Lessons from a very frugal real estate agent
“Get Smart with Money” screening with other Longmont-area folks pursuing financial independence
Our experience of buying and selling our first home helped us buy a piece of freedom. And because of the Longmont FIRE community, we learned how to utilize that freedom to gain more free time.
When we sold our first house we made some great financial decisions. We gained the financial freeboard to start making decisions without the pressure of maintaining two 9-5 jobs. (We made some poor decisions, too that I like to warn clients about)!
Homes are pretty neat. You not only get to live in them and express yourself within their walls, they grow in value over time. Up to $500,000 of that growth is tax-free when you sell. Imagine that!!!
When we moved back to Longmont (my hometown), we had earned enough profit from the sale of our first house, in Northern California, that we could have purchased a much nicer, larger, and newer home with our proceeds + a modest mortgage. The resulting mortgage payment would have been less than our mortgage payment at our first house.
That was not what we did, though!
Thankfully, I had heard of the FIRE movement before we moved back, and we didn’t do that! We instead bought a modest, older home that (still) needs cosmetic updates, and invested most of the profits to grow our nest egg.
I’m not a financial planner, a financial guru, or credentialed financial professional. Do not make changes to your financial plan because of anything you read here. This is not financial advice, nor should it be construed as such. Please consult a qualified financial professional to help you make financial decisions.
If you have not heard of the FIRE movement (financial independence, retire early) then allow me to explain.
The FIRE movement is a bunch of frugal weirdos. It’s folks who save aggressively, invest every dollar that they possibly can in lower-risk, stock market index funds, and aim to retire early from regular employment. They achieve “FIRE” status when the income from their investments meets or exceeds their living expenses.
Side note: I consider “frugal weirdo” a badge of honor, and I wear it with pride. I know for certain that my grandma, Mima, wouldn’t think my frugality is silly: it’s smart.
So, to recap…FIRE is: save like crazy + invest like crazy = quit your regular job in +/- 10 years… Well, that sounds downright impossible, right?!
Nah. It’s just math.
The more frugality and intentionality you can bring to your spending, the more control you have of your time. Per the 4% rule, you need about 25x your annual spending rate saved in order to retire.
You home is one of your biggest monthly expenses, and likely your largest single asset – so bringing intentionality to how you buy and sell your first home can have a big impact. That’s where I come in!
FIRE in the movies
Most people I know in the Longmont FIRE community, and there are a LOT of them, “retired” before age 45. Retired is sort a silly word, like verbal clickbait. I don’t know any who have retired early to a life of bonbons and leisure.
The early retirees that I know still choose to earn income. Now, however, it’s on their own terms and tends to be in pursuit of passion projects. They are now tradespeople, serial entrepreneurs, podcasters, inventors, and more. All were inspired to be frugal weirdos because they value time freedom more than anything.
Case in point: last weekend I attended a screening of the new Netflix film, Get Smart with Money. It was at a co-working office owned by Mr. Money Mustache and Mr. and Mrs. 1,500 days. Mr. Money Mustache was featured in the new film as one of four financial gurus. He helped a local couple get a handle on their expenses so they could work less and spend more time with their kids.
It was a packed house (the photo does not show the folks who were inside the building, watching while staying warm!) and a lot of fun. Though the FIRE movement has its limitations, it’s gratifying to be around people who use money to buy time freedom rather than fancy cars.
Front Range FIRE and real estate
One of the cool things about living in Longmont is having access to this community of generous people. One of them, Mindy Jensen, is my real estate partner. Mindy and her family achieved FIRE years ago, and she still chooses to work: in real estate, podcasting, and home renovation. (In fact, a recent client confessed to me that he was starstruck working with us because he was only used to hearing Mindy’s voice. Working with her in person was a real treat!)
My family does not fit the “typical” FIRE mold, not at all. Most I know who retired early had sizable incomes early in their careers. My husband and I worked in nonprofits (for me it was for 20 years) and didn’t think we could ever retire. At one point we had 2.5 full-time jobs and a small farm, bringing in a grand total of $32,000/year. Total. For two people, working non-stop. It would be equivalent to about $45,000 today.
We are now on the road to financial independence because our first house gave us a huge financial boost in that direction, and the supportive Longmont community helped us make good financial decisions subsequent to our first home.
It’s amazing that the place where you spend so much time – your home – can eventually “buy” you more free time. I love helping people review their goals, challenge their assumptions, and find ways to bring rational budgeting and intentionality to owning their homes.
If you or anyone you know is hoping to buy or sell their first home in the next 18 months, I’d love to talk to them.
I'm Libby Earthman. I specialize in helping first-time buyers and sellers pursue financial security on the Northern Front Range.
825 Delaware Ave, Suite 208
Longmont, CO 80501