Good morning, afternoon, evening fellow reader,
So my first few posts have been nothing but stats on the progress of the M1 account, and while recently I have been going through the podcasts done by Brad and Johnathon over at ChooseFI, I have been on this journey for a really long time (going on 5 years now). While listening to them I have found that there are numerous ways to build income, but also that there is no one specific way to go on the path to FI. If you haven’t heard of them before I highly recommend it, they post podcasts every Monday and Friday and is an amazing resource for building ideas.
Here’s a little backstory how I started this journey.
I was the typically individual that was taken over by the consumer lifestyle, I didn’t pay my bills, I let stuff go into collections, got involved in payday loans, basically everything that you are not supposed to do…I did. Why did I?
At the time I was working at an apartment maintenance company making $9/hr, I rented an apartment at the place that I worked, got a little discount, it was like 10% off rent, and my paychecks would’t even meet the qualifications from someone off the street, which was you had to make at least 3x the rental amount a month. They took my portion of rent out of every paycheck, which left me with maybe $300-350, and this had to cover gas, cellphone, the payday loans, etc.
My tasks would be “special projects”, I wouldn’t fix garbage disposals, or replace appliances or any issues that may have came about in a tenants apartment, but I would get the apartment ready for a new tenant, and painting, lots and LOTS of painting. Then a project came up where I would have to paint the hallways of all the buildings on the property, which there was about 9-10. One of the days as I was painting I had a big self-reflection moment if you will. I thought to myself “what am I really doing with my life?”, “I have to get out of this miserable lifestyle”.
So, I go into the office and sit down with the property manager and the maintenance supervisor, first I ask them for a raise, they say no, then I ask them if I can go back to school, they say that either I would have to work full-time or quit. Well this wasn’t a option, so now when I would have to paint a hallway, I started to sit on the stairs and read. The first thing was I was not getting paid nearly enough that painters get, and that infuriated me even more. And then I stumbled onto the stock market, penny stocks in particular.
Now before I go on, THIS IS NOT A PENNY STOCK PROMOTION!
The way I felt at the time was I really didn’t have much else to lose, and well this was cheap and I could make crazy gains. So I pursued it. I learned, and would trade as the days went on, some days were great, but majority of the days were not. But I started meeting new people across social media and someone said, instead of dealing with that penny stock garbage, learn options trading.
So I get home and I download the etrade pro platform on the computer, and click on the options tab and well I’m reading a new language, I didn’t understand any of it, so back on to social media I go and learn about all the terminology, the greeks, technical analysis. My first couple years were really rough, there were quite a few times I would need help making my car payment, or gas money because I took too big of a loss. Over the course of the two years I lost about $12-13K.
That changed when instead of chasing the money, I followed specific stocks, and backtested a strategy extensively, the long-term probability of profit was between 60-65% and the only thing I really had to focus on was risk/money management. Consistency soon followed.
I still didn’t pay any of my things that were in collections, but I also started looking for a better job, moved out of the apartment to something cheaper and things started looking up.
Met the love of my life, and then after about 10-12 months we moved in together. Our combined income really got things going, one weekend we both sat down and checked out credit, and made a plan to start knocking things out. So when enough was made in the trading account, we would call up a creditor, and negotiate a deal. As time went on we got married and found out we were expecting our son. Shortly after I got hit with a garnishment, so I called them up and told them that I was willing to settle, what would they accept? They refused, and knowing that my wife was going to be out of work for some time, we made the decision to file for bankruptcy.
Which in the end would’ve probably been the best idea from the very beginning. This opened up our world and now was able to trade more frequently.
While all this was going on settled at a nice paying job, and have been there since. The wife and I moved in to the mother in laws house and we help her around the house, she watches our son while we work.
Within this whole journey as you read we pulled a complete 180, got a little affected by lifestyle creep. We have some debt, 2 2015 cars. But between the job and the trading this isn’t a concern. And everything will be taken care of within 3.5 years from now, and will drop our expenses to $700-750/month.
Now for some numbers, our monthly expenses come to about $2,896, the income comes in at about $6-7K a month and growing. Then M1 came out, and this turned into the perfect opportunity to publicly display the power of small daily contributions.
As the title suggests $10 a Day dividends. The idea is to invest $10 every day of the year, since I learned about M1 at the end of April, I’ve been making slightly bigger contributions to get the balance to where it should be as if I started on January 1st.
Now the big question, “Why don’t you just pay everything off?”
Because being a options trader I need capital on hand, the trading makes way more than the interest I’m paying, and accounts for the investments that are going into M1.
So why do you or your wife still work? She works because of health insurance, once all this health care reform finalizes and we can get private insurance, there is no need for her to work, unless she still wants to. Myself, that will be when the the monthly expense drop.
So that’s the story behind our journey,
Until next time