For a lot of people chasing financial independence, the end goal is pretty simple in theory: save enough money so work becomes entirely optional.<\/p>\n
But for Andy Hill, 44, a family finance coach and podcaster (1), that idea has shifted over time into something a little less rigid \u2014 and, he says, a lot more realistic for regular households trying to make it all work.<\/p>\n
Must Read <\/p>\n
He started out following the classic FIRE (Financial Independence, Retire Early)<\/a> playbook, saving aggressively with the goal of potentially stepping away from work decades ahead of the traditional timeline. But as life, costs, and priorities evolved, he moved toward a more flexible approach known as Coast FIRE<\/a>. That means you save aggressively for a while, until you have enough to \u201ccoast\u201d for a number of years until retirement, no longer needing to save, because of returns and compound interest that you have accumulated on earlier investments.<\/p>\n Coast FIRE, combined with what he calls \u201cF-you money\u201d are, together, the \u201ccheat code\u201d for the FIRE movement, he said in an interview with (2)Business Insider (2).<\/p>\n And for Hill, that mix didn\u2019t just change his financial plan on paper \u2014 it changed the day-to-day feeling of working, saving, and having options in a way he hadn\u2019t experienced before.<\/p>\n What is Coast FIRE and an \u2018F-you fund\u2019? <\/p>\n Coast FIRE is basically a lighter, less all-or-nothing version of the FIRE plan.<\/p>\n Instead of trying to save every extra dollar until you can fully walk away from work, you do the heavy lifting early in your career \u2014 building up a solid investment base \u2014 and then, at some point, shift gears.<\/p>\n Once you hit that \u201cenough is enough\u201d number in savings, you stop aggressively pouring money into retirement accounts. You still work, but you\u2019re no longer in full accumulation mode. Your investments are left alone to grow over time, while your paychecks go toward everything else life throws at you \u2014 housing, kids, travel.<\/p>\n For Hill, that number was about $550,000 invested by age 40. From there, the math takes over. With an assumed long-term return of around 6% a year, that portfolio could potentially grow to roughly $2 million over time without adding another dollar, Business Insider reporting says.<\/p>\n And compared to traditional FIRE, where the goal is often to fully replace your income much earlier, the coasting approach can take a lot of pressure off the savings target itself.<\/p>\n Story Continues <\/p>\n But the part that really changed things for Hill\u2019s family financial plan was what he calls his \u201cF-you money.\u201d<\/p>\n It\u2019s not a technical concept \u2014 it\u2019s just his word for a cash cushion. It\u2019s like an emergency fund, in that it\u2019s sitting somewhere safe like a high-interest savings account. But it\u2019s enough to give you the ability to walk away from a job or situation that just isn\u2019t working anymore.<\/p>\n Hill told Business Insider there was a stretch where he felt stuck in a stressful corporate job \u2014 earning a solid income, but feeling like leaving wasn\u2019t really an option. That mismatch between income and freedom pushed him to build a buffer that felt big enough to give him confidence, not just security.<\/p>\n So his \u201cF-you\u201d goal was simple: Accumulate 12 months of living expenses in cash before making any big career moves, giving him enough runway to step back and try something different without immediately worrying about how the bills would get paid.<\/p>\n By 2020, he and his wife Nicole had both reached their Coast FIRE target and fully built out their FU fund. And according to Hill, that\u2019s when things actually started to feel different.<\/p>\n \u201cThe year I left my corporate career, I was making around $180,000 per year working 40 to 50 hours per week,\u201d he told CNBC\u2019s Make It (3). \u201cThis year, I\u2019m paying myself $100,000 working 20 to 25 hours per week.\u201d<\/p>\n So even though the income dropped on paper, the trade-off was obvious: more control over time, less pressure, and a work setup that actually fit his family life \u2014 something a growing number of people say feels harder to come by as everyday costs continue to rise faster than paychecks in many industries.<\/p>\n Read More: BlackRock warns buying and holding the S&P 500 isn\u2019t enough for retirement anymore \u2014 here’s why<\/a><\/p>\n How to build up an initial cash cushion <\/p>\n Hill stresses that saving up an \u201cF-you fund\u201d isn\u2019t about living on rice and beans or cutting every bit of joy out of your life. In fact, he thinks that approach could backfire for most people.<\/p>\n When savers get too strict, too fast, that\u2019s often when the financial decisions get worse, not better.<\/p>\n \u201cThere\u2019s so many other things that you can do with your life besides working,\u201d he said to CNBC.<\/p>\n Instead, he leans on a handful of simple habits that are easy to repeat and actually stick over time.<\/p>\n Keep the fund somewhere safe. The point isn\u2019t to chase returns or get fancy. It\u2019s just to know the money is there, ready to use if life changes suddenly.<\/p>\n Hold monthly money meetings. In plain terms, these are regular check-ins with your household to look at where the money is going, what\u2019s coming up, and whether your spending still matches your goals. It doesn\u2019t need to be more complicated than that. It just keeps everyone on the same page, instead of guessing month to month.<\/p>\n Zoom out and look at the big stuff first. Think: housing, transportation, and food. \u201cThe bigger expenses matter the most,\u201d Hill told Business Insider. \u201cThose are some of the harder questions to ask yourself: Do I actually need this house? Do I need these cars? Are they helping me get where I want to go?\u201d That\u2019s especially relevant now. Even though inflation<\/a> has cooled from its 2022 highs, prices are still significantly higher than they were just a few years ago \u2014 and a lot of households are feeling that squeeze in the fixed costs they can\u2019t easily escape.<\/p>\n Find space to actually enjoy your life: Hill pushes back against the idea that financial independence should feel like constant restriction. If every decision becomes about cutting back, eventually the whole thing starts to feel unsustainable.<\/p>\n Increase income as a final piece. \u201cWe really need to figure out how to combat inflation by inflating our own income,\u201d he said. That might mean asking for a raise, going after a promotion, or picking up extra hours if they\u2019re available. Beyond that, he suggests looking at side income \u2014 but not necessarily reinventing yourself. Start with skills you already have and figure out how they could earn more outside your 9-to-5.<\/p>\n For Hill, the point of all of this isn\u2019t to quit work as quickly as possible. It\u2019s to make sure you\u2019re not stuck in a job just because you have no other choice. And in his view, that\u2019s really where the \u201ccheat code\u201d comes in.<\/p>\n You May Also Like <\/p>\n Join 250,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/p>\n Article Sources <\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines<\/a>.<\/p>\n YouTube (1<\/a>); Business Insider (2<\/a>); CNBC (3<\/a>)<\/p>\n This article originally appeared on Moneywise.com<\/a> under the title: Michigan father, 44, says he built a $550,000 \u2018cheat code\u2019 to financial freedom \u2014 here\u2019s how he did it<\/a><\/p>\n This article provides information only and should not be construed as advice. It is provided without warranty of any kind.<\/p>\n","protected":false},"excerpt":{"rendered":"For a lot of people chasing financial independence, the end goal is pretty simple in theory: save enough…\n","protected":false},"author":2,"featured_media":734079,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[263196,45,8623,49,48,139035,133,46700,117299,264000,131,132,15381],"class_list":["post-734078","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-andy-hill","tag-business","tag-business-insider","tag-ca","tag-canada","tag-coast-fire","tag-finance","tag-financial-independence","tag-fire-movement","tag-flexible-approach","tag-personal-finance","tag-personalfinance","tag-robert-kiyosaki"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/734078","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=734078"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/734078\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/734079"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=734078"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=734078"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=734078"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}