Elena grew up poor and experienced a lot of hardship in her younger years. In this interview, she shares how discovering FIRE changed her life for the better and ended a long journey marked by struggle and the stresses bad investment decisions can cause.
Not all financial success stories are short or simple. Elena’s story certainly isn’t a FIRE fairy tale. But it shows how powerful the right kind of financial information is. Working towards Financial Freedom and simplifying one’s finances is liberating and in many cases life-changing.
Elena’s story also illustrates how empowering alternative FI strategies can be. She found out about FIRE a little later in life after suffering from chronic stress for many years. She just didn’t have the energy to push for full FIRE for several more years. Her body told her that it was time to slow down.
Coast FI (and Semi-Retirement) provides Elena with an alternative strategy that allows her to work part-time and focus on her health. She can balance her financial aspirations and her physical and mental wellbeing without giving up on her end goal: Financial Independence.
Let’s get into the interview!
Hi Elena, please tell us a little about yourself!
I am 46 years old and have lived in Brisbane, Australia, for 16 years. I’ve been married for 23 years and have one adult son who has a disability but lives separately from me and his stepfather (my husband).
I was born in Eastern Europe and moved to Australia when I was 23 years old. My parents and one sibling still live in my home country and their wages/pensions are very small compared to Australia, so there won’t be any inheritance for me in the future.
I grew up frugal (because we had to be!) but in a highly educated household (my parents have Masters degrees and PhDs). My upbringing taught me resilience and how to live on one wage. My parents’ wages were tiny and yet they managed to save one wage. They even took our poor family of five on holidays to a seaside town 2000 km away. Sure, we stayed with relatives and all slept on the floor but it was a one-month holiday each year!
I eventually left my country to escape domestic violence in my long term relationship.
I then met my husband and we lived in New Zealand for 7 years before we decided to move to Australia to “see how we like it”. 16 years later we are still here.
When and why did you first start your journey to Financial Independence and what did it look like initially?
I wanted to be wealthy from an early age, but life wasn’t easy for me. While I do feel a bit jealous of people planning to retire in their 30s, this might just not be possible for some of us due to our unique circumstances.
After my husband and I bought our first property in Auckland, New Zealand in 2001(a run-down shack on 100% finance) I started to read books on personal finance. Sadly, most information back then was about property investing and I never even heard of the term “index funds” until I found Mr Money Mustache’s site in 2014.
We eventually sold our house in Auckland, moved to Australia in 2005 and bought a house in Brisbane. Thinking investing in real estate was the way, we bought three investment properties in New Zealand regional towns in 2006-2007.
We also bought a business in late 2008 and then, as we all know, the GFC hit. Our investment properties dropped 50% in value, rents dropped by 30%, and stayed that way for nine years. Our business failed within 12 months, my commission-based job was paying less. We came so close to bankruptcy that we even talked to a bankruptcy lawyer.
Luckily we managed to keep our house. We opened(and maxed out) a few credit cards and a personal loan to keep our heads above water in the process. Fortunately, my job improved and my husband found a job after walking away from the business.
Our investment properties in New Zealand put us $1,500-$1,700 out-of-pocket every month. We were also unable to sell them. Tenants trashed the houses twice, and our insurance didn’t cover the damages. We had to pay around $10,0000 out of pocket each time. So as fast as we were paying off the debts, they were coming back.
In 2012 I came across downsizing articles and we started dreaming of slow travel overseas. We sold our car and bought a cheaper one. We renovated our house and sold it in 2013, paying off all credit card debts. We bought a smaller house with a 10% deposit a year later.
My husband turned 40 that year and we had almost no superannuation. We had also just signed and had just signed a 30-year mortgage, with no emergency fund and no savings.
When did things start to turn around for you?
In 2014 I found Mr Money Mustache. His articles on “The Shockingly Simple Math Behind Early Retirement” blew my mind. I was hooked. But we had no spare money! All excess funds went towards the investment properties in New Zealand. It was excruciating to read all the information on FIRE without being able to do anything for years.
In 2015 we took three months of long service leave and backpacked around South America. It was an epic(but frugal) trip and I was really depressed coming back to my full-time corporate job. It was very demanding and required constant unpaid overtime(a typical corporate salaried situation). I felt I had no choice but to keep working as I was the main breadwinner and I just didn’t have the time, energy, money and mental bandwidth to make any changes.
Rents in New Zealand improved slightly and we managed to start saving and even put a little extra into superannuation. We bought our first ETF parcel in December 2017, it was $1,200 from a money jar we use to save money from Gumtree sales.
The following year we rented our house out and moved into a granny flat at my sister’s house to save money.
In 2019 we FINALLY sold the three investment properties, two at a loss and one at a small gain. We paid off the losses with the gain and we were free of what had kept me awake at night for nine years. We were on our way to FI! By that stage, my husband was 51 and I was 44 years old.
While we were finally making progress financially, my mental health started deteriorating. Juggling my demanding job and caring for someone with a disability and mental health issues finally caught up with me. I had suffered from burnout for a long time without realising it. I started having panic attacks in early 2020.
What happened next and which changes did you decide to make?
COVID-19 arrived and I was stood down in April 2020. This gave me the breathing space I needed. The first four months I just slept and took care of my mental and physical health. I walked every day and did a lot of yoga. I was incredibly thankful to receive Jobkeeper, as it allowed me to heal and not stress about money.
When I felt ready to start something new, I enrolled in an aged care course. It was perfect for me because it was only one day a week for five months. After the course, I started part-time work(three days per week) in aged care, which I loved, and I was very mindful not to overdo it.
Then the Jobkeeper payments had ended and my old job wanted me back. I knew that I wouldn’t be able to endure the same workload full-time so I asked for a part-time role, fully prepared to walk away if they said no.
I knew the only way it would work was a job share arrangement, so they needed to find another person who wanted to go part-time. Luckily, someone was due to return from maternity leave and wanted to work three days a week. I was more than happy to only work two days per week.
Eventually, after 15 months off, I returned to my old job two days a week. I am still doing aged care work one day per week.
What is your life and financial plan for the next 10 years?
In the next 10 years, we plan to reach full FI. In the meantime, I would like to work 2-3 days a week on something I am passionate about. My husband is doing his own soul searching at the moment. It would be ideal if we could both work part-time and manage financially while “coasting” to full Financial Independence.
We’ll never be rich and I have accepted that. I would love to live near the water someday. Before COVID hit we were planning to slow-travel 3-6 months each year. Now our travel plans are on hold which we have accepted. We are focusing on juggling saving and paying off our mortgage while working part-time.
We also recently got a rescue dog. She is eight years old and we are both already in love with her. So we plan to give her a good life in the next 2-3 years and travel locally. After that, we will re-visit the travel plans.
Our lives were so different 10 years ago. A lot can change in 10 years and I am sure it will over the next 10 as well. I don’t see us living in the same house and having the same jobs in 10 years from now, that’s for sure. We love the adventures of life!
What is one thing you know now that you wish you knew in your early 20s?
Two words: Index funds! We would’ve avoided all the stress and struggle we experienced while investing in real estate. Time would have been able to do its magic. Having said that I do think we should have kept our first home. It was a total shack when we bought it and would be close to $1 Million for the land alone.
We made a lot of mistakes but we have come a long way. It has been a wild ride but it sure hasn’t been boring!
Thank you for sharing your story with us, Elena!
I find Elena’s determination and resilience impressive. And as we can see it did pay off in the end. Now it is only a matter of time before she and her husband reach Financial Independence.
This interview also illustrates how empowering FIRE is as a concept. Just imagine how much easier Elena’s life would have been if she had found out about FIRE when she first started out. She could have saved herself so many sleepless nights.
As I’ve mentioned many times before on this blog, Mr. Flamingo also made a really bad financial decision in his early 20s. Part of the reason definitely was that there was just no easily accessible information available at the time, so he trusted people who seemed to know what they are talking about.
Luckily there is now a lot more useful and easy-to-understand financial information available online. Anyone can learn how to become financially independent (without taking on massive amounts of debt and making risky investment decisions). It is now easier than ever to find like-minded people on the same journey. The investment landscape has definitely changed for the better and it’s great to see that more and more people are joining the FIRE community all the time.
When I last spoke to Elena a few weeks ago she was not sure if her current arrangement (two part-time jobs) is ideal long-term. I’m sure she will find a balance that is perfect for her. The important thing is that she is actively designing her life and FIRE approach around her priorities and goals.
Congratulations Elena, you have really come a long way!
What do you think about Elena’s story? Let us know in the comments below.