Home Blog BiggerPockets Money Podcast

A Mini-Retirement Road Trip in Your 20s with Becky & Noah

The BiggerPockets Money Podcast
44 min read
A Mini-Retirement Road Trip in Your 20s with Becky & Noah

Becky and Noah are in the first half of their gap gear, a pre-FI road trip around America.

They didn’t grow up rich, but they carefully planned out their life to avoid student debt. Both earned the same Chick Evans Caddie Scholarship to Purdue University that paid full tuition and came with housing. They made smart career choices earning employable, in-demand degrees that allowed them to earn high salaries.

After discovering FI on Reddit, they made a few tweaks to their lifestyle, quit their jobs, and hit the open road.

This episode shows that financial independence isn’t just a pipe dream, and while Becky and Noah aren’t there yet, they are well on their way.

Click here to listen on iTunes.

Listen to the Podcast Here

Read the Transcript Here

Scott: Welcome to BiggerPockets Money Podcast, Show Number 23.

“One of the ways I like to describe it is that there’s a bunch of banks out there offering this bet that you can take. They’re going to bet you two free flights that you can’t handle credit responsibly. And if you win the bet, then you get the flight. So are the hotels and whatever else. And I mean, there are a dozen different banks offering this in a dozen different ways and if you can handle credit, if you can be responsible with it, then there’s a lot of money and travel opportunities to be had”.

It’s time for a new American dream, one that doesn’t involve working in a cubicle for 40 years, barely scraping by. Whether you’re looking to get your financial house in order, invest the money you already have, or discover new paths for wealth’s creation, you’re in the right place. This show is for anyone who has money or wants more, this is the BiggerPockets Money podcast.

Scott: How’s it going, everybody? I’m Scott Trench and I’m here with my co-host, Miss Mindy Jensen. How are you doing today, Mindy?

Mindy: Scott, I am doing fabulously. The sun is shining. The birds are chirping. And for the next five minutes or so, it’s not going to rain. So life is pretty good over here. How about you?

Scott: Awesome. I am doing great. I am excited for today’s episode. We have a great young couple and yeah, you want to tell us a little bit about them?

Mindy: Yeah, so on today’s episode, we have an example of a young couple who have just kind of made smart decisions their whole life with an eye towards the future and what the future could hold. Becky and Noah shared their journey to financial independence. They chose employable college degrees, financing college through full-ride scholarships. They earned high salaries and maximized their savings rate. Pretty much everything you are supposed to do with FI, they did.

And now, they are 27 years old. They are three months into a gap-year after quitting their jobs to travel around the country and just kind of enjoy themselves and see what it’s like to be 27 with no cares in the world. And I just really enjoy talking to them. They are way farther ahead on their journey than I ever was at age 27. And it’s nice to see people who are thinking ahead.

Scott: Yeah, what I am thinking is, what I think the power of this episode is, is this is the ‘why’. This is the ‘why’ you just make basic, solid, correct choices throughout your life, over the course of a decade or so and set yourselves up for a lifestyle that is really unmatchable. These guys are living the dream. They are doing exactly what they want, when they want, where they want. All over the country. Visiting friends and family, cool places, having fun, relaxing when they want to.

And that’s why you do it. You set yourself up for FI so you can have that option. And they’re hardworking folks and I bet you they’re going to go right back within a year or two and begin changing the world in a way that that’s unique to them and within their kind of constraints and abilities. And they’re going to go after it, and they have the complete freedom to do so on their terms when they’re ready. This is why. This is why you do it.

Mindy: Yes, that’s a really good description of the show. Before we get into the show, before we bring Becky and Noah in, let’s make a request for people to send in guest suggestions. We did this a couple of weeks ago and we asked for families on their path to FI. I have received a lot of people responding and e-mailing me their story and it’s going to be so awesome.

We’ve got a few family episodes coming up in the next couple of weeks and now, we’re looking for single parents or divorced parents to share their journey to financial independence, too. It’s not just for families. It’s not just for single people, well, I guess single, no kids. What would you call yourself, Scott?

Scott: I am a single guy with no kids, so I am a SINK. And then there’s a double income, no kids, right?

Mindy: DINK. That’s Becky and Noah.

Scott: Becky and Noah. And then we’re going to start interviewing a couple of families who have—I don’t know what the term is for them.

Mindy: Yeah, I was trying to think, what is it? Dual income, with kids? DUWK? I don’t know.

Scott: So there’s a single family with kids, right? And then there’s single-income spouse, you know, a divorcee or a widow or a single parent.

Mindy: What’s that, SINS? Maybe we should say something different.

Scott: But these are—we’re working kind of from easiest to hardest here, you know. And I think that it’ll be very interesting if you know anybody that’s working towards financial independence with some constraints that are beyond that kind of normal, outside the normal.

Like, not a single guy like me, not a married couple like Becky and Noah, not even a married couple like Mindy and Carl. But what are some disadvantages that go beyond that with a single parent or divorcee or whatever that really kind of puts constraints to moving towards FI. How can we hear stories about people overcoming those challenges? So if you know anybody like that, we’d love to hear it and please send them along to [email protected] or [email protected].

Mindy: Yeah, that will make a really great episode, too. And I am sure that I am going to get a lot more fantastic responses because I probably have 40 people that have sent me their stories and it’s fantastic. So the response has been amazing. I’m very excited to get those shows on the air in the next couple of weeks. But before we bring in Becky and Noah, let’s hear a word from today’s sponsor.

Scott: Today’s sponsor is FreshBooks. If you’re an entrepreneur who is not on top of your business financials, you need to get a good dose of FreshBooks in your life. FreshBooks is the ridiculously easy accounting software made specifically for small business owners who need to find a better way to deal with their paperwork. It takes literally about 30 seconds to create and send a polished, professional-looking invoice. And with two clicks, FreshBooks can set you up to receive payments online. FreshBooks can even show you whether or not a client has looked at the invoice you’ve e-mailed. For a 30-day, unrestricted trial, go to FreshBooks.com/BPMoney and enter BiggerPockets Money in the “how did you hear about us” section.

All right, big thanks to today’s sponsor. Mindy, should we bring in Becky and Noah?

Mindy: Yes, please.

Scott: Becky and Noah, welcome to the BiggerPockets Money Show. How’s it going?

Becky: Good. Thank you for having us.

Noah: Great. Same.

Scott: Well let’s go ahead and start right from the beginning of your journey. How did you guys meet and then how did you get started on your kind of journey to financial independence?

Noah: So, it all kind of ties in together. So we met in college and the reason we met is that we both got the same full-ride scholarship to college. So that was at Purdue University and the full-ride is called the Chick Evans Scholarship that we got for being golf caddies.

So we both caddied at our respective country clubs, me from Indiana and her from Illinois, and caddied for at least six plus years and then had good grades in high school, had some financial need for our families, and we were able to get full tuition and housing scholarships to college, which is where we met. So it’s very magical in that way. 

Scott: So you’re basically saying that this golf caddy scholarship allowed you to kind of graduate from a really prestigious university, both of you, without any debt. Is that more or less the story there?

Becky: That’s correct, yeah.

Mindy: That’s awesome.

Scott: And what was your work when you graduated?

Becky: So I have a nursing degree, so I worked in labor delivery for the past five years.

Noah: And then, so I graduated with a degree in computer engineering which is about half computer hardware, half computer software, but I really love the software side a lot more so I ended up getting a job in Seattle working at Amazon. So complete computer science job. But that was amazing and that’s the reason we moved across the country from Purdue.

So we’re both from the Midwest. Purdue is in the Midwest and then we both moved all the way across the country to Seattle, one for the great job opportunity, and that allowed us to  earn and save a ton of money, which set us pretty aggressively forward to the path to financial independence.

Scott: So how much were you guys earning and saving out of college? How much were you able to accumulate over the last couple of years? How are you able to live cheaply in Seattle as well? That’s a pretty expensive place.

Becky: I think that we both grew up pretty frugally. We have never naturally wanted to spend money so that was just a big bonus for us.

Noah: Out of college, I got the big tech job. Becky was able to find a nursing job in Seattle not long after we actually moved there, and combined, we were making about $150,000 out of college. Which is amazing. We’re very fortunate for that to be possible. But yeah, as Becky said, we’re fairly naturally frugal.

We just kind of kept the college lifestyle going after we moved to Seattle. And at first, because we didn’t know about FI at the time, we didn’t really have a purpose for what we were saving money for, but we were saving money already so that put us way ahead.

Scott: So when did you kind of discover the concept of FI? When did that—and was there a change maybe when you discovered that?

Noah: When we first discovered FI, it was about a year after we moved to Seattle. I actually found the FI subreddit on Reddit. I believe they made the personal finance a default sometime in 2014, and then whenever people talked about retirement or early retirement, people linked them over to financial independence and then that kind of, they had an amazing FAQ, which is like the basics of the FI world we need to think about, what people are talking about, what people recommend.

And that, of course, led to places like Mr. Money Mustache and Early Retirement Extreme and a dozen other blogs, just an endless stream of information available to consume. And I just ate it up as fast as I could.

Mindy: Did you share that with Becky and she was on board right away or did it take some convincing? Becky’s shaking her head.

Becky: No, he kind of dove into it pretty intensely and started kind of explaining it to me a little bit and it just didn’t make sense to me at all. And I actually really enjoyed my job at that time. So I wasn’t—the idea of quitting just sounded really, really strange to me, especially early in. Because I was like, oh, this is going to be forever and this is going to be my life.

So it took about a good year, I think, for you to kind of explain it to me. And it was more just him—what am I trying to say—living the lifestyle you wanted to live and me just kind of looking at that and realizing, oh, this is actually kind of cool.

And I started kind of increasing my career a little bit. I became a charge nurse and I just increased my responsibility at work and I became really stressed out, really burnt out, and realized I don’t think I want to do this forever, so that’s when I’m like, I like this idea of walking away a little bit earlier.

Mindy: So what timeframe—sorry, Scott—what timeline am I looking at here? Because you guys aren’t 50 years old. You have graduated rather recently. When did you graduate from college?

Becky: I graduated in 2012.

Noah: And I was one year behind. So we’re both 27 right now.

Mindy: So you haven’t been working for a long time. I can hear people listening saying, you’re not old enough to be burned out yet. But you know, being a nurse is really stressful. Let me tell you how stressful it is, Becky. But you’re in charge of a lot of things so that’s—I can totally see getting burned out.

I’ve been burned out at jobs really quickly after starting. So yeah, I guess being able to see how much fun it is to not do this and oh look, a stress-free lifestyle. That could be a big turnaround point. So how long did you work? Five years? Six years?

Noah: Yeah, so we got to Seattle and we lived there for about a year and just as we mentioned, kind of naturally saved money. And then at the beginning of 2014, we actually bought a townhouse in Seattle because we thought we’d spend a while there and at least at the time, the mortgage payment for the equivalent rental was cheaper so that was the only really math we did. We were like oh, that makes sense, we should get a house.

Fortunately, it was one of the best accidental investments we ever made just because you could have bought anything in Seattle a few years ago and done very well. So we had our money saved for that. We bought our house and then we discovered FI soon after that. And then we started setting up our finances more efficiently to be like, oh, maybe we should be maxing out our 401Ks. Maybe we should pay more attention to IRAs. Maybe we should, I guess it gave our savings a purpose.

So we cut back a little bit on excessive things, just like buying new furniture all the time and stuff like that. Like, stuff we didn’t really need to be spending money on.

Becky: You act like we have like multiple series of furniture.

Noah Well, we bought a house, and then we filled it up pretty quickly. But yeah, so we were naturally frugal and then after discovering FI, after buying this house, we actually had a purpose for our savings and we just started making our whole financial world a lot more efficient and optimized for being able to retire early if we choose to.

Scott: Well, let’s get into that. What specific efficiencies did you realize? You mentioned the 401K but can you just give me the rundown of what you’re doing previously and what the change was once you began giving that purpose? Did your savings rate increase? Were you tracking it more? I don’t know.

Becky: Yeah, the biggest thing is we just started writing down everything that we were spending. You know, we both had a Mint account. I wasn’t really super religious about it but he was, and every month, he would go through both of our expenses and kind of see where we were at and figure out exactly where all of our money was going and we were like, oh, we spent a lot of money on this this month. Maybe we should do that next month.

We were just more conscious of it and being naturally frugal, it helps. And yes, we were able to like move money around and put money into specific things and he did a lot of research on investing and that’s pretty much it.

Noah: Yeah, so like once we started putting money away, so when we first got to Seattle in 2013, we weren’t tracking our expenses very much. It was just kind of making sure we were cash flowing every month. We weren’t spending more than we were making. We knew at least that much.

And then at the time, we were putting in the minimum we could in our 401K to still get the match, so that was like the standard advice we heard from people. At least get the match. Because like it’s free money. So we were doing that already and then as soon as we discovered FI, we immediately bumped it up to the actual max, which is what, $18,500 or it was $18,000 a couple of years ago.

So we were both doing that and we were both maxing out our IRAs and we both, or at least I had access to an HSA when we discovered FI so we were maxing that out because it’s the ultimate retirement account, as you may have read online.

Yeah, and beyond that, it was just putting money into a brokerage account and then just straight index funds all the way, so very standard FI. Everything is in either Total U.S. Market or Total International Market. So just all index funds as tax-efficiently as we can do it.

Mindy: Wow, have we heard from anybody recently about index funds, Scott?

Scott: Yes, what was the show number? We just had Jim Collins on the show and he talked about all the things behind index fund.

Noah: He’s the grandfather of index funds.

Mindy: Yeah, he is the grandfather of index funds. That was Show Number 20, so www.BiggePockets.com/MoneyShow20. You can hear Jim’s take on this but yeah, it sounds like a good choice for you, too.

Noah: Yeah, I mean it’s just the simplicity of it. I mean, there may be much like better ways to invest or even like, okay, so there’s not guaranteed ways to get more but there are ways to get more and that you can put more time in. But just index funds is just so simple, like we don’t have to think about it. We just throw all our money in there and we’re done. And we’ll take the average back, just done very well over the 50 plus years and we’ll take it going forward. So that’s all we need.

Scott: All right, so what is so great about your story is you just didn’t make any mistakes. You got a full ride to college by playing your cards correctly in high school. You graduated debt-free. You got solid jobs. Not crazy incomes bt you know, two full-time college graduates getting a job at an average $75,000 is not extraordinary income right out of school.

And then you just saved and saved and spent reasonably. Sounds like you bought a reasonable house and you maxed out your 401K and you put all this stuff together. How much were you able to accumulate as a result of this over the you know, over the period that you worked out of college.

Noah: At the moment, we are not revealing our net worth. That’s not public information. But I will say that, you know how much income we were making out of college and at that point, we’re maybe saving 25-30% and then over the next several years, we were able to ramp that up to like about 75%. So a very high percentage of our salaries were going to index funds every year.

Mindy: Wow, 75%.

Becky: Yeah.

Mindy: I like that. Sorry, Scott.

Scott: That’s awesome. What I want to know is do you have any peers that graduated around the same time that got similar levels of income and were not able to produce this result. What did they do differently from you that maybe didn’t allow them to get to where you are financially.

Noah: I would say our closest friend that also went to Purdue and also graduated moved out to Seattle, also got a similar tech job and is on a similar path to us. I don’t know if we have any close friends who graduated and moved across the country or even just found lucrative opportunities elsewhere. I mean, I guess the honest answer is I don’t know what most of my friends’ financial picture is. Like, it’s not something that comes up in normal conversations so I don’t know if they’re saving or they’re in crazy amounts of debt or what.

Scott: Let’s rephrase this then. Why are you guys so well off and so able to stock pile a net worth and rapidly move towards financial independence but most people that graduate with these types of degrees and have similar paying jobs are not? What’s the difference, do you think? You just described something that’s not hard.

Becky: Yeah. I think it’s just when people live a college lifestyle and they finally get that first paycheck and they’re like, oh my God, I can live. And I have money. And they want to spend it. It’s the American dream, right? To grow up with the white picket fence and the house and the nice car and that’s just what I think the world wants. But I mean, our outlook on it is just different.

Noah: Yeah, I think Becky hits on the big point. It’s just lifestyle inflation. I think the majority of people that come out, whether they have a low-paying job or a high-paying job or somewhere in between, they just spend all of it or sometimes even more if they go into debt, if they don’t understand the long-term consequences of that.

But like, once we found this path, like we did get a couple of raises over the last five years when we were working. Like, none of that changed our lifestyle at all. We found a level of living that we were very comfortable with and that we could afford comfortably on our salaries and we just never inflated it year over year, even if we were making more money.

Mindy: Yeah, that’s fantastic. That’s kind of hard to do when you see all of your friends doing the same—doing the opposite of what you’re doing. So Scott said a moment ago, it sounds like you didn’t make any mistakes. We had a guy on a couple of episodes ago, Tony Gayden, on Episode 21, where he was telling his story and it was just like obstacle after obstacle after obstacle, keeps being thrown his way, and it’s just like get out of here. I’m going to continue on my path and I’m not going to let anything stop me.

And you know, it sounds like you guys really had an eye towards the future, even when you were in high school. You’ve got this scholarship—when did you discover the scholarship? You don’t just get good grades and hope for the best, right? You had known about this before.

Becky: Right, so my older brother caddied as well and we found out about the country club that we caddied at from a mutual family friend. So that person got us into the club and we started caddying and my brother obviously found out about it before I did, he’s six years older than me, so he got the grades and he also got the scholarship and went to Northwestern in Illinois and so that was basically my goal starting as a caddy, was to get the scholarship. And my parents pushed me and they really wanted me to work and do really well and so I definitely thank them for me getting that whole scholarship. That’s how I found out about it.

Noah: Yeah, I mean it’s a shout-out to my parents for me just having the whole opportunity to start with because my dad actually worked at the country club where I ended up caddying and when I started, I had no concept of like tuition or college or what I wanted to be doing. Because I started at like 13 years old. But at the time, it was just an amazing job because I mean, you would get outside. You’d carry a golf bag for like four or five hours walking the whole time. So you’re getting a pretty good workout. You’re outside. You’re in the sun, and then you go home with like $20-40 bucks spending money.

Like, that’s just awesome as a kid. Luckily, I stuck with it and they pushed me to like actually put the time in and take the steps needed to get the scholarship later on once I realized how important that was. But at the beginning, I’m just happy they set me up with the opportunity and I mean, I just loved it. I just loved being outside, being around golfers because I golfed myself. And just being outside. It was just a great summer job, regardless of the scholarship. And then that was an amazing boost at the end.

Becky: Yeah, same for me.

Scott: All right, let’s fast forward to the present. So you guys, you did it right. At every stage, there’s no major obstacle. You eliminated every major obstacle to financial success, starting from this position of getting the scholarship. Then you went to college, you got employable degrees. You found good jobs out of there.

You behaved reasonably and didn’t spend too much out of college. You saved a good chunk of your income, and then what are you doing now? Can you tell us about what are you doing right now, the last three months that other people that didn’t make these same choices are unable to experience?

Mindy: What a leading question.

Becky: I don’t think you’re looking for a specific answer.

Noah: So as of January of this year, we are both unemployed and currently travelling across the country in what we’re calling a gap year, or a mini-retirement. We didn’t make full financial independence in five years but we are on track to get there in maybe another five years. So we’re maybe about halfway or somewhere around there.

But we decided to just take this opportunity to where we were both looking to switch careers anyways, to just leave, travel for a while, use that amazing financial foundation that we built on the path to FI over the last five years and just tap into that a little bit to just have this amazing life opportunity to travel across the country for an entire year. So that is what we’ve been doing for the last three months.

Scott: So where have you gone specifically?

Becky: So, we started in Seattle obviously. We drove down the coast and we have a dog so we dropped off our dog with my sister in San Francisco. And she’s graciously taking him for the year and loving it. And then we kept going down through California. We cut over through Arizona, New Mexico, Texas. We had a wedding in Austin middle of March so we were there and then we came back through New Mexico, Arizona, up through Utah. We did all the national parks, state parks, and then now we’re in Colorado, in Denver at the moment and it’s been a blast.

Noah: Yep. So like we didn’t start this trip with any specific goals like we want to see all 50 states or we want to see all national parks or we want to see some crazy checklist to follow. We just wanted to relax and so what we’ve been doing is just travelling like on average, or not on an average day but on days that we move from city to city, we’ll maybe drive three or four hours to the next town that sounds good.

We’ll check out national parks in the meantime. We’ll visit with family and friends whenever we get the opportunity, if we’re in the right part of the country. And it’s just been amazing just to see so many parts of the country that we’ve never seen before. And it’s just amazing.

Scott: That’s awesome.

Mindy: So what is it like being unemployed after being employed for five years and going to college. This is something I think a lot of people struggle with. My husband struggled with this when he quit his job. He was like, oh, we reached the number well before he quit. And it was difficult for him to quit. And then once he did quit, he was like oh my goodness, I should have done that sooner. Like oh really, wow. Amazing that nobody ever told you that. So how is it being unemployed for you?

Becky: It was honestly really hard at first. So I actually left my job back in August and I had just recently gotten a promotion and I was a supervisor of my unit, which was really, really struggling for me. It was very hard. And I got even more burnt out and more overwhelmed. And so when he finally told me to walk away, because it was making my life very hard, it was really easy after that.

I’m like, oh my God, I feel so much better and the six months leading up to our road trip, I sold all of our stuff and that was my little mini job, was to get our life ready for this year. It’s been great. I mean, we wake up when we want to and we basically can just do whatever we want to do and I don’t know, I don’t hate it.

Mindy: That sounds awful.

Noah: Like Becky’s situation, very hard to quit. I actually pulled the trigger, being in the position she was and having so many people rely on her. But amazing once you actually did. No regrets of any kind. And then for me, at least in big tech, it’s rare for people to stick around a company for more than a couple of years, which is a more modern phenomenon or I don’t know what. But at least like, between all the big tech companies, it’s very rare for anybody to stick around for more than a couple of years.

I was there coming up on five so I was kind of due to switch anyways because usually, you make more switching companies than getting promoted within for whatever reason. So I was kind of ready for a transition anyways. Becky was burnt out so I’m like, why don’t we just both quit? It’ll be fine. We’ve been doing most of the things right in our lives up until this point. We have this opportunity. Let’s take it.

Becky: Yeah, it was a lot easier because he’s really good with the math and the numbers and he like showed it to me and all of our spreadsheets and he’s like, look at what we have. Look at what we can do. We’ll be fine. And so that did make it a little easier as well.

Noah: And it doesn’t hurt that we both have very employable jobs at the moment to where we’re in very high demand professions. So we don’t think we’ll have any trouble getting back into the workforce if that’s what we decide to do.

Mindy: So Scott just said, oh you guys got employable degrees. That’s a really important thing that I think a lot of people don’t think about. My degree is in Fashion Design and that was really not the smartest choice for me, although I did just get a note from somebody who said oh, my Fashion Design degree was the best thing I ever did. I’m really glad it worked out for her. And I hope she continues with it and continues to see success. It was a bad choice for me and I didn’t see any success with it.

And it’s not that employable. It’s not like I was at a bad place It was just not the right thing for me. And you know, everything happens for a reason. I now have this job which is amazing and I would never want to quit. But I’ve been in that position where every day is like ugh, I can’t believe I have to go to work again. So I hear you and FI wasn’t a thing back then because we didn’t have the internet then. So I didn’t discover this and I just kept plotting along in this horrible job, thinking only 40 more years.

So what’s your favorite thing that you’ve seen so far? On the road, on your trip.

Becky: I don’t know, so many parks. Like, the Grand Canyon was amazing. I had never been there. So that was just a huge, fun week for us. Just all the parks. I don’t know. Arches was awesome. Zion.

Noah: Yeah, we’ve been to like a dozen national parks at this point and they’re all amazing in their own ways. One of my favorites was definitely the Carlsbad Caverns. I’ve never been in a cave anywhere near that size and to be in a cave to like you go into a room and it’s like bigger than a football stadium. There’s more rooms off of that all underground. It’s just very cool.

Mindy: I went there as a kid. I don’t remember much about it except don’t the bats come out at night?

Noah: We did see some bats, yeah.

Mindy: An exodus of bats?

Noah: They swarm out in the morning and swarm back in in the afternoon. Or vice versa. I think I had that reversed.

Mindy: I think they swarm out at night.

Noah: There are definitely bats.

Scott: So you guys are going to go—you built a stockpile and you’re taking a gap year. You’re going to go right back to work whenever you feel like it. At some point in the next year or so. And then you’re going to finish out the journey to financial independence, maybe taking more gap years in between, basically at your “leisurely pace” as you wanted over the next couple of years, right?

You’re just, oh we’ll achieve it if we ever want to buckle down and do it but basically we’re super happy right now and we have just a ton of great options. I mean, what a fantastic situation. Let’s switch this over to another topic of expertise that you’ve got. Unless you have anything to add in that category. And talk about your travel hacking. Because you guys are big travel hackers, right? 

Noah: Yeah. Let me just touch on one thing before we move on. Like you said, it’s all very open-ended at this point. Because we’ve built up this amount of money that’s invested, like, it will compound over time. Regardless of what we do as long as we’re not draining it all. So we have so much flexibility to where like if we want to go back to our full-time jobs and grind through FI in the next three to five years and just be set for life, we can totally do that.

Or we can work part-time or remote or just any sort of non-traditional season job or whatever else. Like we could both work part-time, cover our expenses, and then just let our nest egg grow over the next 10 or 20 years and reach financial independence the slow way. Or still very fast, I guess, relative to the rest of the world. But like yeah, we don’t have to really grind it out anymore now that we’ve set ourselves up on this great foundation.

Mindy: Wow, that’s a really amazing quote. I’m going to write that down.

Scott: I love it. Why doesn’t everyone do this?

Mindy: That’s fantastic. Okay. Now, let’s talk about how you are paying for your travel. You just write checks all the time, right?

Noah: We just put it all on credit cards. It’s very simple.

Mindy: That’s the best way to do it. So I actually was told this by a friend once. He said, oh, I’ll just do what I want. I’ll put it on the credit card. I’ll figure out how to pay for it later. I’m like, oh, that’s not me at all. So tell me how you handle this with just putting it on the credit card and you’ll figure out how to pay for it later?

Noah: Yeah, pretty much. No, so about the same time we discovered financial independence three or four years ago, we also discovered this idea of travel hacking or turning credit cards. Basically, signing up for credit cards just to get the sign up bonus and then moving onto another credit card because there’s dozens of credit cards out there to where they will give you a reward of $500 to $1000 either cash or just in various travel currencies that are cash equivalent in some way for signing up for the credit card and then spending $1000, $2000, or maybe $3000 in the first three months of having it.

So it’s not like you’re giving them $3000. You’re just doing your regular spending, paying it off every month, and then at the end of reaching this spending minimum, you get this huge signup bonus. So we discovered this back in 2014. We signed up for a couple of cards because I mean, when you first hear this, it’s like way too good to be true, or like way too good to be true—all my alarm bells are going off to like this can’t be right.

So we started off slow. We got a credit card. We met the signup bonus. We got the magical airline miles. We actually booked a flight and then took the flight. And then we’ve done everything front to back. We earned the miles. We signed up for the credit card, earned the miles, spent the miles, and everything worked. It just worked. So we decided as soon as we realized it was legit, we just scaled it up rapidly.

So in the past three or four years, we’ve signed up for 70 different credit cards, all with a bonus, and then that has heavily subsidized our travel over the past several years, including our honeymoon. And then it’s helping us a ton on this trip just paying for hotels. Because the majority of where we’re staying during this road trip adventure is in hotels and then in between that, we mix in some camping and staying with family and friends. So that’s been a huge subsidy to our lodging expenses on this trip.

Scott: How much is this year going to cost you? What do you think? What’s your estimate for total expenses? Are you leaving your house vacant or did you sell that or how’s that working?

Becky: So we rented out the townhouse. We got a property manager just because we didn’t want to have to deal with it on the road. So he has been great and taken care of it for us. He found us tenants and they’ve been living there for about a month and a half, two months, maybe?

Noah: Something like that, yeah.

Becky: So we’re getting a little bit of income.

Noah: Yeah, we don’t really make much profit off of it. But it does cover all of our expenses and we don’t have to worry about it. And as the Seattle market keeps appreciating, so don’t jinx that but—

Becky: We’ll let them pay our mortgage until the next year or so and then figure it out after that. But we’ve also been tracking our expenses still, on the road, so we know how much we’ve spent and if we extrapolate that out over a year, it’s going to be under $50,000, which is way less than what we spend in Seattle.

Noah: Yeah, we’re currently averaging about $3500 per month give or take and then I think this month, we’ll actually get less as we kind of like get more rhythm and become a little more efficient with things, say with friends and all of that. It looks like the cost is somewhere between $35,000 and $45,000 or something like that, which is amazing considering the lowest we ever spent in Seattle was like $55,000 for a year.

So like living on the road is going to be cheaper than living in one place in Seattle. So far, so good. I mean, there’s a lot of unknowns with our expenses as we keep going but we’ve been on the road for three months. We have a pretty good feel for it and yeah, it’s right around $40,000 or so, is what we’re expecting the total year to cost us.

Mindy: That’s awesome. I want to touch back on these 70 credit cards that you opened up. That’s 7-0, not 17. It’s 70 credit cards that you’ve opened up.

Noah: Between the two of us, yeah.

Mindy: Between the two of you. So 35 and 35. How does that affect your credit score and do you need your credit score for anything since you’ve already bought a house, you’re on this path to FI, you’re not really to accumulate a lot of things. I’m assuming you don’t have a car loan or if you do, you’re not looking to get another one. Like how does that affect your credit score?

Noah: I’m glad you asked. Because that is the number question whenever I tell anybody that we signed up for a bunch of credit cards. Amazingly, I mean the short version is that no, it doesn’t hurt your credit as long as you use the cards responsibly. So I mean, like having more accounts is actually better for your credit, so that’s a plus. The one thing it does hurt is your average age of account, if you keep getting more.

But I mean, we can just tell you from experience like we started with credit scores in like the low 700s a few years ago. When we know our credit scores because I got a mortgage at that time. And then over the past four years, it’s grown to the high 700s, even bumping to 800s every once in a while, depending on who you ask. But as long as you’re using the cards responsibly, paying them off on time, every month, it’s really not going to ding your credit at all.

A lot of people don’t believe that but there’s at least one anecdote I can provide is that a couple of years into doing this, so after we both opened at least a dozen cards, probably closer to 20, we actually refinanced our house to both remove PMI and get a lower interest rate and we had no problem doing that despite having 20 credit cards in the past couple of years, or 20 new accounts in the past couple of years and having a few new accounts in the past month or two before we actually applied for the refinance.

And the lender basically just said, why did you sign up for these cards and we just said we signed up for travel rewards and that was the end of it. That was all they asked. And yeah, we got refinanced perfectly fine and no issues. We actually opened a HELOC just as kind of a backup, backup emergency fund before we started this trip and the same thing. We had opened a dozen or more cards in the last year and still had no problem opening this new line of credit.

Scott: What I suspect is happening is when you open a new credit card, it usually is a one to two or point ding on your overall score.

Noah: Yeah, a very small ding on the hard inquiry and then as you get all those new payments and the new accounts, your score goes up over the next three months or so.

Scott: And because you guys are young and still working on establishing credit, your age of credit history, your untimed payment percentage and all that stuff has just continued creeping up and so, that is just a completely negligible impact on your credit score. The tradeoff, obviously, is yes, there’s a very small one-time impact if you open up a card. But that can get completely overwhelmed by the utilization rate of your cards, the number of your on-time payments and all that kind of stuff. I’ve been doing this for a little bit and I’ve seen my credit score continuing to climb even though I’m opening those cards.

Noah: That’s a great way to describe it.

Mindy: I would like to share a little story with everybody who’s listening. A few months ago, maybe six months ago, I told Scott about this concept of travel hacking and recommended that he listen to the Choose FI podcast, Episode 9, I believe, where they spell it all out. They spent a whole episode on this. And Scott said, no, I’ve got a cashback card that gives me 1%. I’m pretty good.

I’m like well okay, I’ll just drop it, and then all of a sudden, Scott comes in one day and he said, I just listened to Choose FI, Episode 9, and it was amazing. And oh my goodness, I have been doing this all wrong and I can’t wait to start this. And I’m sorry, Scott, did you just earn a big travel reward recently?

Scott: I have the companion pass now and it’s great.

Mindy: The Holy Grail.

Scott: I don’t understand the economics behind this because I can see how like if someone opens up a card and they spend too much or they are late on their payments or whatever, that okay, I guess the credit card company can make some money off of it. But I spend close to like $3000 on this credit card, maybe just a little over $3000, got 60,000 Southwest points. Then I did the same thing on another card for 50,000. I have 110,000 miles, get the companion pass—that’s like, what, thousands and thousands of dollars in travel?

Noah: Oh, absolutely.

Scott: It cost me $195 in terms of two one-time annual fees which I probably won’t renew. How does that math work economically for the other guy?

Becky: I thought the exact same thing as you when we first started doing this. I was like, this is illegal, right? This has got to be—we’re doing something wrong. We’re going to get arrested. This is crazy. And he’s like, no, there are so many people that are not paying off their cards on time and that’s just where the credit card companies are getting their profit from. I mean, there’s like such a minor amount of people doing what we’re doing that it doesn’t affect anything.

Noah: One of the ways I like to describe it as is there’s a bunch of banks out there offering this bet that you can take. They’re going to bet you two free flights that you can’t handle credit responsibly. And if you win the bet, then you get the flights. Or the hotels. Or whatever else. I mean, there are a dozen different banks offering this in a dozen different ways and if you can handle credit, if you can be responsible with it, then there’s a lot of money and travel opportunities to be had.

Mindy: So true.

Scott: This is crazy to me.

Noah: Yeah, there’s a lot of people that can’t handle their side of the bet.

Scott: Like you, I just didn’t believe it at first for a while because it didn’t make—this is not a fundamental component of wealth building. This doesn’t make any sense. This has got to be like a one-time little trick. I’m not interested. But no, it seems like it’s pretty scalable for now at least. Can you give our listeners maybe some tips on where to start if they’re interested in travel rewards? We’ve already recommended Choose FI, Episode 9, of the podcast. What are some of your tips?

Noah: That’s a great way to start for kind of an introduction. My advice is always, because I mean, if this idea is new to you or you haven’t tried it, I’m sure you don’t believe it’s true. Why would it? It doesn’t make any sense. But there are also a lot of people that have done it and all I tell people is just start small. Just find one card with a signup bonus that you’ll be able to use, sign up for it, get the bonus and then either use it or at least understand the process of how to use those points. And then you can decide whether or not, it’s for you.

I mean, it’s not for everybody. It does require some organization and staying on top of your cards and being able to cancel them after a year to avoid annual fees and stuff like that but yeah, just start small. Get one card like any other adult does, sign up for one credit card with a signup bonus, get the signup bonus and then once you understand the process, if you want to scale it up, go for it. There’s a lot of room to scale it up. And if you don’t, that’s fine. You don’t have to. It’s not a requirement by any means but there’s a lot of opportunity out there if you’re organized and put the time in.

Mindy: I just want to add to this. Keep track of your dates. Your one year date. A lot of times, if you call it to cancel, the company will waive the renewal fee if you call them too late, but you really want to try and keep track of those dates and cancel beforehand. And keeping track of your cards is super important. I know you said that and we actually missed out on one of these huge bonuses because we opened up two cards at the same time.

We were in the middle of a home remodel so getting the spend wasn’t difficult. We just didn’t keep track of it and we put too much on one card and not enough on the other, so we got the bonuses on the one card but we totally missed out on the bonuses for the other card for like $400 or something. So one thing we do is we only open up one card at a time now. So we’ll open up the card, I’ll put that in my wallet and that is my go-to card for gas and groceries and you know, kids’ expenses and anything that I have to charge, goes on that one card.

And then once I figure out that I’ve used my spend, then I’ll go back to a plain old credit card that I use all the time, my Costco Visa or whatever. It has a lot of really great benefits. And one of the things that these cashback cards don’t offer—or I’m sorry, not cashback cards, the rewards cards, they don’t offer the cashback option and the credit card that I use all the time is like 5% off on gas or something and 3% on all your Costco purchases. I can’t remember what all the numbers are. Don’t take that as Gospel.

So that’s a great everyday card. But when I’m trying to spend $3000, I’ve got two kids and a household. That’s really easy. You just put it in your wallet and go. So yeah, definitely keep track of your cards and starting small is a really great piece of advice, too. I’m kind of a jump-in with both feet kind of girl so I will—oh, I can sign up for 27 credit cards. Well, I can’t spend 27 times $3,000 in three months. I mean, I could. Do you have any tips for people who are maybe not sure, like they know they can pay it off, they just don’t have that much to spend?

Noah: There’s a lot of ways to basically manufacture your spend. If you just Google “credit card manufactured spend” you’ll get a lot of ideas. Some of them are shadier than others, but one thing that we tell people that’s very simple to do and very easy is that if you don’t think you’ll meet the spend on a card in three months, just buy a gift card to a place that you go to all the time.

Grocery store is most common. You can go buy a Kroger gift card or a Walmart gift card or a Target gift card, and then you’ll basically frontload the spend on the credit card, get it done in time, and then you just use the gift card after that until it’s empty.

And another thing you can do is prepare your utilities. So I mean, you’re going to keep paying your utilities for a long time so you can just send them a payment for $300-$400 and then that’ll just cover your next several months. But it all hits the credit card during that minimum spend period. So those are a couple of small tips.

Mindy: Oh, I’ve never heard of prepaying your utilities. That’s awesome. I’m so excited.

Scott: Well awesome, do you have anything else to add maybe about your story or about the credit cards before we move onto the Famous Four?

Noah: I think that’s it.

Scott: Alrightly.

Mindy: Awesome. Well these four questions are the same questions that we ask every guest. There’s actually five of them but Scott doesn’t know how to count. Actually I think Josh and Brandon don’t know how to count on the original podcast. But these are our Famous Four questions. And the first one is, What is your favorite finance book?

Noah: My favorite finance book is Your Money or Your Life because it just puts it into perspective that your hours are valuable, like the time you have left on this earth or the time you have in general is very valuable and it’s important to look at how much time you’re spending earning money versus what you’re actually getting with that money, like how many hours you’re putting towards each purchase you make. It was a very big concept that really stuck with me so that’s definitely the one I would go with.

Mindy: Yeah, that’s an awesome book.

Scott: Earlier, you had mentioned that you didn’t make any mistakes. But did you make any mistakes and if you, what was your biggest money mistake that you’ve made?

Noah: There’s no big ones. As we mentioned, when we first got to Seattle, we weren’t maxing out our retirement accounts. We weren’t optimally investing in index funds. But those aren’t really mistakes. Those are just small optimizations. The only thing that could be considered a mistake is that as I mentioned, I work at Amazon and a lot of my compensation was in the form of Amazon stock.

And I did what the smart thing was, which was to sell it and buy index funds because it’s important to diverse away from your employers. At least that was the general advice out there. Like you don’t want your salary and for us, our housing, and all of our investments tied to the exact same company. So I sold them and bought index funds and I mean, if you go look at historical performance of Amazon over the last three or four years, that was a terrible mistake. With perfect hindsight. But I mean, I would totally do it again because I still think it is the smart choice for most people who are rewarded in their own companies stock.

Scott: I think that’s very smart but the way you just described it and the way you’re thinking about it is very smart because you’re saying, I have my philosophy in wealth building and I stick to that philosophy and it’s sound. It’s well researched and I know I’m doing the right thing. You got unlucky on this one. Like there’s nothing wrong with that even though obviously there was an opportunity cost there for that particular company doing really well.

Noah: With perfect hindsight, of course I would keep them but yeah, like you said, I stand by what we did and I still think it’s the right financial move.

Mindy: Well I will throw out one word—Enron.

Noah: Yes. Exactly.

Mindy; There were a lot of Enron employees who got the Enron stocks and kept it and their spouses worked at Emory and everything wrapped up in Enron and all of a sudden, Enron is worth nothing so all their retirement plans are gone—and this wasn’t just one person, this was a significant chunk of Enron employees because the company culture there was just so pro-Enron. It’s great to sit there now when amazing is up like a thousand percent or 12,000 percentage or whatever. But it could have just as easily gone the other way. So yeah, absolutely smart.

Scott: Listeners, if you’re interested in learning more about Enron, there’s a really good documentary called Enron: The Smartest Guys in the Room, which I think was on Netflix previously but it was not on Netflix anymore.

Noah: I think I watched it on Amazon Prime.

Scott: Oh, there it is. Yeah.

Noah: That was a couple years ago though.

Mindy: Throwing out the plugs. When did that go down? Early 2000s? I remember listening to that on the news and just thinking, I’m so sad for all these people, people who were a year away from retirement are now 50 years away from retirement.

Noah: And unemployed.

Mindy: And unemployed. And same with their small. It was really devastating for a lot of people.

Noah: It’d be a good story to know.

Mindy: It’s a good story to know, and yeah, not every company turns out as amazing as Amazon. Jeff’s a pretty smart guys though. What is your best piece of advice for people who are just starting out?

Becky: I would say just track your expenses. Figure out exactly where your money is going and what you’re spending on, not many people realize I spent like $5 a day on coffee or this much on alcohol or something like that and they kind of realize where it’s all going and then they can figure out what to do from there.

Noah: Yeah, just to add to that, it’s amazing how many people just don’t know where their money is going. The best way to do it, especially if you’re just starting out is just track without any judgment. Like just write it all down. Don’t think at all about whether it was good or better or whatever else. Just track it and then after maybe about a month or two or three months, go back and look at it and see, does this spending match my values? Is this where I want my money to be going now and in the future? And then adjust accordingly.

Mindy: Yeah, that’s great. Track without judgment. I love that. Okay, Scott?

Scott: I could not—that’s exactly what I would do with my  spending, by the way. I don’t keep a budget but I just review it and I’m like, you kknow what? Last month I spent way too much money on beer. That’s not my values. And wings. But that’s not value so yeah. I can change that. I think that’s exactly right and I don’t keep a budget. I react if I’m getting out of hand and you want a category that is not reflective of my values.

Noah: We’re the same way. It’s totally just reactive. We’ve never actually said like, this is how much we’re going to spend at restaurants every month. We know about what it will be but then we just try to keep it in with—just spend consciously, like as we go without having a specific number in mind.

Scott: Love it. All right, what’s your favorite joke to tell at parties?

Noah: Would you like to go first?

Becky: You can go first.

Noah: We both have one, yeah. You’re going to love them. Okay. So why did the old lady fall in a well?

Scott: I don’t know. Why?

Noah: She didn’t see that well.

Scott: Ahh.

Mindy: You didn’t love that, Scott? That’s such a joke for you.

Scott: I mean, I’m just coming up with my jokes retoir. That just pains me.

Mindy: I will say that I am continually impressed with just how Scott thumbs up with these really awful retorts.

Scott: I really do that really well, don’t I?

Mindy: Oh god, I quit.

Noah: There it is.

Becky: Why did the hipster burn his month?

Scott: I don’t know, why?

Becky: He ate his dinner before it was cool.

Scott: I like that one. All right, we had two jokes today.

Mindy: Two jokes.

Becky: Mindy, I was the exact same way. I was laughing for like five minutes after I heard that and I can’t stop laughing and it’s so funny.

Mindy: I rarely, rarely, rarely laugh at these jokes. See my response to Noah’s joke. Sorry, Noah. Okay, Becky and Noah, where can people find out more about you?

Noah: So the easiest way is just on the blog. So I write a blog at MoneyMetagame. It’s just kind of tracking our financial journey and adding in various travel hacking credit card tips here and there and all sorts of fun stuff. So you can find me there. MoneyMetagame.com. And then I’m also on Twitter @moneymetagame, all one word.

And then ever since we started this trip, so for the past few months, we’ve been posting awesome pictures of all the amazing national parks and everywhere else we’ve been to Instagram. And that’s also just @MoneyMetagame. So follow us wherever. I’m almost always online in one form or another so feel free to reach out.

Mindy: Awesome. Well thank you so much for your time today. I know you’re busy doing nothing for the next year.

Becky: It’s effortless.

Mindy: I really appreciate you earmarking some time for us. And thank you for sharing your travel hacking. I learned a new travel hacking tip. I’m super excited. Now, I’m going to go sign up for another credit card.

Becky: Thanks for having us, it’s been fun.

Noah: Yeah, it’s been great. Thanks.

Scott: All right, that was Becky and Noah from MoneyMetagame.com. Mindy, what’d you think?

Mindy: Oh my goodness, I love talking to Becky and Noah. Their story is fantastic. They are so smart. They are so forward-thinking and they’re just such nice people. And I wish I would have had the foresight back when I was 27 to save up a huge ton of money. I was not making the kind of salaries that they are making at age 27. I wasn’t married. I didn’t have any kids.

And I had a very different life than they did and I’m excited for them and their gap year sounds super fun, especially the whole part about not making any plans. I’m kind of jealous about that. I’m still trying to convince Carl to stop planning every minute of our vacations.

Scott: Yeah, I’m jealous. I would love to do something like that within the next couple of years. Maybe I will. Again, that’s the ‘why’. It’s having the option and the ability to do that. Good for them for giving themselves every advantage on this journey and taking advantage of opportunities that they could put themselves in this position.

Mindy: Yeah. That is amazing. That is absolutely perfect. Today, Scott, before we get out of here, since this episode is running a bit long today, I would like to throw in a couple of requests to our listeners. If you’re listening and you’re enjoying the show, please subscribe to the podcast on whatever podcast player you choose to listen to. You can subscribe on iTunes. We are on pretty much everything, SoundCloud, Stitcher, Podcast Addict. Every place you can find a podcast, you will find us. And we have very few Twitter followers for the BiggerPockets Money podcast Twitter handle. So if you would please throw out a follow on Twitter—it’s @BPMoneyShow on Twitter. We are at BiggerPockets Money on Instagram. I am @[email protected] on Twitter, Instagram, and Facebook. And Scott, can you share your social media handles?

Scott: Mine is @ScottTrenchatBP. However, I am not particularly active on Twitter. So follow me if you’d like. You’re going to see my last post from 20 Dec. 2017. So there might be a new one coming and you’ll get qualified so you don’t have to follow me.

Mindy: All right Scott, shall we get out of here today?

Scott: Let’s get out of here.

Mindy: For Episode 23 of the BiggerPockets Money Show, this is Mindy Jensen, over and out.

Watch the Podcast Here

Help Us Out!

Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds. Thanks! We really appreciate it!

Podcast Sponsor

freshlogoThe all-new FreshBooks is accounting software that makes running your small business easy, fast and secure. Spend less time on accounting and more time doing the work you love.

For a 30-day unrestricted trial, go to FreshBooks.com/bpmoney

In This Episode We Cover:

  • How Noah and Becky met
  • What happened when they first discover FI
  • Buying a house by accident
  • What changes they have made after learning about FI
  • How much they are saving
  • Making no mistakes with their FI decisions
  • Having “Gap Years or Mini Retirements”
  • Their thoughts about employment and unemployment
  • Travel hacking and credit cards as bonuses
  • What their credit score looks like
  • Travel rewards, and making the most of them
  • What is “Manufacture Spend”?
  • And SO much more!

Links from the Show

Books Mentioned in this Show

Tweetable Topics:

  • “We don’t have to really grind it out anymore, now that we’ve set ourselves up on this amazing foundation.” (Tweet This!)

Connect with Noah and Becky

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.