How to Get Rich Slowly and Retire Earlier Than Most with a Modest Portfolio

Mindy:
Welcome to the BiggerPockets Money Podcast where we interview one of the OGs of the personal finance blogging community, JD Roth from getrichslowly.org and talk about life after retirement. Hello, hello, hello, my name is Mindy Jensen and with me as always is my get rich slowly co-host, Scott Trench.

Scott:
Thank you, Mindy. Great to be here with my got rich swiftly by investing in literal rocket ships co-host, Mindy Jensen.

Mindy:
Scott and I are here to make financial independence less scary, less just for somebody else to introduce you to every money story because we truly believe financial freedom is attainable for everyone, no matter when or where you are starting.

Scott:
That’s right. Whether you want to retire early and travel the world, go on to make big time investments in assets like real estate, start your own business or just understand what a day in the life of a financially-independent person looks like, we’ll help you reach your financial goal and get money out of the way so you can launch yourself toward those dreams.

Mindy:
Scott, we have a new segment of the show. It’s called The Money Moment, where we share a money hack tip or trick to help you on your financial journey. Today’s Money Moment is, do you have a habit of spending too much online? Try using the three-day rule. Once you add an item to your cart, wait three days before purchasing. Not only does this rule help curb impulse spending, but sometimes brands will email you coupons if you leave items sitting in your cart. Do you have a money tip for us? Email [email protected]. Now you’ll notice I didn’t take that tip today. At the very end of the show you will hear that JD shares an amazing book recommendation, and I went and bought it while we were talking. I was so impressed with his review of the book, and I cannot wait to read that. However, otherwise, that’s a great tip. Scott. I am super excited to bring JD Roth to the show. I can’t believe it took us 432 episodes to get him on. What Is wrong with us?

Scott:
I don’t know this. The JD has just really been a pioneer in the financial independence space, in the personal finance space, has really been doing this for 20, 25 years, providing great advice, helping tons of people and then living his best life. It’s just really awesome to learn from him and I think you really admire what he’s built. Just as a quick heads up, this is obviously one of the stories about someone who is financially independent and a glimpse into their lives, which we think is really important to emphasize here at BiggerPockets Money. This is the end goal for a lot of folks is getting to this point and then reaping the rewards. No, JD is not a mega-millionaire here with millions or tens of millions of dollars in assets. He’ll talk about his net worth. It’s something that’s very achievable for a middle or upper middle class American over a 10 to 15 year journey to FIRE. So this is a very realistic financial situation and these are the opportunities and challenges and struggles that many folks who are successful on the journey to FIRE will share.

Mindy:
Absolutely. JD Roth is an OG personal finance blogger who founded getrichslowly.org to document his quest to get out of debt. Over time, he learned how to save and how to invest, and today he’s managed to reach early retirement. Actually, a long time ago he managed to reach early retirement. He wants to help you master your money and your life. No scams. No gimmicks, no get-rich-quick schemes, get rich slowly, just smart money advice to help you reach your goals. JD Roth, welcome to the BiggerPockets Money Podcast. I’m so excited to talk to you today.

JD:
Thanks, Mindy, you’re very excited. I love the enthusiasm.

Mindy:
I’m always excited to talk to JD Roth. All right, so for people who don’t know you, the one person listening who doesn’t know you, tell us a little bit about yourself. How did you get involved in personal finance and how did you start blogging?

JD:
Okay, well, so the start blogging thing is easier to answer. I’ve been blogging since before blog was even a word. So back in 1994 I think it was, I made my first website. In ’95, 96, I started reading what were then called web journals. They weren’t called blogs, and in 1997 I started trying to write my own web journal. It was was trying to document my weight loss at the time. By ’98 I had started writing them out movies and cats and computers and comic books and just having a lot of fun. So I started blogging over 25 years ago, but again, we didn’t call it blogging back then. That word had not been invented. At the time, I was deep in debt. My parents were bad with money. I didn’t have anybody to learn good money habits from. So I grew up and I was bad with money, and I was just really struggling.
Eventually, I had some people recommend some personal finance books to me, including Your Money or Your Life by Joe Dominguez and Vicki Robin, and The Total Money Makeover by Dave Ramsey, which of course, those are two huge books in the personal finance community. So I read those books, and the way I process things is I write. I’ve always been like that, so I write. So I wrote an article for my personal blog about, I call it How to Get Rich Slowly, because reading those two books and a bunch of other… I went to the library and checked out a bunch of personal finance books. I thought that the theme that I saw was, there’s no reliable way to get rich quickly, but if you do the right things, you can get rich slowly. So I wrote that article, it went the 2005 version of viral. About a year later, I was looking to start a website to try to make some spare cash to help me get out of debt. I thought, “Oh, I’ll start a site called Get Rich Slowly,” and that is how the blog was born.

Mindy:
An overnight success in just 25 short years.

JD:
Right, exactly.

Mindy:
So 2023, fast forwarding just a little bit is the year of JD, the year you give yourself permission to do you. Now we’re halfway through, how has your decompression journey been?

JD:
It has been awesome and it has been interesting. So just to give a little bit of context, I started Get Rich Slowly in 2006, then I sold it. I sold it actually in 2009, but I stuck around till 2012 writing it and running it and stuff. Then after 2012, I took a few years where I actually did try to be retired. Then I started another website and eventually I bought Get Rich Slowly back. I just found that, oh, my gosh, it’s so much work. It’s such a headache and I’ve got other things going on in my life too. I struggle with my mental health. My girlfriend and I had moved. 2022 was a really bleep year for me. I had a lot of stuff going on in my life. My mom died, my best friend/cousin died, three pets died, all this other stuff was going on and it was just like, “Ah.” So I reached the end of last year and I’m like, “Man, I have got to do something for myself.”
So I decided 2023, I’m going to make it the year of JD So what I’ve done is given myself permission to put myself first, which is a hard thing for me to do. I don’t know about you, but for me, I put other people first or I try to, but that’s my goal anyhow. So to say, “No, this year is for me and what I want to do,” it was difficult at first. Now we’re about six months into it and I’m like, “Okay, I kind of like this. What are some examples of things you said no to and things you said yes to regarding your putting yourself first, and how has that impacted how your mental health and your relationship with yourself?” So examples of things I’ve said no to, well, first of all, let’s take financial blogging. I’ve been writing about personal finance now since 2006, and I’m burned out on it. I was burned out on it many years ago, which is why I sold the site originally.
I’m burned out on it again, so I’ve decided that I’m going to walk away from writing about money. I’ve turned the site over to my business partner, Tom, and I just want to get back to doing what I used to do, writing about the cats and the computers and comic books, just writing about everyday life. It’s fun for me, and people seem to enjoy it. So that’s an example of the stuff I’m trying to reject is work. I’m also trying to kill some of my bad habits. I like computer games. I’ve played computer games my entire life, and so I’ve tried to set aside the computer game that I’ve been addicted to most for the past 10 years, and I’ve done a good job. I used to play about two hours a day. I think I’ve played two hours total since middle of April, so that’s really good. It’s not just that I’m saying no to things during the year of JD, I’m also trying to say yes to things. So an example of that is I’m trying to learn about art.
I’ve never done anything artistic in my life outside of writing, and I’ve never done anything with visual arts. So I’ve been trying to teach myself to draw. In fact, when we get done with this interview, what I’m going to do is pull out the iPad and sit down and do some more clumsy sketches. But I’ve also been doing solo travel. I’d love to travel with people, but my cousin, who was my primary travel partner, he died last year, so he can’t come with me. Kim, my girlfriend, I love traveling with her, but she has a job. Can you believe it? So I decided I need to give myself permission to do some solo travel, and so that’s what I’ve done. I spent most of the month of June on a cruise ship, believe it or not, going up the coast of Norway all the way up to the Arctic Circle and then back down to Iceland, and that was amazing. That was a chance for me to try to do nothing, just decompress, do nothing, go to the ship’s gym, sit in the ship’s spa, read mystery books, just do nothing. It was hard.

Mindy:
I love this.

Scott:
Yeah, I think it’s great. I think it’s a really rough 2022 to have the ability to go down this journey and see its power for what it’s doing for you is just awesome here. Has this been a financial burden? Are you unretired now as a result of this, or how do you think about the impact this has had on that aspect?

JD:
Well, that’s a good question because travel, well, travel doesn’t have to be expensive. In this case, I’ve done my best to keep it as cheap as possible. I’m not a travel hacker like some people we know, but I listen to what the travel hackers do, and when I can incorporate their advice, I do incorporate it. So I guess, Scott, what I would say is I’m not the most frugal person in the first place, and I’m willing to take on a lot more risk than many other people are.
So I talk to a lot of people in the financial independence community who are risk averse, and they’re the ones who tend to stick around in their jobs for five, 10 years longer than they actually need to because they’re like, “What if something happened? Maybe I need more money?” I’m just the opposite of that. I’m like, “Well, I’ll figure something out. So I guess what I’m trying to say is I’m not spending a huge amount, but I am spending more than I would if I just stayed home. I’m still financially independent, it’s all good, but I consider myself right on that edge. If we go by the strict definitions, I’m walking a fine line, and I think most people who pursue this would not do that.

Mindy:
Okay. Well, let’s talk money since you brought it up, let’s look at your portfolio in terms of percentages or fine number or whatever. You don’t have to give exact dollar figures, but what does your net worth look like now in comparison to when you officially retired after however many years of retirement and spending and all of that? Do you look at your portfolio and your net worth and think, “Ooh, I’m going to have to go get a job?”

JD:
No, I don’t think that, but I think I could get a job if I needed to. Then that’s part of what keeps me sane, I guess. So this is a great question and something that I think about a lot. If you look at my net worth today compared to when I reached financial independence, it’s exactly the same, maybe not to the penny, but within a percentage or two, it’s the same. It’s been the same now for 14 years, and I think for a lot of people, they would view that as a failure. They’d be like, “Oh, my God, you should be accumulating money, you should be accumulating…”
But I view this as a success because I’m maintaining my nest egg, and I’ve got exactly the same net worth as I had 14 years ago, and I’ve been able to enjoy life with the rest of the money. I’ve taken the growth that I achieve in using that money. This isn’t a deliberate thing. I don’t want to want people to think that I’m sitting down with spreadsheets and making this happen, it’s just worked out this way. Remit Sethi, he talks about mindful spending or conscious spending, and I’m a huge proponent of that. So I do spend on things like travel. I do spend on things like books, but I cut back on tons of other stuff because a lot of other things just do not matter to me.

Mindy:
That is something that I have advocated for for years. Spend on things that matter and cut back on things that don’t matter. If you don’t care about the thing then don’t spend money on it, that’s just silly. Spending money on something to keep up with the Jones’ when you don’t even care about it is ridiculous. What are some of the things that you have cut back on

JD:
For a long time, an answer would’ve been clothes. I guess I still don’t spend a lot on clothes relative to other people’s budgets. I used to shop a lot at thrift stores and now I’ll buy one or two quality and very expensive pieces of clothing per year, and I’m happier that way, so cutting back on clothes. For a long time, I’ve lived in a very small home. We lived in a 1,200 square foot home out in the middle of the country, so that was one way. I don’t need a big fancy house. Even this house that we have here that we’re living in now is slightly more expensive than the house we used to live in, but we were able to pretty much just transfer the equity over.
I had to put down a down payment, and that’s the difference, but so cutting back on clothing, cutting back on housing, in a way, the travel too. I do travel and it’s important to me, but the way I travel is often very different than the way many people travel because for example, I don’t need fancy lodging. A fancy hotel is wasted on me, so I stay in the cheapest possible place. I’m happy to stay in a shack as long as I can spend a lot of money on food. I just went to a Michelin star restaurant in Reykjavík, Iceland, and that was the most expensive meal I’ve ever had in my life. That is also one of my favorite memories of my life too.

Scott:
It sounds like you’ve basically gone through this journey of retiring in an official capacity twice now. What is that like from a mental perspective? How does one adjust to that new reality after selling their business, or there’s likely an abrupt change or even maybe there isn’t. Maybe there’s a gradual process there, and then what’s it like going through it a second time?

JD:
So the first time it was a gradual transition because I sold the site, but I stayed on for three years to manage it and to run it, and so I could not tear myself away. Even after I did tear myself away, I felt this emotional attachment to the community and felt like I had deserted them, and so I could never really tear myself away. Plus, I had, my identity was tied up in my work, my identity was tied up in personal finance. I know a lot of people go through that with their jobs, their identity is tied up in their jobs. So the first time I retired, it was great because I was able to do things that I had always neglected. I got in shape, I learned Spanish, I started to travel. I started to learn to play the guitar. My girlfriend and I took 15 months to travel around the United States in an RV. It was fantastic. When I look back, that period from roughly 2012, 2013 to 2016, that’s the best time of my life.
So now in 2023, what I’m trying to do is… again, I said my 2022 was rough, but I’d also allowed my mental health and my physical health to decline. I think largely it’s because I was back at get rich slowly doing this work and feeling this pressure when I didn’t need to do it. Now that I’ve spent six months trying to be retired, and that’s what I keep telling people is, I’m trying to be retired and mostly succeeding. It’s been wonderful because I’m, again, allowing myself to spend the time to get physically healthy again. I’ve been working on my mental health and it’s all just coming together. I feel like I’m more myself and when I am more myself and when I’m happier, I’m not just better for me, I’m a better partner for Kim. I’m a better friend to my friends. I’m just better for the world in general when I do put myself first, which seems counterintuitive, I have to say.

Mindy:
No. I am struggling a little bit with exactly what you’re saying now. I’m wondering if you have any guilty feelings in taking a step back. Do you have any guilt in being, quote, unquote, “selfish” and putting yourself first? Because I absolutely do.

JD:
I do, but I’m curious to what makes you feel guilty, Mindy?

Mindy:
Well, this isn’t about me, it’s about you. But it makes me feel selfish, so why would I put myself first when I could put myself last and put everybody else first?

JD:
Yeah, no, 100%. I’ve had those feelings. I’ve had to wrestle with those feelings, and in fact, that’s a large part. So when I took this solo trip on the cruise ship and off the cruise ship, it wasn’t just for fun. It was, but it was also meant for me to have a month where I could just reflect on life, reflect on what it is I want to do, and try to get squared away in my head, and I did a lot of reading. I read one book over and over again. It’s Thich Nhat Hanh’s The Miracle of Mindfulness. I just read this four times on the boat, and I’ve read it in the past. This is a classic of mindfulness literature, and it says all the things you would expect it to say about being present in the moment.
I think being present in the moment, in many ways, I’ve been thinking lately that a lot of Buddhist thought seems pretty selfish in a way because it’s about just being here, being now and being with yourself. Yet at the same time, I think, like I said earlier, it makes me happier. When I’m happier, it helps me be better for the world at large. So yeah, Mindy, I hear what you’re saying about feeling guilty and feeling selfish, but trying to get squared away on or understanding that this actually makes me better for everybody else around me helps me get over that selfishness or that feeling of selfishness.

Mindy:
Yeah. When I am not in the moment, I’m thinking about the 396 things that I have to do, and I’m not paying attention to what you’re saying. I’m just nodding and, “Uh-huh. Yeah, wait, what did you say?” Or I just agreed to do something that I wasn’t even paying attention to. So being present is really important, but so why should I feel guilty about pushing away everything else and focusing in the now and paying attention to my surroundings? When I can put away everything and focus, then it’s a better relationship all around, and when I’m happy, everybody else is happy.

JD:
Exactly, and you said something else just now, like you said that, oh, if you’re distracted and you say yes to things and you’re like, “Oh wait, what did I just say yes to?” This is another thing, I’m realizing that when I was happiest a decade ago, I was deliberately saying no to almost everything that came my way. So much of what I’m doing now is also learning to say, “No. No, I don’t want to do a speaking gig. No, I don’t want to write this for your website.” It brings up the same feelings of guilt and selfishness, but at the same time, my time is mine and I need to use it in the ways that are going to make my life better so that I can then be able to help make other people’s lives better.

Scott:
Going back to how money plays a role in providing these options for you, how-

JD:
Yes.

Scott:
How would you describe your portfolio relative to other folks in the FIRE community? Are you more conservative with your portfolio, more aggressive? You said it hasn’t moved much in the last decade or so, is this an enormous pile of money? Is it something that would be attainable for someone working a full-time job within a 10, 15 year period? How do folks think about that? I think a lot of people would have a lot of trouble with a portfolio that didn’t move much in 10 years. Doesn’t seem to bother you at all, though, and you’ve been able to really run a lot of experiments and really work on your relationship with yourself, with your situation.

JD:
So I’m actually pretty public with my finances in what I have. The structure of the portfolio, I would say is probably very typical of the FIRE community in that it’s primarily in index funds and real estate. Well, my net worth’s about 1.6, 1.6 million, and I’ve been public about that on the blog before. I’ve never shared it on a Podcast, so it feels odd to say it out loud. About a million of that is invested in some REITs, but primarily in stock market index funds. Then the rest of that is in a variety of other things like the house. There’s a lot of home equity in the place where we live, but I also have investments in other companies. So not all of it is liquid, but still, and I feel like for a lot of people, this would seem like, “Oh, my God…” I read the stuff on Reddit. I go to the financial independence subreddit.
I go to the FatFIRE subreddit and I read this. And there are people who are like, “Oh, my God, you can’t retire with less than 3 million. Financial Samurai, I read his stuff and he thinks you need to have 3, 4 million, whatever it is. I’m like, well, it really depends on your lifestyle. I don’t feel like I deprive myself in any way. I have a life that I love. I do things that I love, I enjoy, I can’t do everything, there’s no question. I have to make some choices where I’m like, “Oh, no, I’m sorry. I can’t go on this trip to Europe with you,” which is fine. I can’t have a Tesla, that’s fine. I don’t need a Tesla. So I’m able to prioritize what’s important to me and my million dollars of invested assets plus my real estate, it all works out. Like I say, if I get desperate, well, maybe then I’ll write another book or start another blog or go get a job. But so far, not even close to desperate.

Mindy:
Do you feel any pressure to do more or make more money, or there’s this always be hustling? There are some bloggers who blog about how much money they make blogging, and there are bloggers who are constantly posting net worth statements, and, “This is how much money I made last month, and look at all of my income streams, and look at all of the money that I’m making.” do you feel any pressure to do that too because you are from the beginning?

JD:
Sure, absolutely.

Mindy:
How do you deal with that?

JD:
When I started blogging, I was doing it just as an outlet, so I never set out to make money from the blog. In fact, I had to have a fellow blogger come to me and say, “JD, why don’t you have the…” Back in the day, I had the top search result for savings accounts. If you search for savings accounts, Get Rich Slowly came up first, and I didn’t have that monetized in any way. I had a fellow blogger, it was actually Jim Wang from Wallet Hacks. He came in and he said, “JD Why don’t you have your savings account page monetized?” I’m like, “What do you mean?” So he had to explain it to me, and once I monetized that, well, things took off. So anyway, I hang out with people, I go to blogging conferences. I participate in mastermind groups, and I hear how much people make and I’m like, “Oh, my gosh, this is amazing.” So of course I’m like, “Oh, I could do this too. Why don’t I do this too?” I think the answer is it doesn’t feel true to who I am.
So I started my blog to help myself and to try to help other people, not to make money off them. I know that it’s possible to help people and make money at the same time. I’m perfectly aware of that. Another thing is, when I start monetizing what I’m doing, it feels like work it. Instead of feeling like something fun to do, instead of feeling like a hobby, it feels like, “Oh, my God, this is a job.” So that’s a long answer about, yes, I do feel the pressure, but then I also feel the pressure because we live in a society that’s deeply steeped in the Protestant work ethic and this idea that, “I’m still young-ish 54, I’m healthy, I should be working, I should be productive. I should be doing something demonstrably make society better right now, and so for me to take this time off, it’s difficult.”
One of the things I’ve been doing is reading books about how to do nothing and reading essays. There’s a, someplace I’ve got it, Bertrand Russell, the philosopher, even 100 years ago, he wrote an essay on, I think it’s called A Praise of Idleness. He was talking even then about how there’s all this pressure in modern society back in 1923 or whatever it was to just be, go, go, go, go. Of course, that’s only gotten infinitely worse by, well, not infinitely worse or magnitude worse in the past 100 years. There’s just this pressure to do things and be things, and we no longer take the time to just decompress and be, just exist, and I think that’s unfortunate.

Scott:
So I’m going to jump in here with this. Today I woke up at 5:45, hopped on a bike, did a workout, ate breakfast while hanging out with my baby and wife when they got up and all that. Drove to work, got in at work around 8:15, was in meetings from 8:30 until 1:00. Now we’re doing this podcast, which is my favorite part of the day; another couple of meetings after that. We’re going to get dinner with a coworker who’s flew into town. I’ll be back at 6:30 or so to put baby to sleep and hang out for a little bit. Then I’ll do a little bit more emails and go to bed. So that’s life of a CEO. What’s a day in the life of JD at this point for you? I want to get really jealous here.

JD:
Well, first of all, Scott, I want to say that, I’ve never been that busy, but if you’re happy doing that, that’s awesome. If you can find balance and pleasure and enjoyment and fulfillment from that kind of lifestyle, absolutely pursue it. Typical day for me, this is a great question. Okay. So I get up, I drink my coffee, and as I’m drinking my coffee, I’m reading what’s going on in the world. I think most people do this or many people do this. After I’m done with my coffee, I take the dog for a walk. We’re usually out for an hour, hour-and-a-half. I’m walking all over Corvallis. I live in Corvallis, Oregon. I come home, I go to the gym. It’s usually after the dog walk, I’ll go to the gym 3, 4, 5 times a week. I come back, make myself something to eat, and then I’ve got the afternoon to myself.
So I get to decide, “Okay, what is it I’m going to do?” Often I have house tasks. I have a full list in front of me house tasks that I need to do. This year, I’ve made it a point to try to get back into reading, reading for pleasure. For so long, and I know many people have struggled with this recently, when I was younger, I read for pleasure all the time. But somehow over the years I’ve gotten so that I can only read short-form stuff. I think it’s because of the internet, it’s conditioned me, and I’ve gotten so that I don’t read just science fiction novels like I used to, and so I’m trying to make myself read. Right now, the book that I’m really enjoying is this book from Rick Rubin called The Creative Act: A Way of Being.
This is one of the best books I’ve ever read. It’s just fantastic. Okay. I read, I do stuff around the house. I might run errands. Then in the evening, once Kim is done with work and she comes home, I make her dinner. We watch something random on television, and I’ve got a couple of things that I’m doing. We have a second run movie theater in town. So my thing is every Wednesday night when they play their second run movie, I go see it. Last night I went and watched Batman from 1989, and I think the next movie is Raiders of the Lost Ark, and then Stand By Me is coming up. So I go do that every Wednesday night, and it’s just a way to get out of the house and do stuff. But what I really want to do is take art classes.

Scott:
So that’s an awesome day. JD, I love what I just described to you. It’s a full action packed, I don’t have a minute to breathe. It’s this classic representation of the Protestant work. I wouldn’t have been able to articulate it like that before you said it, and it’s good. But I also look forward to the day, and at some point down the line when I can… That life, the day that you just described sounds like a wonderful, wonderful Thursday weekday to just go out and hang out or Wednesday at the movies.
So I think that that’s the goal for people is to get to that point and enjoy those things and explore these different outlets. So one question I’d have as a follow-up to this is, yes, I’m working full-time currently, and I have this busy schedule here. Is there a book you’d recommend or a resource you’d recommend that can help say, “Hey, go check this out, and you can begin bringing elements of what you just described into your life today? You don’t have to wait until you’re jobless or whatever, fully retired. You can adopt parts of this mindset much earlier than that.”

JD:
It seems strange for me to recommend this Rick Rubin book. So Rick Rubin is a music producer. He’s a very prominent music producer and he wrote this book, The Creative Act: A Way of Being, and I’m not finished with it, I’m only about halfway through. In a way, it’s the answer to the question that you’re asking because what he’s urging people to do is to embrace life as a creative person. He says, “Everyone is creative no matter what they’re doing, whatever your job is, you are creative.” He urges people in a way that’s also very Buddhist, very zen. He urges people to be more aware of their surroundings. I think this is something that even somebody who’s busy as you, Scott, could probably find a way to set aside 20 minutes each day… Okay, here’s something that people have always told me I needed to do, and that’s meditate.
I have never been able to meditate. I’ve tried so many times, and I have that monkey mind. It just jumps all over the place. I think that issue that I’ve had is I’m trying to get all the thoughts out of my head. What Rick Rubin wants you to do is sit and just notice everything. So I think somebody like you, Scott, you probably have 20 minutes you could set aside to either do traditional meditation where you’re trying to just notice the thoughts as they come up and mean, or do the Rick Rubin thing where you’re just paying attention to the world around you and trying to soak it all in and to appreciate it and be grateful for it. I think that’s one thing that almost anyone could do.

Scott:
I’ll definitely check that out. Yeah, I need to incorporate more of that in my life, ’cause I’m just go, go, go, go, go, go, go all the time. The piece that I think some of the things that you’re doing in your day, those are things I can incorporate today without having to be retired at this point and I think [inaudible 00:34:05].

JD:
I will say this, and who knows, maybe you end up cutting this part out, but maybe you don’t. So I’ve struggled with my mental health. I struggled with depression and anxiety and ADHD, and maybe you don’t wrestle with any of that, Scott. So for me, a lot of what I’m doing is an attempt to address the mental health issues, to find ways to live so that I’m happier and not suffering from this. So what he’s describing and what I’m doing with the year of JD is a way to address all of this and to, I don’t know, become more grounded. It’d be more true to who I am.

Scott:
No, absolutely. I think I certainly struggle with some of those elements. I think that these are really important things to incorporate. So I definitely need to hear this message today, and I think that that’s really helpful. I’m going to go check out the book.

Mindy:
Do you think our busy culture adds to these issues? Would you recommend taking a year for yourself to wind those down? Would you recommend more than a year? Do you think that a year is enough?

JD:
Well, I think a lifetime is probably the best way to do it, but that’s hard. No, I would absolutely recommend if a year sounds too daunting for people, start with a month, make it the month of you. It takes a while to get ramped up and to get comfortable with doing this, so I think saying, “Oh, yeah, 2024 will be the year of me.” That’s a great way to do it. But yeah, Mindy, I think our culture, when you start paying attention, you will see that our culture is very much driven by productivity and action and activity. Everything places value on this. If you are inactive or you’re still or you’re calm or you’re not doing anything that seems to be productive, it’s viewed negatively, not a 100& of the time, but in most cases, it’s viewed negatively. I think that’s unfortunate because this decompression, when you create margin in your life, you’re happier and you have room to breathe.
Yeah, I have a lot I could say on this subject. One of the things that I’ve done that’s really helped myself is I’m trying to spend much less time online. Because of the work I’ve been doing over the past 15 years, most of my life has been spent online, and I’ve come to realize that that has probably contributed heavily to my mental health struggles. So I’m deliberately staying off social media as much as possible, although I do post to Facebook, but I use it as a blog. So I’m trying to get out of my computer games that were online. Reddit, I have a huge Reddit problem where I go in, I know a lot of people get sucked into Instagram or to Facebook or to Twitter, I get sucked into Reddit. So for the past two months, I’m trying my damnedest to quit Reddit. I still struggle with it. Last night I spent an hour on it, but for the most part, I’ve really squashed that habit, and it helps me be happier.

Mindy:
You just said it takes a while to decompress. If I choose for 2024 to be the year of Mindy, what can I be doing now to prepare for the year of Mindy so that I can hit the ground running, which is not the point of decompressing I know, so that I can set myself up for success.

JD:
So the short answer, Mindy, is to spend time in the rest of 2023 getting clear on what it is that’s important to you so that you can then spend the time in 2024 focused on those things. So last year, probably around this time, ’cause I remember listening to the audiobook during the summer, a good friend recommended a book called Designing Your Life: How to Build a Well-Lived Joyful Life. It’s by Bill Burnett and Dave Evans. I read it, thought it was amazing, read it again. Then a buddy and I, we worked through it. So the book has all sorts of exercises in it, and a buddy and I worked through the book. We got all these note cards and paper, and we’d meet once a month to go over the chapter we were working through. One of the amazing things about this is it has you eventually draw up three different five-year plans.
So you drop up a five-year plan based on, “Okay, what is your life like now? What might that look like five years from now?” One is, “Okay, if you couldn’t do what you’re doing now, what would your fallback be? What would that life look like five years from now?” Then the third one is, “Okay, just dream project, if money was no object, if there was nothing holding you back, what would you do?” So that’s your third five-year plan. It’s a pretty powerful exercise, and so I long answer again because that’s how I work, I guess. If somebody were trying to come up with a year of me for 2024, I would say start now in 2023 working through designing your life or a similar book or similar exercises to figure out what’s important to you and what kind of things you might want to focus on. ‘Cause when I did this, I came up with art and so that’s why I’m pursuing the art this year.

Scott:
That’s an awesome answer. I love that. How do you know what you should do in 2024? You should think about what you want to do in 2029 or 2028, five years from now that in the perfect situation I’ve never heard of. I think I have that book, and I read the first chapter and somehow I got distracted. So it’s sitting in my bookshelf. I’m going to pick that one up. But yeah, I got to go check that out. I never heard about dealing the three different visions there or three different five-year plans that incorporate those things. So I’ll have to go check that out and actually complete this one here. That’s awesome.

JD:
It’s a great exercise. I recommend it, even if you are content with what you’re doing, it’s a great exercise to do.

Scott:
So I have one last question for you, JD, it’s a two-parter here. In this context and in the context of the discussion that we’ve had today and how you’re living your life and approaching 2023, do you think that people tend to still over save or delay this point of early retirement far too long to get to that point? Second, we talked about taking a year of JD or maybe potentially a 2024 year for Mindy here, do people need to wait until they’re FI to achieve that, or would you recommend looking back people do this much earlier and maybe do it on the journey to FI at some point?

JD:
Okay, so you’re going to have to remind me the second part when we get there. The first part, do people tend to over save? Well, I think obviously average people do not over save, but I would say that people who are interested in financial independence, the people who are actually focused on it and committed to it, yes, from my experience talking with them over the past 10, 15 years, they tend to over save. The thing is, they know they tend to over save. They just can’t help it because it’s risk aversion. Again, I have a buddy here in Corvallis, love him to death, he has far more money than I do. He’s frugal than I am. He cannot pull the trigger, cannot pull the trigger, and it’s because he’s scared. He’s like, “What if X happens? What if Y happens?” I’m like, “Yeah, those are possibilities.” You have this balance you have to do. You have to think of today, and you have to think of tomorrow, and that’s where the struggle is.
If we knew what day we were going to die, all of this would be so easy because we would just like, “Oh, I’m dying on the January 1, 2039.” Well, then you just optimize for that date, but we don’t know when we’re going to die. The thing is, today is knowable. We know what our life is today. We don’t know what life is like tomorrow. So to me, in some ways, you can’t neglect tomorrow obviously, but you’ve got to make sure that you’re enjoying today. I think too many people in the FIRE movement sacrifice happiness today for theoretical happiness tomorrow. I think you’ve got to find a balance there, and that balance is different for everybody. So I hope that answered the question.

Scott:
No, I think it’s a great answer, and I think that the other part of that question was, should I just go ahead… Hypothetically, I have $500,000 on the way to financial independence. I think I need 1.5, 1.6 to get there. Should I just keep grinding for another five, seven years, try to pull back a little bit and enjoy myself, or should I just take that leap year now or that year off now, year of me and spend $50,000 of that and enjoy that year tremendously at this point? What would be your advice to that person?

JD:
My answer is it depends. I’m not a person who believes in one answer for everyone, it’s situations are different. But I would say that generally speaking, if you think you might want to try something now, you should try something now. Don’t let fear hold you back. If you’ve got, say, your hypothetical I think was half-a-million saved, and your goal is 1.5, if you would like to try to take a gap year, take a sabbatical, do it. In my experience, talking with all sorts of people who’ve done this sort of thing, nobody has ever regretted doing that. I’ve never talked to anybody who said, “Damn, I took a year off and now my whole life is bleep.” I’ve never talked to anybody who’s said that. It’s the opposite is usually true. The thing is, when you take these gap years or when you take time off to explore, when you take a sabbatical, often you discover new things about yourself or about the world, and you’re able to go in new directions that you would not have otherwise been able to do before.

Scott:
I think that’s a really, really powerful answer, right? Yeah. I don’t think we’re ever going to find the person who regrets taking that gap year off or they’re going to be few and far between. In the FIRE world. I think this is true. Again, you could look at lottery winners or whoever, people who get windfalls and then they spend it all at once, but that’s not what a person in the FIRE community’s going to do. They’re going to go live their life within their means for a year and see what it’s like.
I can’t say that it’ll be right for everyone, but I think that for many people, if not most people, they’ll find that, “Oh, okay, I can do this, and I should’ve done this earlier.” Well, JD, thank you so much for joining us today. A lot of really good insights here. It’s just a privilege to know you, to have had the discussions with you over the years and watched your journey, seen how many people you’ve helped and then gotten an insight today into what life is like in the FIRE community, the good, the bad, and the ways to make the most of the position of power you’ve put yourself in from a financial standpoint. Thanks.

Mindy:
Okay, JD, I normally ask our guests, where can people find out more about you? But you’re taking a step back from social media, so how can people get in touch with you?

JD:
Well, what I would say is, even though I’m trying to do nothing, I really enjoy writing. I’m going to be writing at my personal website. It’s just jdroth.com. If you want to read about my cats and my computers and my comic books and all that, come hang out there. It’s just going to be a place to have fun. It’s interesting, I’ve neglected the site for the past five, 10 years because I’ve been focused on other things. It’s always in disarray, and I’m undergoing the process as many know of trying to revitalize it. I’ve got to pull in things from all over the place and get it fixed up. But my aim is that going into 2024, this will be a robust place where it’s fun for me to just write about whatever and a just fun place to hang out like old school blogs were. I want it to be like blogging was 20 years ago.

Scott:
Awesome. That’s jdroth.com. Go check that out, and then we’ll also link to that and the books mentioned on the podcast today at the show notes here for this episode.

Mindy:
AI actually just bought that book, Designing Your Life. Thank you to JD Roth for recommending that, and thanks for Amazon for making it so easy. JD, this was super fun. I got so much out of our conversation. I really appreciate your time. I always love spending time with you. Thank you so much for joining us today.

JD:
Thank you. I appreciate it.

Mindy:
This was great, and we’ll talk to you soon. Okay, Scott, that was probably my favorite episode that we have ever done. I love JD I love talking to him. Again, I can’t believe it took us so long to get him on the show, and I had a wonderful time talking to him. I love that over the last 14 years, his net worth has stayed the same while he continues to live his best life, and anybody who thinks that’s a failure is flat out wrong.

Scott:
I agree, define winning in a financial context, JD is winning. That is a win. This is someone who has a over $1 million net worth. We’re not like trying to pretend that’s a small number or anything, but this is someone who’s been successful there and then has really been able to use that to optimize the life that he wants to lead. So this is what we should all be striving for here in terms of wealth. I don’t think that JD’s going to look back one day and say, “Gee, I wish I had earned a lot more money here.” He’s going to say, “I’m happy with the way that I built wealth and how I tried to optimize my time and the efforts I put in into living my best life.” I think that’s the aspiration here for a lot of folks.

Mindy:
Yep. I love his tip at the end, the book, Designing Your Life. If you want to make 2024 or heck the rest of 2023 the year of you, go get that book. Check it out. Do the three different five-year plans and see what you can do to make the rest of this year, next year, the year of you. I’m very excited to get that book. It comes in two days.

Scott:
Yeah. Look, I think that’s great advice. We’ve talked in the past about this on the show here, but it all starts with, what do you want? That is what designing your life, I think, will potentially give you is a clear definition, pen to paper of what you want. Once you know what you want, you can then begin to build a plan to get there. It’s the root of all the finance Fridays, all the things that we discuss on BP Money, it all starts with, what do you want?
If you’ve got the biggest pile of money possible 30 years from now, there’s a strategy for that. If you want the freedom and flexibility to do what you want five years from now, there’s a plan for that. If you want to take 2024 off and go travel the world and backpack around Europe, there’s a plan for that. Well, you have to figure out what you want, and no, you can’t have all three of those. Maybe you can if you’re particularly creative, but it’ll be hard to have all three of those things, but it won’t be hard to have any one of those or maybe even two of those that you choose.

Mindy:
Yeah. What does Paula say? You can’t afford anything. You can’t afford everything. So you can have anything, you can’t have everything. Make a list of what it is you want. All right, Scott, should we get out of here?

Scott:
Let’s do it.

Mindy:
That wraps up this episode of the BiggerPockets Money Podcast. He is Scott Trench, and I am Mindy Jensen saying farewell, turtle shell.

Scott:
If you enjoyed today’s episode, please give us a five-star review on Spotify or Apple. If you’re looking for even more money content, feel free to visit our YouTube channel at youtube.com/biggerpocketsmoney.

Mindy:
BiggerPockets Money was created by Mindy Jensen and Scott Trench, produced by Kailyn Bennett, editing by Exodus Media, Copywriting by Nate Weintraub. Lastly, a big thank you to the BiggerPockets team for making this show possible.