Saving $70,000 a Year at 24 Years Old with John Hawrylack

My guest on the podcast is a 24-year old Software Engineer who is killing it!

John and his wife, Sam, have been on the FIRE journey since college. He talks about how embracing a frugal lifestyle has enabled them to save & invest $70,000 a year! Their money habits will soon take them to the ultimate freedom: FIRE (financial independence retire early).

They’ve taken Financial Peace University, use Travel Rewards Points for vacations, and invest in a 529 Plan even though they don’t yet have kids. (My non-existent kid’s college fund is in AMZN & NFLX. If those tank, he/she will have to do it the hard way, like John & I did.)

Here’s what we discuss:

• Travel-hacking Las Vegas
• Using the envelope system when gambling
• Visiting the Grand Canyon & Hoover Dam on a budget

John’s Personal Finance Journey (at 3:08)

• Finding FIRE in college
• Working as a government contractor
• Living frugally in a big city
• Getting more square footage for your money in the suburbs
• Minimizing your Big 3 Expenses
• Buying cars with good gas mileage
• Using commute to work for learning time
• Listening to ChooseFI podcast
• Taking Financial Peace University
• The good & bad of Dave Ramsey’s advice
• John’s major disagreements with Dave Ramsey
• Accounting for children with FIRE goal
• Explaining life choices to family & friends
• The math behind The 4% rule
• John’s FIRE Calculators
• Supplementing your retirement with real estate
• Accumulating a wide variety of assets

How John & Sam invest their $70,000/year (at 20:35):

• Utilizing tax-advantaged accounts
• Investing through 401k, Roth IRAs, HSA, 529, Vanguard
• VTSAX now requires only a $3,000 minimum investment
• Comparing VTSAX vs. VTI
• Investing in bonds, mutual funds & index funds
• His thoughts on coming out of college at the end of a bull market
• FIRE as a long-term play

Other Discussion:

• The DJIA went sideways from 1966-1982
• Japan’s stock market was envy of the world in the 1980s
• The way John approaches his finances has helped him at work
• Projecting how much money John & Sam will have at my age
• How kids factor into their FIRE goal
• Marrying someone who is cash-flow positive
• Time in the market > timing the market
• Looking for asymmetrical risk (low risk, high reward)
• Successful investors: Warren Buffett, Ray Dalio, Howard Marks
• Being on same page with your spouse through good communication
• Attending FinCon in Washington DC in September
• John’s an admin for a ChooseFI meetup (find your local group here)

Connect with John:

• on Twitter: @howtofire
• or his blog: howtofire.com

Listen here:

Books mentioned:

Article mentioned:

How I Failed My Daughter and a Simple Path to Wealth