The Australian Blogger Interview Series: Latestarterfire

Welcome to The Australian Blogger Interview Series.

We noticed the Australian personal finance community growing, mostly through our interactions on Twitter and we wanted to continue to foster this great camaraderie. We’ve reached out to as many Australian personal finance bloggers as we could and asked them to participate in our interview series. If you have any favourite Australian personal finance bloggers, tell us about them in the comments below and we’ll invite them to participate.

Next Up: Latestarterfire.

 

** A short note from AWP: Latestarterfire submitted this interview to me in 2020 but, due to my unannounced hiatus, I am only publishing it now. She has since announced on Twitter (screenshot above) that she has scheduled her retirement date! I strongly encourage you to head over to her blog and congratulate her!

1.  Tell us a little bit about yourself.

I just turned 49 in August and live in Melbourne. I work full time as a health care professional.

2. How did you get into blogging about personal finance? Was there someone (another blogger perhaps) or something that inspired you to start blogging?

One morning in January 2018, I literally woke up in a cold sweat, thinking that retirement was looming and that I wasn’t prepared for it at all. I was in a very stressful and demanding job at the time. While I was terrified of the idea of retirement, the thought of working another 20 years was unbearable. 

I started googling how much I need to retire and stumbled upon Mr Money Mustache and other FIRE blogs. My mind was blown away! So now, instead of being worried about traditional retirement, I wanted to aim for early retirement.

The more I read though, the younger the FIRE community seemed – the people in their 40s had already retired or were about to retire soon. I couldn’t find anyone who started their FIRE journey in their 40s. So I decided to start a blog – with the main intention of having a public space to be accountable during my own journey and also to add an older voice to the community.

Once I started writing, I discovered there were many more late starters like me, just that they were not very visible at first. I started the Late Starter to FI series to share other late starters’ stories.

3. What are your financial goals? Are you aiming for FIRE or something else?

I am aiming for FIRE although I started a LOT later (at 47) compared to the typical FIREy so I guess it can be described as Retire Early-ish. I am aiming to retire fully at 55, or at least be able to transition to part time work then. [see AWP note at the beginning of this interview].

4. What has been your financial journey? Did you start with a pile of debt? How have your finances progressed throughout the years?

I started off well enough – in my 20s, I was contributing extra towards superannuation and purchased shares when they were publicly floated on the ASX eg. CBA, Qantas and Telstra. Plus I saved up a decent deposit to buy a house in my early 30s. 

It was downhill after that or rather as I wrote in my blog post, My Biggest Money Mistakes, I was in a state of inertia – I became content after achieving my goal of owning a house and stopped investing in the stock market and contributing extra to superannuation. Ostensibly it was so I could focus on paying off my mortgage quickly but really, that was an excuse. After all, I found the money to travel and buy stuff for the house.

So it wasn’t until I had paid off the mortgage and discovered FIRE that I started investing again. Now I’m playing catch up on my superannuation – making sure I contribute the maximum of $25000 (including employer contributions) every year. I had hoped to stop salary sacrificing so much this year but alas, the downturn in the stock market with COVID-19 meant that my balance has not grown as much as I hoped it would. So I am still salary sacrificing the maximum I can.

Outside of superannuation, I invest in shares – mainly LICs and ETFs although I do have some individual shares which I bought prior to learning about LICs and ETFs.

5. Do you advocate shares or property to build financial independence? Or Both? Why?

For me at my age, it’s shares because it is more doable than property. 

After I bought my house, everyone urged me to look for an investment property but I was debt averse and was not comfortable with taking on more debt. I was single and felt I had no backup if I lost my job. Even though I had income protection insurance, I just didn’t want to carry so much debt. Plus I didn’t want to give up my weekends searching for a house. It took me a long time to find my house and I wanted a break from the process. The problem was I never considered it again. Oops.

After I paid off my mortgage, I did have a chat with a loans officer at the bank – by this stage, I was nearing 50 and banks had tightened their lending criteria – I was not an attractive prospect. And the thought of going back into debt again was not appealing for me.

6. What is your personal investing strategy? Have you ever changed or reconsidered your strategy? Why?

At the start of my FIRE journey, I was pretty much paralysed by all the analysis – should I invest in this LIC or that ETF? What about dividend stocks? Overseas shares? Etc etc. I was so anxious about the correct strategy, worried that I wouldn’t have time to correct any mistakes.

By then, I had bought a parcel of individual shares – one Top 200 company from each industry/category in the ASX. There was no point in selling them now and cop the capital gains tax on my higher tax bracket. They will be the first lot of shares I sell when I retire.

After that, I invested in older LICs eg AFI, MLT, WHF – I like them for their dividend distribution even during tough times. 

My portfolio of ETFs focus on overseas markets and property. I do plan to invest in VAS soon, Vanguard’s Australian shares ETF to balance out the LICs as LICs still rely on managers not changing their investment strategy. ETFs is truly passive – just tracking an index.

7. What do you think the biggest challenge is for Australians seeking financial independence?

I am firmly in the ‘own my home’ camp – the security and stability it brings is just priceless. Therefore I’d want to own my home outright before I retired, early or otherwise. The challenge these days for young Australians is house affordability – property prices in the cities are so high. 

8. Who has inspired you the most in your journey toward financial independence?

Frogdancer Jones – her story of starting FIRE at 50 and now about to retire at 56 plus how she brought up 4 boys on a single parent income is so inspiring – the stuff of legends!

9. Which do you think is more powerful: frugality or higher earnings? Why?

A combination of both, though it’s easier to start with frugality as it’s within our control and we can start immediately. There are so many ways we can reduce expenses – once we’ve identified which are important to us and which we don’t care that much about. Higher earnings, particularly from our 9-5 involve negotiating with bosses, increase in responsibility, leadership role etc. takes some time to eventuate. Side hustles take time to establish too.

10. Has there been anything about becoming a blogger that you didn’t expect (good or bad)?

I didn’t expect to make so many friends in the community, even those blogging from the US, Canada and the UK.

I’m not tech savvy so I don’t enjoy the technical parts of blogging. However, I am continuously learning new skills which I love 

11. What do you plan to do in retirement (whether early or on time)?

I would like to enjoy slow travel – staying put for several months in one place, exploring at my own pace, not limited to the amount of annual leave I have

12. What’s your biggest splurge?

Travel is my biggest expense. I have family in London and whenever I visit them, I like to visit somewhere I hadn’t visited before in Europe. And Europe is not the cheapest destination. And when I travel, I like to splurge on experiences and good food.

13. How do you think the Australian financial blogger community can grow? Do you think something like Fincon is viable over here?

I think the Aussie financial blogger community has grown a lot since I started 2 years ago. We are so small compared to US though – not sure if a FinCon is viable here. Maybe we can just have a get together?

14. Do people in your real life know about your blog? If so, what do they think? If not, why not?

Nope! I want to be anonymous for as long as I can. Maybe once I’ve retired, I’ll ‘come out’

15. What’s your number one piece of advice for those interested in financial independence?

There is no short cut – increase the gap between income and expenses and invest this gap wisely. Evaluate what brings you the most happiness – you may be surprised that they don’t involve money at all.

Thanks so much for being our next interviewee Latestarterfire! We look forward to sharing more interviews with you soon!

Do you like the idea of an interview series? Who are your favourite Australian personal finance bloggers?