. Paying yourself first never heard of that before.
276 - 298 Brad Barrett So before you found Dave Ramsey What was your financial life like. So you know you're saying affectionately you guys were financial morons but like but what did that realistically look like were you the ultimate living paycheck to paycheck. Were you just not aware of the concept of emergency fund and that kind of thing or or were you truly just all right the money comes in and we spend it all and it all goes out.
298 - 356 Mr Groovy I would say we we were definitely living paycheck to paycheck. And it was mostly because we were just doing what everybody else was doing. We were being normal. We never gave it any thought and once we discovered Dave it was the lightbulb moment we started thinking about these things and like oh geez you know every once in awhile the car breaks down. So it'd be nice to have an emergency fund. Hey you know one day we like to retire. It'd be nice to start paying ourselves first and invest in a Roth IRA. It's it's kind of bizarre. We both had master's degrees but we didn't know that the elementary stuff of personal finance and the interesting thing about that as soon as we discovered it we went into it 100 percent. We weren't opposed to being wise with our money we weren't worried about what people thought what clothes we wore we want what about what car we drove . We just never thought of it before. It was it really opened up our world.
emergencyfunds, ira, roth
356 - 372 Brad Barrett Yeah that's amazing. So Mrs. groovey comes home with Dave Ramsey's book and it sounds like truly that was this light bulb moment. Do you recollect like what changes you made in those first couple of months six months a year even like that puts you on a different path.
372 - 417 Mr Groovy Budgeting I never tracked what was coming in and I didn't track what was going out. Something as simple putting a spreadsheet together tracking First of all we had no idea what was coming in. And then we had no idea it was going out. So the first couple of months it was just we think $6000 is comming in and we think oh I thought we was spending four hundred on groceries was spending close to 800 on groceries for two people. So that was an eye opener. Just getting a budget putting on paper what's coming in and what the heck you're spending on. And from there it just as I call it now back then I didn't but functioning brain. Once you see what's on paper once you see the money coming in the money going out you can fix it if there's a problem.
417 - 419 Jonathan Mendonsa What year was this that you found Dave Ramsey.
419 - 420 Mr Groovy 2003.
420 - 436 Jonathan Mendonsa So would you say that it was a total 180. Or how quickly were you adding new skills on to this you know in the past. We've talked about these small slash marginal gains that are made over time and how they compound how quickly were you adding to your personal finance toolbox and skill set.
436 - 448 Mr Groovy At this point. We're in our early 40s to 41 right around there have nothing save for retirement. First thing we did was spend less than we earn and we started saving money.
448 - 475 Brad Barrett All right. So you have this light bulb moment you start creating a budget. You have some sense of what's going on. But then what. What actual tangible steps like. Was it just as simple as just knowing how much money was coming in and coming out that led you to make changes or like what actual changes did you sell your car. Like where was all the money going. And like how were you able to create that space between your income and your expenses.
475 - 504 Mr Groovy Now. Excellent question. First of all food we were spending $800 a month for two people and we quickly got that down to $400 a month. Now you're talking $400 a month in savings just by being mindful. Just thinking about food and what are you going to do less eating out more eating at home. So I mean this is a perfect example then once we saw what we were spending we got to the point where we were saveing you know 1500 to $2000 a month pretty quickly.
504 - 517 Brad Barrett That's amazing. Yeah. I mean that's a huge margin just by being mindful I think that's a perfect way to put it. I guess I'm also curious. Did you have any debt at any point where their credit cards were there student loans anything like that.
517 - 539 Mr Groovy When we got married thinking back you know I was think about this the other day what our consumer debt situation was it's probably around 30000. I mean nothing horrible. I mean between car loans student loan and credit card debt you know you said it's it wasn't horrible but it was significant. About 30000.
college-loans, debt
539 - 557 Brad Barrett So now you have this huge margin in your life right. Let's say $2000 rights are $24000 a year you've created. At what point did you start attacking that debt or what was your actual strategy as far as debt versus saving for the future and emergency fund or whatever you want to call it.
debt, emergencyfunds, savings
557 - 600 Mr Groovy So this is weird because once we got a light bulb moment with Dave Ramsey that's when we decide to leave New York. So it was like in conjunction. It kind of happened at the same time. So when we discovered Dave Ramsey we decided we wanted to get in New York so our main concern now was basically twofold. We wanted to get rid of all consumer debt by the time we left New York and wanted to make our transition to whatever destination we were going easier. So we figured the most money we have or had that would make things easier. So it it's it's weird. Soon as we decided to get our financial act together. We already had a plan. We already had a year. Our goal was to get out of New York in 2006.
600 - 639 Jonathan Mendonsa A couple things come to mind. We need to obviously dig into all the resistance to leaving your home because I mean you can tell that New York is ingrained even into your voice. Every little bit of you screams New York obviously your family is from New York. I mean this isn't just. Pick up and leave. There's a reason that not everybody just does this automatically there's resistance. But before we walk through that I guess what I'm curious about once you had this light bulb moment did you start to have any savings aside from this I mean you're planning this transition. Are you putting any money aside to plan this escape strategy. Is there anything else that you need to do to prepare to leave New York.
families, savings
639 - 680 Mr Groovy Good question. Basically in our minds we want to keep it simple to save as much money as you can. We called it our transition fund. Our goal was to save $2000 a month. Unbeknownst to us at that time this is in 2003. I had a one bedroom condo and in Long Beach Long Island and it was becoming a hot area. We were aware that we were building equity in our one bedroom condo. So that was part of our transition fund. And in the back of our mind we knew if we played it right we would walk away with a lot of equity. So between the savings and equity that we thought we had a legitimate shot at that was what we concentrated on.
680 - 697 Jonathan Mendonsa Before you sold the house and you pulled out that massive amount of equity which I know you're going to end up with. Did you guys have any money really set any significant amount. Or is it just. Well we were probably going to be OK we can cash flow it that. Did you have any sort of you know 30 grand 20 grand in the bank.
697 - 735 Mr Groovy Going back what is it 14 years now. When we left Long Island 2006 we had $80000 basically in cash so between 2003 and 2008. Our transition for not including the equity that we'll be talking about shortly was about 80000. So that was our our primary objective. You know any overtime opportunity I had I jumped on it. I took a part time job in a warehouse. So we just became saving monsters. And as far as 401k as far as Roth IRAs they weren't even on the radar yet.
401k, ira, roth, savings
735 - 747 Jonathan Mendonsa OK so from 2003 to 2006 you started to accumulate a rather sizable amount of money close to $80000. Was this going into the stock market or was this in cash was it in a savings account.
savings, stocks
747 - 751 Mr Groovy No Cash like we said we were very ignorant and just in in a in a savings account.
751 - 762 Jonathan Mendonsa OK. And your life at this point in New York do you have any idea of what your expenses actually were in New York in 2006. How much your life is costing you.
762 - 774 Mr Groovy $4500 a month and you've started to hatch this plan that allows you to move somewhere else. That in theory has a significantly lower cost of living. Did you start announcing your plans to friends and family.
774 - 810 Mr Groovy Not initially. Mrs. groovey God bless her. She has a relatively small family her mom and dad were already in Florida. My family I mean there are scams that are locked into Long Island so it was kind of hard to say hey guys I'm leaving. So we didn't announce it initially. Like I said it was it was a tough call. I do love my family but we do what is right for us and on Long Island just wasn't working. So no we didn't tell anybody initially about I would say 2004. By 2005 everybody knew friends and family now.
810 - 817 Jonathan Mendonsa And was there a sense of betrayal was there a sense of hard feelings. Were you supported in this idea.
817 - 828 Mr Groovy No and this is part of the story. Everybody said yes do it. I don't know if it's because they didn't like us but they were very supportive and that's that was a big help.
828 - 895 Brad Barrett Yeah. Long Island is an interesting place and I don't think people who who don't live there who didn't grow up there really have any comprehension of it. But it's amazing how like you said ensconce people are there. They have their lives and they never look off that island. And I know we we've tried to talk to people about our move and how significant it was for us financially and just how amazing it's been. But there's just something about that place it's like the pull of family it's the pull of friends and the beaches being right nearby and the New York sports teams or something that you know it's all these things that are tied up together. But like people have a hard time escaping like the tractor beam that is Long Island and to your point when you tell people that you're actually leaving. People are thrilled for you because they know they should be making that decision. But but it's just so hard. And we experienced that exact same thing. I mean people were absolutely thrilled for us. And again we've talked to dozens of people over the years about the move. But not one single person has ever moved off the island. Since we have it in my family and friends it's astounding.
895 - 911 Mr Groovy Wow. You know you said I was very fortunate. And you know for years I know exactly what you're talking about because for years my family and friends all the people I know they complain they complain a lot about the traffic the weather the taxes but they don't do anything about it.
families, tax
911 - 982 Brad Barrett Yeah they really don't. It's so bizarre. I mean there are so many good things about living there but but as you said so many bad things then and people really do complain a lot about it because it's legitimately difficult to get ahead. And this is not a conversation about Long Island per se is it. It's interesting that you and I both happen to live and grow up there but this is more an discussion about high cost of living areas in general which is it's very difficult it's not impossible by any means. As we've seen on past episodes with Paige and Sam and people like that you can definitely reach financial independence in a high cost of living area but it's extraordinarily difficult. And in my opinion like you always have to give something up. So like we could have made it there. Laura and I were both CPA as we had you know a reasonable income. We could have done what everybody else did and succeeded to some degree I suppose but we always felt like we couldn't do everything we couldn't have that significant savings rate we couldn't save for retirement save for our kids college go on vacations do all these things that we really don't want to compromise on. And that's why we left Long Island and I'd be curious to hear your thought process behind why you left and what you thought you would have given up by staying I guess.
college, savings
982 - 1027 Mr Groovy Yeah I hear you. I think the genesis of my move really started when I went to Buffalo University. You know I was 18. I left for college the first time I left Long Island. I thought Long Island was the center of the universe. You know who doesn't want to live in New York on Long Island. Anyway I go to Buffalo University. Great people great town. We had fun in small town America. And also it dawned on me you know there's something there's a life beyond Long Island. The world doesn't revolve around Long Island. So that was always in my head and then moved down to North Carolina. I gave up nothin. The weather is nice. The core government services are just as good as long island. I do the same thing I do in North Carolina as I did on Long Island so I don't know why anyone stays on Long Island to tell you the truth.
1027 - 1068 Brad Barrett Yeah I hear you. I'm sitting here cracking up trying not to laugh over you because that's exactly what I feel about Richmond. Richmond at least the part of Richmond that I live in it's basically the epitome of suburbia just like Long Island. And I think that is a misconception actually about Long Island people think it's either like the Hamptons or Queens and it's really like it is suburbia it's the original suburbia. So like where I live in Richmond is basically the exact same place as long island just without the traffic the bad weather the surly people. Right. And everything is kind of nicer and newer and it costs a third of the price. It's crazy. Like I agree with you I don't know why people stay there and it's the cost of living is just so significant.
1068 - 1100 Jonathan Mendonsa It struck me when you were saying that your expenses month month in Long Island were forty five hundred dollars. In my mind I was actually going to be honest I was actually thinking that's actually not too bad for a high cost of living area for someone that's kind of gotten their act together I'm sure you could have done it less with some of the things the skill sets that you've learned now but $4500 doesn't seem too bad. But I know from reading your blog that part of that is that you're housing to some degree was already baked in and I wonder if that cost of living hasn't gone up even farther over the last I guess 10 years or so.
1100 - 1134 Mr Groovy Oh God yeah because don't forget we're talking about 2003 to 2006. And also don't forget I was living in a one bedroom condo and my expenses are $4500 a month. Nevermind the house. So just to give you an example my taxes my property taxes on my one bedroom condo in 2003 was $5400. If I had a house they'd be at that time to be eight to ten thousand dollars. So the only reason our expenses were forty five hundred dollars was because we had a one bedroom condo. We had a house that would be over $6000 easily.
1134 - 1224 Brad Barrett Yeah there's no doubt about it and that condo you bought for seventy thousand. So with the mortgage on that is pretty low obviously. But yet there are all those things that go into even a condo or a co-op which is also prevalent on Long Island like I lived in a one bedroom apartment that was structured as a co-op and I had to pay the mortgage and then I had to pay a monthly maintenance which was like $800 a month for a one bedroom apartment. It was crazy. So I had my mortgage and then that maintenance fee which is taxes and some other nonsense and then all the other expenses of life. So yeah I hear you completely on what it's like on long island Jonathan to answer your question is really in almost any town that you would want to live in a starter house is going to be 400 plus minimum and you probably have to put some work in it. And also like the taxes are just absurd like I am not someone who ever complains about taxes in general. I think my tax burden is fairly reasonable. But when you look at the real estate taxes on long island houses and then compare them to my house here in Richmond for instance my friends are paying 12000 to 15000 dollars a year in real estate taxes and I pay like 2000. And I would argue to Mr. grooviest point the government services here are as good or better in all likelihood better in almost every single aspect. And I'm paying a sixth of what I would be paying. So it's that is just such a massive massive expense that I cannot overstate how significant the taxes are on Long Island.
1224 - 1295 Mr Groovy Brad I got one for you. My former supervisor on my last job on Long Island lives in Woodbury that's like I said school district. Last time I spoke to him was three years ago. So I bust his chops to go. Doug what are your taxes up to now he had a ranch. Right around 25 2600 square feet. Nice ranch home built in in the 60s. But he's got an acre of land $36000 a. This was three years ago. Could you imagine paying $3000 a month just on property taxes. That's crazy. I mean right when you said Woodbury and an acre I mean that's one of the most expensive places to live in America. And that's not shocking to me which is sad. So yeah I mean Jonathan that's a big aspect of cost of living Certainly. And Mr. Groovy I'd be curious to hear other areas where you have found in particular. I know for me car insurance was a big one my car insurance is about a third of what it was in New York. And also I utilities and heating costs. I know like boys parents spend a fortune on heating oil in the winter. And here I mean our utilities are like $100 a month they're virtually nothing. So those are the two big ones for me. Other than housing I'd be curious to hear yours.
housing, insurance
1295 - 1338 Mr Groovy Brad I'm having flashbacks here 2006 is 600 square foot one bedroom apartment. Our electric bill is usually between one hundred sixteen hundred seventy dollars a month. Our electric bill right now is 2017. I have a 2000 square foot house. Our electric bill is $112 a month. And Mrs. groovey and I we're here all day. So the conditions run and all day. I mean the utilities car insurance when I was in Long Island I was living in Long Beach. So I will have flood insurance and just to give you another example my homeowner's association 467 a month. We had nothing we didn't have a gym we have well we had a pool. We had onsite parkign and that was it.
1338 - 1348 Jonathan Mendonsa For both you guys I'm just trying to keep a running tally and I'm kind of in my mind trying to convert from an annual cost to a monthly cost but this you keep coming up with these new line items it's literally breaking my mind.
1348 - 1351 Brad Barrett Yeah like it keeps on going because then tolls.
1351 - 1360 Mr Groovy There no such thing as tolls. I think South of Washington D.C.. It's incredible. I mean just to go over a bridge is going to cost you 12 bucks.
1360 - 1397 Brad Barrett Yeah I know every time we drive back home it's something like 50 dollars in tolls. It's absolutely absurd. So yeah I mean it's it's everything Jonathan it's just even geographically being on on an island there the distribution costs are more significant. There are plenty of union. So wages are union wages and it all gets trickled down. So goods cost more. You go to the food store as we say and things cost more than than here in Richmond. And I'm sure in Charlotte as well. So it's hard to quantify exactly how much you're saving but it's almost every line item it really is just about everything in life which is astounding.
1397 - 1459 Jonathan Mendonsa There's two things that are really powerful. One is that you would have no idea how much you're hemorrhaging to taxes unless you tracked it which is why tracking it is ultimately the most important step in this decision. It all starts. You know you making this decision was not possible without you tracking your finances it wasn't even wasn't even on your radar until you actually started to look to see where your money was actually going or how much you were making compared to how much you actually had to use that the possible utilization of that of that dollar. The other thing is that it's so much more dire now for someone than it was for you and your specific situation. Even if someone was willing to live the most perfectly optimized lifestyle and be willing for them them family to live in a 600 square foot one bedroom single bedroom condo in New York they're not going to be able to do that for $4500 right now that's that's going through the roof. So I just want to highlight to our advantage is that you're going to have that we're about to discuss but on the flip side of that it's just it's just astounding to me how much more of a benefit someone would have for making that decision today than they did even back then.
families, tax
1459 - 1460 Mr Groovy Oh absolutely.
1460 - 1466 Jonathan Mendonsa So let's go ahead and talk about this. This house equity situation how that really set you up for this transition.
1466 - 1550 Mr Groovy The moment we decided we're going to leave New York it was 2003. I get that letter from the mortgage company telling me what my mortgage payment is going to be. Beginning in 2004 at this time my taxes with thirty seven hundred dollars a year again for a one bedroom apartment. So I get this statement to go up to $5400. And I looked at Mrs. Graham and I said What the heck are we doing on Long Island. And unbeknownst to me she wanted to get out of Long Island since we were married but she never said anything because of my family. I'm very close to my family. So that was the moment we decide this is enough no more. Let's get out of here. And like I said at the time we knew our condo was building equity for whatever reason maybe people would have gone to the Hamptons Long Beach got on New York City's radar and they started building condos new condo developments in Long Beach. So it became a hot neighborhood. Again we had no idea but we knew we were on to something good. So we said to ourselves also before we so we said let's do our our upgrades let's we do the bathroom was to redo the kitchen let's just make this an immaculate one bedroom a beautiful one bedroom and so that was what we did. We had three years we saved our money. We redid every room in our condo. And you want to know what we sold it for.
families, tax
1550 - 1560 Jonathan Mendonsa Yeah. Yeah I would love to see you've I guess initially you put down $7000 to purchase this $70000 condo in 1997. What did you end up selling it for.
1560 - 1632 Mr Groovy Yeah. In 2006 we sold it for three hundred forty thousand dollars. So it was you know I knew it was a joke. I didn't understand it. It didn't make any sense to me. I remember arguing that necessarily arguing but just discussing friends who are in the mortgage business who one was a lawyer who did closings and I said the prices don't make any sense. It's supposed to be a reflection of household income. My household income hasn't gone up five fold in eight years. So I didn't understand it. I wasn't arguing with it but that's what happened and it was just dumb luck. When we decide to leave Long Island I had 17 years in my government job. Now I left then I was entitled to a pension a mini pension. But if I had 20 years in it was a bump in the percentage for every year of your service. So it went from 1.5 percent to 2 percent for every year just by going an extra three years. And if you did the math and it really made sense. So that's the reason why we picked 2006 it was just dumb luck. And it also turned out to be the height of the real estate market on Long Island.
1632 - 1654 Jonathan Mendonsa So what was so amazing to me and maybe you can just confirm this number but with this housing bubble that you simply rode that wave when you sold in 2006 for 340000 even after closing cost even after all appropriate taxes even after the remodel they did. You still pulled out $250000 in equity from the sale of that condo is that right.
housing, tax
1654 - 1703 Mr Groovy Yes. And even to this day I'm floored. And I remember it it's funny because when I did refinance probably in 2004 I remember I was so nervous I took out an extra $20000. Meanwhile other people were using their homes as you know as ATMs . So after paying everything off my mortgage all the fees. Nassau County hit you with when you sell a house in Nassau County we walked away. A quarter of a million dollars. A little aside when we agreed to sell our home we went the contract with the buyer. They started making some demands like we were you know we want to close in a month. And I remember Mrs. clearly saying well they can't dictate to us why. I was thinking Mrs. groovey they're giving us a quarter of a million dollars. I'll do whatever they want. Let's let's make them happy let's get out of here before it all collapses.
1703 - 1721 Jonathan Mendonsa It sounds like you read that one right. I just think it's so interesting that I did go and take the time just to run the math on that. So if you're able to take the $7000 that you put down and then nine years later pull that out 200 and turn that into $250000. That's a forty eight point five percent year over year return.
1721 - 1722 Brad Barrett That is amazing.
1722 - 1726 Mr Groovy And I never do the math that that is pretty pretty remarkable.
1726 - 1763 Brad Barrett And just the sheer fact that you guys were able to make that move and pocket that $250000. I mean so many people up there are house poor as I'm sure you know. I mean people might have some assets but it's stuck in that house. And I mean you actually you live the dream as as many longn islanders in their dream scenario would sell and move someplace. Low cost of living and pocket the difference and buy a place in cash I mean like this actually became reality for you and I'd love to hear about about the actual move like how you decided on Charlotte and just talk us through like what that process looked like.
1763 - 1846 Mr Groovy Oddly enough at that time believe it or not I was kind of pushing Mrs. Gooley towards Las Vegas because Las Vegas was still at that time very affordable it hadn't become a hot spot. But for various reasons. So you know Mrs. group was a redhead. She doesn't do well in the heat. So anyway I was open to anything. And Mrs. Groovy said when she graduated high school. She's from Brooklyn she did summer theater in North Carolina and she said she liked it down there. I said fine. North Carolina is perfect for me at the time. You know we had the Internet was not as robust as today's Internet. You can go online and look at what housing prices were in North Carolina and we knew that we would be we would do well to move into North Carolina. We had no specific city. We were aware of Charlotte. Of course we were aware of Raleigh. We decide well we got go down and investigate. We're going to shut down some trips down in North Carolina and see what areas we like. Two weeks before our first visit to North Carolina and this time we didn't decide where we were going to go. There was an article about Charlotte in the travel section of the New York Times my sister in law sent it to us and talked about Charlotte being an upcoming city and Mrs. groovey and I looked at each other as well. Let's check out Charlotte and that's how it started.
1846 - 1856 Jonathan Mendonsa So let's let's dig into the weeds there a little bit about about Charlotte. What changed for you so let's say you make this move. Did you purchased a home. Did you pay for the home cash.
1856 - 1946 Mr Groovy Yep at the time. Like I said 2006 before we sold our home we had about $80000 in cash. So what we did was we did a couple of trips to Charlotte. We also looked at Raleigh that area we like Charlotte better. We found an area that we liked nice neighborhood and little aside Mrs. Groovy does not drive. So we wanted to pick an area that was on a bus route uptown Charlotte. So we assume that we both started from scratch we both had to find jobs. So we looked for an area that was affordable and was on a bus line and we found a really really nice community and we bought a condo for Eighty eight thousand dollars two bedroom beautiful condo. And what we did is we had $80000. I don't remember the particulars. I think we took $60000 of our money and we borrowed $28000 from my mother in law and bought the condo I think in March of 2006 we didn't move down till May of 2006 we bought a condo before we moved down and we needed that. Would you call it a bridge loan for my mother in law just so we could buy the condo once we sold our condo when we had our profit. We paid her back. So our two bedroom condo in Charlotte was eighty eight thousand dollars and we bought it outright.
1946 - 1971 Brad Barrett Alright so just doing the math it sounds like. Now you're in Charlotte. You have a fully paid off two bedroom beautiful condo and you have somewhere just less than $250000 in cash right because you had the 80 plus the 250 you cleared from the sale from the Long Beach condo and you bought an $88000 condo in Charlotte. So and that's that's amazing. What do you what do you do with that money then.
1971 - 2028 Mr Groovy Well we were still getting our sea legs so to speak with personal finance at that time. Believe it or not it was in bank of America. It was in a savings account. And Mrs. Groovy was very fortunate. She kept her new york job. She gave her two weeks notice and the company liked her so much they said they want her telecommute. So that was a big win. we weren't expecting that. So she kept her job and she worked from home which was awesome. A New York salary of New York benefit. It was great. So basically we had this big chunk of money even after buying a condo I forget the exact numbers over 200000. It almost sickens me. Looking back on it we just are a dollar cost averaging which today I wouldn't do. But back then we started doing our Roths at the time and it was maybe 300 something a month to max out for the whole year and we put $3000 into a brokerage account with Fidelity every month.
brokeragechoice, roth, savings
2028 - 2040 Brad Barrett Wow. So dollar cost averaging $240000 worth of of this pot of money you have at three thousand a month. I mean that's going to take months. Right.
2040 - 2040 Mr Groovy Yeah.
2040 - 2049 Jonathan Mendonsa Well let's but let's walk that through I mean things are hard things crashing all the way down right now this is 2000 2008 2009 You're watching the housing market.
2049 - 2126 Mr Groovy That's the worst. That's the killer. That's the killer because again when we move down 2006 things were still ok. Fortunately for me I had so much time built up at my government job I was still on the government payroll for a year. So basically for the first year we had our New York salary at the time. Hundred twenty hundred twenty five year no bills. So we had tons of money coming in and we would dollar cost averaging $3000 into our fidelity fund every month. At this point too we start contributing into our retirement plans at work. So yeah looking back we didn't play that exactly right. Because when the market crashed in 2008 2009 is an an interesting story. I remember we had over $100000 in a bank just sitting in there and I looked one day I saw an article about Bank of America being a dollar a share. It may have been under a dollar and I jokingly said to Mrs. groovey one night why don't we put $50000 on Bank of America in a year. It was back to $12 share. I we would put $50000 at $1 share. I mean we were had $600000 in a year but we did like we did our dollar cost averaging.
2126 - 2150 Jonathan Mendonsa Yeah. So clearly at this point Warren Buffett's model of you know running out with your washbasin to collect gold raining from the sky wasn't wasn't ringing through in your in your in your mind but I am curious at what point on this journey did you find I guess the mustachian community or the fi community as is index investing something that you use now or was this on your radar at this point back in 2008 2009.
2150 - 2179 Mr Groovy Not on our radar back in 2009. We said we were we were still learning and for our Roths. Just so you know we were doing target date funds. Okay. And similar with our workplace there was really no coordination between a 401k to for all three be the Roths we were investing in but we weren't investing wisely. I mean it wasn't bad but we weren't at that level yet. So.
401k, roth
2179 - 2202 Jonathan Mendonsa So it sounds like at a optimal level it doesn't sound like you are making all the right moves but you are still winning while doing this just because your cost of living had gone down so far. And it sounds based on the numbers that I read on your blog. Your cost of living immediately went from approaching forty five hundred dollars a month the New York all the way down to somewhere in the in the low 3s low 2s. Is that right.
2202 - 2216 Mr Groovy Little lower I would say we were when we first moved down when we were living in a condo the two bedroom condo I think. Fifteen hundred dollars $89 a month. We're basically a third of what we were spending in New York.
2216 - 2225 Jonathan Mendonsa So you guys have a huge hammer just to crush your savings goal. I mean right out the gate you're able to save 50 to 60 percent more than you were in New York.
2225 - 2232 Mr Groovy Oh yeah and more on top of my numbers now. But back then we were easily saving 50 percent of our household income easily. .
2232 - 2244 Jonathan Mendonsa Just by making the move which obviously when we talk about something like the shockingly simple math of early retirement that is taking you from having no retirement plan to potentially early retirement right.
2244 - 2260 Mr Groovy Yep. And it's interesting you brought that up because I give Mrs. Groovy credit for Dave Ramsey. I get credit for Mr. Money Mustache. I thought I was working until 67 and in 2014 I stumbled across the shockingly simple math.
2260 - 2320 Brad Barrett Yeah and I was an absolute lightbulb moment for me as well I mean when you see it on paper it's just so it's so obvious right. Like it's something that you didn't consider. Just thinking about about you and Mrs. groovey like you moved down to Charlotte. You bought your condo in cash. Your expenses are virtually nothing. At that point you have almost a quarter of a million dollars in cash sitting there right from the sale of your long beach condo you're saving five to six thousand dollars a month in all likelihood just based on the back of the envelope math like if you are sitting pretty like that's amazing. But but yet you still thought before you found that article before you had that lightbulb moment which I don't know what lightbulb moment number that is. But you know it's certainly a major major moment in your life like you thought you were working till 67. And like what did it look like the next. Did you talk to Mrs. groovey and say wow our entire lives just changed like what does that conversation look like.
2320 - 2355 Mr Groovy Well first off she said you're not working at 67. You know what we'll get a divorce before you work to 67. And once I discovered Mr. Money Mustache I said Mrs. groovey Check this article out check this guy out his Web site. He's a nut but he makes sense. And she was all in and this in 2014 we did a rough calculation and believe it or not at that point in 2014 given our annual expenses and what we accumulated at that point we are pretty close to 25 times our our annual living expenses.
2355 - 2371 Jonathan Mendonsa What's so remarkable about this is based on the first year where you said your life was only costing around $1500 a month. Brad I'm just recalling earlier in this conversation you said your friends were paying twelve to fifteen thousand dollars a year in property taxes. His life cost less than their property taxes.
2371 - 2381 Brad Barrett Yeah it's amazing. That is absolutely amazing. There's no starker example of geo arbitrage just here in the US than that. I mean that is that is brilliant.
2381 - 2386 Mr Groovy It's a game changer when you really think about it. It just made sense for us and thankfully it worked out.
2386 - 2412 Jonathan Mendonsa And practically speaking just to put some numbers on this and to use that stark contrast of that fifteen hundred dollars a month in living expenses if you get to a point in this world where your life only cost $1500 a month and for some people maybe that's a reality for other people that's aspirational but that's $18000 a year multiply that times 25 re practically speaking 400 $450000 gets you to think what you call the moustachioed threshold am I right about that.
2412 - 2413 Mr Groovy Yeah absolutely.
2413 - 2512 Jonathan Mendonsa Just really remarkable how quickly and if you compare and contrast her situation you went from and honestly this is retrospective looking back at this what really was an extraordinarily precarious financial situation. You know any margin you had in your life was based on an artificial housing bubble that came out you came out of you know better for wear on that one. But practically speaking that was an artificial bubble that you rode to the top. And this one choice allowed you to essentially be at the gateway of financial independence. It strikes me though that even if you hadn't ridden that housing bubble let's say that you had an experience that forty eight point five percent year over year rate of return on your house and you just moved to this same geographic location. Back in 1997 1998 and had no housing appreciation. If you're able to cut the cost of your life by $3000 a month due to the difference in taxes due to the different costs in food due to the fact that you have to pay for as much heating you don't have to pay for all these ridiculous homeowners association type fees but you're able to reclaim thirty two hundred dollars a month and you invest that and you don't get these ridiculous rates of return but you're able to match the historical returns of the market over time. I guess practically speaking it's been closer to it 13 percent but we'll just go with 8 percent for now for that nine years. That's actually five hundred thirty one thousand dollars which would have them also gotten you to fi. So this math isn't just based on you getting some ridiculous return on and a housing bubble that isn't replicable. It's just based on general math that anybody can benefit from.
2512 - 2535 Mr Groovy Absolutely. Absolutely. When I think about the numbers if if I remain on Long Island my monthly expenses would easily been close to $7000 I would have $300000 mortgage moving North Carolina. My monthly expenses are around fifteen hundred eighteen dollars a month and no mortgage no debt and basically $300000 in equity. I mean it's a no brainer.
2535 - 2577 Brad Barrett And Jonathan the point that you just brought up is really important and I wanted to emphasize this. It's not that the Groovy's just got lucky. Sure. They timed the housing bubble perfectly. I'm sure they laugh all the way to the bank and you know think about it pretty often about how incredible that was. But this was about moving to a lower cost of living area and creating that margin. And they would have reached financial independence according to your calculations in under 10 years. Anyway that's the story. That's the story of geo arbitrage in the U.S. and sure it helps if you're able to pull out a bunch of equity on a housing appreciation. But but that is not necessary and that's really important for everyone to hear and understand.
geoarbitrage, housing
2577 - 2599 Mr Groovy Brad just to give you a little more information when we finally retired last year I want to give you exact numbers but I just want to confirm all your all you were saying we were over 30 times our live in expenses I'm going to give it. How many times I've been we were over 30. And as Johnson said you take away that that $250000 windfall we still would have made it.
2599 - 2697 Jonathan Mendonsa It's really remarkable. And it's encouraging. I wanted to spend a lot of time harping on that because I'm I'm so thrilled for you that you did get that housing appreciation but when I was looking at the numbers My takeaway was that it wasn't necessary for you to achieve this. It really wasn't that the real the power of the story was just the stark contrast between cost of living and a 600 square foot single bedroom condo in New York versus moving anywhere. You know I don't care what state you landed in moving anywhere where you're able to create a $3000 a month space between what your life cost and what you're and what you're actually earning. And then just taking the difference and investing it over time. That to me I wanted to spend a I really was hoping we were going to highlight that because that's the encouraging message for the people that are listening to this. There's people right now back in your home city both in your home city which is someone interesting that they're not going to be able to get a $70000 condo that's not going to be there. They're coming in right now and their options are $300000. Single bedroom condo. And they're making 60 or $70000 a year. Or maybe it's even worse maybe due to lifestyle inflation or the career path they chose they're being pressured to get the 600 or $700000 house and do whatever it takes to get that mortgage because that's the key to homeownership. And trust me the housing in the last 10 years it's gone up to 600000 if you ride it out another 10 years it will be worth seven hundred thousand eight hundred thousand or so no matter what it takes you've got to get in that home. And the message the takeaway message on this episode is it's a lie.
career, housing
2697 - 2698 Mr Groovy Oh absolutely.
2698 - 2718 Jonathan Mendonsa So you've made this move. You landed in Charlotte we talked about your dramatically different cost of living. I'd be curious just maybe as kind of a final thoughts type segment about geo arbitrage generally maybe I could have you and Brad just compare notes for a couple of minutes any like final takeaways that you would want to give to family and friends back home or maybe someone that's considering this.
families, geoarbitrage
2718 - 2771 Mr Groovy My first takeaway is I mean obviously you've got to give it some thought. We gave us of three years to do this transition and I think my number one take away is the biggest transition fund you can put together. That's the key. I mean one eliminate consumer debt before you make the move. And if you can come to your new destination your new home with a positive net worth. It's a homerun. I mean I've seen people do that transition with no networth just coming down with no debt but no equity and they've done fine for us. Like I said I would say concentrate on just work on it. That transition fund. Get rid of consumer debt. You know you come down $50000 or head out to wherever you want to go if $50000 you'll be sitting pretty.
debt, networth
2771 - 2894 Brad Barrett And yeah my advice people who are contemplating this move is more in the psychological realm. It's not easy to make that decision. It's hard to leave the place that you've lived your entire life and your family and friends are there. And that's just what you know is home. It was difficult even for us. And we just sat back and really discussed and said Like what do we want our lives to look like what is the most important thing. And we know that family is always going to be there. Our family even though we're 400 miles away from New York they come down all the time. My in-laws are here every other month or maybe even more frequently. My parents come for a couple of weeks a year. We see them plenty. We get more quality time with them now than we would if we lived a half hour away and we saw them once a week for an hour for dinner or something like that. It's amazing. Like my girls get to spend a week with their grandparents. A couple of times a year. I mean like how cool is that. And also like friends like obviously Friends are important. But you know as you get older and as you have kids you get busy. I mean my group of friends back home they just don't see each other all that often and like if we were staying for family and friends which is what a lot of people do not just on Long Island though it's especially prevalent there. But but other places you're staying for family and friends and a lot of cases and spending so much on this high cost of living area and it's just it doesn't make sense. The family will be there and the family will always be there. And you're important friends. You'll stay with and keep in touch with and you can't just stay to see friends a couple of times a year. And now is something that we were considering and I'm sure Mr. groovey can back me up like that's just the way it is on Long Island people are so in meshed in this community. But you just have to realize like what's better for your life on a 50 year period. And both my family and the groovies can say like we reach financial independence in under 10 years by making this move and by being intentional focusing on our own families our own happiness. And it worked out exceptionally well for us.
2894 - 2918 Mr Groovy Right let me throw this at you. You're absolutely right. Family and friends well worked out for us even better. My family started following us. We were the pioneers. We showed the way saying hey you don't have to put up with the long island taxes the long island whether the long island Moxey. And they started following. So now I got the best of both worlds. I'm in a low cost to living state and my family is down here too.
2918 - 2998 Brad Barrett Wow that's amazing. Yeah you're incredibly fortunate. I know one thing I neglected to mention in the podcast previously is that my brother actually moved down here to Richmond and followed us down which was awesome. So that was the one family member the one person who who did make the move and it worked out well for him. He enjoyed living here. He actually took GEO Arbitrage a step further and he moved down to South America. So he lives in Santiago Chile. Now he's a. It's amazing he's a math teacher there. So he was a math teacher here in Richmond and he wanted to do this international teaching. And it's the most amazing Fi hack. This is for the audience out there like if you're a teacher and you're contemplating some type of change in life for lifestyle or focusing on FI in a different way like look into international teaching. I know my brother makes somewhere in the vicinity of like twice his salary and they pay for his apartment so he pays essentially no cost of living his savings rate is astronomical and he lives in this wonderful metropolitan city where the beach is 40 minutes away the mountains are 40 minutes away. It's like it's the coolest thing. I mean he met his fiance there. They're going to get married next year it's like it was the best literally the best thing that ever happened to him was was taking GEO arbitraged not only the U.S. Geo arbitraged But then the international. And it's been amazing.
families, geoarbitrage, savings, teacher
2998 - 3033 Mr Groovy Brad got a quick question for you. Did you have a what the frig moment when you moved down to Richmond because Mrs. groovey and I our second week down here in Charlotte after getting everything situated and cable all the utilities everything transferred to our name all the basic stuff that's involved would moving at two weeks I remember walking to a dairy queen and I said to myself What the frick am I to go with North Carolina turned out to be the best move of my life. But that first two weeks it was weird. I didn't know anybody I'm in an area that I didn't know you know did you have that moment.
3033 - 3121 Brad Barrett Wow what a great question. My recollection and my memory is that no I did not have that freak out moment. But it's possible. I mean like we were just so excited like it was it was really an adventure for myself and Laura like we had just gotten married so we actually similar to you where we bought the place a couple of months earlier we bought our house here in Richmond in I think it was August 0 5 and we got married in November 05 and actually moved down right when we got back from the honeymoon. So it was like this amazing adventure for us. You know we had just gotten married we have this new life and it truly was this new life. You know we picked up moved 400 miles away. So I mean you couldn't change more in a short period of time than we did. So also I did know some people through work though I have never actually met them in person before. I I we had tax personnel on Long Island and in Richmond. So I moved down. I was working with people that I had corresponded with for years. So you know we have a little bit of a safety net. I had some friends from college who are still here so yeah I never had that freak out moment but I suspect if I just randomly happened upon you know I woke up in Charlotte one day and I said What the heck did I do with my life. Like yeah I mean it is a little weird. It's it's not easy to just pick up and move your whole life. But like we were always content with the decision. We knew that it was the right decision for us and I think that's what staved off a lot of that kind of reaction.
3121 - 3220 Jonathan Mendonsa You know what I love about your conversation and you tiptoed into it a little bit Brad. And I think both of you probably understand this that at some level. But I think it's worth mentioning is that just like with many things in life you have to ease yourself into an idea. And we talk about this idea of international Geo arbitrage or maybe what you would just call traditional Geo arbitrage which is going just anywhere in the world and trying that out for a season of life. But what I love about this conversation is that while maybe when you're looking at it from the outside and this can seem like this really drastic decision but it's really not. I promise you Brad sees his family more often than I see mine which is really sad because mine are in the same state. They live less than two hours away. Brad sees his on almost every other weekly basis but if you can just baby step your way into this and try a level of domestic arbitrage that allows you to cut your FI plan in half how much more possible is it to go to some incredibly exotic destination like Chiang Mai Thailand and go from whatever living expenses you may be experiencing in North Carolina and cut that in half again which then cuts your FIplan in half again. So you know this doesn't even have to be the final destination. This could be the safe experiment that lets you see you know what our family is stronger when we move to maybe what could be considered an uncomfortable situation one that we have to redefine ourselves. And once we've done that and we have the confidence that comes from achieving a life in a new area why not try and take that next step and do it Brad's brother did and go to Chile just completely blow up the game and reclaim your life. So I love that this conversation opens up that door and thank you so much Mr. groovey from coming on the show today and sharing your story with us.
families, geoarbitrage
3220 - 3230 Mr Groovy Oh my pleasure guys. It was it was phenomenal just discussing my situation and I said I hope people take that leap because they're going to love it if they do.
3230 - 3235 Jonathan Mendonsa Well if they do I hope that they will share it with us and share it with you. What's the best way for people to reach you.
3235 - 3240 Mr Groovy Freedom is groovy dotcom and I'm on Twitter it's freedom is groovy.
3240 - 3247 Jonathan Mendonsa All right. We'll put the links to both those in our show notes. Now before we let you go today we want to give you the chance to tackle the hot seat. Are you ready for this.
3247 - 3259 Mr Groovy The guy's voice. I live for that guy's voice in a world I don't know where you got him but that's awesome.
3259 - 3287 Speaker In a world drowning in debt and rampant consumption. Trapped by the chains of lifestyle inflation. These questions highlight the secrets of those who are broken free. Welcome to the choose F-I hot seat.
3287 - 3290 Jonathan Mendonsa Question number 1 your favorite blog that's not your own.
3290 - 3299 Mr Groovy Killing me this is like picking my my favorite child. There's so many great bloggers out there. I love Montana money adventures. Have you heard that site Jilian yet.
3299 - 3301 Jonathan Mendonsa No I haven't. Tell me more.
3301 - 3318 Mr Groovy If you get a chance check out that site in Montana husband five kids under 40 are doing a gap retiming right now. I mean they are killing it. Great story great person. I mean I love everything they are doing out there.
3318 - 3324 Brad Barrett Wow that's really cool. We love hearing new blogs. We've never heard of does she go by Miss Montana by chance.
3324 - 3324 Mr Groovy And that is her.
3324 - 3334 Brad Barrett OK. I've seen her comment. I feel like on 1500 days. Or some other Web sites. But yeah I've never checked out that site but that's going to change now.
3334 - 3334 Mr Groovy Excellent.
3334 - 3340 Jonathan Mendonsa All right. Question number two your favorite article of all time and this can be one that you wrote or somebody else's.
3340 - 3350 Mr Groovy Sure. I hate to be ordinary but I'm going to have to go with the shockingly simple math behind early retirement by Mr. Money Mustache if it wasn't for him I'd still be working.
3350 - 3352 Jonathan Mendonsa Nice go with the Classic.
3352 - 3355 Brad Barrett All right. Question number three your favorite life hack.
3355 - 3378 Mr Groovy No bread and no sugary drinks. I don't diet but by eliminating that too a couple of other things a little intermittant fasting. And it's been a little you know saving my sugar for Saturday. I've gone from 215 pounds to 185 pounds. Actually a little bit less I went on the scale the other day 180 pounds. Not bad for a 56 year old.
3378 - 3379 Jonathan Mendonsa You're crushing it. How tall are you.
3379 - 3380 Mr Groovy Six foot.
3380 - 3397 Jonathan Mendonsa It actually sounds like we've kind of landed on something similar. So I'm doing the six in one as well kind of saving my I guess cheat day for Saturday and I am. I occasionally do intermittent fasting Although lately I've been latching on to maybe just doing a periodic fast like once every couple of weeks or so.
3397 - 3410 Mr Groovy That's awesome. And guys your podcast. What was it. Small waist fat wallet. One of the best ones I ever heard. I mean you're still in my phone. I'm listening and I'm going. These guys are me. But there are 25 years younger.
3410 - 3432 Brad Barrett That's great. It's amazing. Yeah we definitely have locked in on a lot of similar stuff healthwise. Yeah I mean for me I've just tried to cut carbs and sugar as much as I possibly can. And yeah the intermittent fasting and also the fast that the multiday fast that Jonathan just undertook. Those are interesting things to me as well. Have you ever done one of those multi-day fasts.
3432 - 3439 Mr Groovy No I have not done that. I've done a 24. I don't know if Mrs. groovey will let me do the multiple day.
3439 - 3444 Jonathan Mendonsa And that funny that's where my wife is that was she actually gets angry with me when I try it.
3445 - 3450 Mr Groovy You know I'm a Tim Ferriss fan so I'm I'm definitely curious about. I would love to give it a whirl. But we'll see.
3450 - 3465 Jonathan Mendonsa Very cool. Thanks for the feedback on the skinny waist fat wallet. I'm glad that resonated with you. It certainly is just kind of filtering through all the garbage that's out there and trying to pull those little bits that have stood the test of time that don't blatantly have some supplement to sell you right behind them.
3465 - 3469 Mr Groovy I had one question for Brad. I know he's a pull up guy. Have you ever done a muscle up.
3469 - 3481 Brad Barrett I have not. done a muscle. That's a good question. I know I I just recently started CrossFit and yeah muscle ups are one of the advance movements but I've never I've never tried frankly so I don't know if I physically can do it.
3481 - 3496 Mr Groovy Took me two years. I don't think I'll ever get one but I finally got Actually once I got the first one the others started coming pretty quickly and I got up to nine in a row. So let me know when you hit it. I mean it's a great milestone.
3496 - 3511 Brad Barrett Wow that's really cool. I love the fact that you kept at that for two years. I mean that's I talk about that all the time and the podcast is like making incremental progress towards goals and just the sheer fact like what does that look like when you try to attempt that for two years.
3511 - 3532 Mr Groovy Oh it was. I did everything I did the weighted pull ups. I even got the the straps to the assisted pull ups to get into that just to feel what the transition was from the pull up to the to the to the depth and the key for me what really turned around. Once I lost that weight boom that's when I got my first one.
3532 - 3540 Jonathan Mendonsa Awesome. I saw your set up your less than $100 set up on while I was digging through your stuff I was pretty impressed by that very minimalistic approach to fiteness.
3540 - 3552 Mr Groovy If I only knew what I know now 30 years ago. Rings will kick your butt. It's a great tool. Just that I guess it's come back into favor now because of crossfit But when I was growing up they were unheard of.
3552 - 3565 Jonathan Mendonsa I might have to get a pair. I have a little home gym setup I don't know if I need more space like I feel like they probably need to be higher up off the ground more room than I would have but I might just get a pair and throw them on those pull up bars that I have brought or hanging from the ceiling or something.
3565 - 3571 Brad Barrett That's cool. That's a good idea I like that alrigh I question number four your biggest financial mistake.
3571 - 3639 Mr Groovy Yeah. I've done a lot of them. You know one of my biggest was when I went to school Buffalo University this is 1979 college was so freakin cheap back that I graduate in five years lame major sociology my last semester whatever it was 15 correct I took five classes. $542 that was my tuition and I wasted that I did not I didn't have the stomach for it. I did nothing. But even though that was a big mistake I still think my biggest mistake. 2009 I had $100000 in cash sitting in the bank. The stock market crash went from 12000 down to as I think was sixty seven hundred dollars. And I still did. Dollar cost averaging. I didn't throw it into an S&P 500 index at that time. I didn't put it on a stock. We talked earlier about Bank of America $1 a share. If I would put $25000 on Bank of America I could have had $250000 a year. So looking back that was my biggest mistake.
college, stocks
3639 - 3642 Jonathan Mendonsa Question number five. Advice you would give your younger self.
3642 - 3689 Mr Groovy And I thought about this and you know over the last year or so I kind of had an epiphany I would say good habits don't discriminate as soon as you befriend them they'll befriend you and I didn't realize that until I was in my 40s I was making excuses. I was worrying about what other people had and never looked what I had and the opportunities that were all around me. And you know I said I was a financial moron prior to 40. And as soon as I started behaving wisely making wise choices everything just opened up. Nothing could stop me. Not the evil one percent not the rigged system. Nothing could stop me.
3689 - 3726 Brad Barrett That's brilliant. That's the internal locus of control that we talk about here in the podcast it's believing that you can impact change on your life and that you're not beholden to these outside forces that everybody else is so worried about when they're watching the news nonstop and freaking out about this or that it's you control what you can control and you are truly taking control of your life in that regard. You don't have to worry about that. And I don't think about these outside forces I don't think about how angry or aggrieved I am it's nothing like that I have this wonderful life and I make the choices that better my own life. And it's a really mentally freeing way to look at life.
3726 - 3727 Mr Groovy Exactly.
3727 - 3733 Jonathan Mendonsa All right now we do have a bonus question for you. Your favorite purchase made on Amazon.com over the last year.
3733 - 3736 Mr Groovy This is an easy one. My picker for trash.
3736 - 3743 Jonathan Mendonsa I saw that. Let's talk about your trash videos for the people that want more information. Tell us about your your side gig on YouTube.
3743 - 3799 Mr Groovy Yeah freedom is groovy. I started a YouTube channel. I mean it's hideous Yes. And one of the reasons why I started it was that's one of my weak points. I am not comfortable talking in front of people. You know what. You know everybody says the greatest fear is talking in front of an audience. That's me to a tee I freeze up. I said you know I got to get over this. Not that I'm going to be given a speech any time soon at Fin con but I didn't like that aspect of my life that I would freeze up i'd stutter. You know I know I look like a friggin moron. So I said let me just go out there and just talk. And that's how it started. You know and Mrs groovy convinced me to go on you know go on Amazon get that trash picker up and just go out there and start filming it. So that's how it began. And again if you go to that channel you are going to see anything spectacular but it's cathartic. I enjoy it I do it once a week if I'm ever driving through Richmond. You want to pick up trash with me.
3799 - 3803 Jonathan Mendonsa Yeah man you got it. You're awesome. What a team.
3803 - 3804 Mr Groovy That's all I ask.
3804 - 3811 Jonathan Mendonsa Very nice very nice. Well thank you so much for coming on the show today and joining us. We really appreciate you taking the time to share your story.
3811 - 3818 Mr Groovy I you guys like I said You guys are in a short time. You're my go to podcast. You guys are really you know you're kicking butt.
3818 - 3821 Brad Barrett That's really kind we greatly appreciate the kind words.
3821 - 3914 Jonathan Mendonsa And hopefully we'll get a chance to see it maybe an upcoming camp FI event. That would be really awesome. And to our community I hope you got value from this episode. Honestly what I really want to come across is this is not to bash a particular geographic location although I get that that probably came through but rather is to show you the power of the tool to show you the power of doing the math and I hope that you're willing what you take away from this is just the fact that first you just have to start. You just need start tracking your finances. Once you've done that you're going to be positioned to decide whether or not this is a tool or a lever that you should be considering. And if so I hope you're able to make a choice it's in your family's best interest just like it was in Mr. groovie's and it was in Brad's. But either way it starts with just doing the math. Thank you so much for listening. Thank you so much for being here and for being a part of this community. If you want to support us here are four easy ways 1 press the Subscribe button on the platform that you're listening to this on and leave us an iTunes review if you want to do that just go to choose FI dot com slash iTunes two use our page to sign up for travel credit cards. If you want to travel the world with miles and points instead of your hard earned dollars then just go to choose F-I dot com slash cards and get started today. Three if you're working on the milestones of FI. Set up a personal capital account to track your progress and use our affiliate link. It's completely free and just go to choose F-I dot com slash PC P as in Paul C as in cat and 4 and most importantly find your friends coworkers and family members who might be open to this message and tell them about the podcast. Have them start with episode 38. The why of fi and right behind that have them go listen to Episode 21. The pillars of FI. It is a fantastic starting place. Alright My friends the fire spreading. We'll see you next time. As we continue to go down the road less traveled.
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