The Fallout of My FIRE

Shutterstock

So a few weeks ago I posted a set of articles that would alienate members of my readership as well as the wider FIRE landscape. Let's face it, I was picking a fight. To summarize: I was sick of seeing the "Welcome to FI, not FIRE" bullshit populating the space and the weak saving rates that followed. 

The legions of delusional FI followers thinking of about FI as if it doesn't unlock early retirement really began to weigh heavy on my conscious (but of course how could it when your crippled journey to FI is as close to FIRE you'll actually get?). So many people were getting it wrong. What if I took it upon myself to be the contrary opinion and voice my concerns? Surely chaos would follow?

7 Simple Steps to Investing for Canadians on FIRE

Photo by Elijah O'Donnell on Unsplash

You've been thinking about investing for a while but you've been held back by several excuses. Some of these are legitimate (everybody says to do this or that... but is that right?) and some of them are pathetic (I'm not sure right now is a good time to buy.... just look at the news!). I have some very simple advice for you:

Fuck the news and fuck the piles of noise everybody is "adding" to the "conversation." 

It's simple, you already know you need to invest and you probably have the cash sitting somewhere else collecting a garbage interest rate. The more complex you make it, the more easily these websites, robo advisors, banks and mutual fund companies can profit from you. I have nothing to gain from you - so I have this really easy step process because I haven't been bought to make it more complex or sell you additional garbage. No must-use language from advertisers, no paywall and no book. It's almost like I want to do this. Neat, eh?

If you're just starting to invest for the first time, you can use my steps to take your first dip into the investor's world. After you've completed these steps you'll probably come back to the top and reread all the convincing I just had to do to get you to do the thing you knew you needed to do. We'll have a good ol' laugh about it, don't worry. Let's begin.

The Requirements of FIRE

Photo by Mark Duffel on Unsplash

I don't want to gatekeep the FIRE movement or anything... but.... okay well you'll read this article and realise I really kinda-sorta want to but for hopefully altruist reasons. 

The reason for such gatekeeping is to fix the blurred line between what the FIRE movement is and what is isn't. The blurred line is caused by the mainstream blogs and podcasts and the million niches within them are actually watering down the FIRE movement for their own marketing and branding purposes in an effort to increase their sales. Hard things in life are hard to do so let's lower the bar and make it easier for everybody else who can't achieve hard things and profit as a result. Fun!

With that I would like to dispel a few myths, crack a few heads and position the FIRE movement as a IN or OUT policy without much of a revolving door. While I think everybody has a unique circumstance when it comes to their personal finance and lifestyle optimization, there are easy and hard requirements to fitting yourself into the FIRE movement in Canada.

Are you Turning the FIRE Movement into a Fad?

I think I say this often around here - I believe I have written the most unpopular article to date. I'm sure this article will twist several panties into a bunch. Prepare your soft feelings.

Are all these wusses saving 10-49% on the path to FIRE actually a part of the movement? Or are they just big softies ruining the hardcoreness of the Mustachian lifestyle that runs parallel with the mainstream FIRE movement? Spreading the gospel that FI is the answer and RE is the devil is complete bullshit. What the fuck people?

Criticisms of ChooseFI

Old logo depicting their original intention

Having gone back and listened to ChooseFI from the beginning (I originally subscribed episode 90, on veganism) I have seen quite an interesting trajectory of how ChooseFI has branded the FIRE movement. Originally, they were to experiment in 'FI', presumably to try out different tactics and report back with the data + results. This actually sounds really interesting - wouldn't it be neat to see a before and after of somebody's finances after driving for Uber in the evenings for a month? Or what about batch cooking breakfast for the next two weeks and looking at the physical and financial results then? Put into an audio format under the lens of FIRE and you have yourself a really neat podcast.

Translating VTSAX for Canadians

Like most of you, I've read The Simple Path to Wealth and thought "Wow! Now to head to Vanguard and set up my account! Hey, WTF??" If you haven't read the book, feel free to read it in blog form on the authors blog right here.

Photo by Kelly Sikkema on Unsplash

Probably a proper rite of passage for any Canadian pursuing FIRE is to hear about the message from an American blog or podcast and then immediately google VTSAX only to realise that the mutual fund is not offered to Canadians. To add further insult to injury we can't even open a Vanguard account. ....well fuck you too, Vanguard. Just kidding!

Vanguard is Canadian-friendly - very much so. They have superb products available for Canadians to buy in the form of ETF's from the numerous stock exchanges around the globe. This certainly adds complexity to the average Jane or Joe trying to buy their first index fund but not greatly so. In fact, I keep it VERY simple in this blog post called the 7 Simple Steps to Investing for Canadians in 2020. I will be keeping that thing updated so feel free to check back often and feel free to pass that around the internet, you'll do me and my blog a big favour, not too mention the person on the receiving end obtaining such valuable advice, all for free!

Okay, now that the rambling and shameless self-promotion is out of the way, let's look at how to buy the Total US Stock Market Index, otherwise known as VTSAX. As I hinted above, we cannot buy this in mutual fund form from Vanguard, we have to look at ETF's only. For the purposes of this article, I will be focusing only on Vanguard products.

Podcast Review: Canadian Portfolio Manager

Audio is my main form of content consumption so any new podcast in the Canadian Financial Landscape has to be reviewed and judged accordingly, regardless of whether or not FIRE is the focus.

Justin Bender's New Podcast!

Justin Bender of PWL Capital has been operating his blog for some time now. It is both quite interesting and quite boring at the same time. It's interesting because he writes in simple terms and doesn't beat around the bush about passive index investing. You get to learn a whole lot of practical Canadian investing mechanics and implementing his advice will make you rich one day. He himself seems like a cool dude.

It's boring because it's just plain old research-based investing and investing done right is boring. That's okay though, we're not chasing FIRE for the thrill of marijuana stock returns nor do we pursue actively managed ETF's in the E-Sports scene because computer gaming is the future of the olympics (which it might just be). Besides, games like Hockey are best explained by the mechanics of the hockey rink, the rules of the game and the known strategies most likely to win the Stanley Cup. Going through this process with graphs and blog posts is inevitably boring.

This is why I'm excited for Justin's new podcast: Canadian Portfolio Manager. While he does read from a script, he will certainly improve his lecturing skills in time and hopefully have a bit of fun with it much like Dan Bortolotti from Canadian Couch Potato did. Let's review his first ever episode:

PayTM and Why It's Worth It

*This article is now outdated due to PayTM's recent changes. These changes include a 1.75% credit card fee on all transactions. I will update this article in the future but for now only the credit churning section can apply as a last resort. You can read about the terrible changes here: https://blog.paytm.ca/blog/important-update-convenience-fees/ *

If you had told me 15 years ago I could funnel all my bills through one company and "save money" I would've said "Not today Satan, not today!" 

Having worked as a teller for one of the big banks in Canada, I've seen my share of people coming in with fake cheques, forged letters and other stories about scams they've unwittingly signed up for. It sucked when I had to break their hearts and tell them they've been scammed. 

The easiest way to figure out if something is a scam is to literally just google "X scam" - X being the product you're interested in. The front page will be loaded with forums full of angry consumers and then you'll know to stay away. The second easiest way is to follow the money. PayTM for instance is owned by an international Indian company with billions in revenue and has investments from incredibly large corporations such as Alibaba (The Amazon of the East). They've also partnered with major Canadian banks, such as RBC.

This is great news for us - PayTM is legit and offers its product to Canadians. Thousands of Canadians use the app to process bill payments and it's talked about often on ChooseFI Canada. So why should we FIREwalkers use it?

My Library is ON FIRE!

Don't call the emergency department, it's the good kind of FIRE.

Photo by Alfons Morales on Unsplash

**Sorry about the awkward formatting, below, Blogger is a piece of shit**

One of Canadian FIRE's readers (Lauren) recently reached out to me on the ChooseFI Canada complimenting my blog post concerning the Vortex of FIRE Information. This is a post where I curated a list of Canadian and American blog and podcasts suitable for the FIREwalkers in Canada. Blogging has become such a popular medium in the FIRE space because it doubles as a diary and a potential side-gig with income to be made. While I respect other bloggers attempting to monetize at the get-go, I've chosen the path to serve my readers with as little clutter as possible. This means a simple user interface with no ads. As the site grows I will inevitably begin adding features and perhaps a ads to help cover the cost of operating the blog.

So while the blog space is as crowded as an Ikea on Boxing Day, the book department is actually quite simple, especially for Canadians. It's more like a Boston Pizza.. but at 3pm when the lunch crowd have all left and the dinner parties are hours away. You practically have the whole place to yourself with a calm atmosphere and timely food.

FI and FIRE Are the Same Thing

Perhaps this will be my most unpopular opinion yet but here goes!

Photo by Mohamed Nohassi on Unsplash

'Financial Freedom', 'Financial Independence' and 'Retire Early' are all the same thing people. While I respect your right to your informed opinion, I have noticed that vast majority people on the path to FI explicitly say they do not seek RE whereas those already at the finish line often use the two terms interchangeably. Why is this?

I have a few quotes that I'd like to put to the test. I hope I don't step on toes here.... just kidding. I'm actually hoping to break a few bones.

The Elevator Pitch to FIRE, Explained

I stole the title format from the Netflix show Explained. If you haven't tuned in yet, you should. Wonderful documentaries kept under 20 minutes discussing anything and everything.

Photo by Jason Dent on Unsplash

If you have 30 seconds to explain FIRE to somebody next to you on the elevator, what would you say? Mine would go like this:

Increase your income

Reduce your spending

Invest the difference

Simple enough right? I think this is widely known as the ethos of FIRE. Focusing on just one or even two of the three will add unnecessary burden to your path to FIRE. Let's explain all three in the form of a checklist (who wants to read an essay..?) to evaluate the pitch and see if anything is missing...

The Thief, the Freeloader, the Cheapskate and the Valuist

Are they all that different?

By Rob at unmedicatedcomic.com

Due to social norms and peer pressure things like price-matching at stores, bringing a coupon to dinner or googling referral codes are seen as unpleasant and even unethical for some reason. Heck I even wrestled with how to display affiliate links on my own blog WHERE PEOPLE ARE COMING TO USE MY REFERRAL LINKS TO SAVE MONEY!! All because of mainstream society's problem with frugality.

Let me drop a truth bomb onto all of you: Is is perfectly normal to get the most amount of "X" for the least amount of money. X being anything you damn well want. This is where our story comes in.

I Wish I Was At Camp Mustache

These guys are just fanatics, I used to think.

Camp Mustache Toronto - 2019
Photo Courtesy of Chris P.

Perhaps there are a few readers out there who were like me back in early 2019. I didn't comment or talk to anybody, at least not really. Maybe once every now and then. I had joined the Facebook groups long-after I had heard about them, everything from Mustachians in Practice to ChooseFI Toronto. I didn't really see the in real-life (IRL) community being all that valuable at the time. I am a tad ashamed to admit I just thought I was better than everyone else. My expenses were pretty low around 35k, what did I have to gain by communicating? Sure, I might comment every now and then and throw a lifeline to all these poor souls creating their own financial problems!

Now I'm a blogger, podcaster, meetup organiser, and small-business owner - heck maybe even one day Canadians will see me as a thought-leader if I so deserve it. So what changed?

How's the Challenge So Far?

So far so good, Captain.

On the ChooseFI Canada Facebook Group, there's a frequent poster named Carol. I've had the pleasure of meeting Carol at a local ChooseFI Toronto Meet Up that I organised a few months back and she's as wonderful IRL as she is online. The FIRE community is easily one of the happiest and friendliest places I have ever stumbled into and I'm glad I've put myself out there to meet people. That's not so easy for us Millennials!

I posted on the weekly "What did you do to make your life better?" thread about my October Challenge relieving stress and Carol responded with this:

I Can Go the Distance

Who wants a live remake? Not me.

My wife has gotten into this annoying habit.

She's begun to test my patience and play Disney music off of her Spotify account within ear shot. According to her, I assault her ear drums on a daily basis with my music interests (which is usually dance/electronic/rave music - I admit it's not for everyone). So when chores around the house need to be done and we're unable to find middle ground on an audio experience, we compromise and each choose a song back and forth. This ends up creating an ugly playlist that bounces back and forth between multiple styles, such as 2pac, Great Big Sea, Aqua, Frankie Valli and the Four Seasons, Timbaland, etc.

So recently her picks are including Disney songs that have actually got me smiling. I'm remembering all these songs from my childhood of Disney, Coca-Cola and McDonald's (a fun yet unhealthy childhood to be sure). One in particular has always motivated me and I'm guessing by the title of this post you know which one I'm talking about.

The Chess Pieces to FIRE

Photo by Randy Fath on Unsplash

I thought it might be fun to showcase my army of actionable tips in the form of a Chess board. This should hopefully illustrate how useful some tips are for building wealth compared to others.

Without an philosophical rambling, here are my 16 Chess pieces that make up my side of the financial game in Canada. To keep the post moving along, I'll be explaining each piece with only one to two sentences. Feel free to ask me for more elaboration in the comments below :)

The Lucky Path to FIRE

And I'm not talking about penny stocks.

If life is a competition then money is the game. We all have to participate, some of us starting from $0.. This is incredibly unlucky and sadly very common, even in first-world countries as rich as Canada.

Every game, be it Chess, Hockey or Dota 2 (an online multiplayer game with a $34,000,000 prize pool this year) have a certain amount of luck to it. In hockey, it could be a chip in the ice that you trip over, losing your breakaway.. or in Dota 2, an observer ward collapses the moment the character you've been chasing ducks into the trees with 3 alternate paths, leaving you in the fog of war guessing which way to pursue (don't worry if you didn't understand that last part, I'm just being a nerd).

You could blame society for having to participate in the money-making bonanza that is capitalism.. about how unlucky you got because we had to take out student loans to buy your education or how housing prices have pushed Millennials like you and I out of the city we grew up in or any other endless array of financial bad luck we all face from time to time.

Financing Your FIRE Lifestyle

We'll assume these are happy FI/RE flames.

Forgive me for preaching to the choir here but of course what good FIRE blog doesn't at least once mention the rampant abuse of a consumer culture that revolves around borrowing for your wants in less than an hour.

I could go to town on how horrible a financial decision it is to walk into a "Easyhome" or how morally bankrupt the "Chip Home Income Plan" actually is but I digress it's all been said before by smarter people than me with actual research and relevant quotes from important people in society.

So instead, I'll talk about how FIREwalkers such as myself take advantage of cheap and easily affordable credit: Financing, the Responsible Way!

The Vortex of FIRE Information

The FIRE Vortex

If you've recently stumbled upon Financial Independence or have been a willing participant for years now you will have noticed that A LOT of people talk about it.
It is quite liberating and perhaps a little too easy to type away on a laptop about how happy I am and how much money I have, increasing said happiness.

The problem as a reader or listener is when you find multiple sources you like. And then they recommend multiple sources they like, so you click ahead to get all that good stuff too. Then you discover all the different FIRE blogs around and wait a minute what was that first one you liked before? What was it I truly valued before I received input from 20 or so different bloggers and podcasters?

October Daily Posting Challenge

The October Challenge

Photo by Igor Rodrigues on Unsplash

I really like this picture. Take a good long look at it.

If you're listening to this using the Pocket app, I'll describe what you're seeing.

There are two women army crawling through mud water, underneath pretend barbed wire (they're using string to be safe). Their faces are about 3 to 4 inches from submerging and the ground looks very uneven, causing them to dunk said faces into the crap-fluid every now and then judging by their wet hair and disgruntled faces.

Mental Liberation

A Facebook post from a while back

by nikko macaspac on Unsplash

I think one of the most fascinating things about FIRE is the mental liberation. I have deliberately uncluttered my life. By DIY'ing my investments to cutting the cable to cooking batch meals at home, I have become a much more patient person because in stead of "outsourcing" all of these decisions, I or my spouse generally do it all now.

So when I DO outsource something, like switching out my winter tires at Canadian Tire, I'm much more relaxed about the outing. I got lots of time now that I can do most things myself! So the clerk at Canadian Tire called me yesterday to tell me they made a mistake. 1 of the 4 winter tires they put in my trunk didn't actually belong to me.

Your Road to FIRE Doesn't Need an SUV

Back in my day, SUV's were stupid!

Photo by Nico on Unsplash

I've made it a daily habit to cruise across the Canadian landscape of FIRE communities that have popped up here and there. Canadian's pursuing FIRE is not new but the community is emerging, ideas are flowing and I'd like to keep my finger on the pulse of the movement. Having a blog and podcast of my own means I should be somewhat up-to-date with the community across the nation and in my local area. So while hitting up my favourite bookmarks, I happened upon a thread of discussion that caught my eye.

The Best Chequing Account in Canada

We the community use Tangerine Bank. Let me tell you why:

Photo by Sharon McCutcheon on Unsplash

Last updated: 1 AUG 2019

** My referral code is at the bottom of the page. Please consider using it to help support my blog and my mission **

You'll get $50 cash!

Here's a list of why the Tangerine Chequing Account is the preferred option for Canadians seeking FIRE. FYI - I'm not paid by Tangerine Bank, I'm just intentional about my spending and finding the best value ultimately serves my goal to Retire Early.

The Best Phone Plan in Canada

We the community use Public Mobile. Let me tell you why.

Photo by Charles 🇵🇭 on Unsplash

** My referral code is at the bottom of the page. Please consider using it to help support my blog and my mission. Last Update: Nov 2019 **

You'll get $10 credit!

Here's a list of why Public Mobile is the best phone plan out there. FYI - I'm not paid by Public Mobile, I just really like them and so does the FIRE community. Let us help you see the light.

My Fixed Expenses

I spend under 16k/year to live. How about you?

Photo by 青 晨 on Unsplash

Last Updated: December 2019

I'm flattered you're here, especially if you've come from my new podcast project, Explore FI Canada (with Chrissy and Money Mechanic). If you've heard about my low living expenses, scroll all the way down to see the daily/monthly breakdown of my fixed expenses.

If there is one thing I'm certain of, it's that I have one of the lowest annual expenses in Canada. Period. I spend exactly $15,519.12 to live! If I am that certain that my expenses are so low in comparison to the average Canadian, than I am that certain that I can accurately show you how I spend my money and what we both value doesn't come at a high cost that forces everyone else to work until 40, 50, 60, 70+. 

Before you get skeptical, keep in mind I'm writing as a taxpayer, a homeowner, a husband, a father, a driver and everything else you and I have come to enjoy living a luxurious middle-class life - a.k.a. the Canadian Dream. I'm just like you.

The Dividend Tax Credit is ON FIRE!

If you're looking for an endgame strategy, then look no further - this tax credit is whatcha' need.

Photo by Michelle Spollen on Unsplash

Before we get started, I wanted to point out that the research I did for this article was extensive and time-consuming. They are a lot of articles written about the dividend tax credit and they cover a lot of the technical aspects, but none of them simplified anything. One of the annoying side-effects of limited FIRE content is the complex and scattered valuable information. If there is one thing I love about the FIRE movement, it has embraced simplicity as one of its core values and I hope to consolidate all of that data into one easy-to-read blog.

So.. what is the Dividend Tax Credit (DTC)?