Millionaire Interview 13 – RV-on-FIRE

Millionaire Interview 13. I have started a series called Millionaire Interviews. There is no better way to learn how to build wealth than from those who have already done so. Along those lines, I ask millionaire bloggers or even millionaires who are not bloggers a series of 11 questions that they answer. The questions are highlighted in bold and the answers are below each question. Hopefully, the answers are enlightening and will help you on your journey to build wealth and attain the $1,000,000 mark and beyond. 

The millionaires in the Millionaire Interview series became millionaires at a younger age than the Secret Dividend Millionaires. This comes down to mostly having higher incomes. Second, they are not very frugal to the point of austerity as some of the Secret Dividend Millionaires but certainly save more than they earn and save more than the average person. Lastly, most have multiple sources of income.

Before we start with Millionaire Interview 13, if you are a millionaire blogger or even a millionaire who doesn’t blog and want to be a part of this series, just send me an e-mail or message me on Twitter.

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Millionaire Interview 13 – RV-on-FIRE

Millionaire interview 13 is with the anonymous authors of RV-on-FIRE blog. They are a retired couple from South Dakota who were originally from Southern California. They are 46 and 50 and both retired. They have one college-age son. She was a fraud investigator and he was an accountant. They blog about traveling in their RV and their dividend stock portfolio. He and wife reached the $1 million mark at the ages of 44 and 48 through investing in their 401(k) plans and some really good luck in the real estate market. Their current net worth is approximately $1.6 million. Now let’s take a look at Millionaire Interview 13.

• Tell us a little bit about yourself.

I’m 46 and my wife is 50. We both grew up in Southern California and we have a son in college. As full-time RVers we are now residents of South Dakota as that is one of three states that offer the most benefits to living this lifestyle. Changing our residency to South Dakota means we no longer pay state income taxes and vehicle registration fees are low. Those are both a huge contrast to being a resident of California. South Dakota also accommodates RVers when it comes to things like voting, jury duty, renewing drivers licenses and renewing vehicle registrations so it’s the ideal place for us. 

As for education, I dropped out of college and eventually attended a vocational school for accounting. It was tough to get an accounting job without a degree, but I ended up finding a good company that was growing and the executive management allowed me to grow with the company which I am forever grateful for. I ended up having a nice career in management and made decent money. I have my wife to thank for my career. We met when she started working at the same company I was at, and I knew I wanted to marry her from the moment I saw her. The problem was that she refused to date me because we worked together so I enrolled in vocational school for accounting and quit my job. We have been together 25 years, so it seems to have worked out. She is the smart one of the family and has a bachelor’s degree in criminal justice. She worked as a fraud investigator and manager for 20+ years until she retired in September 2021. 

• What is your net worth? At what age did you become a millionaire? How many years did it take to become a millionaire? Do you have any debt?

Our net worth was just under $1.6m as of our last update. We became millionaires on a net worth basis in 2018, but on a portfolio basis, which is what I like to track, we officially crossed that threshold in late 2019. We bounced below it a few times in early 2020 with the pandemic, but as you know the market took off and so did our portfolio. It was a very fulfilling moment, and we had a huge sense of accomplishment at the time. We had been investing regularly since 2001 and sometimes it was hard, but we stuck to our plan no matter what. It was a great feeling to see our hard work pay off when we hit the $1M mark. We were real millionaires at only 44 and 48 years old.    

As full-time travelers we don’t own any property other than our RV, Car and whatever else fits in our RV and travels with us. 95% of our net worth is in cash and investments with the remaining 5% coming from equity we have in our RV and car. 

Breaking down our portfolio we have about 96% in mutual funds and just under 4% in cash. We also have a small percentage in individual stocks for our dividend portfolio that we hope to keep growing. The only debt we have is paying for our RV. It’s something we planned for in our budget and it’s not a burden in any way. While we are pretty frugal, we wanted to maintain a certain lifestyle and level of comfort while traveling so we made a sizable upgrade. It’s like having a house payment and the interest is tax deductible, but it is a depreciating asset in the long run. 

I know having this type of debt isn’t ideal in the F.I.R.E movement and some folks will have a negative opinion on it. But we are not living the ideal F.I.R.E lifestyle being full-time RV travelers. We are however living our ideal lifestyle and we are the happiest that we have ever been which is really what achieving F.I.R.E. is all about. This is our home and even though it will depreciate in value over time it makes our lives better and more fulfilling. We don’t have any credit card debt or any other consumer debt.

• How did you become a millionaire?

Our investment journey is an interesting story. When we got married our combined income was about $70k and by the time we hit the $1M mark we were making a combined $180k. Our only sources of income were from working for our employers and growing in our roles over the years.

We were very fortunate in the California real estate market which is just insane at times. We bought our first house by selling some Intel stock which is a crazy story in and of itself. Long story short, due to some family circumstances my wife wound up with shares of Intel stock, which at the time we knew absolutely nothing about Intel let alone their stock. The shares were held at an old school brokerage and the guy said to just hold them as the company is really growing so that’s what we did.

This is also the exact moment when I became obsessed with the stock market. I watched the markets every single day before work and on my lunch break. The stock just went crazy and then it split, and we had twice as many shares which I though was the greatest thing ever. At the time I had no understanding that prices drop when shares split so I was out of my mind happy and hooked on the markets for life! Then the stock went crazy again and the value of our shares grew enough for a down payment on a house. So, we sold and had a house built. 

The timing was great because the .com bust destroyed Intel’s stock price, so we really dodged a bullet there. Compounding our luck, we bought at the bottom of the next housing boom and sold that house in 2006 for 3 times what we paid to have it built. Of course, we also bought a house that was way too big and expensive after that and when the housing market crashed in 2007, we took a good hit. We eventually decided we wanted to downsize our lives so we sold that house at a loss in 2016 but as luck would have it, we once again bought at the bottom of what was the latest housing boom. We sold our last house in 2021 for a hefty profit making back our losses from the last house and then some and hit the road. Welcome to the California housing market! 

All of this enabled us to open a Vanguard brokerage account and create an emergency fund. We invested in some core index funds which we have never touched and have grown nicely over time.     

Aside from all of that we started with simply investing in our company 401k’s. The company my wife worked for at the time offered a great company matching program along with some additional profit sharing which made opening an account a no brainer. The company I worked for didn’t offer anything when I started there. They eventually started a 401k after a couple of years and the match just wasn’t great, so I immediately started putting 15% in from every paycheck to make up for the lack of matching funds. As our salaries grew so did our contributions which I when things really started to take off for us. Eventually we opened a Roth IRA to save for our son’s college savings, but we decided to use cash from our last house sale instead and let the Roth keep growing longer.   

• What is your investing philosophy, and do you use a particular strategy?

From the moment we decided to invest our philosophy has been to set it and forget it. Well, maybe not forget it because I still watch the markets every day. While we were still employed, we set all of our investments to automatic and invested at the same time every month into 401k’s, Roth IRA and into our brokerage account. All of our investment contributions go to various mutual funds, most of which are index funds. Most importantly, this all happened regardless of what the markets were doing. We never wanted to get emotionally involved with our long-term investments.  For long term success it’s important to stick to the plan through all of the ups and down.

Now, that being said I also have a high-risk tolerance and when I see market corrections or irrational moves, I like to jump in and put more cash to work. I did that in 2007, 2008, 2011 and again in 2020. I’m not trying run a fool’s errand and time the market but as the saying goes “when there is blood in the streets”. I like a deal and have always tried to hold my nose and take advantage these pull backs. In the immediate term it can be hard, but for long term investors it’s like adding a supercharger to your portfolio on the rebound.

• What was your best investment? What was your worst investment?

Luck has played a role in our financial lives, so I don’t consider the real estate stuff an investment. We were lucky every step of the way from getting Intel shares, to when we sold them, when we bought our first house and everything that followed. It was all luck. But we recognized this and made a good decision to use it as a foundation and allow our assets to grow over time. A lot of people would have blown the money on meaningless junk or overpriced vacations. So, I would have to say our best investment was buying low-cost, no-load index funds and holding them for a long period of time. It is by far the best investment we ever made. 

The worst investment? That’s an easy one. After seeing what Intel stock did for us I set out to capture lightening in a bottle once again. We still had our old brokerage account and I tried buying and selling stocks like a pro. The problem was I wasn’t a pro and on top of it I was paying a $40 commission fee for every trade. It taught me a valuable lesson and it ended my days of buying individual stocks. I eventually rolled over that brokerage account to get commission free trades, but it just sat dormant with a crappy stock dwindling away over time. I finally decided to get back on the horse with a different strategy of buying dividend paying stocks and growing that portfolio over time into an income stream.     

• How much time per day or week do you spend reading financial news and going over your investments?

I have always spent a lot of time reading business and investment news. I still watch the markets daily and now that we are retired that is pretty much my morning routine. I love watching everything that is going on and how things are moving. It can be hard some days, but I never really miss a day unless we go hiking or have other plans. Because of this I really always know where we stand.

We had a financial advisor at one point in our younger years that was recommended by a family member, but we didn’t see things the same way. She wanted to sell us insurance and talk about saving enough to replace our current income levels when we retired at 62 or 65. We were never on board with that philosophy, especially the part about working until we are in our 60’s. To us current income was always just a means to an end. We were already living well below our means in addition to saving and investing. We wanted to retire in our mid 50’s at the latest and live a more modest lifestyle.

At the time there was no F.I.R.E. movement and the idea of retiring early and living modestly was not excepted very well with so called financial advisors. Probably because the very notion puts their industry at risk and cuts into their profits, but I digress. So, we moved on from our advisor and set to achieve our goals on our own. We do use a tax accountant so we can make sure our filings are done properly which is more important now that we move around a lot.

• What habits helped you become a millionaire?

The best habits we formed was paying ourselves first with automatic investing. I know that’s kind of a cliche’ or a copout, but to me that is the best thing you can do as a young investor with time on your side. Figure out what you to live and enjoy life and then automatically invest the rest in a low cost, no load mutual funds and forget about it. 

Now that we are retired, we live off a budget, but that’s not really something we did prior. We made a good living and with our investments automated everything else was available for us to live our lives. That’s doesn’t mean we just wasted money on frivolous junk, but we have always traveled a lot and enjoyed life. When we got our first RV it changed everything and set us on the path to where we are today. If we had a budget back, then we probably wouldn’t have ever rented or bought an RV and life would be very different today.   

Setting goals was an important part of our process, but we never set time limited goals like we need to have X dollars by X date. We knew if we stuck to our plan the financial side would take care of itself. Obviously selling everything we own and moving into our RV full-time was a huge goal that we accomplished. The most beneficial goals for us were things like spending less on stuff or figuring out how can we reduce the reoccurring cost of things like cell phones and cable tv. These are things that would benefit us in the long run living a more modest lifestyle in our RV. 

Now that we live off our investments the only money we generate is through our website, which isn’t much of anything, and what we do get I put right into the dividend portfolio. While we were still working, we probably saved and invested $3k – $4k per month throughout our accounts. We had our set investments and then depending on our plans for the month we would add more as we could or wanted to. 

It’s important to enjoy life so we always planned vacations, road trips and weekend getaways with our son. Our most expensive splurge was trips we took to St. John and Maui. They were expensive but we also stayed at the resorts on a discounted rate, and we flew for free using reward points both times. There are plenty of ways to have fun and still save. Some of our best memories are from those trips and that is worth the price we paid.  

Some people that want to save 70% or 80% of their income and while it’s great to have goals and save for early retirement it can also be a recipe for burning out. I see it all the time with people in the F.I.R.E. movement. Some people want to retire so bad they forget to live today which just turns a long-term positive into an immediate negative. To me, if you see friends and family doing things, going places, enjoying life and deny yourself those experiences because you want to save 80% of your income, then you are probably pushing too hard and need to dial it back and live a little. No one is guaranteed tomorrow and missing out on experiences with friends and family could be a major regret later. 

That’s why we did the math and set everything to automatic. It’s helped us achieve our long-term goal and also allowed us to live a great life even before retirement. Knowing in the long run we have a plan, and it will be successful gave us peace of mind. 

• What are your three favorite books related to investing, personal finance, retirement, and financial freedom?

My all-time favorite is “The Intelligent Investor”. Way ahead of its time and made me look at investing in a completely different way when I read it. And it’s still relevant today.

Next would be “The Millionaire Next Door” which made me look at material things and people a whole different way.

Then of course “The Simple Path To Wealth” which really brought out the simplicity of what it takes to be successful and independently wealthy. Everyone can do it if you just start.  

• Why do you blog about your investing and journey to millionaire status and financial freedom?

We started our blog, RV-on-Fire.com , as a way to hold ourselves accountable and as a way to track and share our journey to both financial freedom and living a full-time RV lifestyle. We had always talked about retiring early and then once we fell in love with RV travel, we knew it was what we wanted to do when we retired.

The two ideas fit so well together that it became the basis for our blog. Also, once you put an idea or a goal into a blog post it’s out there and gives you a lot more motivation to accomplish it so you can share it with your audience. I feel we would have always accomplished our goal but in some ways the blog helped us actually make that leap to selling everything we own and hitting the road.  

• Besides investing what else do you like to do?

Together we enjoy going hiking, fishing and really anything to do with the outdoors. Spending three months in Sedona, AZ was one of the best things we ever experienced.  

On a personal level and aside from investing, my hobby is playing guitar. It’s something I always wanted to learn, and I didn’t start until I was in my 40’s. Now that we are retired, I make a habit of playing consistently and work hard at to try and get better. My good friend is in a band, and I think it would be cool to play with them some day and not embarrass myself even if it’s just one song.    

• Anything else you would like to add?

I would just say that if you are someone who is reading blogs about financial independence, retiring early or dividend investing and looking for a way to live your best life, don’t hesitate and just do it. Some people get motivated by these resources and then sit on the fence while the idea, passion and most importantly time passes by.

When it comes to investing there is no substitute for time. The longer you wait the harder it gets and that’s a fact. There are so many more advantages to investing today than we had when we started. There’s more information available for free, more resources, more investment options, more low fee funds, elf’s and best of all commission free trades. That alone would have saved me hundreds if not thousands of dollars. There is no reason not to start and it doesn’t matter how small or insignificant a dollar amount might seem because it all adds up over time ends with you living your best life, which is what we should all strive for because we only get one.   

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Final Thoughts on Millionaire Interview 13

I hope you enjoyed reading about the anonymous authors who blog at RV-on-FIRE in Millionaire Interview 13.

Check out their blog when you get a chance. They write about living in an RV, life on the road, monthly spending, and their dividend stock portfolio. You can also see the stocks they own. There are well-known dividend growth stocks on the list and they are generating a nice passive income stream.

The authors of RV-on-FIRE has shown that it is possible to reach $1 million and retire early by the mid-to-late 40s.

In an earlier article we identified the three principles of dividend millionaires: spend less than you earn, invest your savings, and reinvest the dividends. Your odds of becoming a millionaire are about 3.6% in the US. Achieving FIRE is a process. However, I would argue that through careful planning, high saving rates, and investing you can improve your odds. The authors of RV-on-FIRE have showed us it is possible in their 40s in Millionaire Interview 13. Recall, in the US, the average net worth is about $728k in 2016 dollars for those between 35 and 44 years old. We have written previously on net worth targets by age.

As a final note, Dividend Power has another series called Secret Dividend Millionaires. This one is about ordinary people who became millionaires by investing in dividend paying stocks for the most part. Most of these people were only discovered after they died and left their money to charities and other non-profit organizations. Often, they became millionaires through very frugal if not austere living, investing their savings in stocks that paid dividends, and reinvesting the dividends.

Thanks for reading Millionaire Interview 13 – RV-on-FIRE!

You can read Millionaire Interview 12 – The Money Commando as well.

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