JL Collins Explains FU Money vs. FI Money

CHAPTERS
00:00 - Intro - JL Collins Explains FU Money vs. FI Money
01:45 - FU Money Definition
02:30 - Good uses for FU Money
06:15 - JL Collins FU Money Story
07:55 - FU Money Examples
09:23 - Define Financial Independence
12:15 - Lifestyle options with FI Money
14:07 - Views on Retirement
17:11 - Purpose During Retirement
18:49 - Homeownership
22:50 - First step Toward Financial Independence
25:12 - Pathfinders
30:36 - Final - JL Collins Explains FU Money vs. FI Money

#FUMoney #FinancialIndependence #FIRECommunity #FamilyFinance #personalfinance

GUEST BIO - JL Collins

JL Collins is the international bestselling author of The Simple Path to Wealth: Your road map to financial independence and a rich, free life. He has been called “The Godfather of FI” in the financial independence community.

OTHER VIDEOS TO WATCH

FU Money: A Realistic FIRE Movement Alternative

Jeremy Schneider: How He Became a Multi-Millionaire (BEST OF MKM)

JL Collins Recommends This One Fund on a FIRE Path

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CREDITS

Research & Writing: Andy Hill
Thumbnail: Ardi, The Thumbnail Wiz
Channel Management: Nev Maraj

[CaptPicard]

My wife and I bought too much house initially, as soon as we realized we’re were spending more than we made, we put the house up for sale and bought a house where the mortgage was 1k less a month. It was the best decision we ever made, our incomes increased and now we have no worries

[Antandthegrasshopper]

I'm 58 and was burned out from the job. Told my boss I quit and he asked me what can he do to keep me? I said 1 year of sabbatical leave to travel. He came back in two days and said OK... Woo hoo! Leaving in 3 weeks for Asia, Europe, Central/South America trip!

[imdoc]

Im a physician. I got burned out last year. I quit. The director gave me a few options but I decided to just leave in good terms. I came back 5 months later on my terms and they did not even put up a fight. They agreed to my requests.

[sturat]

I’ve been out of debt most of my adult life. I had a VERY high stress and low work/life balance career, and one day (with the support of my wife) I just quit. The key? No debt and a pile of FU money. Now I work remote for less, but through budgeting and long-term planning, still achieved paying off the mortgage and now in the best spot we’ve ever been in.

Upgrade cars? Start a small business? The world is our oyster.

[typorter-pplh]

A year before I quit my last office job (have been self-employed for 10 years now) I told my boss I wanted to reduce my work to 32 hours a week. I wanted to devote more time to my side hustle to see if I could eventually make that my full time job. I could tell he didn’t like the idea, but he agreed to it because in his words “we don’t want you to quit.” He knew I had enough FU money to walk if he didn’t reduce my hours. I have friends who live paycheck to paycheck and they end up being hostages to their employer. FU money is FREEDOM.

[Mary-tjqx]

i grew up in a part of the world where opportunity and employment were not guaranteed. I've never regarded any job as permanent and once i got to a point where i was making more than just enough to survive, i put the vast majority of the surplus into retirement and cash savings. One observation. I think most people assume they are going to be able to work at their careers until full retirement age. They won't. Odds are they'll be forced out long before then. If you shave 20 years off your retirement age and consider that to be the point when your employment will become much less secure, you'll prepare accordingly. The main benefit of having financial freedom is that you build an exit door for yourself. Your employer doesn't hold your fate in their hands. Leaving that kind of work to do work or whatever you want that hold meaning for you is a good life.

[Batirtze-bx]

I love this man. He has a gorgeous voice and a no nonsense approach, which is clearly a double bill. Thank you both. ❤❤❤❤❤❤❤❤

[vanguardvaluist]

I’m so grateful for JL Collins and Jack Bogle. Been on the path with a median income for 8 years and I can see the finish line. The numbers changed when I did!

[CharlesBallowe]

I always put FU money as a step past FI. FU money by my definition would be the point where if an employee at some company was rude to you, you can buy the company and fire the person.

[randymillhouse]

I am $160K away from FU money. That will take 1.5 to 2 more years. Retiring in summer 2027 at 62 and just to be sure we have that FI topped off!

[mitchellhallan]

So glad to have stumbled on JL’s blog back in 2012, his mission to provide simple guidance to investing helped set us up for financial success. Just today (first of the month) I updated our monthly portfolio tracker and was looking back to 2012 when we first started compared to our portfolio today… simply incredible the difference. Thanks JL and LOVE Pathfinders. I share my copy with whoever will read it!

[JosephDickson]

The Simple Path to Wealth is an amazing book. I recommend everyone read it.

[jhpt]

I’m new to your channel and had heard of Collins in passing, but had never looked further into his work. He has a lot of good thoughts - now I want to check out his books. Thanks for a good interview!

[nodnalkrats]

Financial advice from Optimus Prime! Love it

[Bob-yhir]

Love it ! Have had FU money for decades now. It allowed me to take some chances, switch jobs or move within a company to things that may or may not work out, etc. Take longer vacations working with my mgmt team to do so. And of course when a couple places I worked went dark ( out of business ), it was now a buffer and allowed me to take some time to look for what I wanted to do next. Now have hit FI and going into the RE part of it with early retirement.

[LtColDaddy]

Mi was really aggressive in real estate as a young guy, always using other peoples money. Technically, at 32, I could have retired. I’m 52 now, had a great 20 yr career as an airline pilot, and I farm at scale. I’ll qualify for a reserve retirement and benefits soon. I never stopped investing, I work on aircraft as a side gig.

It is and was always the FU factor for me. I was never beholden to the military, my airline, the farm, or fixing and fabricating things. The farming operation is set up as a legacy item. My mark on the world long after I’m gone. It’s set up to where I can’t even sell it. It’s it’s own being.

[economicdevelopmentplannin]

Rather than say, "if $40k yearly is needed ..", we should discuss our actual needs.
For us, it's 1) property taxes 2) utilities 3) groceries yearly. Everything else is optional. A luxury. Toys, at best. Wasteful, at worse. Then, back into discussions about these, where they're higher and lower. What brings more joy vs headaches. For example, Where do we get more amenities in exchange for the property taxes. Beyond the beach and mountains, I find the property taxes of being in the DC area offer more than any other places in the US. The quantity and quality of free museums. The volume of top schools. The moderate weather. Access to both beach and mountains. Generally half the cost of NYC and

Or... Does a car or unlimited transit pass bring more joy.

I'm looking for these discussions...

[ninerknight]

JL: I am struggling with respect for my parents. I love my parents but as I gain financial literacy I’m starting to have trouble respecting people with terrible priorities. As I make all the sacrifices for my family it’s become evident that my parents did the exact opposite. It’s getting hard to respect anyone who has terrible, childish priorities. Who threw their life away because of car commercials.

[qq]

5k in 1972 would be $36, 447 now in 2024 to inflation calculator

[Soupy]

17:00 minutes of the video: Yes, calling it FI opposed to FIRE is probably a better use of the acronym. I have to constantly tell people "retire early" means retired from being an employee. I'm barista FIRE working 2 days a week for the last 2 years. Working 2 days a week including stat holidays covers all my monthly expenses and I even save some money on top of that. Currently, I'm not interested in starting my own business or anything like that at this point and find leanFIRE/barista FIRE works great for me. I did spend the last 2 years playing the options trading and high yield dividend investing. I've quit all that for collecting 5.11% interest in money markets, which is great for the 4% rule. I hope that interest rates don't go any lower but we all know they will and I'll have to go back into the stock market and further out on the risk curve.