Reaching Financial Independence Without Index Funds?

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Ask any parent and they will likely have blocked out part (or all) of the first few months of their child’s life. Not because it wasn’t awesome, terrible, life changing or amazing, but because they’re so stinkin’ tired all the time. This is the delirious state that I found myself in when I first learned of the term, Financial Independence (FI).

While the rest of the world slept blissfully, I stumbled around trying to get our newborn to sleep. The minutes ticked by ever so slowly and he kept on getting heavier and heavier. I rocked and paced and rocked and paced and…well, you get the picture.

With my first baby, I ended up turning on the TV and watching old movies with the sound off. But for this second time around, I wasn't even sure if I could deal with flipping channels and avoiding infomercials to find something half decent to watch. With some coordination and luck, I managed to start surfing around the internet on my phone. I needed something to keep my sanity and to keep me awake. My brain was definitely not up to reading about work, parenting, or health stuff. So I tried to find something interesting but not too mentally taxing. It was on one of these nights under the blue glow of my phone that I started down the rabbit hole of early retirement and financial independence.

Now, you know that in the wee hours of the night one can get somewhat philosophical. As I was rocking my little baby boy I wanted to make sure that I could be fully present for my boys. But how? I was so busy being a mom, partner, professional, and real estate investor. As Jonathan would say, I needed off the hamster wheel.

Mama Sees The Light 

After that fateful night when I discovered the world of financial independence, I spent the next days and weeks trying to figure out what this all meant. I started listening to the MadFientist podcasts while pushing the stroller around, and binge reading Mr. MoneyMustache (MMM), the Frugalwoods and Our Next Life (ONL) between baby business.

After many hours of reading and listening, I felt as though something finally ‘clicked’. Sigh of relief...Financial Independence–there was a term for what I was working towards all these years–but could this really be a possibility for us?

After reading MMM’s famous blog post on how much one needs to retire, the math seemed sound. And as a fellow Canuck, I thought he couldn’t be leading us astray (?!?)

The only problem was that I was already in my 40’s and our financial path seemed to be already set in a particular direction that did not look like those of MMM, the Frugalwoods or the ONLs.

Marching To The Beat Of Our Own Drum

It has been suggested that there are several key ‘characteristics' of those taking the FI journey (check out podcast episode 52) including investing in low cost index funds and living frugally to allow for a high savings rate. But, by the time I learned about FI, we had bought and sold several investment properties and just completed renovating the home that we live in. We lived in a high cost of living metropolitan city and had good jobs after (possibly too much) schooling and moving through several roles in the private and public sectors. Note: not an index fund in sight!

And, after being raised by immigrants from different parts of the world who started out with very little, Mr. MoneyPenny and I were very familiar with pinching pennies. Honestly, we carried some of the baggage and scars of growing up in scarcity and the fear of not being able to make ends meet. So, being super frugal was not at all appealing–been there, done that.

All this to say that we started our FI journey with a financial portfolio made up of real estate properties, employer pension plans, pre and post-tax investments and a complicated relationship with frugality. What did this all mean in terms of getting to FI? Could we get there too?

 “Sometimes it's the journey that teaches you a lot about your destination.” 


Current Asset Allocation for the MoneyPennys. Note that real estate has been calculated as estimated market value net of any liabilities; pension calculated as present day transfer value

A Fine Balance

What we are now discovering is that there is a place for us. That there are many paths to achieve FI. So, we think that the answer is YES, we can reach FI without a significant portion of our assets in low cost index funds.

Our approach will be one with a large real estate component, making smart career choices, and trying to maximize income from our jobs. With young kids in the picture, I expect that this plan will have some elements that will need to be adapted and dynamic as we go forward.

Underneath the nuts and bolts of the financial plans to FI is what’s perhaps the biggest transformation for us–a shift in mindset around money from one of scarcity to abundance. This is now what fuels us to try to achieve FI. Frugality in this context does not have to be the same as what we experienced as kids.

Finally, perhaps it’s because I am midlife and/or because of losing my mother and other significant people at a young age. I am very conscious of only having today. So, to me the journey is just as, or maybe even more important than the final destination.


The FI community has many “Sherpa’s” to reach the summit. Hoping that I and others on the ChooseFI site can be some of them.

Some of the things that I hope to explore with you are:

  • The Game Plan: Our FI plan is dynamic and has a different ‘mix' of assets than some of our colleagues in the FI community. I will try to use my numbers as an example to point out some smart and not so smart moves on our journey to FI.
  • Little FI-ers: How can we model and teach our kids financial literacy, contentment in the midst of consumerism, and the possibilities that FI can open up for them?
  • FI Book Club: I’ve done lots of schooling but now is our chance to learn about finances, health and happiness. Let’s check out some cool books and resources together!
  • Abundance and FI: We only have today, so how can we nurture a FI mindset that focuses on abundance and possibility–not just running away from our 9-5 jobs.
  • Save or Splurge?: Is it ok to splurge sometimes? Confessions of an aspiring “valuist” (check out podcast 29 for more on what this term means)

Please join me as we take this journey together. Looking forward to positive, productive and thought provoking discussions with you all. Here we go!



13 thoughts on “Reaching Financial Independence Without Index Funds?

    • Thanks FI Monkey! I have seen a couple of threads on the Facebook group with some great book ideas. I will do some thinking on how to get this to feedback and suggestions, of course. And love the idea of an army of little FIers – imagine the possibilities!

  1. I love this! Having grown up with scarcity, it is brutal to imagine living with really narrow parameters on what I can do/buy/experience, even though I’m still being driven by a generally frugal mindset. A mix of loving the life I have now and maximizing choices for the future is perfect – super excited about upcoming articles!

    • Thanks CC. Navigating frugality and figuring out what abundance looks like for me is one of my ‘hills to climb’. I know that it’s possible! I like the idea that has been introduced to me through the ChooseFI podcast, “selective frugalism’. Makes sense to me….I just want to dig a little deeper to figure out what defines something as needing the frugal or splurge hat! Sounds like another post will be on it’s way 🙂

  2. Love this article. My favorite line, “…the journey is just as, or maybe even more important than the final destination.” Here, here from a fellow 40 something!! FI bookclub, abundance & FI – yes!

  3. Super post! I love your use of FI and abundance in one sentence. It sounds so much better than FI and frugality!! Keep them coming.

    • Thanks Earlier FI. Think that we can have it all – abundance and FI! The real journey is going to be figuring out how 🙂

  4. Wow!!!! Love this article and can’t wait to hear what you have to say about: Little FI-ers: How can we model and teach our kids financial literacy, contentment in the midst of consumerism, and the possibilities that FI can open up for them?
    We just recently stumbled across the FI community, divine internention, I believe. I am 46 and have never in my adult life felt like I even had financial security. This community gives me hope but I want our children onboard and to understand the why. I struggle with the message of them being conditioned in the “scarcity” mindset that I also grew up with. Delivery of the message is ultra important. Advice?

    • Hello Autumn! Welcome to the FI community and thanks so much for your message! I totally know what you mean about trying to shake the mindset of scarcity. One thing that might be a start is trying to orient yourself to positivity. What I mean is trying to surround yourself with people who look at the world, ‘glass half full’. For me, this has meant stepping back and evaluating my relationships with family and friends. And even letting a few people go since their negativity was getting me down. And for those relationships that you have to keep (like relatives) one trick I’ve been trying is to just notice when they start being negative and complaining, and then imagining that negativity rolling off of me (actually, I kinda visualize water rolling off a ducks back!) We can’t let that negative stuff enter our precious souls!

      Another thing that might be helpful is trying to be consciously grateful. There is lots of evidence that gratitude can be a stepping stone to contentment, as well as other mental and physical benefits. For kids, I’ve tried recently to introduce this language with my son a little. For example, “isn’t X wonderful? I am so thankful that we have/can do X”. Another experiment I have been trying is to be consciously giving with my kids. When we had a big snowfall the other day, my 4 year old and I shovelled our neighbours’ driveway. We talked about how cool it was going to be when they came home and were surprised with a clean driveway.

      These are just some tidbits, which I hope can be helpful. This is something that I hope that we can figure out together. Be encouraged, you are not alone!

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