Why Reaching Financial Independence Will Make You Thrive

Reading Time: 5 minutes

What would your life be like if you had enough money to be able to cease your financial worries forever? Have you ever even considered this a possibility and what it would take to get there? My wife and I think about and plan for this constantly. And I’m not talking about winning the lottery or receiving an inheritance, I’m referring to becoming financially independent to reach this stage.

Financial independence, or FI as it’s called in the personal finance community, has different meanings to everyone. Some might see it as moving out of their parents’ house. Others might see it as having a job that enables them to pay their bills on time or as having a solid business that allows them to work independently. The issue with most of these scenarios, is that you have to be working to make the money instead of the money working for you. Lose a job and everything goes downhill—your independence becomes unsustainable and you might end up at your parents’ house. Become sick for a long period and your business will suffer if it solely depends on you—say hello to mommy and daddy. A word of caution for parents: it looks like all roads might lead to the prodigal child returning home, so teach your kids about really becoming financially independent before it’s too late.

The Enchumbao household sees financial independence differently: the moment that our income-producing assets provide enough income to offset our living expenses indefinitely. This is nothing new in the finance world, but it was to us. It gave us a different perspective on the relationship between life and money. Our approach to reaching FI consists of trading our time and money solely for necessities and what makes us truly happy, while investing the rest.

I always heard about the importance of saving for the long term, but never really had a real purpose or true meaning for it that would inspire me to stay the course. The retirement planners usually advise us to save for retirement, but if we don’t have a real purpose for our actions other than just following advice, it’s harder to stick with it. For us, attaining financial independence represents the ultimate freedom to live our lives the way we choose. The goal is to save enough of our life energy, so we can free our time and have it to ourselves. Also, saving for 30+ years for retirement can be confusing to many because it’s hard to plan for something that is so far away. This is why we decided to set more aggressive goals to reach FI quicker while being in the moment. 

When we get to that stage in our lives, we’ll be in total control of our time. I once heard Warren Buffett say that if he had to give half of his fortune now, it would be to continue to have all of his time to himself. This is a powerful statement on how important the element of time is in our lives. With money not being an issue, the first thing that’d have to go is the darn alarm clock. We’d work only for fun. We’d spend the days as we desire. We’d enjoy more time with friends and family. We’d have more time for hobbies: learn music, play more family games, have more regular walks on the beach or enjoy the pleasure of  unlimited reading time, like Warren Buffett does. And yes, there’d be a hammock!


Our most important realization is that we’ll get to enjoy more out of life much sooner than later. Financial independence is different than retirement. FI involves a more active lifestyle. A common assumption I encounter is that becoming FI means retiring early and waiting at home for death to arrive. “What would you do with your time? So why would you need to become FI if you don’t want to retire early?” We hear these type of questions all the time. It doesn’t mean that you retire and watch life pass you by inactively. It means that you just have a ton of choices on how you can live your life. And the benefits are endless.

For example, we love to travel. By becoming FI, we won’t have to wait until we’re 65 or 70 to travel the world. Also, traveling becomes more cumbersome with age. No one is getting any younger and I just don’t see myself climbing Machu Picchu as a senior citizen, so we want to do it while the body can endure it. This will also give us the flexibility to see the wonders of the world for longer periods of time and spend months in a continent. Mrs. Enchumbao, the world traveler, must be getting a high as she reads these lines!

Another realization is that reaching financial independence kills many birds with one stone. One no longers needs to save for retirement for 30+ years because that’s done through FI.  One would have no more worries about where the income will come from to pay the bills. And no need to be at a job that doesn’t make you happy or be at the mercy of a layoff. The list goes on and on.

This strategy is so appealing to us but why isn’t everybody doing it? We believe that Americans have been programmed to live a life of spending that makes this path hard to pursue, so why even try?  It’s a life designed as such that you don’t even take time to stop, think and reflect. It’s a perfect design that makes it look easier for us to continue our paths, loaded with grenades such as debt and high consumption patterns, than imagining that a simple life can bring us true happiness. The reality is that FI is a simpler path! You make money with a purpose, a means to an end.

I’m not sure if you noticed by now, but my Russian Latina and I don’t just follow the herd. We don’t care much about peer pressure and society’s prescription for life, any more than that a bird is going to poop in the middle of an ocean. (Crap, a fruit fly just landed in my wine!) We’re going in full pursuit of what makes us truly happy. It’s a much better alternative. For now, we get to continue to invest agressively and at some point, we’ll have enough “employees”, AKA dollars, working for us, so that we won’t have to work for money anymore.

To get to an FI state sooner, we needed to change certain behaviors, savings rate being one of them. We needed to become the kind of savers that society calls “extreme”. Well, I say it’s “extreme” working for corporate America for 40+ years, only to start traveling and enjoying your life in your late 60s, but that’s material for another post. This means that instead of putting savings as the last item in our budget and saving 1% to 3% with the hope of increasing it every year, we save as much as we can and invest it right away. Savings became our top priority, instead of spending our hard earned money on materialistic stuff. This is how you get there in a few years. This is how you make that life, that you can now only dream of, a reality. This is how your quality time with your family becomes endless rivers of happiness overflown with priceless moments. This is what it means to take the one thing that matters and set it into motion to fulfill the rest of your life. This is what financial independence means to us. You’ve got to fight for what matters to you!


On the next FI post, we’ll tell you about a simple rule that helped us figure out how much we need to have invested to get to financial independence.

What does financial independence mean to you?  What are your plans to live a life with purpose?

Please like & share:
The FI Million Dollar Question: How Much Would I Need to Fund My Lifestyle Forever?

Mr. Enchumbao

Mr. Enchumbao retired at 44. He worked for 13 years at Vanguard, primarily as a Communications Project Leader in the Institutional Division, helping people save for retirement.

  1. LM

    FI is a license to to do the things we enjoy most, without the fear of losing our livelihood. FI means you can quit a miserable job and start a nonprofit. Or take an extended vacation and then go back to hunt for a more fulfilling job. To me, FI is about holding as much power over your destiny!

  2. Bladimir Mercedes

    When you have a purpose things become clear, that is what makes this valuable….Purpose. Knowing how much money I would need to have invested to maintain my current lifestyle has been a revelation and has provided purpose.

  3. Steve Miller

    Great article, MrEnchumbao! My wife and I reached FI 3 years ago and retired early. We now work out a lot, cycle, play golf, boat, fish and travel.

    I was a software engineer, so now in my spare time I develop mobile apps. I am working on one now that allows you to countdown the days to your FI or early retirement, check it out here: http://www.CountUsDown.com/Retirement.

    Best of luck with your FI activities, it’s worth it once you make it!

    • MrEnchumbao

      Hi Steve,
      Thanks and congratulations on your early retirement. That early retiree life sounds fun, active and healthy!

      The app looks clean and nicely designed. Can’t wait to check out the release. I signed up to get updates. Thanks for dropping in.

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