Starting a FI/RE Journey in a High Cost of Living City
As part of our Women’s History Month series, Cinneah (the founder of Flynanced) and I co-hosted a series of incredible roundtable discussions with some of our favorite women in the personal finance space with the goal of fostering rich intersectional conversations around money.
Anmol Das aka “moneymolz” is a personal finance enthusiast who started her FI/RE journey in the city of Chicago. She says anyone can be a millionaire — it’s all about making the best financial decisions and being cognizant of your money! We asked her for suggestions on starting a FI/RE journey in a high cost of living area. Here’s what she had to share. (You can watch the full recording of the roundtable discussion, We Choose FI/RE, here).
How I Started
I graduated from college two years ago with about $30k in debt, which is not a crazy amount. But being the frugal person that I am, it was my highest priority goal and I wanted it taken care of before I focused on anything else.
I threw everything I could at my debt but while doing that, I wasn't really thinking about budgeting. I had this idea that to thrive in the city, I need to live lavishly. I was living in an expensive apartment and I was splurging on food, transportation and going out. My employers were talking to me about 401ks - I didn't even bother thinking about that. As time went on, I noticed that the money I had saved for myself and my future wasn't really growing. I was just living life and not really thinking about the future.
When COVID hit, I went back to my home in Virginia and it gave me a lot of time to reflect on myself and my financial goals. After that, I started learning more about investing and retirement, and that's when I found everyone on this panel. My FI/RE journey has been more smooth sailing because I had everyone on this panel (and many others) to help me and guide me towards the path to financial independence. I’m feeling very lucky because of that.
Mapping Out Your FI/RE Journey
Next, I made moves to figure out my game plan. What am I going to gain out of financial independence? How is this going to benefit me? Am I trying to retire early so I don't have to work? I spent some time reflecting and figuring out the reason for my financial independence.
Once I spent some time figuring that out, I went through a whole process of learning about investing, reading, took a bunch of courses and bought a bunch of budgeting sheets - it was a wild time.
When I came back to Chicago, I had a completely different perspective about my finances. My roommate and I moved to a significantly cheaper apartment. I'm still spending money on things like food and going out, but I'm allocating it based on my monthly budget instead of just swiping my card every week without thinking about it.
Finally, I understand what a 401k is and am finally putting money into that.
Five Steps to Get Started on Your FI/RE Journey
Here are five steps to help you get started on your FI/RE journey, especially if you live in a more expensive city.
Have a strong emergency fund. Lots of people in the FI/RE space talk about having a three to six month emergency fund. Living in a city with a high cost of living, there are random expenses that you probably will never even think about (parking tickets, moving expenses, random Uber’s in the middle of the night.) Having a strong emergency fund is definitely very, very helpful!
Prioritize your needs. Figure out what exactly you want to splurge on. For me, I didn't really need a fancy apartment. I'd rather spend that on food, art museums and experiences in a new city. (And if you’re looking for an apartment, it can be worth it to use an agent. It can be no cost on your end - always ask - and you tell them your budget and what you’re looking for in an apartment.)
Don't be afraid to say no to plans. My first year in Chicago, I said yes every weekend because it was a new city and I wanted to make friends. You do have to go out of your comfort zone, but you don't have to always swipe your card to make great friends. During my second year, we focused more on fun alternatives to actually going out and spending money every weekend.
Take advantage of your employer match (if you have it). Please, please, please. If you can at least put the amount in your 401k that your company will match, do it. It’s literally free money. I didn’t do it, and I highly regret it. If it’s possible for you, it is a great way to save for retirement.
Share these tips and what you’re learning with your city friends. Chances are they're in the same boat. At the beginning of my journey, I started sharing my experience with my roommate and friends. And they were like, “why did you not tell me about this earlier? This is crazy.” Explaining your financial situation and being more open about it can help us all! Society makes it really hard for us to be who we are transparently. It’s helpful to talk about these things and help each other because all of us are going through it. We're all learning.
Next Steps
Watch the full recording of the roundtable discussion, We Choose FI/RE, here.
Follow her on Instagram at @moneymolz
Check out some of her great resources!
About Anmol:
Anmol Das aka “moneymolz” is a personal finance enthusiast who is starting her FI/RE journey in the city of Chicago. As a newbie, Anmol’s instagram platform explains financial concepts ranging from managing money in a HCOL to investing in tax-advantaged accounts, and has the numbers to support. Being surrounded by people with various backgrounds, Anmol emphasizes the fact that anyone can be a millionaire — it’s all about making the best financial decisions and being cognizant of your money!