Project FIRE 40 – Pursue Early Retirement – without the Mental Sacrifice – using Happiness Principles

In Project FIRE 40 – The second step in my plan is defining my principles/criteria to evaluate decisions.

Money and our brains have a funny relationship.

Our money behaviour is different to our rational choices

I’d love my money decisions to sit in the analytical rational part of my brain, but it seems that they like to spend more time in the emotional part.

At the moment I’m looking to buy a car, I know I want something simple. Something to get me from A to B, something 10-15 years. Something reliable. I know I don’t want a headache.

So I started the search, the next thing I know I’ve slid down the slippery slope and I am looking at demo units 6 times the price. Then a remind myself that is crazy and I climb back up to my value point, where my budget, value and need meet, or more simply, my price range.

Then I look below my price range, trying to find a bargain, then decide it’s not worth the headache, back at my price range… then at that demo unit with a maintenance plan…aahhhh… What just happened?

It is difficult to overcome this rogue part of the brain.

Our behaviour is evidence of our Values

How I spend my money and time is a reflection of my values. Not the values I want, but the ones I have. Often these values are externally imposed and I end up on autopilot. One way to overcome my own behaviour is to re-programme the autopilot, another is to set guiding principles to check the autopilot against.

Setting guiding principles early

In my immersion phase, I heard several stories of people who felt they gave up too much happiness, just focusing on their future FIRE, miserable in the present, without a relative future return. Spending more might bring happiness, spending less might as well, conscious spending does bring more happiness. It brings awareness about what is valuable.

This is why in Step 2 of PF40, I want to establish principles or criteria, these are what I will evaluate my decisions against. I will have more specific ones for investing and spending, so these are the more general ones, which will help keep money walled in to my rational brain, but will also help ensure I’m not miserable for the next 4 (hopefully) years.

This is focusing on not giving up four years of happiness during this experiment.

Happiness Principles

  • 40 is arbitrary
    • Don’t swing for the fences
    • Don’t punish myself for expedience
    • Considered luxuries are okay, as long as it’s conscious spending
    • Only focus on the next gateway to not be overwhelmed
    • Don’t judge the quality of a decision by the result
  • I won’t sacrifice my health like before my transformation
    • I don’t want to be rich, I want to happy
    • I need to stay present – What I learn on the journey is more important than the result
    • I am using this experiment as a personal development focus tool
  • Follow my personal development philosophy
    • Prioritise
    • Focus
    • Habits
    • & the Compound Effect

I realised when deciding on a car purchase, from car choice to financing options, I can turn these principles into a two question shorthand:

  • How is this going to impact my FIRE timeline?
  • How will it impact my happiness?

Sometimes they will align, sometimes they will provide contrasting views which will need to be considered.


For those wanting to join me on the journey:

Step 1 – Foundation– Working out my why and checking my understanding – full immersion listen to FI and learn then stop. From now onwards only Just In Time learning.

Step 2 – Set principles – principles allow better decisions to be made, as they have a reference to evaluate criteria against

Step 3 – Working out my Baseline– Knowing where I am now

Step 4 –Reduce and optimise expenses with Budgeting – Key to FIRE is avoiding and reversing the second application of Parkinson’s law.

Step 5 – Calculating my Number & Setting Gateways – To allow focus and direction

Step 6 – Enhance Income routes – Allowing for financial leverage

Step 7 – Invest Strategically – Allowing for wealth accumulation

This experiment both excites and intrigues me, both the journey and the potential outcome.

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