Free Range Finance: Everything We've Covered So Far
A Quick Recap for New Readers (And a Refresher for Everyone Else)
We've covered a lot of ground in these newsletters! If you're just joining us or want to review the key concepts, this post summarizes everything we've discussed and shows how it all fits together.
The goal of Free Range Finance is simple: help regular people achieve financial independence so they can reclaim control over their time. Here's how we get there.
The Foundation: What Is Financial Independence?
What Financial Independence Actually Means
Financial independence means having enough money invested that you could live without ever working again. It's the point where work becomes optional, not mandatory.
Key insights:
FI doesn't mean you have to retire early (though you can)
It's about having choices and freedom from financial stress
The traditional "work until 65 and hope for the best" model is increasingly risky
FI provides security, better relationships, improved health, and peace of mind
The Math: How Much Do You Need?
How to Calculate Your FI Number
You need 25 times your annual expenses invested to be financially independent. This is based on the 4% rule, the idea that you can safely withdraw 4% of your investments annually.
Key insights:
If you spend $40,000/year, you need $1,000,000 invested
Your FI number is based on what you spend, not what you earn
The number will evolve as your life changes, and that's okay
Don't count on money you don't control (Social Security, inheritance)
The Timeline: Why Savings Rate Is Everything
Why Your Savings Rate Matters More Than Your Salary
How long it takes to reach FI depends almost entirely on your savings rate, not your income level.
Key insights:
Save 10% → retire in 51 years
Save 30% → retire in 28 years
Save 50% → retire in 17 years
Someone making $40k who saves 50% can retire before someone making $100k who saves 10%
Small increases in savings rate cut years off your working life
Compound interest makes early saving incredibly powerful
The Strategy: Three Pillars of FI
There are only three ways to reach FI faster:
Earn more money
Reduce your expenses
Invest the difference wisely
Expense reduction is the most powerful because it provides a double benefit: more money to invest AND a lower FI number (since you need less to support your lifestyle).
The Mindset: Why Internal Changes Beat External Rules
Why a Savings Mindset Beats Budgeting Every Time
Traditional budgeting is reactive and relies on willpower. A savings mindset is proactive and changes your relationship with money.
Key mental models:
Time-based thinking: "This costs 2 hours of my work time"
Investment thinking: "This $30 meal could be $240 in 30 years"
Freedom thinking: "Money is stored freedom"
Abundance thinking: "I can afford this, but I choose not to"
A savings mindset makes spending less feel natural rather than forced.
The Big Three Expenses
Most people spend 60-70% of their income on housing, transportation, and food. Small improvements in these categories create massive long-term impacts.
Housing: Your Biggest Opportunity
Housing: Your Biggest Expense (And Biggest Opportunity)
Every $100/month you reduce in housing costs cuts $30,000 from your FI number.
Key strategies:
Easy wins: Shop insurance, optimize utilities, appeal property taxes
Moderate changes: Downsize, house hacking, move to cheaper areas
Major moves: Geographic arbitrage, alternative living situations
Psychology: Most housing decisions are emotional, not mathematical
Transportation: Stop Your Car from Stealing Your Future
How to Stop Your Car from Stealing Your Future
Most people have no idea how much their transportation actually costs because the expenses are hidden and spread out.
Key insights:
A "$400 car payment" often costs $1,200+/month total
Cars depreciate rapidly while you pay interest on a declining asset
Buy used, pay cash, focus on reliability over features
Consider alternative transportation in urban areas
Every $100/month saved on transportation = $30,000 less needed for FI
Food: Health AND Wealth Optimization
Food: How to Feed Yourself Without Feeding Your Expenses
Food is unique because optimization often improves both finances and health.
Key strategies:
Restaurant meals cost 3-4x homemade equivalents
Meal planning prevents impulse purchases and food waste
Learn to cook simple, cheap, nutritious meals
Focus on whole foods around the store perimeter
Every $50/month saved = $15,000 less needed for FI
Personal Context: Who Is Max?
Who is Max Prosper? (part one)
I shared my background to help you understand my perspective:
Grew up in a frugal household but wasn't extreme
Lost my father in his early 50s before he could retire
This experience motivated my focus on achieving FI earlier in life
Discovered FIRE in 2014 and dramatically changed my financial trajectory
How It All Connects
Here's how these concepts work together:
Calculate your FI number (25x annual expenses)
Develop a savings mindset (think in terms of opportunity cost and freedom)
Optimize the Big Three (housing, transportation, food)
Increase your savings rate (every 5% increase cuts years off your timeline)
Invest the difference (we'll cover this in future posts)
Track your progress toward financial independence
Real-World Example: My Journey
Here's how these principles worked in practice:
Housing: Moved from $2,450/month trendy apartment to $600/month basic apartment
Monthly savings: $1,850
FI number reduction: $555,000
Transportation: Went from owning multiple vehicles to sharing one used car
Monthly savings: ~$800
FI number reduction: $240,000
Food: Switched from eating out every meal to cooking at home
Monthly savings: $900
FI number reduction: $270,000
Total impact:
Monthly savings: $3,550
Annual savings: $42,600
FI number reduction: Over $1,000,000
This isn't about living in poverty. It's about being intentional with money so it serves your goals rather than random impulses.
What's Coming Next
In future newsletters, we'll cover:
Investing basics: Simple, low-cost strategies that actually work
Income optimization: Side hustles, career advancement, multiple income streams
Healthcare costs: Planning for medical expenses in early retirement
Tax strategies: Legal ways to keep more of what you earn
Advanced FI topics: Geographic arbitrage, international living, and more
Your Action Plan
If you're feeling overwhelmed, start here:
Week 1: Calculate your FI number and current savings rate Week 2: Track all expenses for one week to see where money actually goes Week 3: Optimize one Big Three category (pick your biggest pain point) Week 4: Implement one new savings mindset technique
Remember: You don't have to do everything at once. Pick one area, make improvements, see results, then tackle the next area. Small changes compound into life-changing results.
The Bottom Line
Financial independence isn't about having a huge income or living like a monk. It's about understanding the math, developing the right mindset, and making intentional choices that align your spending with your values.
Every dollar you optimize today buys you more freedom tomorrow. Every month you increase your savings rate shortens your path to FI. Every expense you question thoughtfully gets you closer to owning your time.
The goal isn't just to accumulate money. It's to create the freedom to live life on your own terms.
Here's to taking control of your financial future,
Max
New here? Start with What Is Financial Independence? and work through the posts in order. Each one builds on the previous concepts.
Been following along? Which topic has been most helpful for your situation? Hit reply and let me know. Your feedback helps me write better content for everyone.