How much can change in one year! We have exciting updates on our FIRE journey so far. With many of the changes going on in the world, we’ve also been making a pivot or two to get closer to our SideFIRE goal and we can’t wait to share it all with you.
Our goals last year were to achieve the following in 5 years time (2024):
- Grow our share portfolio to provide $12k a year in dividends.
- Build our food blog up to provide $24k a year in ad revenue and affiliate income.
- Pay off our house mortgage.
To give new readers here a quick recap: We’re two self-employed Australians who run two businesses:
A graphic and website design studio and a food blog. This means our income is inconsistent and we budget based off of the average monthly income we earn.
Now back to the goal updates, let’s start with shares.
Our FIRE Journey Update for July 2020
We got married in November last year (yay) and pulled back on share investing for a couple of months during this time to both fund our wedding in cash and take time off with the businesses for us to organise everything.
Once we were happily married and back from our honeymoon at the end of November, we were back to steadily buying monthly parcels of between 1-3k. We’ve continued this through the rocky start that has been 2020 and while our shares did take a hit in March with the nosedive on the markets, they have mostly recovered at this time of writing with the help of regular investing top ups.
We’re currently at just over $38k invested, reaching $1750 in yearly dividends – almost 15% of our 5 year goal.
Currently, our brokering is all done through CommSec, however, with each transaction at $19.95AU for anything over $1000, we’ve been looking for a cheaper alternative. Originally, we were thinking to go with SelfWealth, but were then introduced to new Australian start up called Pearler. These guys are all about investing for financial independence, and their brokerage is $9.50AU per transaction up to $17k! Yeah, I thought that was a pretty good deal too. Watch this space, as I’ll go into further detail on Pearler once I’m all setup and I’ve bought a few shares through them.
While our investing has been steady, we envision this is going to cut back over the next year or so as we come to our first major update and pivot: our food blog.
Passive Income aka Our Food Blog
This is where we have been dedicating most of our time over the last year. When we made the decision to have our food blog be part of our FIRE journey, we started focusing on incremental changes to increase traffic and therefore our income from ad revenue.
We are on track to more than double our income this year AND reach our 5 year goal milestone of $24k. This has just blown our minds.
As a result of this growth, we’re now going to have the blog as our first priority going forward. This has meant implementing some pretty big changes in the last few months.
The biggest shift has been moving to part time with our design business and bringing this down to 3 days a week. While this was a scary decision to make, we’re so glad we did. This has now enabled us more time to focus on our food blog, and to start to transition away from a service based business.
The beauty of our blog vs our design business is we get paid regardless of if we’re working on it or not. For example, we’ve just taken two weeks off to paint our kitchen. We earned no money from the design business, but the blog kept earning the same amount everyday without even needing to login. This is why we see each new recipe like purchasing a share. It will automatically earn us ‘dividends’ for each view it adds to the blog. I think this is why we love it so much. You get to teach people how to cook, learn an amazing life long skill to serve up your own fantastic food at home, and have it earn a living.
Our new goal for the coming year is to have the blog earning enough for us to solely cover our minimums and not require any other work. Reaching this goal would give us the time and financial independence to then spend more time on only work we love.
To achieve our new goal, we’ll need the site to be earning just over double what it is now, which is $57k. This would cover our home expenses, mortgage, business expenses and still have enough left to continue to pay monthly into our Super – officially hitting SideFIRE.
The upside is, we’ll have expenses covered. The downside is we wouldn’t have any left over for investing in shares. So the plan is to continue to work post-FI because 1)we enjoy food blogging so much and 2) to earn more than just $57k!
Once we grow the blog to cover more than just our minimums, we can then start putting any extra straight into shares and have the blog supporting us and growing our portfolio at the same time. That way, the day we decide we want to pull away from blogging, we can then transition into having our share portfolio supporting us for the long term.
While last year our best intentions were to have our mortgage erased in 5 years time, we’re no longer going to be focusing on this. There’s a couple of reasons for this decision.
1. Interest rates so low right now and the share market ‘on sale’. Therefore, it makes more sense for us to be investing what we can into the market now to allow our portfolio to grow at a higher rate than our current mortgage interest of 2.74%.
2. We don’t want to live in our current house forever. We plan to sell it at some point in the future. So the cash we currently have in our redraw can be used at a later date for either a deposit on a new house or more shares.
We figure, the higher our share portfolio, it could possibly be covering our mortgage repayments with dividends within 10 years.
So where does that leave us moving forward?
Our aim is to enjoy the journey to SideFIRE as much as the destination. That means we’re living the lifestyle as close as we can to how our days would be post-FIRE.
As a recap, our FIRE goals for 2020 are:
- Our priority is our food blog. To grow this to cover our minimum expenses of $57k a year.
- Invest as and when we can, depending on monthly income from businesses.
- Leave the mortgage as is. Try and get a better rate in 6 months time.
This method is definitely not a traditional FIRE path. For us, we see each FIRE path as unique as the next. That’s the beauty of it. Forging your own way, switching back when you need to or discovering a new road when the opportunity arises. The fun is in the journey, not just the destination. And we’re going to enjoy it every step of the way.
What does your FIRE journey look like so far? Is it similar to CoastFIRE? Are you going more traditional, are you trying for SideFIRE like us or going the whole hog with FatFIRE? Let us know in the comments below!