BiggerPockets Money Podcast - 68: Hacking Your Military Benefits to Become Financially Free With J Grayson

Episode Date: April 15, 2019

J Grayson grew up poor. But with food on the table every night, he didn’t realize it. Then his sister tragically passed away from brain cancer, financially ruining the family. J fell into a pattern: skipping school, drinking, and doing drugs. A few... Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to the Bigger Pockets Money podcast show number 68 with Jay Grayson from FedonFire.com. So in total, I'm getting paid over $25,000 plus my paycheck, plus free lodging for the whole year. So she and I are just living off of that TDY money, that $25,000, keeping our expenses under that, which is what we try to maintain anyway. It's time for a new American dream, one that doesn't involve working in a cubicle for 40 years, barely scraping by. whether you're looking to get your financial house in order, invest the money you already have, or discover new paths for wealth creation, you're in the right place. This show is for anyone who has money or wants more. This is the Bigger Pockets Money Podcast.

How's it going, everybody? I'm Scott Trench. I'm here with my co-host, Miss Mindy Jensen. How are you doing today, Mindy? Scott, I am doing fantastic. How are you today? Oh, life is good. I'm very excited for Jay today. I am so excited for Jay.

we have had a couple of military guests on this show and on the Bigger Puckets, Real Estate Podcast. But this show today is for anybody who is currently in the military, who is recently out of the military, anybody who's considering going into the military, anybody who wants to learn about house hacking, geo-arbitrage, per diem hacking. If you have a job where you travel, even if you're not in the government or in the military, oh, it's also for government employees. I mean, this is, okay, this show is for anybody who has ears. Yeah. Or eyes who want to read. Let's see, who else is this for?

Anybody who wants money, who has money or wants to have more? This is such an amazing show. Jay blew my mind with all of these little tips that he has. And it's not going to, not every situation is going to apply to every person listening, but I think anybody listening can get something out of this show today. Yeah, he didn't have the greatest start. And then he applies advantages that he accumulated. and a sharp mindset shift to the pursuit of FI and really makes a lot of progress in a kind of

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kickstart your well-being journey with your first audiobook free when you sign up for a free 30-day trial at audible.com slash BPMoney. Jay Grayson, welcome to the Bigger Pockets Money podcast. How are you today? I am excellent. The spring is finally here on the East Coast. The weather is warming up, so I'm very, very grateful for that. How are you guys today? I'm doing great. It's getting warmer here too. It's supposed to be in the 50s today, which is quite delightful. Excellent, excellent. So, Jay, why don't you start walking us through where your journey with money begins? So I grew up in a small farm town in the rural south. My dad is a small town farmer.

So we grew up in a low-income family, fairly poor. My dad went bankrupt in the 80s due to the farming crisis, a glut of supply, crop prices were falling rapidly. So filed for bankruptcy. We didn't have a whole lot of money. and then into the 90s. I never knew we were low income because my parents always made sure there was food on the table, lots of spaghetti and cheese toast and things like that. But we always felt like we were okay.

We never felt like we were poor, low income. My parents did a good job taking care of us. And then in the 90s, I have two siblings and my oldest sister was diagnosed with terminal brain cancer in the 90s. So that was obviously very emotional heart hit to the 90s. the family, but also financially. So it didn't come from a great upbringing of money. My parents and my grandparents were very much kind of that post-depression, you know, put your money under the mattress, didn't know anything about really investing. If you know anything about farming, a farmer's livelihood is his land. And so investing in stocks, bonds, anything like that was really

non-existent. We didn't get that education growing up. So after my sister passed in the late 90s, I fell on hard times. My sister and I both went through a lot of hardship, kind of fragmented family. I got into drinking and drugs and was just really going down a really dark path in my high school years. So I decided to make a drastic change. And so I joined the military when I turned 18 and left just before my high school graduation. I did graduate. And so did that for an enlistment. I was in for five years. I got out of the military, I made a lot of poor financial choices in the military because, again, I didn't have a lot of money growing up, just working on the farm for a little bit of money here and there. So by the time I left the military and went to college, I graduated with college.

I had over $30,000 worth of debt, a little bit of student loan debt. Most of it was paid for by the GI Bill, which is for veterans to help with education costs. But yeah, so I had over $30,000. in debt. I decided to get back into government work. I took a job making load in mid-30,000, so not a lot of money, but I was living kind of paycheck to paycheck at that point, was in way too inexpensive of apartment. I had some money again, so I was feeling good about it. And about that time, this was 2014, and that's when I discovered financial independence. Well, let's take a quick step back into your time in the military.

What were some of those, you mentioned that you've made some poor financial decisions in that time period. What were some of those decisions that kind of come to mind? So absolutely. Probably one of the biggest one

while I was in the military was I was really into cars, sports cars at that, and I'm sure you're well aware. You don't make a ton of money being an enlisted member in the military, especially those first few years when you're very low ranking.

But still, I was using that money to purchase vehicles. At one point, I think I had five vehicles. I had an El Camino. I actually had two Honda S-2000s because, you know, it's necessary to have one for your computer and a second for your weekend driver, you know, that you keep pristine. And that seemed like a good financial decision at the time. So that was probably my biggest money mistake financially and not contributing enough to my government sponsor 401K. It's called the TSP at the time. when I was enlisted, they put everything in what's called the G fund automatically when you

enter the military, which is just government bonds. So all those years before the financial crisis, where that portfolio had I made known about investing or known anything about stocks, I could have adjusted that and probably made a lot more money. So yeah, just not investing my money properly buying depreciating assets such as cars. So yeah, that was probably my biggest mistake. there. Were you living in government housing or were you living off base? So for the first three years, I was in government housing. So even though I wasn't making a lot of money, when you have your housing paid for and your meals paid for, you have a little bit left. But I was, I was blowing all that on meals out and cars and things of that nature. So meals out. The government gives you a chipped

beef on toast. And what else do they, what do they call that? But when you're, you know, when you're 19, old Marine and you want double cheeseburgers for McDonald's, you go and buy that or go buy steak or whatever else because the chow hall is just, it's not good enough. Yeah. And that's, you know, I think that's a good point. When you're 19 years old, you're being expected to make all these adult decisions and you're not in that place. That's, this sounds rude. You're not special in that regard. You're not the only person who's ever decided I'm not going to eat this free food. I'm going to go and spend money because I want this. And I mean, that's just really interesting that that's where your mindset was at the time.

And I think that also goes back to, you know, not coming from a stable financial upbringing and having, you know, that wherewithal to say, hey, look, these meals are free because once I join the military and had my own, you know, a substantial to me paycheck, it's like, well, this is my money. And coming from a poor background, it's like, well, it's my money. I'll do what I want with it. I'll spend it on all these things. So not having that foundation, I definitely think put me on that trajectory to make bad,

poor financial decisions. Yeah, and you're not necessarily the only person that's ever done that. What year did you graduate high school? In 2004. 2004. So this period from 2004 to 2014, is it all this kind of accumulating cars, kind of figuring things out, all kind of thing? Or do you kind of gradually become a little bit more adept with managing these types of things

prior to that kind of phi revelation in 2014. Right. So when I exit the military, they had just come up with the post-9-11 GI Bill, which essentially, instead of just having a standard stipend, you could actually colleges participate and they'll give you what's called the Yellow Ribbon Program.

And if colleges participate in that, then they'll give you a scholarship to cover the rest of the expenses. So for me, and at the time, you know, this was in 2009, you know, the financial crisis is hitting rock bottom. But I decided to leave my stable military job and go back to school. And so I got my undergrad in economics. So I think that's understanding, you know, it's not finance necessarily related, but economics has some tendons of that. So I think that's where I started putting two to two together. And I started a business at that time while I was going to school, which was moderately successful for the first three years,

unfortunately, because of the financial crisis. No one was lending, and we were growing a little too quickly and couldn't keep up with the pace. And that business ended up falling apart. And that's when I decided. So that was from 2009 until 2012. And 2012 is when I decided, hey, this business just isn't cutting it anymore. I had graduated school and decided, hey, I'm ready for that stable paycheck again. So I joined government service on the civilian side at that point. What type of business was it? And have you ever considered restarting it? It was a beer and wine delivery business. So I was in Florida at the time. That's where I went to school. And so we did a lot of corporate events, a lot of kind of catering to Disney travelers, that sort of thing. And I have

thought about starting it again. Unfortunately, now there are a lot of companies that do that sort of thing. time, no one was doing it, but now the competition is, you know, and it's not the type of business I'd like to get back into. It was a lot of driving, a lot of hard work, a lot of, not that I'm opposed to hard work, but brick and mortar. I want to be a little more, if I do start another business, to be a little more location independent. Did you leave the military with any debt? I did. I had some credit card debt at that time. I had vehicle loans. I sold off all my vehicles, paid most of them off, but I did have some debt there. And that's when I made the wonderful, bright decision to withdraw from my 401k cash it out and use that money to pay off my debts, which was somewhat okay of a decision. And then I used some of that money also to help fund the business, which was a great learning experience. I have no regrets there, but hindsight 2020, not a good idea to withdraw money from your 401K pretty much ever.

I would agree, although I have taken out loans from my 401K to do other things with because I'm paying myself the interest instead of a bank and, you know, people will be on both sides of that and that's fine. But did you cash the entire thing out? Oh, the entire thing. I took a huge haircut. It had already shrank by 40-something percent. because of the financial crisis. And then had I left it in there, when the market returned,

it would have been great. However, that's not what I did. So, but right, if you, if you're, financially savvy enough, Mandy, like you were saying, and you can leverage, you know, take a cheap loan to yourself and leverage that to make, make an investment or just get a lower interest rate if you're doing a home improvement or I know you're, you're really into flipping houses. You've done live in flips quite a bit. So if you're using those funds to gain money, great. But I was necessarily. I paid off some debts, which is good. So that's, you know, and starting a business. So it wasn't super terrible. But had I known then what I know now, I never would have pulled that money out. So as a result of that, you know, I heard $30,000

or so in debt earlier in the show here, right? Did this 401K wipe almost all of that out and allow you to kind of effectively start from zero after college? Is that? No. So I had gotten close to zero after, you know, separating from the military, but then my, my three years in college and with the business, I took out, you know, I had a personal, when I finally shut the business down, I had a personal loan. I had a small student loan debt as well. And I had credit card debt. Things I was, you know, things I was using to finance the business or finance my lifestyle. I was living pretty frugly at the time. But I had just a small income from the business. I was putting everything back into the business. And then I also had that when you're using the GI bill, you get what's called

a basic allowance for housing, which is just a stipend to help your living expenses while you're going to school. So I was basically living off of that, but in the meanwhile, accumulating credit card debt and student loan debt and everything else. So I had gone from probably $10,000 in debt post-military to close to zero. And then by the time I graduated, my undergrad, I was at roughly around $35 or so $1,000 in debt when I joined the civilian government. One more thing right before we get to the kind of post-college starting point here. I just want to point out that the $30,000 in debt you accumulated here doesn't seem so bad to me. It seems like it's actually quite reasonable in the sense that you used it to, it was largely

in pursuing a degree and in starting a business at the same time. And yeah, you know, there's ways to avoid having to take personal liability for businesses in some cases. But, you know, it seems like those were calculated risks rather than the second fancy car of the same type that we had previously, right? So a part of that debt was a car, but it was a car that I used, a very modest car that I used for the business. So no, absolutely. Yeah, right, right. So all in all, not terrible, but still, you know, when your school is being paid for and you still graduate with debt, some people look at that and say, how? How did you end up with debt when your college was paid for?

Well, you were hustled. You're trying to start a business. I try and trying. Trying hard, man. Trying hard. Okay, well, let's move to after college. You have $30, $35,000 in debt and you are now getting a job. How long did it take?

What year did you graduate and how long did it take you to get a job after you graduated? So I graduated in May of 2012 and I started, I was still running the business up until probably the fall of 2012 when I landed a job within the federal government, which I started in December of 2012. So there were a few months there where I had no income. And again, living off credit cards just to get by until starting that new job. And I had decided at that point, like, okay, I want to pay down this debt. I had more financial savvy at that time because I went to college. It was just generally better educated. But personal financial, finance still wasn't something I was very strong in, but I knew I wanted to pay off this debt

and that I wanted to be more financially stable. So I wanted to make the best of the having, I almost took a pay cut, you know, from military time, you know, what I was making the military to what I joined the federal service. I was making less than I was in the military. So I was feeling a little defeated. You know, I'm in my late 20s at this point. And I'm going back in the workforce making 33, $35,000. $1,000 a year. But that was okay. I was determined to make it work. So yeah, so I started that in 2012 and about a year and a half later, I'm going to say early 2014 is when I stumbled across Mr. Money Mustache and learned about financial independence and shortly after found Brandon from

Mad Scientist and just totally mind-blown, you know, wow, this is really possible. And that started my my journey into financial independence. Okay. And how did your financial position look during your first year of employment? So I moved into what I thought was an affordable studio apartment in downtown, this small city I was living in, low-cost living area. I'm moving from the city in Orlando to the city in North Carolina. It seemed reasonable.

It was lower than what I was paying in Orlando. However, had I done a little more research, I could have been, my rent could have been much lower. So I was still doing a little bit better than paycheck to paycheck. At the time, I was getting the, in terms of the Thrift Savings Plan, the government 401K, I was financially wise enough at that point to at least get the matching and diversify into stocks. So I was doing a little bit better on that front, but I was mostly paycheck to paycheck outside, but still investing in that, but still paycheck to. paycheck outside of that. So not in a great financial position, but doing better than I was.

And I also, I had consolidated some of my debt and was paying that off. So that's when I started my debt reduction phase. And once I found out about financial independence, I threw a match on it and accelerated it. I started cutting down expenses and looking for ways to, okay, how can I make more money, progress my career, get a promotion. And that really started, you know, in 2014. I had an opportunity to move up to New England and where the locality pay, which for government workers is basically a percentage. It's basically a cost of living, not a stipend, but a percentage that they tack on to your base pay to kind of offset some of those higher cost of living areas. So in finding financial independence, Mr. Money Mustache, learning about geo-arbitrised,

I was like, hey, you know, I can take this job. It's a promotion in New England. I'll be getting living in New Hampshire, actually southern New Hampshire, but getting the Boston locality pay. So that was a great way. The cost of living in New Hampshire for New England is very low. Meanwhile, the locality pay for Boston is very high. So I moved into a small 300 square foot studio apart.

not that great of a place and started accelerating paying that debt down. How long did you work in, did you say North Carolina? I was in North Carolina for about a year and a half. Okay. And then you moved up. How did your expenses change? You got more money, but then it sounds like you reduced your expenses while making more money. Right. So in North Carolina, I was paying $800 a month plus utilities, which was high for the area I was living in. but when I moved to New Hampshire, I was making quite a bit more money. Now I was making, you know, in the 40,000 high 40s.

And also I was living in a studio apartment that was also $800, but utilities included. So my pay had gone up, locality pay had gone up, yet my living expenses had shrank just a little bit. And that's when I decided to, I was looking at the housing market there. And I decided, hey, the rent to housing is much cheaper to buy. than it is to rent in that area at the time. So I decided this was at the end of 2014, I decided to buy a house and get some roommates. I did not know what the term house hacking at the time meant, but I was house hacking, which was covering at that point, I moved out of the apartment into the house, had roommates that were covering basically half the mortgage and expenses. So now I had reduced my

housing costs even lower while also building some equity and that the housing prices in the area were shooting up over the three, three and a half years I lived in that house. So I was able by the time, you know, have roommates pay half my mortgage and utilities. And then by the time I sold it, I was able to profit quite a bit just based on the appreciation. Can we walk through the numbers on that purchase? It sounds like this was one central component of the journey here. Yeah. So really during this time it's twofold. So the housing was one at that point had put enough aside to pay off my car. So my car, I wasn't paying for a car anymore, paid off that debt. Still had some other debt. I was paying down. I still had probably $20,000, $25,000 worth of debt at that time.

And the housing purchase, I bought it for 177 in December of 2014. And so my mortgage was around 1,200. You add in utilities. It was about 1,500. And at any given time, I had one or two roommates that were paying $500 a piece. So, you know, some months, my portion was only $500. They're helping build equity in this home. And I was able to sell it, put very little work into it at all, just a few things when I got ready to sell, just to spruce it up a bit. But I maybe put, I don't know, two or $3,000 into the property total, just some cosmetic work that helped, you know, with the Herbapil and the interior just a little bit and was able to sell it for $215,000 three years later. So a pretty good profit there.

Awesome. And so going back to the car, so I mean, these are two of the central expenses for most people, right, is housing and transportation, right? So you're making money off of your housing at this point because of the way your low cash outlays and then the appreciation and you recapture it when you sell. And then you have a paid off car. What kind of car was this? This was a Sion XB, so the little toaster on wheels, which I'll say, so another, I'll backtrack just a little bit in between when I shut down the business and took the job with the federal government.

So I had taken out a student loan for we were supposed to go on my senior class. We were supposed to go on a trip to Europe. That ended up getting canceled. So I decided I was going to take my own trip. So I took that student loan money. and a friend of mine, we packed up in that toaster on wheels and drove, spent a month driving across the country. So that's where that student loan went to. So that was another, I don't want to call that a financial mistake necessarily because it was one of the best experiences of my life.

And I think we need to have those along the way. But that didn't help my financial situation. No, absolutely. But I mean, those two things, like having them at zero or very low is, it seems like was that central to you help to being able to start making progress towards accumulating cash or paying down debt or the next step? Absolutely. Absolutely. And that's something that is obviously very repeatable, something that's maybe not as repeatable. The second thing that really helped me obliterate my debt, the rest of my debt, as well as build a nestag to start investing. So while I was working in New Hampshire, I decided, you know what, I still have some GI bill left, I'm going to go to grad school and get an MBA. And the stipend for veterans going to

school in that area, because you're close to Boston, I went to UMass. And so my stipend was $24, I want to say $22 or $2,400 a month that fluctuated a little bit increased over the couple years I was in school. So I was working full time. I had gotten another promotion while there, just by grinding it out and working hard at work and proving myself. So I'd got another promotion. At this point, I was making in the mid-60s, maybe high-60s, and I was going to school nights and weekends. And here's a benefit if any of your veteran listeners can learn from this. I call it GI Bill Hacking, where you're working full-time, go to school, you only have to take one resident course to get your full housing stipend from the GI Bill. So I was doing

kind of 50-50, 50% online, 50% on campus. and collecting going to school for free, getting a master's for free, also collecting an extra $2,400 a month that I use to obliterate my debt and start my nest egg for investing. And meanwhile, I've got, I have almost no living expenses in terms of the big overhead items such as housing and transportation. So those two things between cutting down on housing and transportation and then using the tools that I had available to me as a veteran and taking advantage of that to do some geo-arbitrise there from a cost, from a GI Bill perspective, it really accelerated things.

Okay, I've got to look on my face of pure, like, wow, and I don't think Scott is as excited about this as I am, so maybe I'm misunderstanding this. You went back to school, and all you were required to do was take one in-person class, meaning not online, but you have to actually attend class. And the government gave you $2,200 for you. you to do with whatever? Like, they didn't pay your mortgage. They didn't like pay a student housing. They just, here's $2,200 every month. Right. So you have to take a full course load, which for a master's is nine credit hours. So three courses. So I took one on campus. Sometimes I took two on

campus, one online, just depending on what the course load was. Sometimes I took one on campus, two on mine. But just by going to school, quote unquote, full time, I would go maybe two weeknights and one weekend evening, usually two or three days a week for four hours at a time. So not a huge time commitment. I don't want to say that. It was rough working full time and going to school, but I was dedicated to paying down that debt and increasing my net worth. So, and I think a lot of a lot of folks misunderstand the GI Bill can be a little tricky. And so for folks who may be in that situation who don't know, absolutely do it. Go and that also enhances your earning potential, whether you're in federal service or you're in the private sector,

you know, now you're getting a free education and they're paying you money directly to your bank account. Like you're saying many, yeah, it wasn't, it didn't go to my housing. It didn't go towards, you know, additional school expenses. It was directly deposited into my account every month. Okay. So we're just going to reiterate this for all of our military listeners. When you go for your GI bill pays your college, when you go for this, have a house hack and get

roommates and then they will pay your stipend. So everything's paid for. I mean, this, not everything's paid for. I'm sorry, I've never done this before. I shouldn't say that everything's paid for. But holy cow, you have a job which covers all of your living expenses. Plus, here's $2,200, which easily covers your mortgage. Did you still have the mortgage? Were you still living in the house at the time? Or did you move? No, I was still living in the house at the time. Okay. Okay, Scott. Are you now sufficiently excited about this? Yeah, I'm very excited about this. This is, this is, this is, this is. the power of a military background when you're attempting to pursue financial independence or become an entrepreneur or any of those types of things. There's a number of huge advantages,

right? One, the stipend and free higher education, right? Two, VA loans, right? Three, the health care, right, VA health insurance, right? Those three, and I'm sure there's more, but those three seem like absolute pillars of several stories that we've heard around moving toward financial independence at a rapid rate for veterans, right? And rightly so. Can I ask you, Jay, did you use the VA loan for that house? Was that a VA loan? I did. So I paid zero down. I had zero upfront cost to purchase that house. So no money out of my pocket. And also, I'm glad you mentioned the health care. I am a disabled veteran. So I don't pay for health care. I get all my health care through the VA. So, which I also get a small disability stipend from the military or from the VA because of my disability. So between those

things, you know, you add in the stipend, not having pay for health care costs. And I know these things aren't repeatable for everyone, but I think the moral of the story is, hey, look at your employer, look at the opportunities. You know, a lot of employers do, you know, even if you're not a veteran, they do tuition assistance, things like that. Take full advantage of the benefits. Your 401k matching, all of those things, any health care benefits, HSAs, whatever you can to really reduce your expenses while also building your net worth.

Yeah. And what I love about this is that you recognize all these advantages. You just see the concept of FI and then you go all out basically over the next couple of years here. You move to New England. You physically relocate. You buy a house hack, right? You leverage all of your benefits

to the absolute max, right? Because you're using the VA load and you're getting a massive stipend here. You've got got a cost of living adjustment for a high cost living area while you live in a low cost living area. You're working full time and obviously kick in butt because you're getting promoted, you know, relentlessly without this period, and you're getting their MBA part-time, right? So what did you do for fun during this period? Well, you know, craft breweries, lots of craft breweries in New England.

So on the weekends, I would, after all that stress, go and partake in a couple New England IPAs here and there. So that and hiking, a lot of free activities. There's, you know, the white mountains in that part of the country, lots of hiking, camping, those sorts of things. So kayaking, just being in the outdoors, skiing. I didn't grow up skiing, did that a little bit, which was terrifying. Even as a Marine, you get on top of those mountains. It can be a little bit scary.

So I don't know how you guys do it out there in Colorado. I'll probably do it again at some point, but I'm looking for smaller mountains these days. Your first lift ride up one of these mountains out here is pretty terrifying. I'm sure. Come visit and I will take you skiing and I will take you on the little hills and then we'll go to the bigger hills and then we'll go to the great big hills. Okay. So this may not be repeatable for everyone, but it is definitely repeatable for all of our military listeners. And we're definitely going to reach out to our military blogger friends like Doug Nordman.

Oh my goodness, I'm blanking on his blog because it's all for military and I'm not military. I don't read it that frequently, but I know he's huge. David Pear from military to millionaire, I believe it's the name of his blog. We're going to reach out to all of them and make sure that they know that this episode is available because this is huge. This is amazing. And I've never heard this. Again, I'm not military so the GI Bill doesn't apply to me. But this is really, I mean, I'm speechless.

This is amazing. And this is still, you can take lessons from this. House hacking is available to every single person. House hacking is an excellent way to reduce or completely eliminate your housing expenses. And there's a really awesome article on Bigger Pockets about house hacking and the whole concept and that we'll link to that in the show notes, which can be found at biggerpockets.com slash money show 68. But this is just fantastic.

And I love how you said, you know, your employer could have ways to pay for college. We had Zach Gautier on episode 64, where. where he talked about how to pay for college, all these different ways to fund your college, mainly for kids, mainly, but there's definitely opportunities to pay for post-regular college age. I don't know how to say this. Scott, save me, please, because I'm just fumbling over here.

Well, I think it's just being creative about how you're going to approach your journey, right? Like maybe if you didn't have this stipend, you know, maybe that changes the equation ongoing and getting that MBA in the first place. I don't know. But I think that it's kind of just all about assessing all of those things and your benefits and how it will impact things, right? Because, I mean, these degrees are very expensive and are they going to have that paid tradeoff in pursuit of FI, I don't know. In this case, which you could make money while getting an opportunity to earn even more with the degree,

that's a no-brainer, right? Like, that's going to clearly be a winner to a certain extent. Right. And even for, so on the federal civilian government side, even with that, I know the agency that I work for, they offer tuition assistance, which will cover most, if not all, for a local state college, we'll cover a lot of those expenses. So and a lot of government agencies offer that type of thing. And private employers too. So anytime there's free education benefits and you can build your resume and increase your knowledge and your education, absolutely. Go forth and do that. If it's free, it's free. Take advantage of it. And there are also, there are lots of, for federal civilian employees, there are so many

opportunities, other things I've done to help increase my net worth. I mean, everyone has to get, if you're in the federal service, you're in some job series where you have to get certifications, you're traveling for training, or you're going to conferences, or you're going to give briefs. And in the federal government, when you travel, you get paid, your lodging as well as what's called M&I, which is mills and incidental expenses. So that ranges anywhere from $50 to $100 a day. your own travel that just goes directly into your pocket. And I forget who mentioned it was on your podcast at some point. Someone was mentioning, I believe it was on bigger pockets money.

Maybe it was the frugal woods. We're talking about going down for breakfast and making lunch sandwiches while at breakfast. I do that all the time. Every time I travel, I pocket all that mill and incidental expense because I just go to the hotel. And if you stay at somewhere like a like a Homewood Suites or Embassy Suites where they also have a dinner and cocktail hour, I mean, you can essentially go get breakfast for free, make yourself a sandwich for lunch, grab a couple eggs. You've got lunch and then you come back, get a free drink and dinner and you didn't spend a dime. So I've done that quite a bit.

And I'm currently on the on the biggest travel hack of my federal career, which is really, really expedited things. and I'm actually in Washington, D.C. right now on a long-term TDIT.Y temporary duty assignment. I'm here for a year. And currently, my girlfriend and I are living in this gorgeous apartment right across the river here in Arlington. And we are saving 100% of our incomes right now. We have zero cost because the government is paying for our lodging and living expenses. So if you're a federal government employee, seek out those. opportunity and travel as much as possible. Okay, no, you can't just drop that. Oh, before we get to that, let's build the rest of your story into this point, and then

we'll cover this. Sorry, I know Bendy's antsy to hear exactly how this happens, but let's keep going linearly across this. So in 2014, you buy the house and you stay there for three years of 2017, right? At the same time, you are getting your MBA, you're getting the stipend, you're living frugally. I imagine you exhibit frugal tendencies towards. other major expenditure categories like food, for example,

kind of as you just mentioned, where you would grab all the extra breakfast stuff and all that kind of stuff. But you're not, interestingly, foregoing a lot of the fun stuff, like the outdoors activities and the craft beer and all that kind of stuff, right?

Yeah, so I sold the house at the beginning of 2018, and the reason I sold it, my girlfriend and I, she had taken a promotion in Baltimore, and I had, because of it, I don't want to downplay this, because I think this is really important too, and you guys discuss it all the time, you can cut expenses drastically, but at some point, if you really want to accelerate things, you've got to

increase your earnings. So again, if you're in the federal government, if you're willing to move and you're a hard worker and you show that you've got, you know, that tenacity, the promotions are out there. So I took a promotion to move to Southern Virginia, and my girlfriend took a promotion to move to Baltimore because we both knew that I was going to be on this rotation in DC. in the Baltimore, D.C. area, for a year. So that was definitely part of the plan. So at this point, now, during that time, I'm steadily getting promotions. And so I'd gone from when I first got into Federal Service making, you know, mid-30s, by the time I sell the house, take the promotion down in Southern Virginia, I finally hit six figures. So work your way up along the way. And I know some

people, it's tough. You have kids. I don't have kids personally. I have two fur babies, two cats, but they're pretty, pretty easy to travel. So relocation is not something everyone can accomplish easily, but, you know, how bad do you want it and how willing are you to make a couple sacrifices in relocating in order to really boost your income? And what happens to that your net worth over that three-year period in New England? So I hit net worth as zero at the end. And the end, of 2015. So I spent about a year, year and a half getting my debt to zero and I'd build a little bit of a nest egg. And so I started investing. I went from, I'll just say, zero to hundreds of thousands of dollars in the matter of three years. So 2016, 17, 18. And now I'm, like I said at the beginning,

I'm pretty much, some people say the term lean five, whatever you want to call it. I, between my my small disabilities type in and the assets that I have stored up. I don't have to work. I choose to and I want to build that nest deck to a more comfortable level. It would be a very, very lean, lean life, which I live currently. A lot of Costco, Aldi. Do you guys have Aldi out in Colorado? No, no Aldi. That's unfortunate. But Scott, you'd love it. I can actually out my window, I can see Costco from here. Oh, nice.

I got there yesterday. It was great. The only problem is you can't walk to Costco because you can't bring all your stuff home. Every once in a while, I'll go to Costco and I see somebody on a motorcycle. I'm like, what are you getting here? There's literally nothing you could put in your pocket. It's all like 40 gallons and added.

And they're just there for the free samples, the ultimate food hat. So here's a deal. You can go on Amazon or Walmart, wherever. You can get these cheap rollout carts that fold up. My girlfriend friend got one, and it is the best thing ever. It just folds up. We literally, we walk to Costco. It pops open. We throw everything in it, check out, and it's like a little red rider, you know,

wagon, and we pull it home. Oh my goodness. He even walks to Costco. I love this. I walk every, I have zero transportation costs now. There's, there's great public transit here, so I have zero transportation costs. Okay, so you said there's great transportation here. That's in Washington, D.C. In D.C., yes. Okay. So, So can we please talk about that now, Scott? Yes. I'm really into to talk about this zero living expenses hack that you have. Your girlfriend took a promotion to Baltimore.

And did you know that there was this temporary duty assignment coming up? Or did you just apply for it or hope for it? And all these cities are really close together. I'm not from the East Coast. I know Scott is from Baltimore. When I grew up, my mother worked in Baltimore. and my dad worked in a town called Alexandria, Virginia, which is a little bit south of D.C.

So how far away are these cities? So we lived in between. Yeah, they're not very far. It's probably 50 minutes between the two, maybe an hour. Yeah. Yeah, between, depending on traffic, as always, you know, you're about an hour between D.C. and Baltimore, and Alexandria is just right up the road.

Yeah, so they're all very close. Okay, so your girlfriend took a job in Baltimore. How long was she in Baltimore before you came down to, or did you go down at the same time? So she moved to Baltimore in March of 2008, and then I moved to Southern Virginia, Richmond area, central southern, just south of Richmond. I moved there in May of 2018. And so we spent a few months apart, and then we kind of traveled back and forth to see each other on the weekends for a bit, knowing that I had already applied for and been accepted to,

that rotational assignment here in D.C. So we already knew that going into us living separately, that eventually, instead of being three hours away and more southern Virginia from Baltimore, that I would be right there in D.C. So we were both renting at the time. And then I came to D.C. on the rotation. And she's like, why are we living in two separate places? Why don't I get out of my lease? I'll come live with you in D.C. for free.

and I'll just take the train to Baltimore because the government will pay for her transportation costs. So I was like, yeah, that's a great idea. Let's do that. So at this point, she's getting on the five pad. She's trying to pay down her student loan. That's all. She's got a whole story in and of herself if you guys ever want to interview her. Does she work for the government too? She does. We both work for the same agency. Oh, okay. I was like, why does the government pay for her train ticket? But because she works there. Okay. Okay. So the government has you assigned to wherever you used to live, and now you're just temporarily in Washington, D.C. Yes. How long are you temporarily in Washington, D.C.?

So I arrived here September of last year, and I will be there until September of this year. And all the while, we're basically that M&IE portion of, that meals and incidental expenses, they pay the current rate. It just boosted up from 2018 to 2019. It's now, I want to say $76 a day. So in total, I'm getting paid over $25,000 plus my paycheck, plus free lodging for the whole year. So she and I are just living off of that TDY money, that $25,000, keeping our expenses under that, which is what we try to maintain anyway. And it's really easy when you don't have any lodging cost. And it's something you mentioned the name of it earlier, but it was like a long-term, short-term deployment or something like that. What was the name of this? Yeah, it's long-term TDI.

So it's long-term temporary duty. Long-term temporary did, yeah. Sorry, that just... Wow. So what are you doing with your money? You're just buying more S-2,000s? Yeah, I have six now. No, so I am investing all of it.

So I did the math. I'm actually saving 109% of my taxable income. Well, of course, 109% because that doesn't exist. How do you save 109% of your taxable income? Because, oh, so you're making X plus you have no housing expenses. Plus, they give you, in addition to paying your housing expenses, they give you an additional $76 a day so you can eat.

I don't know how you can survive on such a small amount of food. In a few months or in a few weeks, we're going to interview the saving Sherpa, who has, he claims he has $25 a week in grocery costs. And so we're going to get some recipes from him. We're going to talk about how he does that. But $25 a week versus $76 a day. How do you do it? Costco and Aldi.

I mean, that just seems ridiculous that people could spend $76 a day on food. So that's what you're using to live off of while saving 109% of your income. And what are you investing in? So I invest in a variety of things. I max out my TSP, which is the government version of a 401k. So I max that out. And plus they give 5% matching. They do 3% on your first 3%.

They match. And then a half percent for the next two. So that gives you 4%. And then they have an automatic 1% that they contribute. So it's a total of 5%. So I max that out. I also max out a Roth IRA. and then I have some money in peer-to-peer lending and some money in crowdfunded real estate.

And then I'm currently putting a lot of cash aside. And I'm sure you guys have been watching the interest rates that banks are supplying now. So if you haven't heard a CIT bank, they offer over 2% on the money market account. So that's where I'm putting all my savings for my next real estate purchase. So that will be I'm searching hard for. a duplex or triplex or quad in the southern Virginia area because she and I will be moving back there. I have a decent amount about 10% of my net worth just in a savings account now, strictly for real estate purchase. Do you own any other real estate or besides, I guess you sold

your first place, do you own any real estate that you privately hold? I do not. Just the crowd-sourced real estate, which is more commercial real estate focused. So, you know, I imagine that you're accumulating quite a bit of after-taxed liquidity after you max out your off and after this TSP based on your savings rate with all this stuff. So is that why you're kind of shifting to real estate now and kind of putting all this money aside in these money market accounts and coming up with that strategies because there's not enough places to store it pre-tax? Yes. Well, that's part of it. Also, we've become accustomed to not paying for lodging. So when we move, we want to continue that. So the biggest goal there is,

is to do a house hack. And when we move back to Virginia, southern Virginia, to have something that's going to put our lodging cost at zero. We want to maintain that so that we can continue. I want to build a small real estate portfolio, you know, less than 10 properties, probably. I'm not big on landlording.

But it's such an incredible tool towards financial independence that you can't ignore it, at least in my opinion. And I like the diversity, too. The market's been so crazy up and down lately. I want to diversify. I'm very, very heavily weighted in stocks. Overall, I'm probably between stocks and bonds, between my taxable accounts and my 401k, I'm probably at about a 90-10 split, 90% stocks, 10% bonds. And because we're looking to hit our FI goal collectively between myself and my girlfriend within the next

three to five years, we want to have some more stable outside income, some more cash flow coming in. And so real estate is definitely that avenue that we're approaching. With the, you know, your plans going in the future into moving into Virginia and getting a house hack, would you consider using a VA loan for that or are you going to use a large down payment with that cash or set aside? So probably, ideally we'd use a VA loan, but as you probably know with the VA loan, there are lots of restrictions. It's tougher to buy like a, like a property you're going to rehab. So if we're looking to do like a, like use the Burr method, or something of that effect, it's tough to do that with a VA loan versus a conventional

loan or a rehab loan. So ideally, if we could find a property that qualifies for a VA loan and put zero or just little money down. But even if that's the case, I want to have some liquid cash sitting there to do any types of upgrades or things that will really bring the property to bring the most money in. Great. I love it. I mean, hey, I'm going to have a lot of cash to give me more options. And then, yeah, I'll use the advantage of the VA loan if the property that meets the qualifications comes up. But I think it's great. You know, not using it gives you more options. Absolutely. Or maybe I'll just throw it all in Bitcoin, you know. Yeah, there you go. I'm kidding. I don't recommend that. No, no, definitely not. It's, it's your money.

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It's good to know just in case. Anyone can call or text for free confidential support from a train responder anytime. 988 suicide crisis helpline is funded by the government in Canada. So where is your girlfriend on her path to zero net worth? You said she still has some student loans. So she started, when she started her path, She originally, when she went to a private school, she had over $100,000 in student loan debt. Oh, man.

And so she started her path about a year ago. I finally convinced her, which wasn't hard when you start to, wow, if we could travel, you know, full time and work from the road. And she's like, okay, yeah, let's do that. So she really got on the ball and she has paid off about $70,000 in student loan debt. She had around 120 and now she's around 45,000. And what she's also maxing out her 401K. She's maxing out a Roth IRA.

So she also, you know, she's building her net worth while also, you know, paying down that debt. So we interviewed Travis Hornsby from Student Loan Planner on episode 22. And he did not use the government job with the long-term temporary duty assignment as a way to pay down loans. But let's look at your girlfriend for a second. She had $120,000 in student loan debt with whatever interest rate, even if it's at zero. That's still a lot of money to pay off. And what we talked about on episode 22 with Travis is that there are doctors and veterinarians and dentists who have all of these super high, like multiple six figure loans, not just 100. They've got, you know, three, four, six hundred thousand dollars in student loans. And they're unable to make any sort of dent in it.

Your minimum payment doesn't cut it. And it's just, it's soul crushing. And there's a huge rate of suicide, frankly, for a lot of these professions that are just so mired in this debt. And your girlfriend has taken this, it's not geo-arbitrage, job arbitrage with this government job. And granted, I don't know how many government veterinarians there are. But there's a lot of jobs in the government that can help you pay down your job. debt just by having this travel, what did you call it, travel hacking and GI Bill hacking and per diem hacking and all of these hacks that, I mean, how's your life? Does it suck? It sounds like

it's pretty awesome. Yes, yes, absolutely. Absolutely. I mean, it sounds like you're living your best life while also having zero expenses and living in an amazing city and going out and, I mean, living on $25,000 a year without having any expenses at all besides what? Food? Right. Is that literally your only expense? Pretty much food and I do have a storage unit right now because we had to put our stuff somewhere which I can't stand having a storage unit, but it's like 100 bucks a month. I mean, that's my only real overhead expense and a Netflix account. Shame on me. Oh my goodness. Look at this Mr. Spendie Pants over here, a Netflix account and a storage unit. By the way, storage units are a really awesome way to make a lot of money in real estate

because lots of people are just like you. Oh, I don't have enough room so I need to put myself in storage and then, oh, it's only $100 a month and you just pay it and pay it and pay it and yeah, my parents have had a storage unit. They had two storage units, two of the biggest storage units they have. They moved it down to one, but they've had it for 12 years, 11 years, because they live in an RV and they travel around the country building churches. I'm like, get rid of all this stuff in the storage unit. You don't need it anymore, but whatever. 12 years, they've been paying this same bill and theirs is like $2.50 a month. That's a lot of money. You can make a lot of money in storage units because people will put.

stuff in there and then, you know, oh, it's only $100. What's $100? Absolutely. Absolutely. So look into that too if you can't find yourself a duplex. Find yourself a storage unit. Definitely. We'll do. Well, so what's next after you move to Virginia? So move to Virginia. We hopefully, you know, can find a place that we can house hack. And then even, even if we did have small living costs in terms of housing, you know, we'll both be able to save and put back roughly 75% of our income if we continue our lifestyle. And we don't want for anything. We actually, and I know this is going to sound terrible, we actually go out to eat two or three times a week and have fancy expensive beers two or three times a week. And we still are able to live up, you know,

when you don't have the housing cost or if you have low housing cost and you don't have transportation cost, you can still live on $25,000 a year or less and still have a really fulfilling life. So continue the lifestyle, continue investing. Depending on the market, three to five years, if we have to work a little bit longer to really hit our comfortable number, then we will. And that's we're totally okay with that. But then that's when we plan on cutting the cord from traditional employment

and going on to more bigger and better things, things that excite us more traveling, helping. We've discussed, I have a niece who's extremely disabled, and there aren't a lot of organizations available to help a lot of those folks with her specific condition. She actually has a cousin that has the same condition. So we've discussed starting a nonprofit to help fund some of those health care expenses. My sister and my brother-in-law are both teachers, but even on low teacher salaries, they make too much money. They've actually had to cut down and take demotions in order to meet certain health care requirements, you know, to get the stipends

from the government or the healthcare coverage to help cover her expenses. So we're looking into potentially starting a nonprofit to help with that, joining the peace core. Who knows? The sky's the limit. No, that's awesome. And that's what kind of gets me going at what I do here. We do with this bigger pockets money podcast because the carrot on the stick, the carrot that we dangle for everybody is, hey, go sit margaritas in the beach and hang out.

But no one does that. If you have the ambition, the drive, the hustle, the discipline, plan to build a massive net worth and do all the things that you're doing, optimizing every front on the wealth generation equation. And you end up achieving this five within the next couple of years, you're going to go out and impact the world positively in some unique way that's kind of this unique blend of the things that are you're passionate about where you are and what you're going to be good at. I love it. All those things you just mentioned are going to make a huge positive contribution to society. I love it. I think it's fantastic and a great goal. And Scott, you got your

undergrad degree in economics, right? I did. Yeah. How much did you learn about personal finance in college? I didn't learn anything about personal finance in college. I didn't learn about personal finance until I discovered Mr. Buddy Mustache, branded from bad fiantist in 2014, like you. Absolutely.

That's my point. Exactly. I would love to, and I know the guys from Choose Fy, this is something they're really into. I'd love to network with folks and say, hey, how do we give younger folks or even, you know, young adults or regardless, like some kind of free access to personal finance education, it's not part of our curriculum as we're growing up in school. You know, I think that's also something that I'm very passionate about is teaching personal finance.

I mean, if you learn this at an early age, you know, we wouldn't have such a looming, you know, retirement crisis and student loan crisis and all that good stuff. Yeah. And then even within a niche in there, the military in particular, right? I mean, there's so many, it seems that there's a lot of folks that go and the military and come out with a bad financial situation when a little bit of education in the right direction can produce a very strong foundation from which to go after this stuff. Absolutely.

I always think the military is particularly interesting branch of that because of the benefits that you guys have. And it just seems so perfectly suited towards a life of five because you just have two of the biggest problems completely eliminated in the VA loan and then the health insurance. Well, you know, in military as well as it's one of the. last places where you can actually still get a pension, right? And federal civilian service is the same way. So we'll actually, we have enough time in the service and my girlfriend's also reservists. So she's going to get a reservist pension, you know, at 60 and we'll both get federal civilian pensions.

We're going to do a deferred retirement. So we only need to stretch our dollars for maximum of 20 years before we'll receive pensions and then shortly after Social Security, if it still exists. who knows, but we want to make sure, even with those pensions and potentially Social Security Company, we want to make sure we have enough that if those things fall apart and don't happen, some massive government change happens, it's not funded, that we still have enough and we don't have to worry. Love it. Yeah, I love that.

I love the forward thinking of that because I have people in my life who have a pension, but it's not guaranteed. And counting on that as your only source of income during, your final years is really not the smartest maneuver. I really hope the government doesn't go out of business, but I love that you're thinking past that. And the whole nonprofit thing, wow, that's really cool. Because the whole financial independence thing is not about quitting your job.

It's about having enough money to do whatever you want, if that's travel, if that's, you know, stay home with your kids and raise them, working at your passion with no consideration for money. My husband wanted to be a park ranger and never wanted to. to make, what do they make, like $4 an hour or something? He didn't want to have that job because it's not sustainable. I mean, you can't, I don't know how park rangers live off that, but now we live by Rocky Mountain National Park so he can go and be a park ranger if he wants because it doesn't matter what they pay. They pay nothing. So, yeah, that was kind of an abrupt stop. But yeah, that's what this is all about.

It's living your best life without considering, oh, how much am I going to make? Right. You know, it's fine in that what would I do if money weren't an option? What would I do that paid zero, but I'd still get up every every morning and go do it? You know, that's a park ranger? Absolutely. Spent time in nature. That's great. Oh, and Rocky Mountain National Park is amazing.

We'll take you there when we go skiing. We'll plan another day to go up to Rocky Mountain. Perfect. Okay. Is there anything else you want to share with our listeners before we move on to the famous four? No, I think I'm all set. Yeah, this was fabulous. I'm so excited to share this with, like, everybody I know.

Okay, so now it is time for the famous four questions. These are the same four questions or five questions, four questions and one command that we ask of all of our guests. What is your favorite finance book? Okay. So I have two. The first being for if you're a beginner and you're just getting into this or you're, you know, you're midway through Scott trenches set for life. It was a game changer for me. I was like, oh, man, I'm already house hacking.

to do this some more. Building that financial runway, it's just an incredible resource, kind of nuts to spoon, look at financial independence, and it's very accessible for anyone and steps you can take to really enhance your financial independence path.

The second book is called Plenitude, and it's by Juliet Shore. And if you're already well onto your five path and you're thinking about the future, and I think it's a really good book, The subtitle was the new economics of true wealth. And it's very along the lines of Vicki Robbins. So her ideas, you know, we have this,

our current economy and our current culture and state of the way we're doing things isn't sustainable. You know, what does the new economy look like? And you're starting to see it and, you know, pop up in certain urban neighborhoods. People are growing more of their own food and doing these sorts of things, becoming more green, if you will. So I think it's kind of when you're thinking about, okay, how can I live a more sustainable, you know, less impactful on the earth and on society? But it's very, I think it's very phi-related if you read it in the right context.

That's great. I've never heard of that book and I look forward to checking it out. All right. What was your biggest money mistake? So I think we covered those, all the vehicles for one, and then cashing out my TSP, my 401K when leaving a military service, just terrible. But, you know, if that business had worked out, would you still consider it a mistake? True, I guess not. I guess not. You know, you take risk, right?

You take risk and you have to. And did you know that the market was going to crash like it did? No, of course not. Did you know that the market was going to shoot up like it did? Absolutely not. You never know. So you can't really beat yourself up over these. It's, I mean, now sitting over here in 2019, you're like, wow, that wasn't such a smart move.

but when you were doing it, you still paid off a lot of debt. You didn't take it to the boats and gamble. So, you know, it was still a fairly smart move. You know, I, a couple of months ago, maybe almost a year ago, interviewed Annie Duke, who's a poker player. She wrote a book called Thinking and Betts on the Bigger Pockets, Real Estate podcast. And I love the way she kind of thinks about things.

It's about like, was it a bad decision or was it a bad result on that? And that's where I kind of want to get at with the liquiditing the 401K there. You know, yes, there's a lot of things. no one's recommending liquidate the 401K. But I think that you made a bet on that one versus necessarily a bad decision. And the bet didn't work out. The result didn't end up the way you wanted. But I guess you could make the argument that that wasn't, you know, if things that,

if you'd still thought it was a reasonable probability of success and you did that, it wasn't the worst mistake in the world compared to a lot of other mistakes that we've heard in the show. Well, right. And I want to be clear, it wasn't like there was, I had a ton of money in that 401K. I wasn't making a ton in the military. So I didn't liquidate hundreds of thousands of dollars to throw into a business. You know, it was, you know, a relatively insignificant amount in the big scheme of things.

So the risk reward ratio there I felt was worth it. Hindsight, you know, obviously. 2020. Absolutely. I just always try to think about things like, hey, did I get a bad result or did I make a bad decision on that? And it's sometimes difficult to separate the two and the thinking all that. And the lessons you learn in running your own. own business are invaluable. I mean, you can't replace those. It's something that I will always look back

fondly on. That's awesome. Okay. What is your best piece of advice for people who are just starting out? So people say it all the time. It's a marathon, not a sprint. And something that I've been coming to grip with, you know, or have over the past year. So now that I'm kind of, I'm at the point where, hey, I really could leave my job today if I wanted to just recently, you know, when in the past six months to a that's become the reality. And it's like, oh, well, I'm running from a job, but what am I running to? I think you really need to think about

as you're in this process and you're building your net worth, focus on what you value, do some soul searching because, like Scott said, and many of you say it all the time, it's not all my ties on the beach. That gets boring. So what are you going to contribute to society?

We're in a country and in an economic situation where we're able to do these things and build this type of wealth, and that's very fortunate. So what do we do to give back and better each other and better society? Yeah. You know, there's a event that I go to every year. And it's a meetup for a lot of folks that are interested in financial independence and that kind of stuff.

And there's always a good number of folks who are a couple years into the journey and pretty close, like in your position. Like, yeah, I could probably do this somewhere. And it's a spectrum. I'm kind of lean right now. I really, I guess I technically could. But I really got a couple more years work to do. it sounds like that's where you're at, or it's in your mind for this kind of stuff.

And then some people are like, well, I'm way past whatever the conservative expectations are for this. I'm clearly fine. Like, what do I do, though? Like, my identity is my job and all that kind of stuff. And I think that that is a unintended consequence that a lot of people don't think about

when they're starting on this journey is like, what is going to come after this? And how am I going to plan around that? Because, you know, it's kind of hard. I think at that time, at the moment, once you get there and you realize you're fine to actually make that leap, and go do whatever it is that you're going to do after your job,

if you don't have that planned out ahead of time. Right. And Scott, you know, some, one of the things you see a lot on forums or blogs, like if you're on Reddit or wherever, people go, oh, I'm going to, once I hit my number, I'm going to travel the world and maybe they've never even been out of the country, you know, like, so, you know, take some steps now to kind of dabble in some of your passions or dabble in a little bit of travel to places you think you may want to see

or live in potentially to, you know, more geo-arbitrage. Because you may get there and say, wow, this kind of sucks. I actually, I don't like it here. I want to be somewhere else. So don't just make a plan, but also test that plan a little bit and make sure it's what you want versus diving into it. Don't up and move to Peru when you've never even stepped foot in there, you know, Peru before. Absolutely. That's a really good point. I think a lot of people love traveling. I don't like traveling that much. Yeah, at least not right now. I'm not a big traveler. Yeah, I just, I don't want to go somewhere and hang out and from place.

Like, I live in Denver because I like living in Denver. I don't want to go to Peru for four weeks and have an experience. Sorry, I'm making thought of someone that it's not even here as a strong man. But that's just not me. And I think that some people are like, hey, that's what you do when you hit five. Well, no, you do what you want to do. If you don't know what you want to do, you're in trouble because you're not, all that works, not going to pay off for you the way that you want it to.

Absolutely. What do you value? It comes down. What do you value? What brings you joy? Exactly. All right. Well, one thing we all value is parties. So what's your favorite joke to tell at those parties? That was a horrible transition, but we'll go with them. It's awful. So this is a terrible one. But Scott, you may appreciate it since you, you know, you got to agree in economics. If he's terrible, if it's terrible, he'll love it. So three economists go hunting and they're in the woods and they see this giant buck walk up. The first economist grabs his rifle and he shoots and he six,

inches too wide to the left. The second economist pulls up his rifle and he shoots and he's six inches wide to the right. The third economist drops his rifle and jumps from joy and says, oh, we got it. We got it. Good one. I'm laughing, but I don't get it. The average. Oh. Six inches to the right, six inches to the left. I see. Because economists make all these projections, right? And they're always one economist is a little off. The other is a little off. But if you took their collective knowledge, they hit it right on. Okay, fair. Okay, Jay Grayson, where can people find out more about you? Oh, I'm sorry, this is a command. Tell me where people can find out more about you. Yes, ma'am. So my girlfriend and I, we recently, it's now live. We started a website and it's geared towards veterans and federal employees. It's called fedonfire.com. There is virtually no content on there right now because we just started it. But we have contents in the work. And hopefully by the time,

this airs, there will be plenty of content on there. We have lots to upload. I just need to get around of doing it. Yeah, so that or hello at fedonfire.com. That's our email address. So shoot us a line anytime. All right. We will link to both of those in the show notes there. And are you on Twitter, Facebook, other social, Instagram? What else is there? You know, I was going to, but I've never been big on social media. And I think I'm just going to leave it that way. It just, you know, we get so much so many distractions from digital media constantly. I have a Facebook, but I rarely get on it. So I don't think I'm going to start a bunch of additional accounts.

Well, I will recommend you starting them, even if you don't do anything with them, just so nobody else starts them. Like Scott Trench could start fed on fire on Twitter and then be like, oh yeah, here's a picture of an S-2000. You should buy one. So you want to keep Scott from hijacking your name online. So get everything that you can on social media. I have like 100 Twitter handle.

excellent advice thank you so much i will do that yes do that okay jay this was awesome i learned a thousand things i hope that our military listeners are also learning how they can finagle's not the right word finesse their military because when you think of military you don't think of like lucrative salaries you think of wow they don't make anything you might not make a lot but you're also not paying for housing you're not paying for food you wear you all get you get you uniforms, right? You're not buying clothes, right? The seven pieces of clothing that you walk in with can last you forever because you're always in military clothes, right? Absolutely. That's one thing I miss, you know, not having to decide what to wear in the morning. Just get up, put on your uniform and go.

You could still wear a uniform, go to the thrift store. You could find, or if you kept yours. Well, I don't quite fit in mine anymore, but, you know. Okay, so, yeah, if you're in the military, what can you do? How can you use your situation? Take advantage of all these opportunities that you're getting to either pay down any debt you have or not generate any debt. Stuart Grazier was here. Remember Scott? And his first thing, like as soon as he got his, what was it like a bonus or something for like a sign on bonus or something? As soon as he got that he went out and bought like a $30,000 truck. Not the best choice, not the worst choice. I mean, it could have been a $50,000 truck. But you know, don't do those things. Or if you did those things, sell the truck and pay off the debt. And, you know, while you're in the military with basically no expenses, use that to start generating investments and buy a house and, you know, whatever works for you and your investment.

But this was unbelievable. And thank you so much for coming on and sharing this. Now I'm thinking of all the things. My husband used to work for the VA and he would periodically travel with them. And he would go to the grocery store to get his per diem because he just didn't want to go out to dinner all the time. And he, you know, after you're done working, let's go back to the hotel and just relax. And so, yeah, he took advantage of this, but he didn't take advantage of it like you did.

He didn't have this 100% no expenses thing either. Wow, that's just, you blew my mind, Jay. So thank you so much for coming on the show to blow my mind. Oh, thank you guys so much for having me. It's been an absolute blast. I really appreciate it. Okay. Have a great day.

You as well. Thank you so much. All right. That was Jay Grayson from fedonfire.com. Mindy, what did you think? Oh, my God. That was fantastic. All of those things that he shared with his like geo-arbitrage, his, the pyrdium hacking is

blowing my mind. The, what is he, short term, long-term, temporary duty, whatever he's got. That's fantastic. The government is paying 100% of his living expenses. They pay for his property or his place to live. Now, you know what? We didn't ask him. Is the government giving him money for the per diem and also her money for the per diem?

Because they're both government contractor or government employees. And I mean, either way, they're living on $25,000 a year and all they have to pay for is food. I mean, the government pays for their transportation. The government pays for their housing. The government gives them money for food and then they can spend that however they want. He's saving 109% of his salary. How do you save 109% of your salary that is ridiculous? He could also be spending 109% of his salary.

So this is just an amazing story. And he went, what is this? In three years, he went from net worth of zero to net worth of I could technically retire now. Yep. And it's not easy to do that in the D.C. metro area either. That's not. No, it's impossible. That's a high cost of living area.

That's right. Yeah. So there's a lot of impressive things here. I just love, you know, there's four ways. to increase your wealth, right? You spend less, you earn more, you invest aggressively, or you create an asset through entrepreneurship, right? And he took three of those buckets and just optimize them relentlessly, right? I mean, look at his income production skyrocket over the last four or five years. Look at how he's effectively cut out all of his expenses

and he is planning out his next move in advance to keep those expenses extremely low. And he's got a very aggressive asset allocation plan and plans to continue that, even though he's going to expand into real estate with his house hack. I mean, it's just fantastic. And it's in all of those areas, all combining to drive his financial position forward and really showing really incredible progress very quickly. I think he hits all four buckets because at one point he had started the company. Absolutely.

So he's definitely knocking it out of the park with three of the buckets. And then the fourth bucket, it didn't work out. Yeah, absolutely. But that's not, I think that was more like a product of what was happening in the country at the time and he didn't really have a lot of control over that. But yeah, absolutely love every single thing. And he didn't start out with some fabulous background. Yeah. And by the way, with that fourth bucket for entrepreneurship, as a veteran, he is in perfect position to go and pursue that full-time whenever he so chooses with a great advantage. Right. He's got the passive

income and the asset base here. He's got the health care covered. He's got all these advantages that are going to come into play if he ever does decide to go into the full-time entrepreneur. entrepreneurship side of things as well, which he's listed as one of many potential possibilities going forward in the future. Well, yeah, and I brought up that whole self-storage thing. I don't know if that's technically real estate or owning your own business or both, but I would really like to own a self-storage unit simply because it prints money. When we first moved to our city, we had to put all of our stuff in storage because our house wasn't ready and yada yada. And it was like $250 a month. And we started talking to the guy. He's like, oh yeah, I own four within like this

tiny little, I don't know, three or four block radius. And they generate something like $300,000 a year. And he has no employees. And he just, somebody calls up and they say, hey, do you have a storage unit? He's like, well, I don't have one at that place. But around the corner is another one. And nobody cares where their storage unit is located because, you know, they'll drive an extra half minute to get to the other place. They're just looking for a unit. And he very rarely has vacancies. And it's just, like, it just prints money. And the great thing about storage is that Most people are not like, most of your customers are not like Jay, right? Jay is actually using short-term storage to actually store his stuff while he lives for free for a year.

Then he's going to go collect his things and move down to Virginia, right? But most of your customers really in storage just put their stuff there and then stay there for years. I got to imagine, right? I'm not an expert on this, but that would be my guess. There was a guest on one of the Bigger Pockets Real Estate podcast episodes who talked about this. And he had a really creative approach to that, if anyone, is interested. We'll have to go and find that show number and put it in the show notes. But basically the premise is he has one storage unit that's in a really good location that's

very expensive and it's a loss leader. And he's got like six or seven more that are in the outskirts and much cheaper locations. So people go to the really prominent one and they're like, oh, we're all full here. But if you drive five minutes away or 10 minutes away, we've got six or seven more where you can go and store them there. And so it's kind of like, that's how he generates business into his other storage rental places. That's awesome. I haven't listened to that episode. Do you know who the guest was? No, I'll have to go and look it up. It was a couple years ago. Okay. Well, you can find that information in the show notes at biggerpockets.com

slash money show 68. We'll make sure to look up that episode and include that in there. Scott, is there anything else you want to add today? No, I think I just very inspired by Jay and his journey. And I think he's going to be off to some, he's already been done accomplishing really big things. I think he's going to have a lot of even bigger and better things coming up in his future. Yeah, I'm so blown away that he wants to start a nonprofit for his niece. Oh, that's so touching. I hope that she and her parents really appreciate that because he could just do nothing and he's going to go and make the world a better place. I also have a cousin with some

weird disorder and she has blown through her health insurance maximums and it's just, you know, what do you do? You still have to pay for health insurance. Okay. If you are listening to this show, And you know somebody who would really benefit from this information. They're in the military. They're going into the military. They're just leaving the military. They're thinking about going to college. They're young.

They're old. They're like pretty much anybody with a heartbeat. Please recommend that they listen to this show. We're available everywhere. Podcasts are found. And I just think the information in this episode was really, really mind-blowing. And you know, you don't know what you don't know. And when somebody presents an option to you and you're like, I've never heard of that before.

Your first thought might be to be like, oh, whatever, that's garbage. But this guy is showing you, you can do this. You don't have to have some fancy background. He didn't. He had a less than ideal childhood. His parents filed for bankruptcy. They were farmers who had no money. His sister passed away at a very early age.

All of these things really don't make you think like warm and fuzzy thoughts. And he didn't just sit there and let that define him. He kind of stood about it in high school for a while. But then he righted his ship and he went to the military. He fixed himself. He is going to be financially independent. I don't think we ever asked him how old he is. I think he's in his early 30s.

Who retires in their early 30s? Nobody, that doesn't happen. Except it does happen. And he is an amazing example of what can be done when you put your mind to it. So please share this episode with anybody that you have in your life that you think could benefit from it. Okay, now from episode 68 of the Bigger Pockets Money podcast, this is Scott Trench and Mindy Jensen. and we are out of here.