051 - Mad Money Monster RollerCoaster Path to FI

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Time Speaker Text Tags
0 - 34 Jonathan Mendonsa Alright guys we have a very exciting planned for you today we're going to be speaking with Lisa who as a qualifier is a mother scientist and financial enthusiast. She founded Mad Money Monster a personal finance blog that chronicles her and her family's journey doing money all wrong to doing it all right. She and her husband go by the moniker Mr. and Mrs. Mad Money monster and they pride themselves as being Gen-Xers who have turned it all around and are now charting a course towards financial independence. Their goal is to inspire others just like them to take control of their financial future and realize it's not too late. So this is going to be a fun conversation and help me with this. I have my cohost Brad here with me today.
families
34 - 61 Brad Barrett Yeah Jonathan I'm excited for this one. Actually it's funny just yesterday in our Facebook group one of our moderators posted a link to one of Lisa's articles that I know we're going to dive into today which is FI or so it's f i o r financial independence optional retirement. And I just thought the timing could not have been better that we were going to literally record with her the very next day. So yeah this is going to be a really interesting interview. And Lisa welcome to the show.
61 - 62 Lisa - Mad Money Monster Hey glad to be here thanks.
62 - 68 Jonathan Mendonsa So Lisa I know for a fact what an absolutely fascinating back story you have and I'd love for you just to take a few minutes to introduce yourself.
68 - 148 Lisa - Mad Money Monster Sure. My backstory story grew up actually in the original tiny house it was a trailer it was eight by 50 feet long so 400 square feet six people. So it was crowded house but it was it was a good time. Fortunately I was in a great school district so I had friends with parents who you know maybe well not maybe absolutely did have you know a lot more than I did and you know I would look up to their parents and I would think wow I really would like to be in a different position you know in my life as I grow up and turn into an adult despite my parents having us growing up in a trailer and things like that. They work their butts off and they really pushed education but they didn't really know how to build wealth Well they pretty much kept us out of debt. So they weren't racking up credit card debt and things like that. But they did spend everything that came in like everything that came in went out for bills went out for making sure I had the trendiest clothes. You know I think part of my mom's overcompensation for growing up in a trailer was to make sure I'd look like the other kids I went to school with. So and at that time you know I I took it right that sounded good to me. So basically I grew up I graduated and started working I didn't think I was smart enough to go to college which is completely absurd.
backstory, college, debt
148 - 158 Jonathan Mendonsa Let me slow you down for just a second. I mean what is it like actually growing up in a trailer. I mean that is a that's a different set of circumstances than many of the people that we've talked to up to this point.
158 - 211 Lisa - Mad Money Monster Yeah that's actually true. Growing up in a trailer it wasn't as acceptable. I guess it's the right term I think today people were more accepting of different lifestyles and different you know housing situations. But when I was growing up it was definitely something I was embarrassed about. And actually I only started telling people about it only a few years ago so it kind of coincided with us getting on this fire journey that I started to open up about you know what it was OK you know this is how I came to be who I am today. So yeah I was definitely embarrassed about especially growing up in you know going to the good school district where you know my friends were not living like that. So I barely was just over the line where I got to go to the good schools. And so that was a good thing I guess. But yeah it did affect my self-esteem and things like that. And unfortunately I guess. But yeah.
housing
211 - 231 Jonathan Mendonsa Yeah absolutely you know one of the things that we've talked about in the show is this idea of being selectively hard core which really is a privilege because you're making a choice to be more hardcore in this particular aspect of your life. But coming from a place where it wasn't an option you're just having to live this thing out. I'm. sure it ingrains itself into your identity which carries forward into almost every other aspect of your life.
231 - 260 Lisa - Mad Money Monster Oh it absolutely does. And you mentioned that there was a time when we did not have a hot water heater you know it just gave out we didn't have the money to replace it so there was a time period. I definitely is imprinted in my memory that we were heating our bathwater up on the stove and we dump it in the tub. But you know I was I was pretty small at that point so I didn't really get the I should be embarrassed about this yet. So at that time it was just normal. You know I was like oh sure we're heating up our bathwater of course.
260 - 270 Jonathan Mendonsa Well clearly it didn't hold you back I mean we can take a look at where you are now but I would say that your path was not predetermined and you definitely had to work through some stuff. Can you tell us a little bit more about your high school and college experience.
college
270 - 394 Lisa - Mad Money Monster Oh yeah absolutely. So my high school experience was pretty low key. I was pretty much just a generic student like I wasn't picked on but I wasn't ok generic student. I'm going to get in trouble for saying something like that but I wasn't picked on and I wasn't in you know the popular group or anything like that so I just kind of coasted through high school didn't really apply myself just kind of saw myself graduating getting a decent job and just working you know just working paying bills. I mean I didn't want to live in a trailer I knew that but I didn't really have super high goals at that point. So I did. I graduated high school basically an average student. I got a job. I actually worked at a worldwide electrical components company so I got a job in their lab soldering electrical parts together. That's where I met an engineer. He was pretty cool pretty young and was asking you what are you doing here. I'm like well I'm not smart enough to go to college and you know he just burst out into laughter. You know my face turns all shades of red and I'm like oh my god what are you doing. You know it's like of course you're smart enough to go to college anybody can go to college. That's when he talked about a community college. And I said because I said you know my grades weren't great. High school he introduced me to the concept of a community college. I remember going home and secretly looking into their local community college and secretly applying secretly being accepted. Now at that time I had no idea about an open admissions policy I had no idea they pretty much except everyone but I was so proud of myself that I got accepted. You know I came to my parents and I you know I got accepted into college and that's great. Sorry we can't help with money. So basically I stayed at the electrical components company I stayed there for the next four years while I worked full time. I listened to my lectures while I soldered components. I went to class at night so it took me almost four years to get my associate's degree and then I transferred to a local private school for the remainder of my Bachelor's So.
college
394 - 450 Brad Barrett Lisa we talk a lot about limiting beliefs here on the podcast and it strikes me as a major limiting believe that I wasn't smart enough to go to college or maybe because nobody in my family had a high school diploma not less a college degree than maybe I could never do it. I wonder if you've ever reflected on that like where did that come from. Was that something that was part of your family something you just grew up with like. I know one of your quotes in your article said I grew up as a poor kid on the right side of the tracks which lit a fire inside me and I'm curious like this interplay between the limiting beliefs potentially from your family or seeing your family. And then also maybe aspiring to the wealthy people who live next door like Was there ever an interplay there. Like a balance where you're struggling. OK my friends are going to college or the wealthy kids are going to college but it's not for me or I'm not smart enough. Did that ever play into your thought process.
college, families
450 - 486 Lisa - Mad Money Monster So I never actually took the SATs. That's that's a funny thing. But my best friend one of my best friends I said to her Do you think I could still go to college. And she was set up to start a pre-vet program so she had already been accepted. So I kind of looked up to her. She was bright and she said oh no it's too late now. And it's like oh I didn't really have I guess I didn't really have a mentor to go to. I didn't have somebody I mean my parents would say yeah you can go but we can't afford to pay for it. So right there I kind of hit a roadblock.
college
486 - 512 Jonathan Mendonsa You know I want to say what's striking me is we've kind of thrown out that phrase first generation fire as someone that realized the possibilities of high savings rate. But it almost seems like you had even more disadvantages stacked against you I mean this stuff wasn't even that it was nowhere on your radar there was not a single person that you could point to that even had a modicum of financial prowess at this point right. That is true. You reaching out into the void and hoping that something comes back.
savings
512 - 546 Lisa - Mad Money Monster Yes. And one thing about me is that I'm I've learned this over the years I'm coachable. So that that has served me really well. So I left high school and I immediately got that job and it was that engineer that really encouraged me to go to college and said No you can do this. You're way smart enough. And he was sitting there with a master's degree. So if he believes in me and he is telling me I can do it well then maybe I can. You know so that was my moment that I grabbed onto and I thought you know what I'm going to try this. I'm going to see what I can do. I can see what I can make happen.
college
546 - 571 Jonathan Mendonsa I'm just blown away by the fact that you know I'm having this kind of light bulb moment right now. Just thinking out loud that you can be that one person for someone else you know how often do you just go through life saying I can't make a difference. I'm not big enough. I don't have a big enough platform but honestly the value of mentorship and it doesn't even have to be a formal mentorship. It could just be one person giving someone else words of affirmation to just destroy any belief that could have been held for decades.
571 - 615 Lisa - Mad Money Monster Absolutely absolutely and I can actually also remember I had saved up enough money because I had to work it I had to pay for this myself. So I'd saved up enough money which was a lot for me at the time $600 for two classes I was going to take in the evening and I went to a friend's home. I had a friend of mine that didn't go to college. And I'm sitting there with their parents and I said Oh I don't know should I go do it because that's a lot of money for me to give up. Right I was so proud that I saved this money you know I do it not do it the response was Well why start. You're not going to finish and that just boy did that rub me the wrong way in that that also lit a fire under me. So I think I probably drove down that night and paid for the classes and signed up and that was it.
college
615 - 620 Brad Barrett Well where do they get off saying that like what would even cause them to say something absurd like that.
620 - 633 Lisa - Mad Money Monster You know looking back I think it's because their child chose not to go. So it was almost like a little jealousy thing maybe that's the only thing I can come up with because why would you say that as an adult to an 18 year old.
633 - 658 Brad Barrett Yeah I mean lighting a fire really does. There are many things that can motivate us psychologically right and thinking that someone thinks hey there's no way on earth you can do this. Right. I would light a fire under me. It's so good for you. That's amazing. I did they haven't. Not to delve too much into this but did they have any past with not graduating college or anything like that just such a weird psychological thing like who would say that to another human being no less. an 18 or 19 year old kid.
college
658 - 664 Lisa - Mad Money Monster Correct. I don't believe they had gone to college either. You know maybe they didn't even realize why they were saying it right. I don't know.
college
664 - 689 Brad Barrett Yeah just limiting beliefs. We all have them and you just have to be so careful about that. Like whenever you say like oh I can't do X or I'm not smart enough or I'm not good enough at X that's crazy to me. I'm not good enough now. But what do I have to do to work to get there. You know and like you said you were coachable. What a great way to go through life thinking I'm coachable. I can learn anything. That's brilliant.
689 - 700 Jonathan Mendonsa You just nailed it Brett. I was thinking that's the takeaway here. You know you're going to latch onto a belief let it be that you're coachable. You know that's the belief system that you need to be holding onto because someone that is coachable can learn anything.
700 - 714 Lisa - Mad Money Monster Yeah I love it. I love the fact that I'm coachable. I mean even listening to podcasts when I'm out running or anything I'll take little pieces of what I hear and all. I'll try to incorporate that into my life to make my life better.
714 - 754 Brad Barrett Yeah that's great. And you know I'm constantly talking about the impact theory podcast here with Tom Billiew and he is just one of the best motivators I've heard and he talks about his belief system about about who he is as a person. I'm the type of person that and to you it's I'm the type of person that is coachable and can learn everything. And so this is what I want the audience to take away is really think about what holds you back mentally and why where did it come from. Is it real. Like do you even believe that when you actually sit back and think about it Lisa believes she's coachable and can learn anything. That's brilliant. As far as I'm concerned.
754 - 766 Jonathan Mendonsa This is the part of the story where you start to get onto this glide path right. I mean you're making it through all the obstacles that you've had throughout your childhood you've overcome your in college and you're on this trajectory to success right.
college, debt
766 - 839 Lisa - Mad Money Monster Yeah I guess that's true. I mean I I felt better and better with each passing semester. You know it was a lot it was it was not easy for me to get through especially those first two years and I was working full time like I would go straight from the factory and I would stop in in the Wendy's parking lot I'd study a little bit. I'd grab a burger. I go straight to class and I wouldn't get home till 11 o'clock at night and I'm up at 6 o'clock the next morning to get to work by 7 again. So it was a lot. Now after that piece when I did transfer does the only time I live for it in work I didn't work for two years while I was at the four year school finishing up my bachelor's degree. I actually put on the financial aid form that I was not willing to work. I think because I checked that box they gave me I don't know they adjusted my package. I don't know but that might be a trick that some of your listeners might want to try out. But my package was great. I mean I came out of private school with $25000 of debt at the end of two years which wasn't that bad. And I graduated with a scientific degree. And you know little debt so I got a job right away making a pretty good salary. So.
839 - 842 Jonathan Mendonsa That is the end of the story right. You've made it.
842 - 885 Lisa - Mad Money Monster No it's not the end of the story but. Yes. My education. Yes. I check that box I made that for me. That was such a big hurdle. I knew that that I needed that or at least in my mind you know I wasn't an entrepreneur I wasn't somebody who's going to make a ton of money with the creation that I come up with at that time in my life so I knew that I needed that college degree to get me into that next level you know. So out of my childhood status I guess but as far as working for the company I know the companies I've worked for actually I took up my employer on their free master's degree as well. So I got a master's degree 100% free. So that was nice too.
college
885 - 898 Jonathan Mendonsa Yeah you know that's actually a great college tip. There are a college act that we haven't spent a lot of time talking about but it's the fact that once you get that first job in many cases your employer is willing to cover the cost of that graduate degree if you position yourself in the right field.
college
898 - 919 Lisa - Mad Money Monster Absolute We absolutely know a lot of times it's not 100 percent. In my case it was so I thought well there's no reason and I really didn't need it for my job but it was really a personal goal for myself like I'm going to get a master's degree. Not only am I not going to not finish but I'm going to go on to get a master's degree as well.
919 - 920 Jonathan Mendonsa So are you 22 at this point.
920 - 928 Lisa - Mad Money Monster No. I was a little bit older because I took longer to get through my first two years because I was working full time so I was like mid-20s OK.
928 - 930 Jonathan Mendonsa Now is this the point at which you found the FI community.
930 - 936 Lisa - Mad Money Monster No. My gosh I didn't find the FI community until a few years ago. I'm so embarrassed.
936 - 938 Jonathan Mendonsa So What happened in the meantime.
938 - 1005 Lisa - Mad Money Monster So my life has been a series of like 10 steps forward and like seven steps backwards right. So I graduated I started making money and I started saving like crazy right. Like I started not maxing out but I had a high percentage rate you know going into retirement accounts IRAs 401k. And I just made bad relationship decisions like they weren't bad people but they just were not the people for me long term. And on some level I knew that but we were comfortable we had combined friends. We got engaged. We bought a house. And like I just knew in my gut I knew that this probably isn't who I should marry. And we never did make wedding plans or things like that but it's just a lot of wasted time a lot of wasted time on top of it. He was not into saving he was into spending and we would go out with our group of friends and oh I got the tab. So you would. What are you doing. You know he's racking up credit card debt we're supposed to be together. So that's a whole other story.
401k, debt, ira, relationships, savings
1005 - 1012 Brad Barrett You know what I'm curious about that because many many times you're with someone and they become more like you I mean did he start saving more the longer you were together.
savings
1012 - 1036 Lisa - Mad Money Monster No. No absolutely not. I mean his personality was very odd. He had a very strong personality and he did not buy into it. I mean I tried I tried but he did not buy into it so I mean I was still saving in my retirement account. I did still put a nice chunk into those. But yeah it was definitely not caring if I went out on a shopping spree and dropped $2000 in a weekend. You know so what.
savings
1036 - 1043 Brad Barrett OK Lisa so all through this time you you still are saving in your 401K or retirement accounts right.
401k, savings
1043 - 1045 Lisa - Mad Money Monster Yep both IRA 401K. Yup.
401k, ira
1045 - 1058 Brad Barrett And we talked about your significant other and his bad habits have spilled off onto you to a large degree like did you lower your contributions beforehand or was that. The one thing that stayed constant throughout.
1058 - 1081 Lisa - Mad Money Monster I did not lower my contributions and he would give me crap about that but not so much that it made me want to change that. I knew that was very important. Now he did rub off as far as me spending more. But because we still had separate accounts separate money you know he wasn't exactly seeing the dollar amounts that I had going into. those accounts.
1081 - 1105 Brad Barrett Nice. That's really cool. So you've been saving in your 401K since your early to mid 20s. And you said once you graduated you had a good salary. So it was that was that right. But I'm curious throughout this process where you started spending more than $2000 on a shopping spree on a weekend like did you go into debt as well or was it you were spending every dollar that came in other than your retirement contributions.
401k, debt, savings
1105 - 1115 Lisa - Mad Money Monster I was pretty much spending every dollar I did rack up some credit card debt. Yeah. It was cyclical so I would rack them up and then I would pay it off and I did crack some up and I pay it off.
debt
1115 - 1123 Jonathan Mendonsa So you're in this relationship. I mean you have this sense that maybe this isn't the right fit. But you know you guys are keeping your finances separately so who cares right.
relationships
1123 - 1168 Lisa - Mad Money Monster Absolutely. I mean we kept our finances separately even though we bought a house. I kept my name off the deed. I put some money toward the down payment but we were living the life you know we were making great money between the two of us. We were having friends over we put a pool in we dropped. Oh my gosh. I think it was 50 or 60 thousand dollars to put a pool in the backyard and every Sunday was a standing open invitation for all of our friends to come over. We were hosting you know we're buying food we're buying drinks. I mean this is every week that's that was a ton of money that we were both spending on this lifestyle or just flaunting it. We've made it look at how successful we are right. I mean it was terrible. Looking back is terrible. But it was fun at the time.
1168 - 1176 Brad Barrett Sixty thousand dollars on a pool like. Where does that come from and do you take out a loan for that. You save the money and you just plunk $60000 on that. Tell me about that.
1176 - 1212 Lisa - Mad Money Monster So let me tell you where the money came from. When we bought the house. Like I said it wasn't in my name. He was a little bit he was a few years older than me so he had been making good money for longer than me. He had a townhouse that had equity in it because this was year. This was I think 2005. So he had some pretty good equity because the market was I mean the bubble had not burst yet. Right. So he got a lot of money out of that townhouse before we bought this other house and instead of putting more money down on the house that we bought he put it into a pool in the backyard.
1212 - 1240 Brad Barrett yeah that is that's pretty interesting. So I'm also curious about the psychology of that cyclical credit card debt. I know you said you paid it off and that's probably better than what many people do right which is to have credit card debt indefinitely. But for someone who was a saver before you met your significant other like how did you get into the process. Where Credit card debt was acceptable. But talk me through how that works. Even mentally.
debt
1240 - 1261 Lisa - Mad Money Monster Uh Mentally I think because I just I'm I'm so young there's so much in front of me we don't have kids yet we're not married yet. Who cares if I drop some money I'll pay it off you know. And so that was just that cycle. You know he wouldn't bend to me. So if any bending was going to take place it was going to be me bending more toward his lifestyle.
1261 - 1270 Jonathan Mendonsa You know what I love about this is that it's obvious you're not saying that he was a bad guy right. This doesn't have anything to do with his personality it just has to do with how you related to money.
1270 - 1284 Lisa - Mad Money Monster Yeah absolutely. And I mean really personality wise we probably were not the best mix either. But he wasn't a bad guy. We were just on the opposite ends of the spectrum when it came to finances and how we viewed money and building wealth.
1284 - 1314 Jonathan Mendonsa When we talk about sunk costs when it comes to picking a profession or maybe picking some sort of course in life but it strikes me that obviously this relationship that you're in right now at this point you're starting to think about the sunk cost. And you know let's say you make the choice to actually break this relationship off to go your own separate ways like I can hear. You know I can hear that in your mind that you're thinking this way that point in time what is actually going through your mind. What are the different factors that come into play when you start talking about actually dividing your life and then moving off in this different direction.
relationships
1314 - 1375 Lisa - Mad Money Monster You know it was so intimidating for me because I had never really been on my own. I was with my parents and then I met him pretty much when I graduated college so all that time you know we dated even when I was taking the college classes so we had been together for a very long time and after I was done with college then we just kind of naturally moved in together I guess I mean he already had the townhouse so I just started staying over for him or oh why don't you bring some things over there was never really a definitive OK let's combine our lives and this is how it's going to look. It just kind of happened without any real decision being made. And that was hard for me to to think about. I mean after years of this and then buying another house and just our lives were so intermingled and our our friends were our friends and it was just I don't know I was scared. I was scared to actually break it off even though and I knew in my gut that that was the right thing to do.
college
1375 - 1382 Jonathan Mendonsa Practically speaking Lisa what's actually going through your mind I mean you can just leave just leave. It's not working out. Just leave what is holding you back.
1382 - 1515 Lisa - Mad Money Monster You're right. And I thought about it so many times. I mean I remember having you know like vacations or vacation days here and there I would be on the computer researching apartments. I was there but I didn't want to move backwards in my mind leaving that big house with the pool was moving backwards. I didn't want like that was a validation thing for me I'd made it. You know I I have my education I have the big suburban house that I drooled over as a child. I mean that's all I wanted. Growing up I just wanted to live in a nice house in a nice neighborhood and I never had that and I finally had that. So that was a big thing. Our friends our combined friends were actually you know his friends that became my friends so you know you know they're not going to you know take my side because everybody has to take a side. I mean you say that doesn't happen but of course it does. It always does. So that was the thing I mean I did have my own friends but a lot of them weren't local so it wasn't wasn't the people that were coming over to the house every Sunday for the pool party. So that was going to be a big change for me. And then we also had you know we had dogs we had cats and we loved our animals. And then you know if I'm leaving I'm moving into apartment and I lose that as well. Just a lot of loss on my end. One thing we did have in common big time was we love the holidays and we went all out with decorating and hosting and you know everything that makes the holiday special. Right. You know what am I going to do continue to do that in an apartment. You know it's just not going to be the same you know everything that was pulling at my emotions and my mentality. I wasn't thinking clearly I was I was thinking you know even though I knew the person wasn't 100 percent who I should be with everything else kind of fit into the into the wheel house. Then there was also the pool right the pool we put them in the backyard. I mean talk about validation not only did we have this big impressive house but we had this big impressive pool. I mean this expensive state of the art you know salt water heated has different colored lights in the bottom I mean it was fantastic. How do I walk away from that. So those are the things that were going through my head.
1515 - 1547 Jonathan Mendonsa I have to pause on this. This is so valuable I mean in some of the more developed countries in America we have this tendency this natural tendency which is brought on by years and years of marketing. Literally you're exposed to thousands of commercials every single week. You have this tendency to quantify and classify and characterize your life by the quality of your stuff. Right. What happens when it goes away you realize that if your whole identity is baked into how much stuff do I have and how high quality Is that stuff. It's a very isolating feeling when you're removed from that.
1547 - 1569 Lisa - Mad Money Monster Absolutely. And it's difficult to change your mindset. I mean one you have to actually realize that that's what you're doing before you can change it. Right. I mean you know your self-worth is not wrapped up in your things. Really. But it is, right So you have to change how you think of your things before you can move on.
mindset
1569 - 1580 Brad Barrett I'm waiting here on bated breath. How did you get out. How did you make this decision. Brain like how. How did you actually get the nerve to leave all these amazing things and and move on with your life.
1580 - 1636 Lisa - Mad Money Monster You know it was it was just before the holidays actually believe it or not I did not wait until after the holidays. I think it was October. We had just a terrible terrible fight. It was just the worst fight we had ever had and I'm not a fighter by nature. He was more of a fighter so it's just oh it was just a terrible fight. And I remember walking away from that thinking I am done. I am leaving. I am done. You know I made the mindset shift and whatever it was going to take it was going to take and it was only going to be up from here. But that's putting it mildly. I mean there were months where I was just I was depressed and I I didn't know how to move on alone. And if you're sitting here talking about it it just sounds like oh yeah I made that decision and I moved out and everything was great but that was not the case. It was a long process but certainly certainly one that I'm I'm glad that I took on.
mindset
1636 - 1649 Jonathan Mendonsa Your finances. You know even if you were trying to keep them separate Obviously your life is intertwined. Your time is intertwined and your finances are intertwined financially was this bankrupting were you able to crawl out of the rubble. I mean what did you actually come away with.
1649 - 1686 Lisa - Mad Money Monster Thankfully I had my education. I still had my good job so I had a good income. I knew I had enough that I could go out and live in an apartment. But I also knew that I had nothing really in the house that was mine. I mean I moved into his townhouse. Then when we moved to the Big House obviously we moved things over to the big house. I did give money toward the down payment but I did not you know buy any furniture or things like that for the for the new house we already had it pretty much so I left with just my clothes four lawn chairs and my two cats. And those were the only things I walked out the door with.
1686 - 1688 Brad Barrett How how old are you at this point.
1688 - 1720 Lisa - Mad Money Monster Right around 30 31. So right around the time I'm thinking I should be you know married starting a family you know everything that that you envision for your life everything was not falling into place it was all falling apart. It was really a defining character moment for myself when I got through that process. I really felt like you know what I can do anything I got through that I got through leaving at the bottom you know and then rebuilding my life and now I feel unstoppable.
families
1720 - 1738 Brad Barrett So your story could be titled The roller coaster path to FI your highs and lows and sadly you know we kind of followed you on this upward slope we could feel the trajectory of your life going to a positive place. Now obviously things are cratering and unfortunately my understanding is it got worse from there.
1738 - 1792 Lisa - Mad Money Monster It did six months probably before the awful fight when I decided this is over. I bought. It was 2007 I believe at the height of the real estate bubble. I bought a property and I moved my parents into it it was a semi-detached home in a local town. I was way over paid for. I probably overpaid Oh gosh maybe 20000. And at the time I didn't know anything about the 1 percent rule or the 50 percent rule I didn't know anything. So this was just a way for me because I was still with you know my significant other. We were still making a ton of money together. You know I had extra money that I wanted to invest so. OK. I'm going to move my parents out of the trailer and into this nice house and that's just where I'm going to put my disposable income. Six months later my life falls apart. And then I'm facing my transition out of that nice big house.
1792 - 1798 Jonathan Mendonsa Now this is a good thing because you're already paying $800 a month in rent for your parents you can just go move in with them right.
1798 - 1847 Lisa - Mad Money Monster Well sure in theory but as a 30 year old woman who wanted to be you know Married With you know starting to have a family. It was devastating it was emotionally devastating to me. So That is what I did. I moved in and it just I was in such depression that I was back living with my parents even though they were really living in my house. It didn't feel that way you know because they were living there already they were set up in the master bedroom like it felt like I had a bedroom in their house. That's how it felt to me even though that wasn't the case. And I just could not at the time I couldn't get over that hurdle emotionally. So so I went ahead and I've rented an apartment on top of subsidizing their living expenses. So that meant I had to stop contributing to my retirement accounts and that's when the backslides started to happen.
families
1847 - 1860 Brad Barrett Wow. So you had the perfect house hack set up as we call it. Like that would have been amazing. You know you own this house you are paying for it already. You could just slide right in and live there for free essentially.
househacking
1860 - 1863 Lisa - Mad Money Monster You got it. That's my biggest mistake.
1863 - 1879 Brad Barrett But like do you think it was like a societal pressure that like oh was successful a 30 year old woman can't live with her parents or was it just that you were in a bad mental state. Talk me through why you made that decision. If you recollect what you were thinking at the time.
1879 - 1930 Lisa - Mad Money Monster Yeah. I don't know if I can actually pinpoint it. I think yeah I think it was a societal thing. I think I was an emotional mess. I mean I I had to leave that big house. I mean just dealing with all those things that we talked about me leaving the big house and the friends and the pets and the you know the holidays and the pools just just leaving all of that I was grappling with my self-identity I guess. And I didn't need to also throw on. Oh and you're also living with your parents at 30 so deal with that too. It was too much I think for me to deal with that it was too much for me to rebuild myself. I had to remove myself and I knew at the time it was not financially savvy thing to do. I knew it was the worst thing I could do financially but for my emotional state I had to remove myself from that situation and start fresh from the ground up somewhere else.
1930 - 1944 Brad Barrett Looking back do you think that was a bad decision then. Honestly like it might have been a bad financial decision which you knew and admitted at the time. Do you think it was a bad decision or do you think it was what you needed for your mental health at the time.
health
1944 - 1967 Lisa - Mad Money Monster Well obviously at the time I thought that that's what I that's what I needed and I think I did need that but I still yes financially it was absolutely the worst thing I could have done. So yeah I mean I can justify it saying yes I needed to do that for me. So maybe it was worth it. You know maybe you know thinking through it and talking about it right now. Yeah maybe it was worth the cost. Right. The opportunity cost.
1967 - 1996 Brad Barrett Yeah. Now that makes sense and life is a series of inflection points and Jonathan kind of describe this as maybe the rollercoaster path to FI. We've learned many of those inflection points in your life from that engineer telling you hey you can go to college to finding a significant other who made you spend like crazy to leaving to going out on your own when you could live with your parents like. Where does the story go from here. Because I know there is a light at the end of the rainbow and I'd love to hear you're like you.
college
1996 - 2005 Jonathan Mendonsa Wow talking about mixing metaphors I love that. Tell us about the comeback story. Let's hear about it.
2005 - 2038 Lisa - Mad Money Monster Well the comeback story took a little bit longer. I was living in the apartment I was rebuilding myself from the ground up I actually got involved with somebody else and had a child. Unfortunately that relationship did not last for the long term. But you know I got something pretty awesome out of it. So during all that time my dad passed away. My mom still living in the house. I'm still subsidizing her living expenses as well as paying for my own and being a single parent at the same time. So it was it was a lot.
relationships
2038 - 2048 Jonathan Mendonsa So what leads you to the concept of FI would lead you to this point at which you're progressively getting better with your personal finances what does the light bulb moment. Are we getting close to that inflection point.
2048 - 2175 Lisa - Mad Money Monster The light bulb moment was when I actually met my current husband Mr. mad money monster. So he had a rollercoaster of a life as well. So always lived a frugal life but still made mistakes still had some credit card debt took out some car loan you know so we again took some steps forward but then took a step backwards. We were talking about buying a bigger house because that's what that's what you do. Right. You're going to get married. You need a bigger house. So we were we were starting to look at these bigger houses and you know because I wanted that validation I wanted the big house back right. I still had that I was still carrying that. You know we were being normal we were going out all the time we were spending money on whatever we wanted to and then we we looked at this house and we actually put an offer in. It was pretty big and it was a house that we could not. I would say a forward because his career is variable so you know he gets paid per job. He doesn't have the typical W2 9 to 5 job. So you know as long as things are going as we expect it should be fine. But you never know. And the anxiety just started to build over that again it wasn't a smart decision. And we kind of stepped back and we actually had an opportunity. The house came back with an issue with the inspection so we jumped on that and we said you know what we're not going to do this. We need to be smart. We are not in our 20s anymore. We need to really focus on the next X number of years if we are making good money. There is no reason we cannot be in a much much better position much better than the average you know in just a few years. He was completely on board. Again he grew up in a family that was frugal but didn't build wealth so he wasn't really I guess educated and as far as that goes. So I was starting to google things as I go. And I came across this fire community and I was just blown away. I was blown away and I felt like we are doing this. I am starting a blog. I'm going to hold us accountable. And that's a story there.
career, debt, families
2175 - 2210 Brad Barrett I'm curious. You already have two houses at this point right or you've purchased two houses in the past. You're on this glide path to buy yet another house that you probably can't comfortably afford. You put an offer in it's accepted you go to inspection like how on this earth did that change like since you offer an acceptance to. OK we had this total change of heart in our entire lives. Like bring us back to them because I'm leaning in when you're telling me about story like I want more like Do you recollect like what you guys would you actually had the conversation over like how does that happen.
2210 - 2270 Lisa - Mad Money Monster Oh yeah. So the biggest piece why we couldn't comfortably afford it is because I refused to sell the house I currently had. So I wanted to turn the house we were living in into another rental. So that was as long as everything was going to go fine and we had tenants and you know his income was going to stay steady and then we would be fine. But the more and more we thought about this and he was even more of a nervous wreck than me. I'm usually I analyze things and the probability and statistics of this happening and not happening. So I was more willing to take the risk but the more he was you know on my case being nervous about this and the more I was thinking about it and I was waking up you know almost having panic attacks in the middle of the night like oh my gosh what if he's right what if this does happen what if that does happen. Oh my gosh. You know so. And that was that was right around the time where the inspection came back and we're like we're out. We're out. I can't you're right. I'm like You're right we can't take this risk.
2270 - 2290 Brad Barrett That is amazing so this really is yet another major inflection point. It's fascinating. We honestly need to talk to you and find all these major distinct points that you can really look back on and say like that was a turning point in my life. And this clearly was and then you quickly found the FI community thereafter.
2290 - 2333 Lisa - Mad Money Monster I did. I started you know. All right. We've got to get our finances into shape and like I said we weren't starting from scratch you know I had always been you know saving in my retirement account except for the time I was in the apartment I did have to pause at that moment. But yes so we had savings. So we weren't starting from scratch but we certainly I mean at that point there there are people that were our ages that were already retired right. So we certainly were behind the eight ball in comparison to some of the other people in the fire community. So yeah I found the frugal woods I found. Budgets are sexy and I was just blown away. That's when we decided to really kick it into high gear and get on the path.
savings
2333 - 2363 Jonathan Mendonsa So what I love about this one is that we've talked in the past about the power of telling your unique story what relates to one person doesn't relate to another because people are looking for someone that have actually walked a mile in their shoes and with the variety of stories that you have covered you've walked in everybody's shoes you've covered the entire gamut. So I got to imagine that your blog and all of your content is extraordinarily colorful as you're able to turn all of these really really powerful experiences into stories to share there.
2363 - 2414 Lisa - Mad Money Monster I mean I'd like to think so. I do. Right. You know a lot about my experiences and my I don't want to scare people because I have I have experienced a lot of ups and downs and I feel like a lot of a lot of other bloggers at least that I've seen in the community you know they don't have such a colorful story so I don't want to say hey. And I was a single mom and I you know I screwed up here and I messed up there and I don't know I just seem like I just feel like other people have a more linear and a cleaner I guess a cleaner path and that might be something that is more appealing to you know the up and coming people who are just joining the community. But you know it is what it is. You know my past is the past and I am who I am because of it so I do like to share their stories.
blogger
2414 - 2455 Jonathan Mendonsa I love that and I think that it adds a lot of background a lot of flavor because people do identify with that people have absolutely experience those same things and in many cases it's difficult to find someone that has made all those mistakes and then come out the other side. And I guess my question is yes. Now you've you found this FI community and you've deep dived into J-money's content over budgets are sexy. You've started actually looking you know researching all these different influencers that have these wonderful ideas to share. Like can you slowly walk us through the progression. What aspect of financial independence did you tackle first and what kind of tips do you have for someone that's making this reset later in life. You know what did it actually look like for you.
2455 - 2507 Lisa - Mad Money Monster I guess you know one step at a time really Thankfully we did have our incomes that were above average so it was just a matter of. All right. We're increasing these contributions we're maxing that out. And you know them we're going to focus on you know we're paying off my eyes. I still had a student loan you know from my $25000. So we're sitting around however long ago. So I still had some of that to pay off. I still had a car loan. So it was just like pay it off pay it off max it out. And you know full speed ahead is just a matter of making up your mind to do it. I think I think as long as you're as long as you're making a certain amount of money you don't have to be making you know Doctor money or lawyer money or whatever. But you know as long as you're making enough that you have some left over I think pretty much anybody can set their mind to paying things off and building wealth.
2507 - 2519 Brad Barrett What did those first steps look like. So you found the FI community like what did you actually change in your lives after finding all this information and devouring them. What were the positive financial changes you made.
2519 - 2561 Lisa - Mad Money Monster So like I said we maxed out retirement accounts. We paid off our debt. We are currently paying off our home. That's our last little debt that we have that we're paying off. But you know we stopped going out all the time. So we're living a much more frugal and I guess purposeful lifestyle. It's not Oh yeah let's let's go out to this restaurant and then afterwards we'll go to the movies. We don't do that unless we are intending to do that unless we had planned to do that. You know we cut the cable. We only have Netflix and we just did all the little pieces. We kind of just put them together.
debt
2561 - 2580 Jonathan Mendonsa Now that you've started to optimize your finances you've apparently between now your dual income you've created significant space between your earnings and your cost of living. Do you track your savings rate at this point. Have you achieved a certain level of. You know I know at one point you're putting 15 percent of your income into your retirement account. What sort of savings rate did you guys hit at the peak.
savings
2580 - 2594 Lisa - Mad Money Monster At the peak. We're right around 70 years. Yes. Yes. But like I said his income is variable so it probably is right around between 50 and 70 at any given moment or at any given time.
2594 - 2601 Jonathan Mendonsa You know it's amazing to me how quickly you can turn things around when you can nail a 50 percent plus savings rate.
savings
2601 - 2602 Lisa - Mad Money Monster Right.
2602 - 2620 Jonathan Mendonsa So what does this look like. I mean you know obviously you're telling this from the perspective of someone that is not at FI but someone that is on the path to FI I mean you're the comeback kid right. You're the one the rollercoaster path to FI. You had the light bulb moment a little bit later on. And now you're just crushing it. How much longer till you hit FI.
2620 - 2663 Lisa - Mad Money Monster A few more years in the traditional sense where we could just live off our investments you know 4 percent rule. It's a life transformation. I mean every month that we get a little bit closer and a little bit closer like my job the stress of my job is a little bit less and a little bit less because you know I need it less. I'm not saying I'll leave my job. I do enjoy it. Most days I enjoy everything that comes along with my coworkers the satisfaction I get from it. The income of course the benefits. So not saying that I will actually retire early maybe earlier than you know. The government says I should retire. But that's not something that we are chasing specifically.
2663 - 2670 Jonathan Mendonsa Well that's what I love. You know you've been in the fire community for two years and you're already ready to change the name. Do you want to tell us about.
2670 - 2770 Lisa - Mad Money Monster That. You know it's funny. I I had this post that I had this idea that I wanted to write this post for a while now I keep a running list of my ideas when they pop into my head at last Thursday night. I was like I've got to polish this up and get it published. I have to because I think it's going to be a good piece to talk about on this podcast. And I remember I stayed up late and I got up early and I just wasn't feeling well. And I said you know what it doesn't matter. It's got to get published it's got to get out say yes the whole time we've been on this journey I just felt like I don't know that we really fit into the fire community in the traditional sense as in financial independence retire early. I thought you know what we don't what we fit into is the FIOR community, the financial independence optional retirement. So for me I don't know I don't think that's my main goal to like hey here's my resignation I'm I'm out I enjoy my job I enjoy my coworkers I enjoy what I do. I enjoy the satisfaction and it is a part of my identity and I'm OK with saying that it's a part of my identity that I don't know that I want to lose and that's OK. as far as my husband goes I mean he works in his dream career and even if he didn't make a penny he would probably still do it. So he is definitely not on the retire early path. He is going to be working on his deathbed. So for me you know I want the option. You know I love the blog if the blog turns into some you know huge money making venture. And then maybe I do maybe I do leave my current employer and do that full time but I want the option.
career
2770 - 2842 Brad Barrett I love that. It is truly all about options and that's why Jonathan I actually shy away from fire with the retire early because I feel like that turns people off like it's just such a loaded thing like retirement just generally that concept right. People think of sitting in Florida sipping umbrella drinks and playing golf. Think that that's not what we're looking for here we're looking to take the power back in your life and that's what you're describing Bryant. Like every month you get a little more power a little more power accrues on your side of the ledger and you feel better about your job even the stresses because eventually you can say how we affectionately call F-U money. Right. Like you can there might be aspects that you don't like about job and you might be able to jettison them and that would have been impossible with the old Lisa. Right. The one who had the cyclical credit card debt and still had student loans like because you've taken this power back in your life you truly have options and and that is why I love FI or that's great. Fire optional optional retirement that is absolutely brilliant. And so yeah. Thank you for coining that I think it's a valuable addition to the community.
college-loans, debt
2842 - 2860 Lisa - Mad Money Monster It was fun. It was definitely a fun article to write. But you're right. I mean we're into building legacy well. Like that's more of our goal than to hit a certain number and live on X amount each year for the rest of our lives. We want to leave something behind. That's why we just want the option.
2860 - 2866 Jonathan Mendonsa Well we're definitely in a link to the article in the show notes so people can check it out in its entirety. What is the best way for people to connect with you.
2866 - 2874 Lisa - Mad Money Monster The Web site mad money monster dot com. I'm also on Facebook Twitter Pinterest same name mad money monster.
2874 - 2882 Jonathan Mendonsa AlRight well on most shows that would be the end of the end of the episode. But on our show we always like to finish up by giving you the chance to tackle the hot seat. Are you ready for this.
2882 - 2887 Lisa - Mad Money Monster Boy I think so. Go ahead.
2887 - 2915 Speaker In a world drowning in debt and rapid consumption. Trapped by the change of lifestyle inflation. these questions highlight the secrets of those who have broken free. Welcome to the choose F-I hot seat.
debt
2915 - 2919 Brad Barrett Alright Lisa. Question number one your favorite blog that's not your own.
hotseat-blog
2919 - 2930 Lisa - Mad Money Monster Oh that's so easy it's the frugal ones. I was one of the first blogs I found and I just look up to them so much. I just love following their story and their little hacks for everything and I just love them.
2930 - 2935 Jonathan Mendonsa I think 2018 might be the year of the soda stream for me I'm highly considering that.
2935 - 2940 Lisa - Mad Money Monster I know my husband would actually love that too. So maybe we'll check that out again too.
2940 - 2945 Jonathan Mendonsa Question number two your favorite article of all time now. this can be one that you wrote or somebody else's.
hotseat-post
2945 - 2974 Lisa - Mad Money Monster I was actually going to bring up my fire article but we just talked about that and that's not my favorite article of all time but one of my favorites anyway. I'm going to say something that I think a lot of people have probably said and it's Mr. Money mustaches. Shockingly simple math behind early retirement is that what it's called. Yeah. Yeah I was again that was another lightbulb moment for me and I think I think he has a spreadsheet in there that I that I downloaded and actually plug my numbers in. Yeah I love that article.
2974 - 2986 Brad Barrett Yeah that was a true game changer for me. I think that was my first real fi moment when I read that it just it changed everything. So yeah I'm totally with you there. All right question number three your favorite life hack
hotseat-lifehack
2986 - 3018 Lisa - Mad Money Monster Ah. OK. So my favorite life hack is just enjoying the moment that you're living. I think so many times we are chasing something like I'll be happy when I reach financial independence. I'll be happy when I graduate college I'll be happy. No you have to be happy now you have to enjoy the ride you have to enjoy not just the coming weekend but you know Tuesday night with dinner around the table. I enjoy little things. And I think it contributes to my overall happiness.
college, hotseat-lifehack
3018 - 3041 Jonathan Mendonsa That is so insightful. What happens when you're tied to the hamster wheel when you're purchasing stuff to make up for your general unhappiness to have a truly happy moment. You have to have this epic adventure this epic experience something that totally overshadows how just miserable your 9 to 5 is. But if you break the hamster wheel and you get to recall back a large percentage of the time it can be the simple things right.
3041 - 3071 Lisa - Mad Money Monster Oh it really can be. I mean I'm talking. I look forward to my lunch at work because I get to decompress I sit down at my computer I might read some blogs I might start a blog I might you know do a little research and I get something done and I accomplish something and then I'll look forward to dinner with my family that evening or a bike ride that we have planned. It doesn't have to be our next vacation or something big is just little things that I get a lot of enjoyment out of that I do think is a life hack for me.
families
3071 - 3075 Brad Barrett All right. Question number four your biggest financial mistake.
hotseat-mistake
3075 - 3095 Lisa - Mad Money Monster Well it was not moving into the rental house that I bought for my parents when I broke up with my significant other from the big house. It was hands down the worst financial move I could have made and it affected me for a while it's still affecting me because I still have to work.
3095 - 3102 Jonathan Mendonsa Do you think that that one decision if you had made the opposite choice of what you made you'd be at FI right now or are you. Is it. Is it that stark.
3102 - 3121 Lisa - Mad Money Monster Yeah I do think so. I do think so because I was always interested in saving more than the average person and investing money. So yes I think if I had focused on that at that moment and really made the right decision for my finances. Yeah. But you live and you learn and it makes for a more colorful story.
savings
3121 - 3172 Brad Barrett So it does and we can't beat ourselves up over past decisions. I think this is important for the audience to realize like so many people come to us and say oh I'm just getting started with FI I'm 50 years old and I've done everything wrong. Well OK you've done everything wrong. Well start today making the right decisions. Right. So I hear you completely. Sure that was a mistake. And ideally you could go back and change it but it helped you on your story and helped you on your path. And now you're making all the right decisions and saving 50 to 70 percent of your income. So yeah I have moments in my life that I I still think about even though I tell myself like you can't change the past. Like I still rue the day that I went and bought some investment property in North Carolina. But like you can't beat yourself up about it because you made the best decision with the information you had at the time and that's just the way life works you know absolutely.
savings
3172 - 3173 Lisa - Mad Money Monster You're absolutely right.
3173 - 3180 Brad Barrett All right. Question number five the advice you would give your younger self.
hotseat-advice
3180 - 3214 Lisa - Mad Money Monster I would tell myself to really analyze the decisions you're making because they do have the potential to affect you years and even decades down the line especially with relationships you know don't just blindly stay in a relationship just because you're having fun or you don't want to break up. You know this is your life you're talking about and it's finite. So yeah I would definitely tell myself to act sooner on things and make better decisions I think.
relationships
3214 - 3224 Brad Barrett Alright we have one bonus question. what was your favorite purchase that you made on Amazon.com last year.
hotseat-purchase
3224 - 3262 Lisa - Mad Money Monster Okay. Well I'm not an Amazon aholic that's for sure but I do I do use Amazon occasionally and our local pet store so we actually feed our our cats grain free food just because it's better for them for them. Our cats are mad money cats. They are on a certain kind of food. And our specialty store actually ran out of that food. So I picked something else up and they went on a hunger strike. So you know what am I going to do. So I actually ordered it from Amazon and it was here the next day.
3262 - 3262 Jonathan Mendonsa Nice.
3262 - 3264 Lisa - Mad Money Monster So that's probably my favorite.
3264 - 3280 Jonathan Mendonsa I'm getting better I would I would qualify myself as an Amazon addict or have the risk of becoming one. But I'm doing really good lately like it's almost like I've got this linear focus this tunnel vision and I rarely deviate outside of it these days. Brad it's I'm really giving myself a pat on the back here.
3280 - 3282 Brad Barrett Nice. You're a changed man.
3282 - 3308 Jonathan Mendonsa I'm totally a changed person. Yep. Well Lisa thank you so much for coming on the show. This has been a lot of fun I think this is going to be a episode that's can be very encouraging for some people in our audience who say gosh you have all these people that are 20 years old and have never made a wrong decision. And of course they're at FI. But what about me. I'm over here. I think the fact that you have this diversity of experience to draw from really grabs people where they are and gives them hope and gives them encouragement. And I just thank you for coming on the show today.
3308 - 3310 Lisa - Mad Money Monster Oh thank you so much. It was a lot of fun.
3310 - 3357 Jonathan Mendonsa And thank you for being a part of the Choose of my community. If you want to support us here four easy ways 1 leave us an itunes review. You want to do that just go to chooseFI dotcom 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 good to choose F-I dot com slash PC PIAs and Paul C as in cat and four 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. All right my friends the fire's spreading. We'll see you next time. As we continue to go down the road less traveled.
Jonathan_Catchphrases, families, travel

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