Barista FI. The freedom to have enough savings to… | by Nate Meharg | November 2022

The freedom to have enough savings to choose what you do

Photo by Fahmi Fakhrudin on Unsplash

Everyone who begins the journey to financial independence has different reasons or seasons for which they begin. Maybe it’s because they don’t like the job they’re currently doing, or they’re approaching retirement, or something important happens and they realize they need the freedom that a form of FI can give them.

There is a pervasive thought in the FI community that either you achieve FI or you don’t. And for me, it’s not either, or it’s a journey. I have 7 phases of FI, and they are as follows.

  1. FI Budgeting — Telling and Tracking Where Your Money Goes
  2. Buffer FI — Have an emergency fund of at least three months
  3. Barista FI – You could live off a part-time job like in a coffee shop, or if you have two incomes, you could live off one person’s income.
  4. FI Retirement — You can live on Social Security when you retire with your investments.
  5. Peace Out FI — Your hustle and investments can pay for your expenses
  6. Lean FI — Your Investments Can Pay Your Expenses
  7. Fat FI – Your investments can pay for your quality of life far above your expenses.

Whatever your reason, most of the time it can come down to two things. Freedom to choose the life you want and security. Each person has varying degrees of risk or protection. Getting just one level of FI will help you feel more in control.

Today we are going to talk about Barista FI. Once you start getting to this FI phase, things start to open up for you. The freedom that most people seek or want can be achieved at this stage.

What defines Barista FI? If you can make a living from a very low-paying job, like a barista, you got Barista FI.

How do you get there? Like what, there are many ways to get there. Some people can achieve this quickly by drastically reducing their expenses where they can live on a small income. Some people achieve this by having enough investments to live on plus a small payment. Some have independent or side money combined with a small w2 income that gets them there. You can even do all three.

What this level of FI really gives you is the ability to choose where you work. I can’t describe how liberating it is when you get to that level of FI. The possibility of not needing a job reduces a ton of stress. I know it first hand. When I reached this phase, I could take risks on a (failed) real estate flip business without stress because of this level of FI. It finally allowed me to work in the ministry for less money because of it. Knowing that if the going gets tough you could get a part-time job to make ends meet is a big help and means you don’t have to stay in a job you hate!

I know for the record that a lot of people don’t like the job they’re in, and that’s usually the catalyst for them trying to figure out how to achieve FI. In phase 3 (sometimes even in phase 2), they have the ability and freedom to leave with less stress.

My mission is to give people hope and show that they can do it too! I offer coaching, so write me on medium or Twitter if you are interested.

Nate Meharg

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