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The Why of FI

by Phia @ Freedom 101

Amidst all the budgeting techniques, savings tips, spreadsheets, investment strategies and travel hacks floating around the personal finance and FIRE worlds, there’s a really integral question that is often overlooked.

Why do you want Financial Independence or Financial Freedom?

I believe the question is rarely posed because on the surface the answer appears obvious. But I’d like to argue that it’s actually far from obvious, and very much a subject worth taking a deep dive into.

Whether our initial response to the question is that we want to retire, work less, pursue a job that pays less but we have a stronger interest in, the common assumption is that the motivation behind FI is to escape or minimize work. Yet rarely is that the true answer driving people to pursue FI/FF.

If you are currently on a path to FI or FF (you can check out the difference between the two here), or even just considering pursuing it, this is a question that you must have a concrete answer too. 

Even though reaching FI is simple, it isn’t easy. It takes hard work, self-discipline, a willingness to delay immediate gratification for future reward and the ability to maintain a big picture perspective.

Sure FI is trendy, it’s fun to think of ways to save more money (at least for us finance nerds it is), and it provides an actionable goal to work towards, something most people thrive with. But what is the endgame? What does attaining FI get you that makes the whole process worthwhile?

If you are pursuing FI/FF, or decide to do it without first knowing your why, it will probably have zero impact on your progress………..for about the first year or two. But after that point, the difference maker between the people who stay committed to their financial plan and reach success and those who don’t, often comes down to the clarity of their why.

The first year or two of FI is ADDICTING. There are so many external motivators and immediate rewards happening that our internal drivers are rarely called upon. In that first year there are endless opportunities to cut expenses, increase income, and see BIG changes in your overall financial landscape.

It’s exciting and incredibly motivating to see your new and continuously improving financial habits create immediate results. Your savings rate spikes, your debt is being obliterated at record rates, and maybe you’ve even picked up a side hustle to really speed the whole process along.

It’s the FI honeymoon phase. And like any honeymoon relationship, FI will have your full attention…….until it doesn’t.

And for a lot of people that comes right around the 24-36 month mark of pursuing FI. Increases in savings rates become much less impressive, you’ve already experienced the mental highs of demolishing your smaller debt’s, and are now tackling the much larger, slower, and less psychologically satisfying ones like car loans or mortgages, and it gets a whole lot harder to find new ways to continue to increase your income or cut expenses.

After the success of the first year, hitting the slow progress that comes after those initial big changes can feel a lot like stagnancy. People start to get impatient with the process,  and a lot of people jump off the FI bandwagon.

In year three the reality of the day to day pursuit of FI can very quickly begin to seem like a grind, feeling much less impressive and a lot less motivating. The whole delaying gratification for future gain concept becomes tiresome, and you really just want to forget about budgets, spreadsheets and frugality.

For some, YOLO even starts looking like a bandwagon worth jumping onto…………

But if you are on your journey to FI/FF, know that at some point you will hit this wall, or some version of it. Be ready for it, because it’s coming.

It’s not a bad thing, and it’s nothing to fear, it’s just part of the process. Because like anything worth working for, there will come a point in your journey where it feels like you’re just never going to get there and you start to lose focus and question the worthwhileness of your endeavours.

But this is exactly the point where knowing your why can reinvigorate your commitment and keep you on track (because trust me, if you keep at it, you will get there. And I promise you, it’s so worth it!).

Knowing your why will give you the necessary motivation to keep you moving towards your goals, even if it’s just one small step at a time. It gives you a daily mantra to repeat to yourself, and represents the prize to keep your eyes on.

It’s the requisite ingredient to help you dig down, find your grit, stay resolute on the path less taken and push through to success.

But your why is most definitely not the daily tag line of FIRE people everywhere. It’s not the daily mantra from the latest and greatest self-talk book. It’s not “I want to retire”, or “I want to quit my job”, or “I want to be my own boss”, it’s the why that underpins those generic surface reasons.

It’s the why that only you can know, the one that inspires you to comb through your budget to find a few more dollars in savings. It’s the why that gives you pause when you see a tempting new gadget at your favourite store. It’s the why that convinces you to reallocate your down time to build your side hustle income.

Your why is also not your goals. Your financial goals may be what you want to accomplish, but your why is the current beneath those goals, pushing you forward. It’s the reason you will MAKE them happen.

Our goal was to eliminate our debt, but at the core of that goal, our why was that we wanted to be able to spend more quality time with our kids without feeling constant pressure to work harder and earn more. To enjoy the experience of parenting and life without the frenetic lifestyle of survival.

That why kept us moving towards FI, year after year. Continuously looking for ways to shave just a little bit more off our expenses and ultimately crush our mortgage. It kept us on the hunt for ways to make extra income and tuck it away into our savings.

It kept us on the wagon when we were tempted to increase our lifestyle, and kept us focussed on the long game. Ultimately it drove us to succeed.

If you don’t know your why, make it a priority to sit down (if your married – do this with your spouse) and figure out what exactly is motivating you to choose FI. And don’t stop at the generic reasons, keep asking why until you’ve drilled down to what is intrinsically important and motivating for YOU.

The journey to FI/FF is a marathon, not a sprint. As Dori said it best, just keep swimming, just keep swimming – just make sure you know exactly what you are swimming for.

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cougarmoney February 12, 2019 - 3:59 pm

Great post. I am in the beginning part of my path to fi going on just about a year now and it is still exciting. I have thought about the point when it isn’t exciting anymore and I have theory about it. The most important thing to do is establish your why just like you said but I think if you work on increasing your income at this stage it will keep things exciting because it will challenge you as well as grow your wealth faster if your expenses remain the same.

Phia@Freedom101 February 13, 2019 - 12:55 am

Thanks! I’m happy to hear you are still feeling motivated and excited about FI 🙂 I agree that finding new ways to increase your income can help in continuing to feel like you are building momentum. One caution I would have in that department is that often between our primary work and side hustles we all hit a bit of a ceiling or cap on how much we can increase that income without taking on some substantial risk, changing careers or investing in ourselves (not to say those are bad options) but they can significantly change the scope and duration of your FI plan.


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