Financial independence is for Everyone (Part 1)


One of the funny things about financial independence is hearing the objections made against it.  Most are pitifully thin.

For example, one of the more bizarre criticisms is that financial independence is only relevant for high earners.

Errr…hello???…if you’re not a high earner, its even more important not to piss your money away on ridiculous spending.

Living paycheck to paycheck leaves people at the bottom of society prone to disaster.  They, more than anyone, need the techniques of financial independence to build a safety net and gain options to improve their life.

So let’s discuss why the mindset and techniques of financial independence are for everyone. Even those on low incomes. Even those who like their job.  Everyone.

What I’m not saying

I’m not saying financial independence is easy. It isn’t. It’s obviously easier for people with high incomes. But even they will find it tough to resist lifestyle inflation.

I’m not saying you can get to financial independence on minimum wage. Whilst you do hear stories of janitors leaving millions in their will, that makes the news because its so unusual. No, the way that people on low incomes can get to financial independence is by increasing their income (as well as holding down spending). Again, this is not easy but its possible.  Earning more is not cheating.

Those of us living in rich countries can usually control our own spending quickly, its under our control. The truth is that people on low incomes are wasting money…people with high incomes even more so.  But the lower your income, the more you need to be frugal.

I’m not saying everyone should be obsessed by financial independence.  Some people won’t ever be interested in financial independence. And that’s OK…The Escape Artist is used to being ignored by the majority of the population.  It happens…a lot.

Financial independence as a journey

But let’s distinguish between 2 very different things. The destination and the type of transport.  If you are flying to New York, the destination is….errr…New York and the transport is a jumbo jet.

Here’s my point. Don’t just think about financial independence as a destination, think of it as a means of transport as well.

In money terms, the techniques of financial independence are the fastest and most efficient form of transport.  They are how you get to your destination the quickest, wherever that might be.

There is often a silly idea that the destination of financial independence has to be early retirement.  Nope, they are 2 different things.

The opposite of financial independence is not working, it’s consumerism.  Consumerism is buying shit you don’t need. Its self-imprisonment via mortgages and other debt, advertising jingles and keeping up with the Joneses.

So, to repeat, think of the tools of financial independence as how you get where you want to go. Early retirement is a destination where you could go. But its not the only destination.  If your destination is freedom, happiness and doing work that you love…then 1) good for you and 2) the tools of financial independence are the best way to get there.

But even if your destination choice is more dubious, then the tools of financial independence are still the best way to get there. So let’s say your goal is to spend as much money as possible on buying donuts. In other words, you set your objective:

I will buy and eat as many donuts in 2018 as possible

and then make conscious choices to track your spending, stop buying shit, switch energy supplier, move house to pay less rent, cycle to work, get promoted, maybe get a side-hustle etc etc and then you’d have a ton of money to spend on donuts!

The same things work for saving a deposit on a house, buying a car, saving for a holiday…or anything. You get to choose.

People sometimes say : “FI is irrelevant because house prices are too high“.  I see it the other way round.  In other words, its because house prices are so high that young people need to use the techniques of financial independence to buy a house.

The techniques of financial independence

The techniques of financial independence are about making smarter life choices.  Over time, these add up and make you rich, thanks to the aggregation of marginal gains.

For example I’ve written about the magical effect that keeping track of your spending can have.  The reason I bang on about finding out where it all goes is not that, in and of itself, its a thrilling way to spend your time (it isn’t). Its to switch off your spending auto-pilot and to bring conscious awareness to how you spend your money (and therefore your life energy).  What gets measured gets managed.  Once you’ve scrubbed off the gunk of consumerism, there’s no need to track your spending anymore.

Then you put your money to work in productive assets like index trackers which, over time, make you wealthy. This is easy…even if you know nothing about investing.

What if you like your job?

Financial indepedence

After The Escape Artist was on telly earlier this year, his contribution to Western Civilisation was critiqued in The Times by some clown a journalist who seemed to have trouble understanding that anyone might want to quit their job.

Two points here. First, if you like your job as a fancypants journalist on a national newspaper, then Yay…go you.  But how narrow minded would you have to be to conclude that everyone else must also love their jobs?

And second, how short-sighted would you have to be to not see that things change? Even that nice Mr Murdoch has been known to fire people.

So dig a well before you are thirsty.  Even if you are currently paid to review new mountain bikes (I actually know someone who is) or test condoms (good work if you can get it).

How can we help low income people?

One of the great things about this blog’s readership has been the near absence of complainypants comments…even as the page views have crossed 2 million (according to WordPress stats anyway).

Elsewhere on the internet, it often seems people just read the title of an article, the vein in their temple starts to pulse alarmingly and they skip straight to the comments section to puke up a complaint about how financial independence is impossible for people called Dave, people with ginger hair etc etc.  Not that Ginger Dave is bitter, of course.

Other commenters seem more interested in virtue signalling than they are in actually doing something useful to help poorer people. If they were actually interested in helping poor people they might…I don’t know…perhaps write a blog about how to get better with money and put it free on the internet where everyone can find it?

The question is not whether there is some magic wand that we can wave to immediately make all poor people rich…there isn’t.  The question is whether everyone can get better with money?  I think we all can…but we have to start with an inconvenient truth which is that…

Most people are not even trying

No matter how many mistakes you make or how slow you progress, you are still way ahead of everyone who isn’t trying.        Tony Robbins

Most people spend time and energy complaining and waiting for their elders and betters to come and rescue them.  Sadly, it doesn’t work like that. The cavalry are not coming to save us.

For example, there is a lot of moaning about energy prices.  But why is it that about 60% of people have never switched supplier and are therefore on a standard (i.e. expensive) rate?  Is it because its difficult to switch? No!

Is it due to those evil companies trying to make profits by keeping people warm? Errr…no.  The problem is not lack of information, nor lack of intelligence, nor lack of competition. Its because, when it comes to getting richer, most people are not even trying.

We’re told the UK has a housing crisis (young people have nowhere to live) and a pensions crisis (old people don’t have enough income). But there are 19 million spare rooms in England alone not being rented out. Can anyone else see a solution here?

Everyone becomes FI at some point

I used to think that financial independence was a very rare thing.  And in some ways it is.  But I’ve come to realise that large sections of the population have a lifestyle which looks quite a lot like being financially independent (in that they don’t have to work full time in an office).

For example, people that are employed but work flexibly from home. Self-employed people. People with a small business. All retired people. Housewives and house husbands.  People living on benefits.

And I could take the argument to an extreme and say that everyone becomes financially independent in the later stages of life.  Even someone with no money will at some point have only a few days left to live and won’t need to earn in that period.

Let’s agree that just a few days of “financial independence” before snuffing it is setting the bar a bit low.  A more suitable target duration for not having to work would be 40+ years. My point is that financial independence is not binary. Everyone can get better with money and that will move them in the right direction along a spectrum.

This blog is trying to help people move away from the 2 day scenario and towards the 40+ years scenario.


Financial independence is not just a destination, its a journey as well. And “using the tools of financial independence” is just a fancy phrase that means not being shite with money.

Financial independence is a mindset and a set of practical tools to help you achieve your goals.  You could apply these tools to achieve almost anything.

Like I said, financial independence is for everyone.

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  1. Totally agree, everyone can do it but not everyone will do it. Thanks for the reminder about tracking spending I have been going off track recently. Love the blog, keep up the good work, did not realise that was you on the C4 programme, they should have gone into detail on the magic of compound interest IMO.

  2. Nice article TEA. One thing that comes to mind is the amount of time companies spend reviewing and updating their figures, (at least quarterly). Since I’ve changed my perspective and I think of my budget in terms of a P&L for my own business, (myself!), it has helped me greatly.

    Things will change over time, (hence the journey comparison makes sense), and you need to make adjustments accordingly.

    1. 👍

  3. Financially Astute Millennial · · Reply

    Completely agree! I’m a recent graduate (bottom of the food chain salary wise) with £45k of student debt hanging over my head. Still deploying the power of FI/Frugality to save for Pensions, House deposit and eventually repaying the student debt! Most of my friends aren’t interested in doing anything about it and just complain constantly.

    1. Michelle Stewart · · Reply

      The 45k is not a debt, dont even waste your time thinking about it. You may never have to pay any of it back. If you earn 25k a year you pay 9% on everything over that. Good luck with your future, you are on the right path reading this blog. X

      1. There’s debate over whether student loan debt is really in fact debt, but I would say yes it is.

        The fact is, if you earn over £25k/yr you are going to be paying that back, with interest. And it’s going to be taking you a long time, and it’s going to affect your ability to get a mortgage etc.

        And if you’re not going to be earning £25k/yr, why bother having gone to uni in the first place?

        It’s a debt alright!

  4. I did quite a lot of research for my book ‘DIY Simple Investing’ and in my experience, over half the people I meet simply cannot understand simple finances. It could be a mental block or psychological or a combination but however carefully you explain things, they simply cannot grasp it. They will remain ‘shite with money’ and rely on others for help.

  5. paullypips · · Reply

    A good article, both informative and motivational. It was nice to see you on TV too. I think that your comments were wasted by the people at Channel 4. Talk about dumbing it down. They had an interesting subject and an interesting person to interview. They threw it all away with one comment, “save 25 times my annual spending, is that even possible?” This has just reminded me why I hardly watch TV, it’s 99% solid guff. The presenter is obviously proudly on his way to penury. What were you doing in a coffee shop? I do hope Channel 4 picked up the tab for the expensive looking coffee that you had! Anyway, thank-you for providing me with regular & instructive reading.

  6. mrspickypincher · · Reply

    Agreed. You can be FI at almost any income level, as long as you don’t continue to inflate your lifestyle. Is it easier for high earners to achieve FIRE faster? Of course. But it’s not impossible on a modest income.

  7. Nice read! We’ll track the expenses quite good, just a bit high in some area’s.(groceries anyone..?)

  8. Since preparing for my partner’s redundancy 15 years ago, we’ve both been frugal. Neither of us high earners by any stretch but by the good luck of being born 40 something years ago, we paid off our (not South Eastern) house and are preparing for FIRE in about 8 years, should we feel the need to bail then. In the meantime, it gave me the choice to leave work for a few months when a new manager made the office pretty unpleasant to be in which really gives meaning to the phrase Eff You money.
    I’m since in another position at the same salary which suits us, managing around a 50% savings rate. Of course, the lower your expenses (within reason and/or contentment), the lower your magic FIRE number is. And you can get there sooner with a higher salary, but in our (mine and partner’s) careers, that comes with rather more stress and mither than we’d want to endure and we’re reasonably happy where we are (megalomanic managers notwithstanding). No side hustle either so we’re really taking the scenic route, mostly by not inflating our lifestyle. As you say though, doing something is better than doing nothing and the scenic route is rather painless as far as we’re concerned.

  9. Survivor · · Reply

    Whoa you’re playing with fire here …..speaking truth to apathy by pointing out the cake conundrum most people are incurably susceptible to 🙂 – wanting their cake & to eat it too.

    The vast majority want to have an easy, comfortable life, keeping up with the Joneses, yet not take any pain by working hard &/or delaying gratification. It reminds me of that fascinating iconic psychological study on toddlers mental discipline – they left them in a room alone with a marshmallow & the choice of eating it immediately or waiting a set time to get double. It turned out that later in life those who struggled with self-control had harder lives because they made impulsive/worse choices.

    It’s always going to be an unpopular message though because it’s basically a rallying call for people to fully take responsibility for themselves …..& surprisingly few do so. I love the hunter-gatherer example because it really is crystal clear in dispelling any illusions & misinformation.

  10. Hi TEA.

    I can’t work this one out. Your help would be appreciated!

    A BBC chap came and interviewed us the other day about FI, and this question came up: can everyone do this. My answer to it was ‘no’. I don’t think everyone can do this. I did go on to say (something like, I can’t recall): but it is worth trying, you don’t need to go to the extreme we went to, the advantages accumulate.

    The reason I said no is this: I can’t work out how I did it. Or how you did it for that matter. Sure, I get the maths. But what makes us different to those millions around us that don’t do this? What made even the idea of it occur to us? What made us believe that we could do it? What enabled us to turn off the desire to buy? How did we step off the ‘one more year’ treadmill?

    The Daily Mail article wrote about me and Ju off the back of the Retire by 40 debacle has now attracted 15 million billion comments. Not all of them are, ah, universally supportive. I only read the ‘most liked’ ones, and can’t recall most of ’em, as it was the usual ill-conceived rubbish, but one did strike me. It was from a lady who was clearly in a desperate place, and said something along the likes of “why would you publish something like this, why did you do this to me?” It seemed my happy story was a burning form of torture for her. Fair to say, I felt like shit.

    There is something which sets us apart from the crowd, from millions of people. But what is it? I can’t work it out. It’s not intelligence. I’m not an idiot, but I’m not that bright either. It’s not pre-requisite financial knowledge – I didn’t understand how a pension worked or invest in an ISA until I was past 40.

    What do you reckon? What is it? What is the FI-X factor?

    Cheers, Jay

    1. Hi Jay…always a pleasure to hear from you. And the comments section on that Daily Mail article is one of the wonders of the world. Its an absolute trollfest…like a Glastonbury for haters 😉

      One of my comedy highlights of 2017 was being interviewed by Closer magazine…in the end they didn’t run my story…which is probably a good thing given how things might have kicked off in the comments online.

      What makes us different? Good question, I don’t know…but I’ve always believed that its better to die on your feet than live on your knees. Cheers, Barney

    2. AlbinoBlackSheep · · Reply

      Hi Jay & TEA,
      Long time reader, first time commenter.
      I believe what makes the likes of you Jay, as well as TEA and to some extent myself, different is that we’re willing to put in the work, unlike many that will never achieve FI whether it be due to a lack of self belief, laziness, paying attention to the abundance of capitalist misinformation, weak-mindedness or just plain fear of doing something different.

      We all need to take responsibility for the lives we lead and how we spend our time and money. It just seems like the grown up thing to do. I take solace knowing that any bad day on my journey to FI will be as a result of my own decisions (good or bad). This gives me no choice but to own anything negative, learn from it and look forward, building character in so doing (Sounds like stoicism to me). As harsh as it sounds, there’s nothing to be gained by that unfortunate lady who has broken down and chosen to blame you for highlighting it.

      Don’t feel bad Jay. Perhaps hearing your story was the wake up call she needed…

      1. Hi

        What makes us different? I think it’s a very good question. I believe it comes down to what MMM and some FI bloggers wrote about before: Stoicism. It’s not entirely related to Financial Independence but the way of life for a Stoic is to make the right decisions, sometimes the difficult ones and counter-intuitive one to benefit their quality of life. Perhaps it’s the maturity to say ‘Hey, I know what it is I need in my life: ‘Happiness’ and I can achieve it by making choices and being satisfied with less. And that is good enough. I think the lack of self-belief, laziness, weak minded etc will always be lingering somewhere, at least some where in me (part of being human), but I part of being a stoic is taking little steps to improve things as in Aggregation of marginal gains. I will never be the perfect being and will not always make the right decision, may sometimes be upset and fail at things but a Stoic will get up and get on and be brave to failure.

        The first step is always self-awareness and then the rest is a life long process of learning and awakening to the various aspects of life choices. Be curious. Learn from others. Believe that things will be better even if things are shit at the moment. Embrace change. Failure and try again. If it takes a breakdown to start the process, I think it’s a good thing.

        as always, baby steps…


  11. That’s a great little…..I don’t know, too considered for a rant, too wild to be anything else. Really so much truth in it, but people can’t handle the truth, if they did they have to admit to themselves that everything else is a lie. Thanks.

  12. Nice article. It’s amazing (to me) how many people think that it’s not for them.

    I was on a panel about saving more at a recent money bloggers conference and I was surprised to find that most of the 90+ audience (who write about money every week) were against the idea that people should save more.

  13. Probably a bit late commenting on this one, but… better late than never.

    Reading this really useful article and a few other related ones on Monevator, ERN and MMM made me have a look at the maths more closely. I started with the derivation on referred to by MMM’s “shockingly simple maths” article and tidied it up a bit, but with the same assumptions. They are simplistic assumptions, but it is a really good mental model.

    Years to financial independence (FI) [n] only depends on 3 things:

    (1) the number of multiples of your annual expenditure that you need to add in order to reach FI [X]
    (2) savings rate [y]
    (3) real rate of investment return [r]

    The simplest presentation of the equation I could come up with is this:

    n = ln(1 + k * r) / ln(1 + r)


    k = X * (1 – y)/y

    As a sanity check I put in r = 0.05, X = 25, y = 0.5 and get n = 16.62 years. This is the same as referred to by MMM.

    So for 100% savings rate y = 1 then k= 0 and n = 0 – you are FI. Or again if X = 0 then k =0 and n=0 and you are FI too.

    Mathematically ln(1+q) is approximately equal to q for small q and this leads to the following approximation for small k and r:

    n = k

    for example if your savings rate k = 0.5, then n = X. Which makes sense as each year, you are saving the same amount as you spend.

    For people saving really hard (large y) or with a small amount left to save (small X) the investment return doesn’t help much during the accumulation phase.

    Another case is where I leave savings in a place with negative real returns (such as a cash ISA, short term bond or building society) and also have a low savings rate. Been there and got the T-shirt.

    At the point where kr = -1, n becomes infinite – you never make it and have to rely on the state pension. Actually if n is bigger than say 45 you haven’t really made it – at least in one generation.

    I suspect all of these points have been made qualitatively on this blog and others, but for the mathematically inclined (we do exist) it’s nice to see them in one equation

    Happy to provide the derivation.

    1. Thanks, the simple maths is also laid out here and here

  14. Barn Owl · · Reply

    OK. It’s also interesting if you fix n, r and X and work out the necessary saving rate y. Have you looked at it that way around?

  15. Jimmy Boy · · Reply

    Brilliant blog mate. I’m a tiler in NZ originally from Bolton UK. I’m on the path to FI and no **** is gonna stop me. I’m not a big earner nor a big spender. Your blog and a few others has changed my viewpoint therefore changing my life. Respect to you Sir you absolute f*****g legend!!!!!!!!!

    1. Ladies and Gentlemen…THIS is how to think about success (as well as how to use the English language effectively)…respect.

    2. Jimmy Boy · · Reply

      Ps. Please excuse my French, I’m just a wee bit excited

  16. Cristina · · Reply

    This is the first article I am reading on your website and even if I didn’t care about financial independence (which is not the case) I would still keep on following you because of your writing style. I can hear the frustration in your voice when you talk about the clown/journalist, brilliant!

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