055: Reaching FI in the Yukon With a Disability | Tara

Disclaimer: Some of the links on this page are affiliate links. That means we may receive a commission if you make a purchase after clicking through our links.

Money Mechanic
Hello, listeners. Welcome to Explore FI Canada, where we sit at the roundtable with Canadians, and share their thoughts, ideas and personal journeys to financial independence.

Chrissy
Thanks to Matt McKeever for sponsoring Explore FI Canada. Matt is a Canadian investor, CPA, entrepreneur, and real estate expert who achieved FIRE at age 31. Do us a favour and check out his YouTube channel by searching Matt McKeever or using the link in our show notes.

Money Mechanic
Welcome back to Explore FI Canada listeners. Nice to have you with us again, it is the Money Mechanic. And of course Chrissy is with me.

Chrissy
Hello, how are you doing Money Mechanic.

Money Mechanic
Good, good. Just as I mentioned, mushrooming away here down in the basement. But that’s fantastic. Hey, we’ve got a great show. Again, this week we have Tara joining us from the Yukon. We are wrapping around Canada as promised. So it’s exciting to have our first guest from the Yukon. Welcome to the show, Tara.

Tara
Thank you. Thanks for having me.

Chrissy
Yeah, we’re excited to talk to you, you have quite a few unique aspects of your FI journey that we would like to share with our audience.

Money Mechanic
Yeah. Give us a quick little rundown about whereabouts you are. And just bring us up to speed on that before we get too deep and everything else? For sure.

Tara
Yeah. So I’m in Whitehorse, Yukon, which is the capital of Yukon. And I was born and raised here. I left a couple times for school, but I always ended up making my way back here. So yep, living in my hometown.

Chrissy
And what is it that keeps bringing you back to your hometown?

Tara
To be honest, there’s such good opportunity here. You know, many people think we’re pretty isolated up here, but we’re really not. And we have everything you could possibly need. And there’s great jobs, lots of opportunities in terms of getting higher paying jobs, there’s not as much competition and just yeah, generally better opportunities I find just throughout, you know, growing up and even as an adult,

Money Mechanic
Is that because people like migrate away from Whitehorse, or is it just the population is pretty flat, but there’s all sorts of jobs available?

Tara
Yeah, I think a lot of people actually can’t deal with the winters. That is one thing that is a bit harder, especially this winter with COVID. And everything, it was pretty rough. But I think that kind of manages the population, although I think there are a lot of people that sort of find out about the Yukon, especially actually, Ontario people, and we have a lot of Ontario transplants. So yeah, it just kind of depends. If you’re an outdoorsy person, usually people stay and they really like it here. If you’re more of a city person, or if you can’t handle a cold, then you’re likely going to leave. So I think it kind of balances out in the end.

Money Mechanic
So just in general, do you think that a lot of the older population tends to move away in you know, does that help the job markets? You know, kind of like that the traditional retirement age people if they’re not stuck there with family or wanting to be with family and moved somewhere warmer? Does that help the job market as well?

Tara
Yeah, maybe? Yeah. I mean, I think a lot of people retire and move down to the island. River Island. Yes, they do. Yeah. But we also have quite a bit of retirees here as well.

Money Mechanic
Right. Okay.

Chrissy
And what would you say about the expenses? I know you listened to Scott’s episode, he’s in Northwest Territories.

Tara
Yeah. It’s very similar.

Chrissy
Okay. So you get the transfer payments from the government, that kind of thing?

Tara
Yeah, so we get a northern living allowance, and then we get a bit of extra travel tax credits as well. Yeah.

Chrissy
Okay. So overall, do you find that you have the higher salaries, some things are more expensive, but overall, the cost of living would you say is lower than, say in Vancouver or Toronto, one of the big cities?

Tara
Yeah, it’s certainly lower than the bigger cities, I would say it’s probably comparable to like Vancouver Island, though, or other parts of BC, I think, from talking to friends that are from BC, and actually, my brother lives in Nanaimo. I think the expenses are a bit lower on the island. So but pay is way higher. Like, for example, I used to work for the government here. And I looked at very comparable jobs down on the island, and I would have been taking like a $30,000 pay cut.

Chrissy
That’s huge!

Tara
Yeah. And that’s like a communications job in government.

Chrissy
And why is it? Why do they pay you more for a communications job? I’m just curious, because I know that they sometimes pay more to attract doctors, for instance, but…

Tara
Yeah, I think it is as a lot to do with attracting people here and keeping people here. It’s one of the biggest struggles I think is for employers here is getting good people and keeping them because it’s not very competitive. You know, it’s more of like a job seekers market as opposed to like an employers market. Yeah. So I think for sure, just kind of retention that makes sense.

Money Mechanic
So somebody could potentially move up there with, you know, possibly transfer from another equivalent job, make a whole bunch more money, speed up their journey to FI live some interesting years up there and then move to Nanaimo, right? I mean, that’s possibility, right?

Tara
Definitely. Yeah. I mean, I think it’d be great if more people came here. I would love that.

Chrissy
Would you?

Tara
Yeah, I think so. I mean, I’m not too worried about competition at this point, so.

Money Mechanic
Do you get a sense of, is there any kind of FI community or FIRE community there? I mean, it’s sort of spread a lot across Canada, there’s individual groups in sort of Vancouver and Toronto, and all the big cities have like a ChooseFI Canada group or ChooseFI Toronto group? Is there any community that you’ve met any other people in that area that you can kind of relate your story to and talk about FIRE and things like that?

Tara
Not really, to be honest. One time I was at a coffee shop, and I overheard a guy having a conversation about Bitcoin. And that was the basically the only conversation I’ve ever had with someone here. I know of another guy who’s super into FI and I’ve never connected with him. I’ve met him through work. But yeah, actually, that to be honest, is one of the reasons I wanted to reach out to you guys was because I thought, if anyone from the Yukon listens, then maybe they’ll reach out.

Money Mechanic
Yeah, it’s so nice to have a local group, you know, even just a few people just to sort of bounce some ideas off or like, Oh, hey, there’s stuff in the classifieds. It’s a great deal, or, you know, odds and ends like that. Well, that’s pretty cool. I’m glad you joined us. Let’s talk a little bit about your journey to FI. You mentioned that you worked for the Yukon government for a while, but you don’t anymore. Let’s just back into that a little bit and fill us in on what you used to do and where you’re going now.

Tara
Yeah, so um, just for some context, like, so I was born without my left hand. And throughout my life, it really didn’t affect me much like physically or anything. So I was always able to work a full-time job and you know, use all the equipment I needed to, but about four years ago, I started developing overuse injuries in my dominant arm. And so at that point, you know, I was making really good money, I owned a house, but I was living paycheck to paycheck. And I kind of realized at that time that, you know, this could be something that sort of threatens my ability to earn a good income and work a full-time job. So I kind of started getting into FI or personal finance stuff at that point, I ended up sort of slowly going down to part-time work through the government, just to sort of manage my pain levels. And I ended up selling my house because at the time, I was dating someone, and he owned his own house, too. So we thought, why don’t we move in together, I moved into his place. And you know, we filled up all the rooms. And so we’ve got super low expenses and all that. And then about six months ago, I decided to finally let go of my my government job. And throughout the last year or two, I’d also sort of retrained, I went back to school to become a holistic nutrition health coach. So in the last sort of year and a half, I’ve also started up my own business, I do health coaching and customized meal plans. And I also have, you know, sell digital products on my website, and I’m in the process of monetizing a food blog. So I’ve got lots of sort of income streams in the works. Even though I’m not sort of making like a full-time income off it yet, I decided sort of based on how my expenses were pretty low. And I do have some runway from selling my house. And then I recently sort of retired from government and took that out. So I thought it was kind of the right time to sort of give my body a break and sort of pursue other things. Yeah, I would say I’m kind of partially there. And I’m sort of working on sort of increasing these income streams. And, and,

Chrissy
Yeah, to me, it sounds like you had your FU money. And maybe you’re partway to Coast FI or you’re at Coast FI at this point.

Tara
Yeah, I’m like, I guess a partial FIRE is the term I always hear. I’m probably about a third of the way there. And based on how low I’ve gotten my, my sort of monthly expenses right now, like I, you know, I probably have at least 10 plus years of runway. Yeah, I think with that I feel comfortable sort of letting go of my government job and pursuing my own sort of interests. And yeah, and also having more time to myself and more flexibility, which is awesome.

Chrissy
So I’ve heard a couple of our recent guests have said the same thing… Kay, on one of our episodes, as well as Courtney, they are not worried at all during COVID even though they have seen a drop in income and haven’t been able to work as much as they wanted to. They felt totally okay. Is that how you’re feeling at this point? I mean, I would think you have to be in order to let go of a full-time job to transition to the online work.

Tara
Yeah, for sure. It was it was quite stressful, making the decision and finally coming to it and there was definitely some fear when I first did it. You know, like, what will people think? or What will I do if I run out of money? You know, all that kind of what if I don’t make as much as I want? But I realized that I was also just kind of driving my body into the ground still sort of working full time or close to full time. And yeah, I kind of weighed out the pros and cons. And yeah, kind of did some calculations to see that. Yeah, I really do have like, some pretty good runway here. And, you know, I, I sleep well at night now. Yeah, there was a period where I may have not but yeah, I’m doing good now.

Money Mechanic
Quick question to add into that is, you decided to leave your job completely. You didn’t go for a year, but you can get a year of absence. After working there for that long, you decided that quitting full-time was better for you?

Tara
Yeah, I in the past, I’ve taken a year off to go back to school. So I did consider it. But yeah, I just wasn’t feeling super passionate about the work. And I just, yeah, I just wanted to pursue my own stuff. And I, I slowly went down sort of part-time hours and like over a couple years. So at the end there, I was only working three-and-a-half hours a day. So it really wasn’t like a huge leap to go from that to quitting completely.

Money Mechanic
Right on. Chrissy won’t want me to get into investments yet. Because I know there’s lots of other interesting things to bring up. But I do want to ask, because we’re just talking about the end of your government work. You did mention in your communique with us that you decided to commute your pension?

Tara
Yes.

Money Mechanic
Did you have any, just maybe speak sort of quickly to that that decision that you made? and What gave you the confidence to do that or your reason behind it?

Tara
Yeah, I’m 34. And I’ve been in the government since my early 20s. So also a lot of high earning years. And only I owned my house for about 10 years. So that helped as well. But yeah, in terms of why I decided to take my pension, because I had done so much learning over the past year or two. And, you know, we’ll talk more about this later. But, you know, took my mutual funds out of RBC. And now I’m doing my own investing, I just feel confident in the idea that I can do it myself. And I like the idea of sort of having that control over my money and seeing where it is and what it’s invested in. And I mean, it’s possible, I may have been able to do that through the pension I never had in the past. So it’s just like, I just give them my money, and then it’s somewhere and, you know, yeah, I just, I feel confident that I can probably do better myself. I don’t know if I can, but I feel like I’d like to at least try.

Money Mechanic
Yeah, well, I mean, good for you. Because I think that’s part of this journey, too. Right? As as you get educated, it builds your confidence, and you feel much more comfortable doing those things. So yeah, for sure. Chrissy, why don’t you go, so I don’t (inaudible).

Chrissy
So I want to dig a little bit more into your disability, you say that you’re born without a left hand. And that’s, that’s interesting, in a lot of ways, because you’re the first guest that has that has mentioned that you have a disability. And I’m just wondering if you could tell our audience, how that affects you financially, whether for better or worse. What have you found living in Canada with a disability? How has that affected you?

Tara
Yeah, so I mean, right from the start, I was always involved in The War Amps of Canada, I’m sure you’ve probably heard them, you seen their stickers on cars, and all their key tags and stuff. So I feel super lucky to have grown up in Canada, they provided a lot of financial support for me as a younger person, in terms of like education and computers and, and just really social and emotional support as well. So that was really great. When I was growing up after school, like, like I said, like I wasn’t, I was always able to kind of work a regular job. And I would have the odd accommodation here and there, like certain assistive devices, but I was, you know, pretty much fine with everything. I feel lucky, I was born without my left hand, but I do have most of my wrist or my whole wrist. And so I can still do a lot of things with my left arm as well. So it really wasn’t until about, like I said four years ago, where I started getting overuse injuries in my dominant arm, which I have been warned about in the past, and I wish I could go back in time and I would done less. I also did a lot of freelance work in the past. So I’d work like an eight-hour day and then I’d come home and work you know, three or four hours on my computer doing freelance and so I probably wore my good arm out faster than I probably would have otherwise. But yeah, about four years ago, that was when I really realized that for the first time in my life actually that, holy crap, like this disability could actually affect my ability to earn and, and the ability to take care of myself not only financially but physically as well. And I mean, I’m lucky that you know, it hasn’t gotten to the point where I need like a lot of additional help, but it has definitely changed. My sort of physical capacity like I, I can still do everything I could do before it just I get a lot of chronic pain. And, you know, there’s only so much that I want to do because, you know, I don’t want to flare things up. So. But one positive thing, though that has come out of it is I am able to access a disability tax credit every year. So I’ve been getting that since I was younger, I think that works out to about an $8,000 credit. And then I’ve also been able to access the RDSP, the registered disability savings plan. So that’s been really great as well, I unfortunately, I didn’t find out about it until about six or seven years ago, but it’s already, you know, been growing pretty nicely. Basically, for every sort of dollar I put in there. I think the government puts in three. And so each year they send me a letter and they say, here’s what you can put in to get the maximum grant of this much. So, for example, this year was you know, you can put in $5,000 and we’ll give you, I think it was $10,500, which I guess now that I’m thinking about that. That doesn’t it? That’s not three times. Yeah, so maybe it’s more like two.

Chrissy
Yeah, amazing. So… yeah, you go ahead.

Money Mechanic
Yeah, I just was dig into the RDSP a little bit because I don’t know anything about this. Does it function as a tax-free investment vehicle? You can self-manage it the same way you could an RRSP?

Tara
Yeah, exactly. So originally, I had it invested in mutual funds. And we’ll get into this more later. But I did pull everything out of mutual funds so that I can start investing on my own. But yeah, it works the same. You can invest it however.

Chrissy
Okay. And are there age limits? like can you only start it from a certain age? Like, do you have to be an adult? How does that all work?

Tara
Yeah, I don’t think so. I mean, because I didn’t start it as a as a younger person. I’m not totally sure. But I don’t see why you wouldn’t be able to I imagine lots of parents probably start them for their kids and start contributing earlier.

Chrissy
And what about withdrawals? Like, are they like, like an RRSP? Do they… are you supposed… is intention to wait until you’re older to…

Tara
Yeah, the intention is to wait. And it’s, it’s a bit different than RRSPs where actually, I have to wait 10 years to be able to withdraw the full amount with grants. So if I was to do a withdrawal within that 10 years, then they would they would claw back some of the grants that they’ve given me. So yeah, for me, I think it caps out at about $70,000 to.

So it’s like an RESP where there’s a maximum grant amount?

Yeah.

Chrissy
Okay. And maximum contribution also?

Tara
I think so. Yeah. I mean, I haven’t because I’m, I haven’t sort of reached the top yet. I haven’t yet really looked into it. But, I mean, I plan to leave it in there for as long as I can. Any money that I need, you know, for emergency money or emergency fund. I keep elsewhere, so.

Chrissy
Okay, this is really interesting.

Money Mechanic
So I missed that. Did I miss it, Chrissy, or did you ask that? Is it taxable on withdrawal?

Tara
Oh, sorry. Yes, I believe it is taxable on withdrawal and based on your your calendar year of income.

Chrissy
Okay. So, that counts the grants, the grants are also taxable? Is it like an RRSP? Like anything you take out, the whole thing is taxable. Is that correct?

Tara
I think so. But now that I’m saying this, maybe I’m wrong.

Chrissy
But it’s still good to bring it up.

Money Mechanic
Chrissy, this is where we say the show is for entertainment purposes only. Right?

Tara
Yeah, yeah. Cuz someone will be listening. And they’ll be like, that’s, not right!

Money Mechanic
That’s the good thing when we hear about that.

Chrissy
Yeah, the info is out there. But it’s great that you’re taking advantage. And you know, we’ll dig into the details another time.

Tara
For sure.

Money Mechanic
So one more thing I wanted to ask about the RDSP, then is how does that fit into your FIRE plan? You mentioned you’re going to keep it for a long time. But at what point do you think you’ll use it? Because it’s going to be income dependent if you’re paying tax on it? And we’ve talked in the FI community about having our RRSP drawdown strategy, so you’re paying minimum tax on it? Where does this sort of fit in down the road for you? Do you think I mean, obviously, the plan changes. But do you have a current plan?

Tara
For sure. Yeah, it’s a good question. Because right now over the next sort of two, three years, I imagine my income is going to be quite low. But I think it’s a bit early for me to start drawing down on things but once my you know, all my sort of income streams start picking up I do wonder about that, because later on, then my income will start getting higher and higher every year. So I have to admit, I haven’t totally planned that out yet. That’s one part of FI that I actually haven’t really like spent a lot of time thinking about I’m mostly sort of in like the accumulation phase and haven’t even thought a bit about that To be honest, but I imagine I’ll probably I won’t draw down on it until probably around the same time. I’m ready to Draw down on my RRSPs?

Chrissy
And do you have an idea of when you might reach FI? Are you, do you have a goal in mind? Or what age?

Tara
If everything goes to plan, I hope by 45 or 50. So I guess 10 or 15 years from now? Yeah.

Chrissy
And what about your boyfriend? What does he think? What does he make of all this?

Tara
Yeah, he’s, um, like, he has a really good government job as well. He’s in just got into management. So he’s pretty happy right now. He’s sort of sitting on a pretty lucrative job, and a nice, nice fat pension. So yeah, I’m not really sure he hasn’t totally kind of gone all in on this. I’m kind of exploring it on my own. But the idea is that once my business is making a lot more income, that he would probably join me in my business. And then we could travel maybe, or like, We always love the idea of getting a fifth wheel and like moving to the island or, you know, traveling around. So I mean, we’ll see what the future looks like now. But yeah,

Money Mechanic
Digital nomads, right?

Tara
Exactly. Yeah. Yeah.

Chrissy
And I just want to touch on this, you do mention that you also have some side hustles going on. And I think that’s really cool. Because I do like in this day and age, it’s so easy to have a side hustle. So can you just touch on that a little bit? What do you do just to supplement your income a little bit?

Tara
Right now, because my business is not making like a full-time income. I’m also working at a health and nutrition store part-time. And then actually, just recently, in the Yukon, we got DoorDash. So I’ve also been doing some DoorDashing, just for a couple extra bucks here and there.

Chrissy
Yeah. Has that been worth it?

Money Mechanic
Yeah, that’s what I want to know.

Tara
Not really. Like when you really calculated out. I mean, it kind of depends on what people are tipping because you get like $5 per delivery. But in Whitehorse, you know, we’re pretty spread out. So you know, I could be driving to the suburbs and back and, and then if they don’t tip, you literally only get $5. So.

Chrissy
Who doesn’t tip? That’s just wrong!

Tara
Yeah, I know, it’s crazy. Lots of people don’t, but but then other people like I got like an $18 tip once McDonald’s, like it was, it’s not. So I’m not really sure. But it’s kind of depends on the day, some days are more lucrative than than others. But you keep doing it just because it’s kind of it’s kind of fun something to do. So it’s pretty low-impact on my body, I just kind of drive around and pick up food and drop it off.

Chrissy
So it does sound appealing. Sometimes when I think, ha, it might be kind of cool. Kind of a, you know, you’ve got some freedom. And it’s not something that takes a lot of brain power that you can kind of zone out with a podcast while you’re doing it. So…

Tara
Yeah, it probably only works out to maybe minimum wage. Although our minimum wage here is decent, you know, it’s like $16 an hour.

Chrissy
That’s pretty good.

Money Mechanic
You brought up driving around. So while we’re on this topic, tell us a little bit about vehicles. Are they cheaper? Go through them faster, the winter is harder on them is that change your costs?

Tara
The winter is definitely a little bit harder on them. We have a lot of rock chips here. I think that I’ve even heard and this may just be speculation. I’m not sure if it’s true, but that when you get car insurance in the Yukon, it doesn’t protect your windshield, which I think in other places it does. Other than that, yeah, just you know, changing from winter tires to summer tires, although a lot of people do all-seasons. But it’s it’s a lot smarter to have proper winter tires here. So you don’t get stuck everywhere.

Money Mechanic
Have you improved your spending on vehicles since you sort of got on the path to FI?

Tara
Yeah, I have. So in the past, I was kind of always in the market for a new car, you know, kind of like a cell phone when your plan runs out. You can get a new one, then you upgrade but I’ve been actually driving the same 2009 Ford Focus for over 12 or 13 years or Yeah, I don’t know, maybe the math not correct yet on that, but…

Money Mechanic
Well it can’t be 13 because that’s not long enough.

Chrissy
Yeah.

Tara
But I bought it in 2008. So anyways, so I’ve been driving that and many, many times, I’ve had to sort of hold myself back from going out and buying a new one. For sure, now I know that, I would never finance a car again, unless it was 0%. And even then I don’t think I would I like this idea of sort of purchasing a car that’s within the last five years and just purchasing it privately. But so far, my car’s sort of still holding up. So I’m going to basically drive it into the ground and yeah, I got rid of my collision insurance and I just just the bare minimum really my insurance is like $34 a month. Now I live pretty close to downtown. So my guess is you know, I bet you no more than about $80 a month so yeah, all in that’s what my car cost me now.

Chrissy
That’s incredible. That’s really low insurance. In Vancouver insurance costs are high. It’s crazy here. That’s amazing.

Money Mechanic
It’s always good to hear that once you sort of dig into the FI journey, you start knocking down the costs on the car. And I love how you mentioned earlier that you have roommates in the house as well, that brings down your housing costs. That’s, that’s awesome.

Tara
Yeah, we’ve got a three-bedroom, half a duplex we live in, and we’ve got two roommates. There’s four of us. That Yeah, we usually get friends. So it’s, it’s nice. And I think during COVID, it’s actually been really nice to have people around to hang out with and visit with. So yeah, it makes things a little easier I think.

Chrissy
Has that brought your housing costs down to zero, or how is that affecting you?

Tara
Yeah, so I made the decision not to sort of buy into my partner’s house. So I am just sort of living here. And basically, the deal we have is that if if we have no roommates, I pay $800. If we have one roommate I pay anywhere from three to $500. And if we have two roommates, I pay zero. So that’s been absolutely amazing. The last year, I have not really had to pay rent. And I think my sort of fixed monthly expenses are less than $200. I got my cell phone bill down to about $45. That used to be around $90 or $100. So yeah, it’s it’s been pretty amazing. Um, Chris, my partner, he still pays a little bit on the mortgage, because I don’t think he gets the full amount. But he was smart enough to, he pays weekly on his mortgage. So he was able to at least cut down his mortgage significantly and pay a lot less interest. And when he bought his house, he’s owned it for I think, almost 15 years. He bought this place for about $200. And I think now it’s probably worth over $400. So things are looking good for him as well.

Money Mechanic
That’s awesome. Even $400 sounds cheap for us.

Tara
Yeah.

Money Mechanic
Yeah. No, that’s great. That’s great planning, sensible. Let’s talk a little bit about food because we’re talking about cars and houses. So and I think it’s super interesting that you do health coaching, you do customized meal plans, you do premade meal plans, recipe books, like let’s talk a little bit about food, because that is a big cost for all of us. Do you, I don’t know, Chrissy, where do we even take this? I’m like, super interested to hear. Like, what’s the perfect FI frugal meal plan? Give us something give us two meals to go with.

Chrissy
Does that affect your work? Does FI and the cost of food affect how you advise people on their diet?

Tara
You know, I have to admit Not really, when usually the way I approach is really more like what’s best for their health. Our food costs are pretty high here. I would say I think there may be slightly more expensive than say BC. But I have to admit I am not a huge spender, but I spend, I don’t know if lavishly is the word, but I think good quality food is super important to me. So I think in my FI journey, actually, it’s I read the book by Ramit, the I will make you or I will make you rich or Teach You to Be Rich. And I really liked his approach of like, spend lavishly on what you value and then just like cut ruthlessly on what you don’t. And I’ve always like really kind of resonated with that. So I don’t really try a lot to save money with food. I mean, I do now I have to admit, I used to just sort of buy whatever I wanted and not even look at the price. Now I will you know if I see a sale and I know it’s something I eat a lot I’ll buy it or you know, I’ll buy more meat in bulk instead of buying like two pieces of chicken at a time. So there’s definitely some changes I’ve made over time but but yeah, I do spend quite a bit on food and I’m kind of okay with it.

Chrissy
Yeah, we’re I mean, we don’t spend a lot on food because like we manage to economize a lot by buying in bulk and doing all kinds of things. DIY as much of the food process as we can you know, prepping and meal planning all that that saves for sure. But yeah, we’re the same and that we look for food that we like and we don’t always put cost first.

Tara
Yeah, and that being said, you just reminded me when you said meal prep so me and my partner once a week we do meal prep on Sundays and so we do make a lot of stuff in bulk. So I think that really brings our cost down as well. We don’t eat out a ton, mostly because you know, there’s not a lot of places I I like to eat here, just that have sort of healthier options. So yeah, that meal prepping we have actually like a massive stand up freezer and two fridges in our house. And part of that is due to the roommates but in truth most of it is because we prep so much and I think we own over 120 glass containers. So you know when we have a lot prepped when our cupboard is like empty of dishes and you know we need to do meal prep when we are like overflowing dishes out of our cupboards.

Chrissy
So what do the roommates make of all your frugal tendencies because to us that sounds totally normal. But for a lot of people, they’re like, You’re crazy.

Tara
Yeah, I think you know, like, I when I got into meal prepping, it really was more just so that I could eat healthy and not spend hours and hours of time in the kitchen per day. I don’t think when I first approached it, it was really anything to do with money. But I guess over time, I realized that it actually has been a huge money saver in the end. Yeah, I mean, they think it’s pretty funny that we have, you know, two fridges and a massive stand up freezer. It’s a little ridiculous, but…

Money Mechanic
Give me an example of a meal that you meal prep, that’s a nice sort of economy meal that that our listeners could tackle.

Tara
So I’m like a big meat eater. So I don’t know how economical it gets. But yeah, I mean, I would say I make a lot of soups. So like the other day, for example, I made like a chicken bacon soup with like kohlrabi noodles, I think altogether cost about $32 in groceries, and I got, I think it was five or six servings. So I don’t think I’m ever gonna be able to get down to like, you know, $2, $3, $4 or $5 a meal. But if I’m less than $10 I’m doing good.

Chrissy
Yeah, I mean, a restaurant meal is at least $15 once you add in the tax and tip. So you know you’re beating that already.

Tara
Yep.

Money Mechanic
Yeah, I don’t think I get down to that. Well, I do get down to the $2 meal because I don’t eat breakfast anymore. I’m on doing the intermittent fasting. So that’s a free meal. Just gotta bring the average down with the other two. But yeah, that’s pretty cool. I we definitely do a lot of that batch cooking as well. And we’d like chilies and soups. And definitely my wife’s got a killer butternut squash soup that she does. Now it’s all veggie and then blended and thickened with lentils. Oh, man, it’s good. If we could only get better at making sourdough bread, because I love the sourdough with it too.

Chrissy
Oh, me too! But that, it’s like having a pet though. That sourdough starter?

Money Mechanic
Yeah, exactly. We have too many fermentations going on at the house already. Because we’ve been making our own ginger beer. I’m making beer again and cider. And then she’s doing kombucha as well. So there’s a lot of things that are percolating.

Tara
Cool, I love it.

Chrissy
Can you tell us, when exactly did your FI journey start? And what did you do when you discovered it? And how did you change your money approach?

Tara
Yeah, so it was interesting, my FI journey, kind of all started coming together around just just before COVID hit. And I was already sort of starting to think about it even before that, just because of you know, not being sure what my future looks like, and what my money situation could look like. So I was starting to sort of come to terms with the idea that I really needed to start sort of learning more about investing and sort of understanding what when money was doing and where it was sitting. And then of course, COVID hit. And so you know, I was one of those people who kind of freaked out and pulled all my money out of the market. But at that time, I actually didn’t have a ton of money in the market. And it was through mutual funds through my bank, which, to be honest, I actually had no idea what they were actually in, I’d never even looked at the mutual fund, like what was it invested in, like no idea. And anyone I had sort of worked with in the past that the bank was not overly helpful. And so yeah, that was kind of like a reset point for me, I think. So it’s kind of an interesting journey since COVID hit, of just sort of learning about investing. But I also think now, it’s quite different as well, in some ways, or could be in the future. And so it’s been interesting sort of learning about traditional fin- you know, personal finance up into this point, and then sort of what it could look like in the future. So I’ve just been sort of, you know, sitting on most of my money in cash right now and slowly starting to invest in ETFs over time, and I just went through the process of pulling all my money out of RBC and into RBC Direct, so that I can start doing my own investing and choose my own ETFs and things that I wasn’t able to access before through my bank. So yeah, that’s kind of where I’m at currently, and just sort of slowly dollar cost averaging in.

Money Mechanic
Okay, let’s, let’s tackle that one. Because that’s a favorite in the community. Yeah. Do you consider the lump sum investing?

Tara
I did.

Money Mechanic
Okay, so what what made you decide?

Tara
Yeah, I mean, I just keep hearing everyone talk about how overvalued things are right now. And, you know, it seems like everything’s looking real nice because of all the stimulus money and I think a lot of new investors are pouring into the market and, you know, investing their stimulus cash and everything like looks real nice right now, but I I guess I’m one of those not crazy conspiracy theorists. But like I, I definitely feel like at some point we are going to, I mean, this can’t go on forever, I don’t think. So I’m kind of just slowly dollar cost averaging so that I can sort of balance out that risk over time, I do actually kind of think that at some point, when all the stimulus ends, that things are going to go back down. And I would rather get in at that time. And I may consider in the future sort of putting more of my money in sort of all at once if that was the case. But for now, I’m just kind of slowly inching my way in. And that helps me sleep a little better at night right now, my old financial advisor who was actually like a really solid guy, the most recent one I had, and I don’t think he would give me bad advice. But he definitely kind of encouraged me to put it all in at once. And I kind of convinced him that that was not the way for me. And I had we had been dollar cost averaging in before I pulled everything out and moved it over. So yeah, I right now, dollar cost averaging, I think makes sense for me. In the future, it’s possible, I might put larger sums in but I kind of want to see what happens here. I think we haven’t really sort of come out of the woods yet. And seeing what you know what the future looks like in terms of investing.

Chrissy
Yeah, and I think there’s a lot to be said, for the psychological benefits of dollar cost averaging, like numbers aside, like I’m a numbers person, and I’m, I’m one for throwing it all in as soon as you have it. But for a lot of people, that doesn’t work. And that will make you actually blow up your plan. If you do it that way. When you know that that’s not in your nature, and you can’t go against that. It’s better to know yourself and do it in a way that’s going to be comfortable for you so that you’ll be successful. And so if the math doesn’t work out, it doesn’t work out, it’s fine. At least you’re in the game, and you’re staying in the gam and comfortable with it.

Tara
For sure. Like I know, there’s potentially more opportunity for making, you know, more money over time with putting it all in at once. But I also fear that if I put it all in at once, especially right now, then, you know, what if it goes down for multiple years, and, you know, I know, everyone’s just like, stick it out, you know, just keep hold and just stick it out.

Money Mechanic
Time in the market, time in the market.

Tara
Yeah. I don’t know, this COVID thing might have, might flip everything on its head. And maybe the future of investing looks different. I don’t know.

Money Mechanic
There’s a couple saings I’m trying to remember now. You know, one of them is well, this time is different. And then the one on the flip side of that is the risk is saying that this time is different. But it’s not yet a different type thing we don’t know. Nobody knows, right? Yeah, we don’t know. It’s all backward looking. And I think Chrissy, you made a great point there. It’s all about your own psychology. This is your journey, not anybody else’s. And the math can say one thing, but it doesn’t matter if that’s how you feel.

Tara
For sure. Yeah. And I’m okay with being you know, I’ll still be young at retirement if I hit my goal, but I won’t be super young, like some people, you know, retiring in their 30s. That won’t be me.

Money Mechanic
We’re not, we’re not super young.

Tara
But are you retired yet?

Money Mechanic
Well, Coast. Let’s go with Coast.

Tara
Okay. Cool. Cool.

Money Mechanic
Okay, so you’ve got a whole bunch of accounts now, right? You’ve got your TFSA going? You’ve got an RDSP, which is a one that most of us don’t have, you’ve got a LIRA as well, because you’ve commuted your pension, and maybe an RRSP going as well, I don’t know. So you got four to manage. For that you’re going to manage yourself now, which is a lot to take on. When you’re at the beginning of your investing journey. Do you plan to keep the same thing and all accounts to keep it simple? As far as investments?

Tara
Yeah, I think so. Yeah, so I’ve got a Questrade account where I don’t have a ton of money, I kind of call it my fun money. I have it in there. And I’m kind of investing in like random, weird niche ETFs.

Chrissy
Sounds like someone I know!

Tara
Yeah, so that’s kind of where I like have my fun. And, you know, I also invest in some individual stocks as well there. And so that’s kind of where I play around. But in terms of like all my other ones, so my RRSP I do have a regular RRSP, my LIRA, my RDSP. I’m pretty sure that all of those, I’m just gonna continue on what I’ve been doing, which is just dollar cost averaging into. I use VEQT, the total stock market. And then I also have some in VFV, which is like the S&P 500, which I realized that’s a little bit heavy on the US side. I had been putting money into bonds, but I don’t know just with all the podcasts I’ve been listening to lately, nobody seems to be super interested in bonds right now. So yeah, we’ll see. I may do some type of fixed income though. Whether that be like GIC or bonds or Yeah, but I probably won’t do, like, 40%. I originally thought I would do 40. And I think I would probably go for less than that.

Chrissy
Yeah, yeah.

Money Mechanic
Yeah, I think the the important part is you know you’re at the beginning of your investing journey. So keeping it simple. A program that you can stick to. And if it’s like VEQT is well diversified. we’ve all talked about that before. And it’s like, I can hold that in all my accounts and get good exposure. And you can always customize as things go along, right? And you’re just dollar cost averaging in. So I think that’s good. It’s a nice, simple strategy, it’s going to keep you motivated and keep you on track, right? And then you don’t even have to do any rebalancing, you just put it away.

Tara
For sure. I love that idea. And I’ve also been sort of looking at, oh, I’m pretty sure they’re called Evolve. And I think they’re out of BC, have you heard of those guys? They have some really interesting sort of progressive like, ETFs, where, you know, well, you know, one might track, like, automatic cars. And anyway, I just thought it’s pretty neat what they’re doing, I have a feeling they’re younger, because they’re all very, like interested in, you know, where things are going in the future, and not just sort of like your standard total stock market. Like they’re like, Hey, you know, things are gonna blow up in, you know, self driving cars and renewable energy and Bitcoin or cryptocurrencies and things like that. So I might look a bit at that, too.

Money Mechanic
Yeah, I think that kind of has to go into the satellite part of your portfolio. This is just going to be a very small amount, because it’s really, it’s all speculation and you’re paying pretty high fees for those. And I think, yeah, the majority, it’s, it’s definitely because it’s so much more accessible to everybody now. And it’s been It was so popular in the last year, that, you know, it’s easy to get wrapped up in the, the excitement of it right, and want to be involved in it. We’re all somewhat guilty of that. But I think we need to be careful to keep our core FI portfolio secured and globally diversified. And then we’ve talked about it before, people want to have a little bit of fun money to do other things with them. Yeah, there’s lots of interesting things out there for sure. I’m the last person to talk Chrissy knows, I try to get one of everything.

Chrissy
So Tara, can you explain a little bit more, I want to question why do you have an account at Questrade when you have RBC Direct Investing? Why have two different brokerages?

Tara
Yes, good question. So I opened my Questrade account, probably almost two years ago. So it was my first little sort of foray into investing. And at that time, all my other money was sort of locked up in in RBC through a financial planner. So at that point, it was just the quickest, easiest way for me to like start investing. So I started there. And then recently, I just decided to move most of my sort of RRSPs and LIRA and all that into RBC Direct. That’s probably where I’ll do most of my investing. I’ve noticed you can, instead of paying $10, like I know, Questrade is cheaper in terms of buying and selling for the costs, but RBC Direct, I can actually just pay the 10 bucks with my travel points, which I’m not using right now. So I was kind of like, that’s okay, to me right now.

Money Mechanic
Is that $10 a buy?

Tara
Yeah.

Money Mechanic
I’m with TD, it’s the same. So yeah.

Tara
Yeah. So if I was, you know, every month I’m doing if I’m dollar cost averaging, you know, a certain amount into VEQT, a certain amount into VFV, and a certain amount into like a bond index or whatever, then, yeah, that’s like, $30 a month. So, I yeah, I need to think that out over time, because I definitely don’t want to be paying more over the long term.

Money Mechanic
Yeah, that’s gonna eat into your returns big time, because you’ve got the, you’ve got that payment on the other side, too. You know, if you just had to change funds, or whatever, you’ve got that transactional cost to that’s why most of us are using Questrade for the ETF purchases, because that saves you a substantial amount of transaction costs.

Tara
I have to admit to like, seeing that CDIC insurance thing on RBC makes me feel better, although I haven’t fully looked into I’m sure there are some protections around Questrade as well.

Money Mechanic
Well, CDIC is deposit insurance. So that’s only going to cover you for savings accounts.

Tara
Oh, okay.

Money Mechanic
No coverage. Yeah, there’s no coverage on investments accounts, but there is a coverage that protects you from the broker itself going out of businss.

Chrissy
The custodian. The CIPF.

Money Mechanic
So if you’re, yeah, exactly. Thank you. If you’re with Questrade and Questrade, no longer exists, you still get all your shares. That’s the protection you have for that. Okay. CDIC is just gonna be like your EQ Bank savings account.

Tara
Okay. Wow. Okay. Didn’t know that. That’s good to know. Okay, so I guess there’s really no, no difference, I suppose, then using RBC Direct versus Questrade versus others.

Money Mechanic
There is a difference. That’s $10 a trade.

Chrissy
Yes, that’s a big difference.

Tara
For sure. Yeah, yeah. So at some point, I might amalgamate all those together.

Chrissy
And it would simplify your life to just to be all in one brokerage.

Tara
I know. For sure.

Money Mechanic
See, and I always want to bring this up too, right? Because none of us start off with a perfect FI plan. It’s an evolution, right. So it’s like I’m there for a little bit, and they’re like, Oh, I can I can optimize that. So then you do the next step. Next optimization and then, you know, it’s like, don’t try and get everything right at the beginning. Let yourself give yourself time to learn more to educate, and then and then you can make changes along the way. It’s it’s not all or nothing.

Tara
Yeah, I don’t think yeah, I think you’re right that looking at my sort of path to FI It’s definitely been sort of up, back, sideways, you know, it’s pretty random but for sure in the end, I think it will all come together. I think too, why RBC Direct interested me was that like, I already bank with RBC. So, it’s very easy to access my investment accounts right from there. Whereas with Questrade, I find it a bit of a pain to like transfer money in and out and… anyways, maybe I just, you know, learning how to use how to use it more comfortably over time will system sort that all out?

Money Mechanic
Yeah, it’s putting systems in place for sure it is it systemising things.

Chrissy
Yeah, I just have one more question to make it more actionable for our readers or listeners, I should say, how did you learn how to DIY invest? Because we talked about how you found personal finance, and then you just started investing? But obviously, you you had to gain some knowledge somewhere to learn how to do it. So how did you find that? And then how did you jump from personal finance into FIRE?

Tara
I jumped from personal finance into FIRE, I think mostly just because I was just consuming as much content and books and podcasts as I could around personal finance, and FIRE comes up so much. And as soon as I kind of heard about it, I was just like, this sounds amazing. And why would anyone work forever, when they could just retire early? And so it totally changed the way I was approaching my life and my decisions and all that in my spending. Sorry, what was your first question there?

Chrissy
Well, I wanted to know how you learned how to invest because you’re talking about personal finance, and then you found FIRE? And where was it that you figured out how to DIY invest? Because that doesn’t just happen. It’s it’s not really something that’s covered in the basic personal finance books. So how did you figure that part out?

Tara
Yeah, so I actually spent a lot of time on YouTube, there’s a surprising amount of tutorials on how to use Questrade. How to buy, how to sell how to, you know, do like Norbert’s Gambit. So I’ve done a lot of that. And with exchanging from Canadian over to American and back, I would say, yeah, mostly YouTube tutorials. And then over time, just podcasts as well, like I would, obviously, they don’t go through exactly how to invest. But they talk a lot about which ETFs that was something that took me quite a while to sort of understand and decide on which ones I wanted to invest in. And it was really just like people mentioning them and me going and googling them and looking them up. And I have a notebook that I just kind of titled like, you know, finances and I’ve just been sort of taking notes for, you know, the last year or two. And, you know, eventually I started seeing a lot of the same ETFs over and over and over like the VEQT for sure was like a huge one. Yeah. And then I just kind of research them. And then I figured out how to use Questrade. And then I kind of went from there. And it also gets a little easier over time, as you kind of get into it. And yeah, I find it pretty straightforward now.

Chrissy
Yeah. And I think that’s something I try to stress to people who are new to the financial journey, whether it’s FIRE or, or just personal finance, is just get started, you know, with the most basic stuff because it seems overwhelming. And it seems like a ton of stuff to learn. But you have to get started and you just take it one step at a time. And before you know it, you’re like Tara and you’re like, this is no big deal. I can do this, right?

Tara
Yeah. Now like even some of my friends and my partner’s sister like I’ve helped them start up some investment accounts and start investing in Bitcoin and all that so and bitcoins the other one, too, that was.

Money Mechanic
Speculating, speculating!

Tara
Yes. Well, hey, I was I warn them ahead of time that anything that they lose is not should not come back to me. Totally their own risk to take. So I’m definitely not pushing people there. But if they’re interested in and I’m happy to like help them out. So

Money Mechanic
Well, that’s I think, you know, it’s nice to see that finance discussion is becoming a little more normal, normalized everywhere, right? I think we’ve gone through this pandemic that shook everybody up, and now people are a little more interested. They’ve got maybe a little bit extra savings to put to work and it’s good. I’m glad this discussions out there. When friends see you’re doing stuff yourself, they generally are interested, right?

Tara
For sure. Yeah. Especially when they used to remember me as someone who was very much an impulse spender, and you know, not a saver. So yeah. It’s pretty cool.

Yeah. Well, good for you. It’s, it’s awesome. I’m glad you’re on the journey along with the rest of us in Canada and that we have our first guest from the Yukon.

Chrissy
Yes. Thank you for sharing that. And I think our audience could take a lot from your story. There’s just so much there. You’ve come so far, in quite a short time, I have to say. Just from the start of COVID. And the thing that keeps standing out to me through the past year, where we’ve been interviewing people is how resilient everyone has been. And, you know, a lot of people at the beginning, the naysayers are saying COVID is going to destroy the FIRE community, everyone’s going to go back to their jobs and have a terrible time. And we’ve proven it’s the opposite. We’re more resilient because of the financial security we’ve worked for and provideed for ourselves. And your story just proves that, you know, during we’re still in the middle of a pandemic, and you’ve been, you’ve given up a full-time job, a government job with a pension, most people hang on to forever, and you’ve been able to transition to something that suits your lifestyle and your physical health better.

Tara
Yeah.

Money Mechanic
Yeah.

Tara
Thank you.

Money Mechanic
Great transition.

Chrissy
Yeah, it’s, it’s amazing. And I’m glad we could share your story.

Money Mechanic
Thanks so much for joining us.

Tara
Awesome. Thanks so much for having me.

---