Today in my awesome series about women seeking financial independence, I’m happy to bring you the story of Frogdancer. She’s a single mom from Australia who started working on financial independence after her 20’s and 30’s had passed – and reached it while raising four boys and not making six figures. I love reading stories like hers (and hope you will too!) because I feel like the “traditional” financial media is overly focused on people who are ultra-young, wealthy, and achieving things that many ordinary folks may think are unachievable. It’s stories about overcoming tough situations that show you it’s possible to do anything you put your mind to.
She has a fascinating story about getting out of debt, playing catch-up, and taking advantage of an unexpected opportunity to reach FI.
So lets get to know her!
All About Frogdancer
Is it possible for a person to achieve financial independence if they start working towards it in their 40’s or 50’s? What about single parents? What about those people who don’t have an XY chromosome and have to make do with XX? Speaking as a woman in my mid 50’s, a sole parent and as someone who is not earning a 6 figure income, I’m saying that it is. But it takes having a long-term view on life and an ability to take lots of little steps to get there.
I’m ‘Frogdancer‘ (not my real name!) from Melbourne, Australia and I’ve been a single Mum (not ‘Mom’) for 21 years since my long-ago divorce. I have 4 boys, who were 5 years and younger when I left my husband. Two of them still live with me. Two of my boys have chosen responsible careers, one as an accountant and the other as a remedial massage therapist, but the other two are studying acting and music, so they’ll probably be living with me until they’re 50. Fortunately we all like each other so it mightn’t be too bad.
I’m an English and Theatre Studies teacher at a public school. Teachers in Australia appear to be paid better than they are in the US, but it’s still not what you’d call a high-paying job. Still, I’ve managed to improve my net worth over the years from the lowest of the low, (a 100K mortgage and $60 cash when I left my husband), to where I am now, with a 1.9M net worth. This figure includes my house. Take that away and I’m worth 900K – worth more dead than alive says my accountant son. He’s joking… I hope…
I live in a house by the beach with my boys and my 3 dogs in The Best House in Melbourne and I love my life. For an extroverted introvert like myself, teaching in a school with over 2,000 students with all the bustle and the noise, and then coming home to a quiet place to recharge with my dogs is the perfect blend.
I first became interested in personal finance out of necessity. When you’re suddenly solely responsible for 4 little lives and you literally have $60 cash to your name, it tends to make you focus! For the next 17 years, I was the Queen of frugality, making every dollar count. I stayed at home with my boys for the first 4 years of my single life, existing on what was the Sole Parents’ Pension of 18K/year until my youngest started school. Then I started work, first as an Emergency teacher, then I started full-time work at our local Secondary school and I’ve been there ever since.
During those 17 years, I decided to refinance the mortgage to pay for a new kitchen, bathroom and ducted heating and cooling. The bank said they’d lend me 260K. I was horrified – how did they ever think I could pay that amount of money off? I decided that 200K would be my limit on my debt, so I borrowed $199,990. I wasn’t going to go over that limit! During that time I cash-flowed things like music excursions for the boys to the US, we went on family holidays to Bali and Thailand and I generally made sure that they didn’t miss out on much.
But during all of that time I grimly kept throwing money at that mortgage. It was my only debt.
Enter Dave Ramsey
Around 5 years ago I stumbled across Dave Ramsey’s podcast and I found it very motivating. The debt-free screams would sometimes bring tears to my eyes and I’d think, “I SO want to be like them.” Then I’d trim something off the budget and redouble my efforts.
Three years ago, I woke up on the last day of the school year, just before Christmas, and I was doing my banking on my laptop in bed. I couldn’t help but notice that I had $10 more in my savings accounts than I owed on my mortgage. I tried to resist – life without an emergency fund is risky – but a few hours later when I was at work I couldn’t resist. I transferred the funds, stood up and yelled out to the rest of the staff room, “I’ve paid off the house. I’m debt-free!!!!”
That’s when my financial education REALLY began. Security for the boys and I was always my main concern, so I had deliberately prioritised paying the mortgage over saving for retirement. Three weeks after that last mortgage payment, I realised that I had to play catch-up. NOW.
I was lucky in that the boys were older. The expensive teenage years were almost behind us. They were working part-time jobs and paying for their own little luxuries and activities.
I joined an investment club with the Barefoot Investor, met some highly intelligent people who weren’t scared of Maths like I am and I began to invest in the stock market. I was also running a side hustle, being a Thermomix consultant, and this enabled me to throw more dollars at my share/stock portfolio and my superannuation/401K. This was all progressing pretty well, however there was this one thing I had to get done. It was eating me alive…
When I was 15 I planned out a trip to Europe and the UK. When I was 51 I finally went on it. 9 weeks and (I estimate) 30K later… it was done. I’ve never had such a brilliant time in all my life. After what seems like a lifetime of frugality, I denied myself nothing. Every day I had at least one ‘OMG!’ moment, such as walking into the King’s chapel at Hampton Court Palace and being where Henry VIII walked; visiting Jane Austen’s house in Hampshire and actually touching the table where she wrote her novels; or standing under the stained glass windows of Sainte-Chapelle in Paris and realizing that once only royalty and their guests ever got to see such beauty.
Sometimes it’s worth splashing the cash! It has given me a hunger for travel and the desire to work for FI so that I can gallop around the world while I’m still nimble enough to enjoy it. Frugality and my side hustle enabled me to cash-flow that trip. A little bonus was that I was able to take long service leave for a term, which meant that even though I was away on the other side of the world, I was still getting paid my full wage. It was sweet.
Meanwhile I’d fallen down the rabbit hole of the FI/RE movement. So many blogs! So many books! I was gathering information like a vacuum cleaner sucks up crumbs.
Then came the opportunity which turbo-charged my net worth.
My little 1950 weatherboard house was on the edge of one of the most sought-after school districts in Melbourne. It was the reason I bought it all those years ago and, as it happens, the school is the one I teach at and the one my boys went to. Melbourne, Australia is one of the most expensive places on Earth to buy property. In the area where I used to live, you’re looking at 7 figures for even the most basic house, while apartments and units are a ‘bargain’ at 500K or so. The desirable school district added an extra 15 – 20% on top of the property value. in November 2015 I went to an auction around the corner of a house very similar to mine. It sold for 1.3M.
I went home, thinking, ‘Is this the sound of opportunity knocking?’
I loved my house. I had spent many happy hours establishing a food forest there, with chickens, over 30 fruit trees and over 12 metres of veggie gardens. We had solar panels, a huge water tank and I was convinced that the only way I would leave that place was when I was carried out of it in a pine box. But 1.3 MILLION dollars? I paid $136,500 for it twenty years before.
Long story short, I decided to develop the block myself in partnership with a property developer. We got all of the council permits and designed a massive development of 2 huge luxury townhouses. In the meantime I moved out, buying my current house 15 kms/9 miles away for 750K. I had to use bridging finance to purchase it.
I joke that my house is a glorified kennel for my 3 dogs, but the truth is that I bought the house because I owned dogs and I knew I’d find it impossible to get a rental. Landlords hate dogs. Then followed 18 months of me paying 3K a month in bridging finance while the council dilly-dallied and the architects and other people dragged their feet. The delays drove me crazy. The whole process took a year longer than I thought it would. Thankfully, those earlier years of frugal living really paid off as we tightened our belts and cut every expense we could.
I eventually sold the house, complete with plans and permits, to another builder. I didn’t have to go through the trauma of doing the build and they paid me the ridiculous sum of 1.7M. Meanwhile, my current house appreciated in value over double what I’d been paying in the bridging finance and after paying out my property developer partner, I was left with a tidy sum. I topped up my superannuation as much as I possibly could and set up a Family Trust with the rest. I have my FI number in mind and I’m not there yet, but I estimate that by the time I’m 59 or 60 I should be able to retire and have a very nice lifestyle.
This geo-arbitrage has probably saved me 10 years of having to be in the workforce. Ironically, I now live in a newer, bigger and by far more well-designed house that is literally 5 minutes walk to the beach. I believe it will always hold its value. My current house is now worth around 1M, which is an increase of 250K over 2 years. The crazy house prices in Melbourne have really worked out for me, but I shudder to think about what they mean for my kids. How will they ever be able to afford a house in a good part of Melbourne?
Financial Independence is hugely important for me. I never want to be one of those elderly people who have to go to their kids for handouts to survive. I think that the greatest gift I can give to my boys is to be financially independent and pay my own way for the rest of my life. Using the 4% Rule as a base, I’ve worked out my magic number that I’ll need in my investment portfolio to retire. I don’t include my house in this because I figure that I have to live somewhere and so, even if property prices plummet, if I don’t include it in my retirement savings then it won’t make a difference.
Being single along this journey has made it harder in some ways. My ex-husband wriggled out of paying much child support so I had the expense of the children while only bringing home one wage. However, being single is also a HUGE advantage. I’m a natural saver and I have full control over the family finances. There was no-one going out buying golf clubs or gambling at the horse races, so my money stayed where I wanted it to with no sabotage going on. That’s a precious thing.
What You Can Learn
I realize that some people may think, “It’s all very well for Frogdancer to say that it’s possible to reach FI/RE. Not everyone has a house to sell in a rising property market.” Fair enough. But here’s what I believe my story illustrates:
1. BEING DEBT-FREE IS VITAL. There’s no way I could have done this if I’d kept refinancing my house over and over again. I have a friend who bought her house when I bought my original one. Today, they owe more than double their original mortgage on that house because they kept borrowing against their equity as property prices rose. If any opportunity comes up, they’re not in a place to take advantage of it. Having no debt means that you can operate from a position of strength.
2. EDUCATE YOURSELF. I was reading about real estate, geo-arbitrage, share/stock portfolios and superannuation/401Ks for years. When the opportunity presented itself, I was able to recognize it and take an educated risk.
3. BEING FRUGAL = BEING A VALUIST. I have no difficulty spending money on things that bring me joy. My trip to Europe and my 2K miniature wire-haired dachshund puppy called Scout, (or Jean-Louise Finch when she’s naughty), are just two examples. However, there’s no way I waste money on things I don’t value. A daily coffee from a café? Nope. New clothes every season to stay on trend? No. My money moves only in the directions that bring satisfaction, happiness and stability to my life.
4. TAKE STEPS EVERY PAYDAY TO REACH YOUR GOALS. Even if I hadn’t sold my house, I was on-track to be able to retire at the age of 69 and still have a comfortable retirement. I had a plan in place and I was working that plan. I want to travel, so I cash-flow my trips. Next month I’m going to China and North Korea… paid for up-front with a set amount going into my ‘travel’ account each fortnight. It makes reaching financial goals very easy.
5. BE A LONG-TERM THINKER. Old Lady Frogdancer, that wrinkled old crone, had better thank me! Every pay packet, I put money aside to make sure that she’ll be able to do the things she’ll want to do. I loved my little house, but I could see that Old Lady Frogdancer would be far better off if I made the move. I firmly believe that delaying some short-term pleasures for a greater goal is how people succeed.
In Closing
I’d like to thank Liz for the opportunity to talk with you. Highlighting women in the financial independence field is a good idea, as all too often it seems that we get pushed out of the limelight.
If you’re interested in looking at my wonderful UK and European trip, I blogged all about it, with all sorts of links to historical info at http://dancingwithfrogs.
My FI/RE blog is http://burningdesireforfire.
I tend to post a couple of times a week, with ‘Frugal Friday‘ being a constant.
I hope to see you there. And seriously, being a woman is a massive advantage in the journey to financial independence. No one is tougher than a determined woman who has her eye on the prize. Let’s all go forth and achieve our financial freedom together!
CMO Here Again
Thanks so much to Frogdancer for stopping by to share her story! I love having the chance to share the stories of so many different amazing women, from all around the country and around the world. There’s something we can learn from each and every one of them – be sure to leave her a comment!
I enjoyed reading Frogdancer’s story….and I love that you feature women my age who started late on their journey towards financial independence. It gives me hope!
I love getting to feature all different kinds of women, in different situations. Everyone has a story!
Anyone who gets their finances together is ahead of the game – no matter what age they are. I’m trying to get my kids to see that they’re now in their prime decade for compounding – a couple get it but there’s still a couple living pretty much hand-to-mouth. I wish I could turn back time for my life!!
Frogdancer’s story just made me smile the whole time. I love her determination and perserverence! Debt hath no fury like a woman on FI/RE. 😍 and what an amazing example you are to your boys. Congratulations on a life well lived!
Thanks! Yes, that ‘survival’ mentality kicks in when you have little ones dependent upon you. You vow NEVER to be in that position of financial vulnerability again. 🙂
Lovely to hear your backstory Frogdancer, and your dogs are so adorable.
Thanks! I’m just about to switch out the light. I have Poppy, one of the Cavaliers, curled up and snoring beside me. The other two are down on the floor in their bed. They’re adorable and they snore like drunken sailors!!!
I want to hang out with Frogdancer–what an amazing spirit she has! Truly an inspiring story.
We should totally hang out!
I love your story, Frogdancer! It’s so easy just to focus on the 30 year old retiree, but there are so many people in their 30s, 40s, 50s who don’t have that option. Your story is one of serious hope.