>>MAT: Hey everyone in this video, we're meeting a couple from Vancouver BC who are planning to retire by age 35. They've adopted an extremely frugal minimalist lifestyle and for the past seven years, they've been able to save over 65% of their annual income. They've been carefully investing their savings and they plan to live off the interest when they do retire. Although early retirement isn't accessible to everyone, we do think that what Stephanie and Celestian are doing is really interesting because frugal lifestyle choices could help make some financial goals like getting out of debt, for example, easier to achieve. We're really excited to share their story. So let's go meet up with them. >>STEPHANIE: So basically about seven and half years ago, we decided to pursue early retirement. We figured out a system involving lowering our expenses a lot, so we could get our savings rate really high up to about 60, 65% and just investing that and then just over time the money just kind of accumulates and now at this point we're probably about 2-3 years away from having just enough in investments that we don't need to work anymore. So at this point, we're nearing the end of the journey we started. [Music Playing] >>CELESTIAN: What early retirement means to us, is being able to retire at a relatively early age but still have enough money to be able to support ourselves through our investment income without needing to work. We might work if we want but we wouldn't be forced to work in order to pay for our bills and such. [Music Playing] >>STEPHANIE: The biggest things we do is make our large expenses quite a bit lower. We rent a very cheap apartment. We don't have a car. I do all our cooking from scratch. I do bulk meal prep. Generally, you know, we're very minimalist. We don't really buy things. There are all these categories for a lot of people that just don't exist for us. I mean, we don't have a restaurant budget; we don't have an alcohol budget; we don't have a car budget. Most of those categories are $0 spent in those categories. So, it just means our cost of living is very, very low which allows us to...you know even though we don't make that much money, we are still able to save consistently 65%, 70% of our income every year, despite making only very average income for our city. [Music Playing] So I'm a receptionist at an accounting firm and Cel is a freelance editor. >>CELESTIAN: So I mostly do novels, like people self-publish novels on the Amazon Kindle Store and similar markets. So those are the main people that I work with. >>STEPHANIE: Usually, our combined income is around $80k/year. We spend about $9,500 on travel, about $9,500 on housing, and about $2,500-$3,000 on food per year for the two of us. To keep our costs down for groceries, it's really just a matter of cooking everything from scratch and not buying frozen meals or things like that, but just actually cooking and baking everything from scratch. It drives the cost way down. We spend less than $300 a month on food for the two of us, and that's no trouble because we shop at the kind of places that are very cheap. We buy a big sack of flour every month. That's at Costco, a $6 sack of flour. That's all our bread, pizza dough, baking, you know, muffins... I buy big sacks of rice. >>CELESTIAN: We buy like cases of soy milk from Costco and that's a bit cheaper as well. So there are some things that we buy in bulk that are cheaper and then we also go to a local market and buy pretty cheap vegetables. It's called Sunrise Market. So that's part of it as well. And we try to get produce that's pretty cheap and in season. We take two big international vacations a year, usually one in the summer and one in the winter and then we do a few little trips to local places here and there. It's something that we really enjoy just going to new countries, new cultures trying new experiences, trying new food. >>STEPHANIE: I think every trip we do is really just inspiration towards early retirement because it's like a taste of it! We spend close to $10,000 a year on travel. So it's not like we do a travel budget. A lot of it is just we do the same kind of stuff when we travel that we do at home. We tend to go to the grocery store, get ingredients and cook. When we travel, we tend to go to maybe a local market or the outdoor markets or something get ingredients, bring them back and cook or at home we don't use a car, we walk places and bike places. When we travel, we do the same. We take public transit or bike or we walk places. So I think there's just a lot of it is just living the same lifestyle that we live at home, definitely cuts into the cost of traveling a bit. So our transportation costs normally would be about $40 a month that would be with bus fare, but it can often be less than that, especially during the summer, where we would just walk and bike more. We really got serious about it, once we realized early retirement was even a possibility which was about 7 years ago. So we've been sort of taking it more seriously and working on it and really focusing on investing a lot and getting our high savings rate and making progress just for about seven and a half years now. When we first started, Cel had a small net worth. He was just finishing up school. I had about seven thousand dollars of debt. I did one year of post-secondary before deciding I didn't want to do any more of that, but that was gone really quickly. We invest in index funds. We just have very simple portfolios through a robo-advisor. When we get paid, we deposit money, it's dealt with, and we don't think about it and it just kind of grows in the background. Once a year, we get our tax slips and file our taxes. That's the extent of what we have to do with our investments, but we don't really do any kind tricks or psychological stuff to spend less. We just really look at our spending as a whole and sort of decide how we feel about that and we're either happy with this amount or we're not and if we're not, we would just spend less. >>CELESTIAN: We try to set it up such that being frugal is easier than not. Because people only have so much mental energy and so much discipline they want to use every day, right? One example is that we do bulk meal prep on the weekends and then we just put all of our food in the fridge and so then after work on the week days, instead of eating out and going to the restaurant or getting takeout, we can go to the fridge and put something into the microwave. Not only is it the more cost effective option but it's the easiest option. >>STEPHANIE: I would say in regards to that I think another one of the things people run into sometimes is they make this plan and they say everyday i'm gonna go home from work and I'm gonna cook a healthy dinner. I mean maybe for some people that works. For me, it doesn't. For me, when I get home from work I'm kind of tired. I want to just eat something. You know, I don't want to cook a meal. So I might be able to sustain a system like that maybe I could manage it for a week, maybe two weeks, but after that, I don't think I could do it every day. So I plan around that so that I have food ready to go, ready to just basically reheat during the week which makes a big difference. >>CELESTIAN: There are downsides, but it depends on... they are kind of subjective downsides. It depends on your values or your preferences like your personal preferences. For example, a lot of people would see not drinking alcohol as a serious downside. For us, it's not because simply we don't want to drink it. Some people would see that not having a car and not having the flexibility to drive, wherever they want as a big downside. So for us not having a car and not driving, are not downsides, that's just how it is. >>STEPHANIE: We have a blog. We're not super active, but we have a lot of information on there. It's called Incoming Assets. It's pretty easy to find. We have sort of updates in our lives, places we travel, sort of how our net worth is going, and then a little bit about investing and self-employment and frugal living in general, sort of some of the things we do. We would like to do things like maybe longer-term travel. We've talked about maybe moving to an island, building a cabin and sort of doing a bit of a homestead thing. There are lots of different things we'd like to do or just having the flexibility just to to move to different places and not have to think "Well, what about getting a job there or whatnot?" Just be able to sort of have that freedom to do sort of some unorthodox lifestyle choices. I think that's one of the real appeals of early retirement is to have that freedom to basically live your life the way you want. [Music Playing] So as for how our lifestyle will look once we retire compared to how it is now. It really depends. I mean if we decide to stay in a city, it would be identical. If we do decide to move to an island and build a cabin, there would probably be some fairly substantial differences. But I think at the core a lot would remain the same. >>CELESTIAN: For sure we have no intentions after retirement suddenly spending a lot of money on restaurants, buying tons of stuff on Amazon. It's definitely still going to be a frugal lifestyle post retirement. [Music Playing] >>MAT: If you want to follow Stephanie and Celestian's journey towards early retirement, you can check out their blog which is called Incoming Assets where they share all kinds of information about their frugal lifestyle and travel adventures. Please share this video if you liked it and thanks for watching.
