ChooseFI | Financial Independence Podcast

Most people cling to careers they've outgrown because they fear what comes next — but what if you could test-drive your dream life without burning everything down? Jessica, who previously appeared on episode 229, has spent the past two years doing exactly that. She quit her job to launch a coaching business, and now she and her husband Corey are planning a three-week road trip through Maritime Canada while working remotely. Their story challenges the rigid either/or thinking around financial independence and careers, revealing how concepts like Coast FI and Slow FI can create breathing room to experiment with what you actually want. Timestamps [00:01:54] Introduction to Jessica Jessica shares what's changed since her last appearance on the podcast. [00:02:45] Jessica's Journey to Entrepreneurship Started a coaching business on the side Transitioned to full-time entrepreneurship Importance of aligning work with personal values [00:03:36] Location Independence Plans Plans for a three-week road trip to Maritime Canada Exploring the concept of working from the road [00:10:12] Societal Pressures in Career Choices The 'shoulds' imposed by society Understanding personal desires versus societal expectations [00:19:43] Understanding Slow FI and Coast FI Slow FI: an intentional pace towards financial independence Coast FI: reaching a savings point for long-term financial goals without further contributions Coast FI Explanation [00:41:05] Experimentation and Confidence Experimenting with different life choices to find satisfaction Taking small actions and learning from them Key Quotes Jessica: "Aim to be a person who loves life and inspires others." [00:16:01] Jessica: "Financial freedom opens doors to being and doing anything you desire." [00:45:20] Action Steps Identify one area in your life where you can experiment and test a new direction [00:41:05] Reflect on and differentiate between what you want versus societal 'shoulds' [00:10:12] Resources The Fioneers Blog [00:47:30] Support the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Most financial advice assumes the best-case scenario — stable income, predictable markets, life going according to plan. In 2022, as inflation spiked, interest rates doubled, and crypto platforms imploded, Brad and Jonathan ask a different question: What if you planned for the worst instead? Brad and Jonathan dissect what it means to truly afford a house when rates and job security can shift overnight, and why the crypto crash exposed a fundamental misunderstanding about ownership. The conversation centers on calculating mortgage affordability using after-tax income, stress-testing financial decisions against life's curveballs, and the critical difference between holding crypto on an exchange versus self-custody. Key Topics Discussed: [00:01:02] Current Financial Climate Rapid rise of inflation and its impact on financial planning Assessing personal financial limits amidst market volatility [00:14:18] Understanding Mortgage Payments Evaluating affordability based on after-tax income rather than gross income Planning for worst-case scenarios instead of assuming the best [00:22:05] Housing Market Analysis Current state of mortgage rates and housing affordability Strategies for maintaining home affordability despite rising rates [00:55:08] Crypto Market Update Recent events in the crypto market, including the collapse of Luna and Celsius The significance of self-custodying assets to avoid counterparty risk Key Quotes: "Identify your fears and manage the risks effectively." [00:00:00] "Ensure your ability to maintain home affordability." [00:24:14] "If you don't control your keys, you don't truly own your crypto." [00:56:30] "Always prepare for the worst-case scenarios." [00:15:28] "Adapt your financial plans to life's uncertainties." [00:18:08] Related Resources: The Tail End by Tim Urban [00:02:07] Episode on Housing Affordability (Episode 381) [00:13:30] Episode on Cryptocurrency Basics (Episode 323) [00:56:30] Key Insights: Consider your financial stability and long-term planning when buying a house amidst rising interest rates The current crypto market environment highlights the necessity of managing risk and understanding asset custody Calculate mortgage payments against after-tax income to ensure manageable debt levels [00:20:10] Self-custody your crypto assets for greater control and security [00:56:30] ▶ Listen Next: Ep. 385 — Time is Your Ultimate Luxury | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

ChooseFI Podcast Show Notes: Common Sense Spending Guidelines for Housing in Uncertain Times Episode Summary: In this episode, Jonathan Mendonsa and Brad Barrett discuss effective strategies for managing housing costs while pursuing financial independence. The conversation emphasizes practical advice on mortgage payments, understanding interest rates, and avoiding unnecessary fees. The hosts share personal anecdotes, highlight the 28% rule for mortgage spending, and introduce a flexible guideline suggesting spending 25-35% of after-tax income on housing. Key Topics Discussed: [00:00:00] Podcast Intro Introduction to Housing Guidelines Discussion on the importance of understanding housing costs in relation to financial independence. [00:02:34] Personal Anecdote on Mortgage Payments Jonathan shares a personal experience with making extra mortgage payments and encountering unintended consequences. Understanding the 28% Rule Overview of the 28% rule which suggests spending no more than 28% of gross income on mortgage payments. Critique of the rule for not accounting for personal circumstances. [00:39:39] Alternative Spending Guidelines Introduction of a flexible guideline recommending spending 25-35% of after-tax income on housing. Breakdown of housing payment scenarios for various income levels. [00:57:13] Key Takeaways and Encouragement Encouragement to adopt a strategic approach to budgeting and housing expenses. Actionable Takeaways: Keep housing payments within 25-35% of your after-tax income to ensure financial stability. [00:39:39] Consider making extra principal payments on your mortgage to reduce long-term interest costs while being cautious of processing errors. [00:11:00] Be proactive in communicating with your bank to potentially waive fees when issues arise. [00:14:09] Key Quotes: “Live a standard middle-class life, yet succeed wildly.” [00:34:31] “Communicate with banks and they may waive fees in tough situations.” [00:14:09] “Being nice goes a long way; everything’s negotiable.” [00:17:04] “Steer clear of overdraft fees; they accumulate fast.” [00:13:29] “The 28% rule is too generic for personal circumstances.” [00:44:41] Chapter Markers: [00:00:00] Introduction to Housing Guidelines [00:02:34] Personal Anecdote on Mortgage Payments [00:35:44] Understanding the 28% Rule [00:39:39] Alternative Spending Guidelines [00:57:13] Key Takeaways and Encouragement Frequently Asked Questions: What is the 28% rule? The 28% rule suggests spending no more than 28% of your gross monthly income on mortgage payments, but it's criticized for not accounting for personal financial situations. [00:35:44] How much should I spend on housing? It is recommended to spend 25-35% of your after-tax income on housing. [00:39:39] What strategies can help avoid overdraft fees? Monitor your account regularly, set up alerts, and communicate with your bank if you foresee issues. [00:13:29] Speaker Highlights: Brad Barrett: Co-host who provides insights on mortgage payments and personal finance strategies. [00:01:01] Jonathan Mendonsa: Co-host sharing personal anecdotes and guiding the discussion on housing guidelines. [00:01:08] Related Resources: SmartAsset Tax Calculator [00:28:50] ChooseFI Newsletter [00:23:55] Discussion Questions: What are your personal experiences with mortgage-related challenges? [00:10:11] How do the rules and guidelines impact your decisions around housing? [00:35:44] What strategies do you use to manage housing costs and promote financial independence? [00:39:39] Email Campaign Excerpt: Subject: Unlock Financial Independence with Smart Housing Guidelines Dear [Recipient], In this week’s episode of ChooseFI, we delve into practical advice to navigate housing expenses wisely. Discover how keeping your mortgage payments to 25-35% of your after-tax income can enhance your journey towards financial independence. Join us as we share valuable anecdotes and expert insights to empower your personal finance decisions. Take control of your finances today! Best, The ChooseFI Team [00:18:44] Mentioned Episode: Episode 372: Can I Get an Extension Please? [00:00:19] Podcast Extro: You've been listening to ChooseFI Podcast, where we help middle-class America build wealth one life hack at a time. ▶ Listen Next: Ep. 382 — Managing Financial Risk and Market Uncertainty | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Every financial decision you make is either opening doors or closing them—and most people don't realize which until it's too late. Brad and Jonathan break down optionality as the core principle behind better money choices, from everyday purchases to protecting yourself against scams. The episode starts with a simple truth: wait 72 hours before buying something you suddenly want, and watch half those purchases disappear from your mental shopping cart. Timestamps & Topics [00:00:00] Introduction to Optionality [00:04:01] The 72-Hour Rule: Wait before making impulse purchases to evaluate necessity [00:09:05] Brad's Bitcoin Purchase Experience: Ransomware attack forces an unexpected crypto transaction [00:14:01] Internet Security Measures: Consistent backups and turning off UPnP for protection [00:17:23] Lessons from Cryptocurrency Trends: Volatile nature of crypto and lessons from past financial disasters [00:29:16] Guaranteed Returns and Risks: Why investments promising guaranteed returns are red flags, with examples from the Madoff scandal [00:52:54] Conclusion and Takeaways Key Quotes "Implementing a 72-hour rule between desire and purchase can significantly reduce buyer's remorse." [00:04:01] "Your finances reflect your life's energy and choices." [00:08:44] "High returns often come with significant risks." [00:29:16] "Beware of schemes claiming superior knowledge or guaranteed results." [00:41:38] Action Items Implement the 72-hour rule: Take a step back before making purchases [00:04:01] Secure your data: Regularly back up important files to prevent loss from ransomware attacks [00:14:01] Maintain skepticism towards guaranteed returns: Evaluate the risks associated with any investment claiming high, fixed returns [00:29:16] Resources Frugalwoods - 72-Hour Rule [00:04:01] ▶ Listen Next: Ep. 381 — How Much Should You Spend on Housing? | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Bradley and Anita both doubled their salaries by breaking into Salesforce—an industry neither had prior experience in. Their stories reveal how financial independence principles create the breathing room to make bold career pivots, and why soft skills matter more than credentials when you're starting from scratch. Whether you're stuck in a career you've outgrown or wondering how to capitalize on your earning potential without going back to school, this episode maps out the unconventional path. Chapters [00:00:00] Introduction to Managing Uncertainty [00:01:18] Transitioning to a New Industry [00:02:30] Bradley and Anita's Success Stories [00:21:02] Discussing Soft Skills [00:32:09] The Importance of Community [01:07:20] Conclusion and Future Insights Key Takeaways Emphasize Soft Skills: Highlight communication, adaptability, and problem-solving during job applications. [00:22:34] Utilize Online Communities: Engage with online communities for support and networking during career transitions. [00:32:09] Self-Led Learning: Build a personal project to showcase your skills during interviews as relevant experience. [00:47:19] Notable Quotes "Financial independence allowed me to prioritize my time and ultimately earn more." [00:06:07] "Understanding the philosophy behind career transitions is key." [00:14:41] "Your story of upskilling really resonates with our mission." [00:07:16] "Witnessing someone's career transformation is truly inspiring." [01:05:00] "The discussion on soft skills is critical for success in today's job market." [00:25:14] Common Questions What were the primary tools discussed for managing uncertainty? Community support and personal development tools, including certifications and soft skill enhancement. [00:09:22] How can someone transition into a new industry effectively? Leverage upskilling programs and emphasize soft skills when networking and interviewing. [00:14:49] What role do soft skills play in career transitions? Soft skills like communication and adaptability are vital for success, often outweighing technical skills. [00:22:34] Is it possible to gain employment without traditional education? Yes, individuals have successfully secured jobs through self-led learning and showcasing relevant skills. [00:57:05] What is the 'hidden job market'? Job opportunities that aren't advertised publicly and can be accessed through networking. [00:39:01] Key Terms Financial Independence (FI): The state of having sufficient personal wealth to live without needing to work actively. [00:00:00] Soft Skills: Interpersonal attributes that enable someone to interact effectively and harmoniously with others. [00:21:02] Hidden Job Market: Job opportunities that aren't advertised publicly, often filled through networking. [00:39:01] Resources Salesforce for Everyone Podcast: ChooseFI.com/SFE [01:07:20] Related Episodes Episode 117: Interview with Bradley Rice [00:02:30] Episode 297: Anita's Career Transition Story [00:02:30] ▶ Listen Next: Ep. 380 — Financial Decision Making: The 72-Hour Rule for Smart Spending | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Most people think their savings rate determines their financial future. But Warren Buffett argues something entirely different: your ability to earn more is the real weapon against inflation. When Brad and Jonathan dig into why your career trajectory matters more than your investment returns in the early years, they reveal a simple truth most people ignore—you can't cut your way to wealth, but you can earn your way there. Earning potential stands out as the foremost defense against inflation, with personal development and skill enhancement being crucial investments. The discussion emphasizes understanding one's job satisfaction, the value of proactive dialogue with employers, and the significant impact of salary negotiations on long-term financial independence. Key practices involve career hacking by enhancing one's visibility and worth in a given role while exploring alternate avenues for income increases. Listeners are encouraged to pivot from traditional educational paths toward acquiring actionable skills that cater to today's job market demands, particularly in high-demand fields like tech. Ultimately, enhancing earning power is framed as both a personal choice and a vital strategy for financial stability in an inflationary economy. Chapter Markers: Introduction to Earnings Power and Inflation [00:00:00] Personal Experiences and the Value of Time [00:05:40] Understanding Job Satisfaction [00:18:07] Salary Negotiation Strategies [00:36:06] Closing Thoughts on Career Growth [00:58:12] Key Insights: Time is your most precious resource [00:05:40] Focus on experiences that bring joy rather than merely accumulating wealth. Regularly assess your job satisfaction to align your career with personal happiness. Your earnings power beats inflation [00:08:21] Personal earnings power and skill development provide the most effective defense against inflation. This matters more than investment returns in your early wealth-building years. Diagnose your career dissatisfaction [00:18:07] If you're unhappy, determine whether the issue lies in your industry, job role, or workplace environment. Don't feel trapped—explore new opportunities that align with your interests. Negotiate proactively [00:36:06] Effective salary negotiation requires preparation and confidence. Practice with family and friends before formal discussions. Show your value through results and proactively schedule meetings to discuss your contributions. Control what you can control [00:58:12] Focus on skill acquisition and career hacking to build resilience against financial uncertainty. Enhance your visibility and value in your current role while learning skills that make you irreplaceable. Key Quotes: "Your earnings power is your best defense against inflation." [00:08:21] "Time is the most precious resource you can leverage in life." [00:05:40] "Financial independence isn't about frugality; it's about value-driven choices." [00:03:33] "Avoid feeling trapped in your career; explore new opportunities." [00:20:57] "Focus on what you can control in your financial journey." [00:56:53] Action Items: Review and enhance your skillset to better position yourself for raises or new job opportunities [00:24:17] Schedule a meeting with your boss to discuss your performance and potential for a raise [00:36:06] Related Resources: Talent Stacker Program - An opportunity to break into tech and enhance earning potential [00:56:48] Terminology: FI - Financial Independence, the state of having sufficient personal wealth to live without having to work [00:06:46] Salary Negotiation - The process of discussing and agreeing on the terms of pay before accepting a job offer or during a review [00:36:06] Career Hacking - Strategies to maximize income and career satisfaction by leveraging skills and networking [00:24:17] ▶ Listen Next: Ep. 379 — The Hidden Job Market: How to Find Jobs That Aren't Posted | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

A 50% savings rate might solve most financial challenges, but what happens when inflation erodes your purchasing power faster than you can save? Brad and Jonathan tackle the reality of planning for financial independence when both stocks and bonds are down, exploring how to maintain progress when traditional strategies feel uncertain. The conversation centers on glide paths—adjusting your financial strategy based on market conditions and life stage—particularly crucial during inflationary periods. They examine how to focus on controllable factors (expenses, savings rate, income) while navigating volatile markets. Key Topics & Timestamps [00:01:09] Travel Rewards for Family Trips Brad discusses his upcoming Disney trip—his first ever—and how travel rewards make it affordable. Using points strategically can cover flights, accommodations, and park tickets, turning an expensive family vacation into a manageable expense. [00:10:48] The Impact of Inflation on Financial Goals With stocks down, bonds down, and inflation rising, the hosts analyze current market conditions and their implications for financial planning. They discuss how inflation affects home prices, investment strategies, and the real value of money over time. [00:19:15] Controlling What You Can Control When markets are volatile, focus returns to the fundamentals: savings rates, expenses, and income. Jonathan emphasizes that a high savings rate provides flexibility regardless of market conditions. "Focus on factors you can control: expenses, savings rate, and income." [00:19:15] [00:29:16] Using I Bonds for Inflation Protection I bonds currently offer a 9.62% guaranteed return, making them an attractive option during inflationary periods. The hosts explain how these government-backed securities work and when they make sense in a portfolio. "I bonds currently offer a guaranteed 9% return, a strategic financial move." [00:36:07] [00:36:07] Stock Market Volatility and Future Planning Expectations around stock market trends and strategy adjustments during volatile periods. The hosts remind listeners that short-term volatility is normal and planning should account for multi-year timeframes. "Expect significant volatility in the stock market over shorter timeframes." [00:17:30] Action Items Look into I bonds for potential investment strategies Review and prepare travel rewards for upcoming trips Evaluate personal savings rate and expense control measures Related Resources ChooseFI Travel Rewards Guide I Bonds Information ▶ Listen Next: Ep. 378 — Earning Power: The Best Protection Against Inflation | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Most people accept the 4% rule as gospel—withdraw 4% of your retirement portfolio each year and your money will last. But what happens when markets crash, healthcare costs spike, or you live longer than expected? Sean Mullaney reveals four hidden safety nets that make the 4% rule far more resilient than you think. The 4% rule suggests accumulating 25 times your annual expenses, then withdrawing 4% annually. While this guideline has guided countless early retirees, it assumes uniform spending throughout retirement—an unrealistic expectation that creates unnecessary anxiety about running out of money. Chapters [00:01:40] Understanding the 4% Rule The rule suggests accumulating 25 times annual expenses to sustain retirement through a 4% annual withdrawal rate. [00:04:05] Inflation and the 4% Rule How inflation affects purchasing power and the 4% rule's relevance during inflationary periods. [00:13:05] Flexibility in Spending Adjusting personal expenses enhances financial flexibility and security. Spending may naturally decrease with age. [00:22:14] Social Security as a Backstop Social security provides additional income and support for early retirees. Early retirees may budget zero for social security but benefit from it later. [00:32:56] Real Estate and Reverse Mortgages Your primary residence can be a source of financial security. Downsizing or utilizing home equity can provide necessary funds. Reverse mortgages offer a potential tool for accessing home equity in retirement. [00:43:36] Conclusion on Mortality The importance of considering mortality in financial planning. Failing to plan for extended longevity can lead to unnecessary anxiety about retirement funds. Key Quotes "The 4% rule assumes uniform spending, but life isn't that predictable." [00:13:05] "Medicare provides crucial financial coverage against increasing healthcare costs." [00:17:39] "The focus of the 4% rule isn't just longevity but ensuring funds last a lifetime." [00:44:05] "By default, early retirees often budget zero for social security, making it an unexpected benefit." [00:22:50] Resources FI Tax Guy Blog [00:49:04] ▶ Listen Next: Ep. 377 — Retirement Planning Strategies During Economic Uncertainty | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Your current income doesn't determine whether you can retire—your savings rate does. If you're spending every dollar you earn, retirement is impossible no matter how much you make. Brad and Jonathan break down the single most important metric on the path to financial independence: how to calculate it, why it matters more than your salary, and how to adjust it for taxes, employer matches, and debt. Key Concepts: Savings rate formula: Savings ÷ Earnings [00:08:05] Why it matters: When you can fund your life from sources other than your employer, you've unlocked financial freedom. [00:10:09] The trap: Living paycheck to paycheck means you will never be able to retire—regardless of income. [00:12:20] Calculation Nuances: Net vs. gross income: Use either consistently, but track the same way year over year for meaningful comparisons. [00:27:49] Employer matches: Include them in your calculations—they're free money and part of your true savings. [00:39:18] Tax considerations: Adjust for how taxes and deductions affect both your income and savings figures. Debt repayments: Only principal payments that increase net worth count as savings—interest does not. [00:41:16] Action Steps: Calculate your personal savings rate using the formula provided. [00:47:31] Track your savings rate year over year to measure progress toward financial independence. [00:27:49] Maximize employer 401(k) matching—it's an immediate return on your savings. [00:39:18] Timestamps: [00:01:00] Introduction to Savings Rate [00:05:00] Listener Question [00:08:00] Defining Savings Rate [00:09:12] Importance of Savings Rate [00:10:09] Funding life outside of an employer [00:12:20] Living paycheck to paycheck correlation with retirement [00:24:20] Calculating Savings Rate with examples Resources: KiwiCo — STEM Projects for Kids [00:03:00] Toys That Teach — Educational Toys [00:02:20] ▶ Listen Next: Ep. 376 — Four Percent Rule Alternatives: Retirement Withdrawal Strategies | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Most people think budgeting means restricting their spending — Brad and Jonathan flip that idea entirely. Budgeting isn't about limitation; it's about creating freedom to pursue your goals faster. Budgeting and tracking finances can feel overwhelming, but with the right tools and mindset, it becomes straightforward. The key is understanding your true take-home pay — not your gross income — especially during tax season. Look at actual earnings after deductions and simplify your tracking process. The episode covers various budgeting tools including Tiller Money, YNAB, Mint, and Personal Capital, along with how to determine your opportunity for investment after expenses. It promotes seeing budgeting as a pathway to freedom rather than a limiting exercise and encourages open conversations about financial goals with partners, advocating for simplicity and proactive adjustments based on past financial behaviors. Chapters [00:01:05] Brad's Gardening Experience [00:10:04] Understanding Take-Home Pay [00:40:06] Budgeting Tools Overview [00:52:59] Final Thoughts and Call to Action Key Quotes "Embrace failure as data for your financial journey." [00:10:04] "Know your actual income to make better financial decisions." [00:10:28] "Your tax return reveals the truth about your finances." [00:12:34] "Keep budgeting simple for better financial management." [00:25:34] "Empower your finances by setting tangible goals." [00:39:46] Budgeting Tools Discussed YNAB — You Need A Budget, a zero-based budgeting approach [00:39:47] Tiller Money — Connects to bank accounts, works with Excel or Google Sheets [00:36:26] Mint — Free financial tracking tool by Intuit [00:41:24] Personal Capital — Tracks net worth and integrates with bank accounts and investments [00:43:54] Action Items Calculate and review your take-home pay [00:10:28] Choose a budgeting tool to start tracking your finances [00:40:06] Related Resources Consumer Finance Protection Bureau Budget Worksheet [00:23:22] Interview with Jesse from YNAB [00:40:59] ▶ Listen Next: Ep. 375 — How To Calculate Your Savings Rate… And Why It’s Important | Essential ListeningSupport the ShowWe work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.