Route 2 FI - Free As A Bird | Investing Is How Philosophers Get Paid

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Hi everybody! Welcome to the 4th edition of my newsletter "Free As A Bird".

The name of the newsletter represents us - we want to be free. Free to choose how we spend our lives.


Check out this video - I think it perfectly describes our modern life working 9 -5.

Consuming, chasing money, doing drugs and watching porn - thinking that all this will lead to happiness and fullfillment.

This is why I want out of the rat race!


Articles I Read This Week That Got Me Thinking 

Look at the grid above.

Let’s say you spend $25,000/year.

If you follow the normal 4% rule, you have to save up $25,000 x (100/4) = $625,000.

A 25x portfolio ($625,000) has a 98% probability to succeed (positive value) over a 30-year time period.

A 15x portfolio ($375,000) on the other hand, has a 63 % probability to succeed over a 30-year time period.

Obviously you wouldn’t retire with 15x if you knew there was a chance of failure here.

But what if you instead earned $10,000/year and had saved up $375,000 ?

Then you would be 98 % sure you would never run out of money during a 30-year period.

I mean, come on..

Everybody can earn $10,000 just doing some random work during the year, right?


I asked 100 millionaires how they spend, save, and invest, and they told me exactly what I expected to hear by ESI Money (4 min read).

This is a compilation of the wisdom from over 100 interviews with millionaires. I learned a lot here, under I will list what stood out for me (really simple tips, but yet it is so hard to follow for most people).

  • Most millionaires have high incomes, but it hasn't always been that way: The median annual income of the 100 interviewed millionaires was $250k. Most readers see an income of $250k and make the assumption that millionaires have been earning this much throughout their careers. This is incorrect. Most started low, applied themselves, and worked their way up the ladder.

    Key learning: Do not get frustrated if your salary is currently low. Many millionaires were once in your shoes. Neither do you need to make as much as $250k, but the higher income you got, the easier it is to reach financial independence.

  • Millionaires save over 60% of their income: Income alone is not enough. You MUST save it (which then allows investment). If you make $250k and spend $250k, you are no better off at the end of the year.

    The median millionaire spends $90k a year while earning $250k in income, an impressive 64% savings rate. But most important: they started with a low savings rate.

    Key learning: If you want to grow your savings, start anywhere (even if it seems too small) and build your savings rate over time. As it grows, so will your net worth.

    Route 2 FI pro tips: Start with a 10 % savings rate and increase with 1-3 % every month. After a while you will reach a point where it hurts to save more. From there you eventually will have to either earn more, cut your spendings or be content with where you are.

    This will surely motivate you. I can’t tell enough times how important it is to track your spendings, savings and net worth.

    Read how I do it here: How These 9 Easy Steps Allows Me To Quit My Job In Only 8 Years

  • Millionaires' investments are generally simple and low cost:

    When it comes to the majority of their investments, they generally buy and hold low cost stock index funds.

    I'm no genius, I can't predict the markets, and I don't enjoy following the market.

    If you do agree, why don’t you stop trading stocks and just let the market do what the market do best?

    Key learning: Low cost stock index funds purchased and grown over time are a key part of building millionaire wealth.


    The Best Things in Life Really Are Free by Deep Dish (7min read)

    I love books like fat kids love cake. You can borrow them for free from the public library, they’re endlessly entertaining, and they make you smarter at the same time.

    Having unlimited access to the entire wealth of human knowledge and experience is so amazing that it feels like there should be some sort of catch.

    In the last couple of years, I’ve finally caught up on the whole podcast thing. Like books, they’re free, and cover any subject you could possibly imagine.

    Unlike books, you can listen to them when you’re doing boring stuff like driving, or doing groceries.

    Earlier today I was buying toilet paper at the store while learning about black holes and the multiverse.

    Drawing and painting don’t cost much. Writing is as free as the birds. So is photography, once you’ve made the initial investment in a decent camera.

    But, research shows that time spent with loved ones is one of the best indicators of long-term happiness, which makes community the most important category of all. It’s a cliché, but you really can’t buy friendship, or family, or love.

    The best things in life are free – or at the very least, dirt-cheap.


The Book I'm Reading Right Now

The Compound Effect by Darren Hardy

The book lives up to its title and will definitely give you a jump start in your life, if you start applying the easy to follow principles mentioned in the book.

I’ll list my main takeaways from the book here:

  • Small choices + consistency + time = significant results

  • The first step toward change is awareness. The best way to become aware is to measure. Writing it all down is key.

  • All winners are trackers. You cannot improve something until you measure it. Tracking will revolutionize your life. The author started by tracking every financial decision in a notebook. Every dollar you spend today is costing you $5 in twenty years. (Because of opportunity cost from investing.)

  • When you set a goal, most people ask, “What do I need to do to achieve your goal?” Instead, you should ask “Who do I need to become?

  • Stop watching the news. The news just aggregates the worst, saddest, and most stressful stories every day.

  • Garbage in, garbage out. Don't waste your time watching TV, eating junk, reading useless stuff, consuming negative stories, and more.

  • What are you willing to tolerate? If you tolerate people being late that is what you'll get. If you tolerate earning less than what you're worth, that's what you'll earn.

  • Always go a little bit beyond what people expect. Dress a little nicer. Try a little harder.


What I'm Listening To

There Are No Get Rich Quick Schemes | @naval

If anyone is giving advice on how to get rich and they’re also making money off of it, they should have made their money elsewhere.

You don’t want to learn how to be fit from a fat person.

You don’t want to learn how to be happy from a depressed person.

So, you don’t want to learn how to be rich from a poor person but you also don’t want to learn how to be rich from somebody who makes their money by telling people how to be rich.

It’s suspect.

Anytime you see somebody who’s actually gotten rich following some guru’s advice on getting rich, just remember that in any random process, if you run it long enough and if enough people participate in it you will always get every single possible outcome with probability one.


This Week's Writing

When To Walk Away From The Rat Race – How Much Money Is Enough? (7 min read).

Here’s an inconvenient truth.

You and I are average people.

Your IQ isn’t 180, your family isn’t billionaires, and you’re not inventing the next Apple.

Neither am I.

How do I know?

If we were, you wouldn’t be reading this blog, Route 2 FI, and I wouldn’t be writing it.

That means if we want to reach financial independence, we need to do it the normal way.

Earning more money will do nothing.

Winning the lottery will do nothing.

You will not solve your money problems until you change your relationship with money.

Think back to when you were a kid.

Your mother and father gave you $5 pocket money each week, and you’d buy a couple of candy bars, or a pack of Pokemon cards, maybe you’d save up for a few weeks and then buy a Super Mario video game.

Then when you were 13, you got a job at the local super market, and the owner started paying you $60 per week.

You didn’t even know how you were going to spend $60 per week.

And now think about your job today. Maybe you earn $40 – 60 per hour.

It’s still not enough, right?


Quote that got me thinking

“Investing is how philosophers get paid. ” 

@Wealth_Theory on Twitter


Have questions, comments or suggestions? I would love to help you.

If you liked this newsletter, I would appreciate that you subscribe or like by tapping the “heart”.

Feel free to reach out directly @Route2FI on Twitter or email me at post@route2FI.com


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Thanks for reading,
Route 2 FI