MillennialAcademicScientist (or MAS) wrote to us when this blog was just a tiny fledging collection of articles back in 2017. What made her story stand out was her background. Like me, she had grown up in poverty, had a traumatic childhood, and as such developed a very fear-based relationship with money. We both knew that while money didn't always buy happiness, lack of money definitely created misery. Lack of money is what traps you in abusive homes, forced to endure being chained to an abusive relationship (in my case, my mother) with no way to escape. As soon as I could afford it, I vowed, I would leave this home and never come back.
MAS had a similar situation, and like me, viewed academic achievement as her ticket to freedom. We're kind of “poverty siblings” that way.
She excelled at school, and fortunately had supportive teachers and guidance counselors who helped her navigate the treacherous admissions pathway into college. And she made it! Not only did she get accepted and enroll at 16, she ended up getting 5 college degrees, including a PhD.
Only problem was, she now had $183,000 in student debt.
This became one of our very first reader cases, in which the mathing shit up was directed at how to manage such a huge loan, and whether it made sense to rely on debt relief programs like the Public Sector Loan Forgiveness (PSLF) program or go after a private sector job to increase her income.
Since then, we've corresponded on and off over the years, her updating us on her FIRE journey and us cheerleading and helping her out whenever she had questions. Recently, she wrote to us with the following:
Finding your blog changed my life. I'm officially FIRE. I sold one house and used the proceeds to pay off the other. My student loans are gone and I have enough cash to pay off the place where my niece is living.
Wow. From $183,000 in student debt to FIRE, owning multiple homes, and even able to financially help out family members! There's a lot I like about writing this blog, but being able to help people achieve FIRE and go from a place of fear and financial lacking to one of strength and abundance is the reason I keep doing this.
However, she also wrote this:
And I should be happy, but instead I feel an overwhelming sense of dread and anxiety. I'm scared the U.S. market and economy will tank or something worse. Is this normal? I realize I should probably speak to a therapist, but I'm wondering if you've seen other people feel this way after becoming debt free.
Short answer: Yes. All the time.
Poverty isn't just a stage in your life that you get through and never have to think about ever again. The experience of growing up in poverty becomes a part of your identity that affects you forever. And one of those lasting consequences is anxiety around money.
It doesn't matter if you're FIRE, it doesn't matter how many houses you own, it doesn't matter how many millions you have in your bank. You will always feel that anxiety, that worry, that dread that no matter how far along you've come, something will happen to make it all go away.
If you feel this way, there's nothing wrong with you. You are not broken. It's a natural consequence of your experience with poverty, because you know what it's like to be poor. You know what it's like to be afraid every time the phone rings because it might be a debt collector, and having to make up excuses for why your friends can't come over, and being trapped in an abusive relationship because you have no other choice.
You know what that's like, and you really don't want to go back to that.
So I wanted to talk to all my fellow anxious FIRE fans about how anxiety and FIRE go (and don't go) together, speaking from personal experience.
It Makes You Ultra-Practical
As you can probably guess, I really like writing. So much, in fact, that I've wanted to be a writer since I was a kid. But when it comes to choosing careers, I didn't even look at writing, because I knew that it wouldn't pay me enough.
A lot of people pick their careers based on something they enjoy doing, or at least find interesting. Not me. My two criteria were 1) Does it pay enough? 2) Are my marks good enough to get in?
That's it. Because at the end of the day, the only thing that mattered to me in my future career was that it would provide a stable paycheck so that I didn't have to live with my mom anymore.
Our reader MAS had the same idea. She got it in her head that education was her ticket out of poverty, so with the help of some very encouraging and supportive teachers, studied her way into getting 5 college degrees.
Anxiety was the fuel that kept me going through every long, sleepless night cramming before midterms. Did it suck? Yes. Do I still have nightmares about being back in university? Possibly. But was it worth it?
Absolutely.
It's Made Our Investments More Resilient
Another thing my anxiety did was it changed how I invested.
Most of the FIRE bloggers are pretty optimistic people. They throw everything into the S & P 500 until they hit their target FIRE number, then they quit their job without a care in the world.
That's not how I roll.
When it's something as important as money, an overly simplistic 4% rule is not good enough. 95% success rate is not good enough, because that means there's still a 5%, or 1 in 20 chance of failure. I need it to be 100%.
That's why our FIRE portfolio has multiple backup systems. The Yield Shield was designed to create a passive income not dependent on stock market swings. We added a Cash Cushion to guard against sequence of return risk. And we made our lives nomadic so that we can use geographic arbitrage to lower our living costs just in case.
Anxiety is what causes our brains to always be looking out for things that could go wrong. And if I can find ways of mitigating those risks without requiring me to save more money, I do it. And I write about it so I can teach other fellow anxious investors how to do it too.
Is it more complicated than simply putting all our money into the S&P 500? Sure. But all this extra effort has made our portfolio surprisingly resilient to economic downturns.
When we first retired in in 2015, the Saudi Arabia oil crisis caused a sudden stock market drop at the worst possible time, which is right after we both quit. But using the Cash Cushion saved the day. Similarly, when stock markets were plummeting and the economy was shutting down during the pandemic, we used geographic arbitrage to take advantage of dropping short-term rents to lower our living expenses to within our Yield Shield.
So when we open up the news and get anxious that another recession is around the corner, that's normal. There's always a recession coming. But the financial system that we teach people to build can handle it.
Conclusion
Anxiety is usually seen as a bad thing to have, but the truth is just like any other emotion, it's neither fully good nor fully bad.
And when you're forced to experience poverty, anxiety gets baked into your system whether you want it there or not.
The trick is learning how to direct that anxiety into something positive. For me, it made me obsessive about managing money, and in a way that's become my superpower. The reason our retirement portfolio has worked out so well is because I kept obsessively coming up with ways to guard against calamities.
So if you're one of the many anxious FIRE fans out there, don't think your anxiety makes you weak, or that it's holding you back.
It just might be your superpower too.
