As I continue to add content to our Financial Independence project, I wanted to provide a little bit of context of how we arrived at the point we are currently at and where we are starting from (in terms of a formal plan). After we discovered and started thinking about financial independence in 2016 our Net Worth was a little over $600,000, and as we start blogging about this in 2019 we are currently just shy of $900,000. We were fortunate that we made a few smart money moves earlier in our life, even though we were not thinking in terms of FI. Many of those decisions are what allowed us to be in the position we currently are in and hopefully able to reach our goals in a relatively short amount of time. Of course while we did do a lot of smart things, we also made some decisions that put us behind where we could be right now, but you can’t change the past, only learn from it. We also had some setbacks due to health care costs and caring for a family member we lost almost two years ago. Even given these setbacks and a few poor decisions, when we compare ourselves with the statistical averages in the United States, we have no room to complain about our current position, especially since nothing in our life has been handed to us or passed down from family.
I figure many of my posts in the future will contain elements of lessons learned and life events that shaped our current thinking, but in this post I wanted to focus on some of the major financial milestones that I (Julia) have personally accomplished and experienced up to this point by looking at my job history, and will probably add a second post by my spouse in the near future.
The Early Years
Growing up I started like many kids do by finding any job around me that I could do to make money. This included things like babysitting, raking leaves, and other types of jobs around my neighborhood to make money before I was legally old enough to work for someone else. This gave me my first experience actually having money and trying to figure out what to do with it. I grew up in a rural area so the temptation to spend significant amounts of money on frivolous things was minimal. I mean seriously where I grew up there was nothing to do that required much if any money. We had no malls, movie theaters, or any of the typical places you find even in small towns and cities. During this time I did not have a lot of experience, education, or role models when it came to financial concepts and knowledge. I did however grasp the idea of if you want something you have to work for it. Growing up both of my parents worked and I would say that we lived somewhere in that huge range of what would be considered a middle class family, probably at the lower end by most definitions, but we did benefit by living in an extremely low cost of living area. Most of the money I made from doing miscellaneous jobs for others I saved for one primary goal, and that was to eventually have a vehicle. For anyone growing up in a rural area, you can probably relate to the desire for transportation to be able to get away, especially when any type of entertainment like a movie theater is 45 miles away.
When I turned 15 I took my first “official” job during the summer at a youth club in a nearby city (45 miles away) working for minimum wage which at the time was $3.33 an hour. My father would drop me off each day before he went to work and pick me up at the end of the day for our 45 mile drive home. This was actually a very enjoyable job where I spent most of my days playing sports and games with younger kids. When I turned 16 I worked at McDonald’s for a year and a half followed by Pizza Hut for another year making about $4.25 an hour. I am not sure I learned a lot during this time about money and managing my finances, but I certainly learned a lot about the type of job I did not want to have in my future. What did make an impression on me during the time was developing a strong sense of work ethic. By this time in my life, my parents had divorced and I was pretty much left to fend for myself, especially if I wanted to buy anything. Most of the money I had saved from these two jobs was used to buy a vehicle which was at the time was one of my primary reasons for working.
The College Years Part 1
When I finished high school I went to a public university in Florida to pursue a double major in psychology and music. Eventually I switched my psychology major to a minor and fully pursued a music degree due to limited time. Obviously I was not thinking about my ROI when I chose my major, but I was pursuing what I was passionate about at the time. I did not have any financial support from my parents for college nor was there any college savings accounts or anything similar to help me with my costs. I had several academic scholarships that covered a significant amount of my tuition and book costs, but I had to work the entire time during my undergraduate degree to support myself. I found a job working on campus in the College of Business that evolved into a network administrator position that actually was a good paying job, especially for a college student. I was originally hired to do small tasks to support a specific department, but quickly picked up on managing both Unix and Windows NT servers and took over the network admin position for one of the departments in the College of Business during my second year. At that point I was working about 35 hours a week at around $16 an hour (in 1996). I also picked up a retail job in the mall selling clothing for a while when my schedule allowed. Ultimately I was able to complete my undergrad degree with zero debt and actually save money during the process.
When I finished my undergraduate degree I decided to stay and work on two master’s degrees, one in Music Education and one in Psychology. I was motivated to stay because I still had a fairly decent paying job with the university and wanted to fill the gap on the psychology side that I missed during my undergrad. I only stayed for one year before I went out and took my first teaching job, returning the following summer to complete my degrees.
High School Teaching
After completing the majority of my graduate coursework in one year I decided that I wanted to go out and get a teaching job. A lot of this was motivated by passion rather than making more money, as evidenced by the fact that I took a fairly steep pay cut leaving my network admin job to teach. My first teaching salary was $26,401, but that only lasted for one year before I moved to another school district to increase my base salary to almost $36,000 a year. While my base salary was fairly low I was able to do a few things to increase that number. First, by taking on clubs and activities at the school I was able to get a salary supplement each year of about $4,000. I was also able to get $1,500 more by working two additional weeks during my normal summer break. Finally, through the school district’s adult education program I was able to teach two courses in the afterschool and evening programs which netted about $10,000 a year. I taught high school for six years and five of those years I was making between $51,000 – $55,000 a year with about two months off each year for holidays and summer break.
During this time I not only went back to complete my two graduate degrees, but I completed a third master’s degree that ultimately would become my new career field.
While I was still teaching high school I decided to start a couple of side projects to make additional income. The first one was a summer camp program I created for middle and high school students that I organized and ran for four years. The camps did fairly well bringing in revenue, but by the time I paid all the staff I needed to hire and other expenses I probably personally netted $12,000 total across four years. It was not a significant amount of profit, but it did teach me a lot about running a side business.
Near the end of my teaching career I launched another business that primarily focused on online learning and training. One of the biggest parts of the business was a set of courses I created on leadership targeted to high school and college students. These courses were delivered completely online in a sequence where the students who started the first course typically took an additional four courses over two years. It was a very niche market but quickly grew to a size that required hiring and paying many additional staff to teach the courses since they were not self-paced independent courses and most required instructors. Between those courses and other areas of business (primarily consulting) this business did fairly well for about four years before I decided to sell it to a third party. I wish I could say that selling this business made me financially independent, but I financed the buyer’s purchase over a five year period and they went bankrupt after the first year (more on the lessons learned from this later).
College Years Part 2 (or three or four…)
In 2006 I decided to return to school to complete a Ph.D. with a primary research focus on learning, cognition, and systems thinking. Prior to starting the program, I was awarded a teaching and research assistantship that paid all of my tuition (for a certain amount of hours) and a small stipend that equated to a salary of about $12,000 a year. During this time I took on a few student loans, primarily to increase the speed I was moving through the program, since my assistantship only covered 9 credit hours a semester. I completed my Ph.D. in two years and a couple of months (more on that later) which helped control some costs associated with living expenses, but did increase my tuition and fees bill, thus needing some student loans. I will also admit that it was hard to get back to spending and living like a college student after being out working for the previous six years. Looking back this was one of the less than desirable financial decisions I made, and I spent four years paying off these student loans.
Immediately after completing my Ph.D. I was hired as a research faculty member to work on a grant I helped to secure and worked in that position for about a year and a half. The pay was actually quite low at about $45,000 a year.
My First University Faculty Job to Present
After working as a research faculty member I found a tenure-track faculty position at a private R2 university with a student population of about 7,500 students. My starting salary at this job was only $56,000 which really was about the same as my salary my last year teaching high school. At the time I was attracted to far more than the pay and benefits of this job. In fact I probably would have accepted a lower salary if needed to secure the position. I did negotiate for a significant pay raise three years into the job raising my at a base salary to around $71,000. In 2016 I left this faculty job to move to a public R1 University in North Carolina for a slightly lower salary, for reasons I will write about later. Even though I have a lower base salary I have significantly more ability to earn additional compensation by taking on some administrative responsibilities, and working during part of the summer since my contract is only a 9-month contract. Not to mention I still do consulting and freelance work on the side when I have time.
Looking back on the jobs and career I have had up to this point provides some context and perspective on my current journey to financial independence. The one thing that I have consistently done throughout all the years was usually having some other money making activity in addition to my primary job. While I have never had a salary as high as some on the path to FI, I will admit I have done fairly well on the income side. Most of this is due to trading a significant amount of what would be free time for others into time that I could use to make money. I will say in the last couple of years my side hustling has changed and decreased since having kids. Right now I focus on areas and things that don’t take time away from my family, especially my children. Thinking in terms of financial independence for our family, it is not the income side that needs the most work, but rather the spending side that we are really going to focus on the most over the next few years.